2009 MALTAG
CONVENTIONAL VEGETABLES
PLANNING BUDGETS
University of Georgia
Department of Agricultural Economics
College of Agriculture and Environmental Sciences
July 2009
AGE CON-09-004
Foreword
This report is designed to provide necessary planning data to farmers, research and
extension staffs, lending agencies, and others in agriculture. Estimated costs for land,
management, and general farm overhead are not included in this report.
Acknowledgments
We are indebted to the Mississippi State University for generously letting us use the
Mississippi State Budget Generator (MSBG). A team effort from all the state collaborators
(which consist of six land grant universities: Mississippi, Alabama, Louisiana, Tennessee,
Arkansas, and Georgia) have led to many improvements in the budgets over the years.
We appreciate the producers from the six states who provided information on crop
practices, and appreciation is due the farm supply dealers, equipment dealers, custom operators,
and chemical companies who provided prices for crop production inputs.
Acknowledgment is made to the University of Georgia Tifton Campus Extension
Team who made this report possible, and to my secretary, Kathy Swain, for assisting with
this publication.
“The mention in this report of any commercial product
does not imply its endorsement by the
University of Georgia, College of Agriculture and Environmental Sciences
or USDA over other products not named nor does the
omission imply they are not satisfactory.”
2009 Conventional Vegetable Budget Committee
Dr. Esendugue Greg Fonsah
Project Director
University of Georgia
Department of Ag & Applied Economics
15 RDC Road
Tifton GA 31793 -1209
Phone 229-386-3512
Fax: 229-386-3440
Email: [email protected]
Dr. George E. Boyhan
University of Georgia
Department of Horticulture
2803 NeSmith Bldg.
Statesboro GA 30460
Phone 912-681-5639
Fax 912-681-0376
Email: [email protected]
Dr. Stanley Culpepper
University of Georgia
Department of Crop and Soil Sciences
Horticulture Bldg.
Tifton GA 31793-0748
Phone 229-386-3328
Fax 229-386-7415
E mail: [email protected]
Dr. Juan Carlos Diaz
University of Georgia
Department of Horticulture
225 Horticulture Bldg.
Tifton GA 31793-0748
Phone 229-386-6861
Fax 229-386-7415
Email: [email protected]
Dr. Alton N. Sparks
University of Georgia
Department of Entomology
118 Horticulture Bldg.
Tifton GA 31793-0748
Phone 229-386-3677
Fax 229-386-7415
Email: [email protected]
Dr. Terry Kelley
Harris Moran Seed Company
2414 Thornhill Road
Tifton GA 31793
Phone 229-386-1451
Mobile 229-947-3253
Email [email protected]
Dr. David Langston
University of Georgia
Department of Plant Pathology
122 Horticulture Bldg.
Tifton GA 31793-0748
Phone 229-386-7495
Fax 229-386-7415
Email: [email protected]
Paul Sumner
University of Georgia
Department of Biological and Ag Eng
122 Biological and Ag Engineering Bldg.
Tifton GA 31793-0748
Phone 229-386-3442
Fax: 229-386-3448
Email: [email protected]
Table of Contents
Page
Foreword........................................................................................................................................................................................... 2
Acknowledgments ............................................................................................................................................................................ 2
2009 Budget Committees.................................................................................................................................................................. 3
2009 Planning Budgets ..................................................................................................................................................................... 5
Budgets for Agricultural Enterprises ................................................................................................................................................ 5
Methods and Procedures ................................................................................................................................................................... 5
Production Practices.......................................................................................................................................................... 5
Machinery ......................................................................................................................................................................... 5
Estimates of Direct Costs .................................................................................................................................................. 5
Estimates of Fixed Costs ................................................................................................................................................... 6
Estimates of Returns ......................................................................................................................................................... 6
Irrigation Costs ................................................................................................................................................................. 6
Marketing and Grading Costs ........................................................................................................................................... 6
MALTAG State Coordinators........................................................................................................................................................... 7
Enterprise Budgets
Table 1. Estimated resource use and costs for field operations, per acre, Bell pepper, fresh market (wholesale),
irrigated, 6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia, MALTAG, 2009............................................... 8
Table 2. Estimated resource use and costs for field operations, per acre, Broccoli - fall, fresh market,
Georgia, MALTAG, 2009 ............................................................................................................................................... 11
Table 3. Estimated resource use and costs for field operatiosn, per care, Cabbage - spring, hand harvest,
Georgia, MALTAG, 2009 ............................................................................................................................................... 12
Table 4. Estimated resource use and costs for field operations, per acre, Cucumbers, slicers,
irrigated 5 ft row spacing, 20 gpm with 8,712 ft of drip tape, Georgia, MALTAG, 2009............................................... 14
Table 5. Estimated resource use and costs for field operations, per acre, Greens (turnip, mustard, collards),
fresh market, Goergia, MALTAG, 2009 ......................................................................................................................... 16
Table 6. Estimated resource use and costs for field operations, per acre, Lima / butter beans – hand harvest,
Georgia, MALTAG, 2009 ............................................................................................................................................... 17
Table 7. Estimated resource use and costs for field operations, per acre, Lima / butter beans – mechanical harvest,
Georgia, MALTAG, 2009 ............................................................................................................................................... 18
Table 8. Estimated resource use and costs for field operations, per acre, Okra, fresh market, Georgia, MALTAG, 2009 ............. 20
Table 9. Estimated resource use and costs for field operations, per acre, Pumpkin, wholesale/freshmarket,
irrigated 8 ft row spacing, 12 gpm with 5,445 ft of drip tape, Georgia, MALTAG ........................................................ 21
Table 10. Estimated resource use and costs for field operations, per acre, Snap beans, fresh market –
hand harvest, Georgia, MALTAG, 2009 ......................................................................................................................... 23
Table 11. Estimated resource use and costs for field operations, per acre, Snap beans, fresh market –
mechanical harvest, Georgia, MALTAG, 2009 .............................................................................................................. 24
Table 12. Estimated resource use and costs for field operations, per acre, Southern peas, fresh market –
hand harvest, Georgia, MALTAG, 2009 ......................................................................................................................... 25
Table 13. Estimated resource use and costs for field operations, per acre, Southern peas, fresh market –
mechanical harvest, Georgia, MALTAG, 2009 .............................................................................................................. 26
Table 14. Estimated resource use and costs for field operations, per acre, Squash - summer, fresh market,
irrigated 5 ft row spacing, 20 gpm with 8,712 ft of drip tape, Georgia, MALTAG, 2009............................................... 27
Table 15. Estimated resource use and costs for field operations, per acre, Sweet corn, fresh market –
hand harvest, Georgia, MALTAG, 2009 ......................................................................................................................... 29
Table 16. Estimated resource use and costs for field operations, per acre, Sweet corn, fresh market,
train harvest (shipping) Georgia, MALTAG, 2009 ........................................................................................................ 30
Table 17. Estimated resource use and costs for field operations, per acre, Sweet potatoes Georgia, MALTAG, 2009 .................. 31
Table 18. Estimated resource use and costs for field operations, per acre, Tomatoes, fresh market,
irrigated 6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia, MALTAG, 2009............................................... 33
Table 19. Estimated resource use and costs for field operations, per acre, Watermelons, irrigated 8 ft row spacing,
12 gpm with 5,445 ft of drip tape, Georgia, MALTAG, 2009 ........................................................................................ 36
Appendix
Table 1. Tractors/Harvesters: estimated purchase price, annual use, useful life, fuel use, and direct and
fixed costs per hour, Georgia, MALTAG, 2009............................................................................................................. 38
Table 2. Self-propelled machines: estimated purchase price, annual use, useful life, fuel use, performance rate and
direct and fixed costs per hour, Georgia, MALTAG, 2009 ............................................................................................ 39
Table 3. Towed equipment: estimated purchase price, annual use, useful life, performance rate, and direct and fixed
costs per acre, Georgia, MALTAG, 2009 ...................................................................................................................... 40
Table 4. Operating inputs: estimated prices, Georgia, MALTAG, 2009....................................................................................... 44
Table 5. Estimated fuel prices and interest rates, Georgia, MALTAG, 2009............................................................................... . 48
Table 6. Labor types, wage rates and unallocated labor multiplier, Georgia, MALTAG, 2009.................................................... 49
Table 7. Drip tape irrigation system, 5 ft row spacing, 20 gpm with 8,712 ft of drip tape, Georgia, MALTAG, 2009 ................ 50
Table 8. Drip tape irrigation system, 6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia, MALTAG, 2009 ................ 51
Table 9. Drip tape irrigation system, 8 ft row spacing, 12 gpm with 5,445ft of drip tape, Georgia, MALTAG, 2009………...…52
2009 Conventional Vegetable Planning Budgets
Budgets for Agricultural Enterprises
This publication provides economic and technical
information in the form of enterprise budgets for
vegetable crops produced by Georgia farmers. A
multidisciplinary approach involving researchers and
extension personnel was used to determine
production practices and input quantities, and to
estimate costs for each enterprise. The purpose of this
section is to present the methods and procedures used
to calculate costs for each budget included in this
publication.
Enterprise budgets represent a type of information
that can be used by a wide variety of individuals in
making decisions in the food and fiber industry. They
are used:
by farmers for planning,
by extension personnel in providing educational
programs to farmers,
by lenders as a basis for credit,
to provide basic data for research, and
to inform non-farmers of the costs incurred by
farmers in the production of food and fiber crops.
A budget should be prepared with a specific objective
in mind. The budgets in this report were prepared to
provide general information for several different
uses. They provide information concerning general
levels of costs which will need to be adjusted for
specific situations. Most users should think of these
budgets as a first approximation and then make
appropriate adjustments using the "Your Farm"
column provided on each budget to add, delete, or
change costs to reflect their specific situations.
Income is not included in the vegetable planning
budgets due to the volatile nature of prices in the
fresh produce market. Budgets reflect the cost of
production per acre planted. The budgets allow the
producer to determine the breakeven price needed for
the vegetable grown. A sensitivity table reflecting
different yields per acre compared to different market
prices received for vegetables allows producers to
estimate potential net returns.
Methods and Procedures
Production Practices
The production practices listed in each budget are the
result of a combined effort by researchers and
extension personnel to represent current practices.
Committees made up of appropriate disciplines from
the University of Georgia and the U.S. Department of
Agriculture review and update the practices in the
budgets every year. The updates are based on the
collective judgment of the committee members.
Quantities of materials and individual production
practices are based on generally accepted
recommendations by committee members.
Machinery
Machinery manufacturers form the basis for
machinery prices used in these publications. Prices
by size of equipment are determined from the most
common sales in each category as reported by
machinery dealers. Prices used in the budgets reflect
prices paid by farmers in 2009. (Appendix 1, 2, and
3).
A performance rate reflects the time required to
perform a given task or operation and is expressed as
that part of an hour per acre. Previous studies and
expert knowledge of the equipment committee
members are used to estimate performance rates for
new and larger equipment.
The hours of annual use have been modified based on
information collected from the cited studies . Repairs
and maintenance as a percentage of new cost are
estimated for the life of the equipment and include oil
and lubricants.
Estimates of Direct Costs
Direct costs include estimated costs of repairs and
maintenance (R&M) for all machinery and include
fuel costs for powered machinery (Appendix 1, 2,
and 3). Direct costs are estimated on an hourly basis
and are then converted to a per-acre basis using the
performance rate for the particular operation. R&M
costs for towed equipment and powered equipment
are estimated as follows:
RPH = RLC x RP
THL
RPA = RPH x PR
where:
RPH = R&M cost per hour of use
RLC = Replacement cost of machine
RP = R&M percentage (percent of RLC)
THL = Total hours of machine life
RPA = R&M cost per acre
PR = Performance rate
Direct costs include an estimate of fuel cost based on
average fuel consumption per hour of use for the
power unit. Other components of direct costs include
quantities of materials used in production multiplied
by the price per unit of these inputs, custom rates,
hourly wage rates, and interest charges on operating
capital (Appendix 4, 5, and 6). Prices of chemicals,
seed, fertilizers, and custom rates are updated every
year.
The labor wage rate per hour includes social security,
accident and unemployment insurance, and some
perquisites. Labor costs are estimated for two labor
categories: operator labor and hand labor. Operator
labor and hand labor represent estimates of labor
required to perform the in-field tasks. Operator labor
is that labor required to operate all power-driven
equipment.
CRCPH = Capital recovery charge per hour
HAU = Hours of annual use
CRCPA = Capital recovery charge per acre
PR = Performance rate 3
Estimates of Returns
It is difficult to estimate crop yields that may be
expected for a particular production system in a given
year. Fresh vegetable prices are volatile and change
daily. Because of this, no estimates of expected
returns are provided.
Estimates of Irrigation Costs
Interest on operating capital is determined by using a
short-term interest rate obtained from agricultural
lenders and making a charge against capital outflows
as the production process takes place. Interest is
accumulated until the crop is harvested.
Generally, irrigation is recommended for vegetable
production. Irrigation costs for the most commonly
used irrigation systems are presented in Appendix 7,
8, and 9. Each appendix table lists all annual
supplies, their prices, and quantities needed.
Estimates of Fixed Costs
A non-irrigated vegetable budget can be converted to
an irrigated budget by adding the desired irrigation
system costs to the non-irrigated vegetable budget.
Costs for the water will vary depending on the water
source. Climatic conditions during the growing
season will dictate water usage.
Annual fixed cost estimates for machinery are based
on a budgeting technique which computes the annual
capital recovery charge . When a combination of
machines or equipment is required to perform a
single operation, the total cost per acre for all
equipment used in the operation is estimated. The
fixed cost of machinery ownership is calculated by
first computing the capital recovery factor and then
using it to estimate the annual capital recovery
charge.
IIR
CRF =
-TYL
1 – (1 + IIR)
where:
CRF = Capital recovery factor
IIR = Intermediate-term interest rate
TYL = Total years of life
CRCPY = [(RLC - SV) x CRF]
+ (SV x IIR)
where:
CRCPY = Capital recovery charge per year
RLC = Replacement cost
SV = Salvage value (at end of useful life)
This value is then converted to its per-hour and peracre equivalent values:
CRCPH = CRCPY
HAU
CRCPA = CRCPH x PR
where:
Estimates of Marketing and Grading Costs
Marketing and grading costs should be viewed as
only rough estimates. These costs are highly
dependent upon the market outlet. For producers with
traditional customers acquired over the years, there
may be no brokerage fees. Other packing for shipping
may go through a broker and incur packaging costs as
well.
(This section is extracted with permission from John Black,
collaborator and Research Associate III of the Mississippi State
Budget Generator used for the MALTAG project).
2009 MALTAG State Coordinators
MALTAG is a multistate and multidisciplinary group formed in 2003.
Its purpose is to jointly coordinate the development and dissemination
of vegetable enterprise budgets to meet the needs of the vegetable industry
in the Southeast.
Mississippi:
John G. Black, Research Associate III
Mississippi State University, Dept. of Agricultural Economics
Phone: 662-325-7989
Email: [email protected]
Dr. Ken Hood, Extension Professor
Mississippi State University, Dept of Agricultural Economics
Phone: 662-325-2155
Email: [email protected]
Alabama:
Dr. Deacue Fields III, Extension Economist
Auburn University, Dept. of Agricultural Economics
Phone: 334-844-4931
Email: [email protected]
Louisiana:
Dr. Roger A. Hinson, Professor
Louisiana State University, Dept. of Agricultural Economics
Phone: 225-578-2753
Email: [email protected]
Tennessee:
Dr. David W. Lockwood, Professor
University of Tennessee, Dept. of Plant Science
Phone: 865-974-7421
Email: [email protected]
Arkansas:
Dr. Ronald L. Rainey, Extension Economist
University of Arkansas, Cooperative Extension Service, Little Rock
Phone: 501-671-2175
Email: [email protected]
Georgia:
Dr. Esendugue Greg Fonsah, Project Director
University of Georgia, Dept. of Ag & Applied Economics
Phone: 229-386-3110
Email: [email protected]
Table 1. Estimated resource use and costs for field operations, per acre. Bell pepper, fresh market (wholesale), irrigated
6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia, MALTAG, 2009.
continued
8
continued
9
10
Table 2. Estimated resource use and costs for field operations, per acre. Broccoli - fall, fresh market, Georgia, MALTAG, 2009.
11
Table 3. Estimated resource use and costs for field operations, per acre. Cabbage - spring, hand harvest, Georgia, MALTAG, 2009.
________________________________________________________________________________________
continued
12
13
Table 4. Estimated resource use and costs for field operations, per acre. Cucumbers, slicers, irrigated 5 ft row spacing,
20 gpm with 8,712 ft of drip tape, Georgia, MALTAG, 2009.
continued
14
15
Table 5. Estimated resource use and costs for field operations, per acre. Greens (turnip, mustard, collards), fresh market,
Georgia, MALTAG, 2009.
16
Table 6. Estimated resource use and costs for field operations, per acre. Lima/butter beans - hand harvest, Georgia, MALTAG, 2009.
17
Table 7.Estimated resource use and costs for field operations, per acre. Lima/butter beans - mechanical harvest. Georgia,
MALTAG, 2009.
continued
18
19
Table 8. Estimated resource use and costs for field operations, per acre. Okra, fresh market, Georgia, MALTAG, 2009.
20
Table 9.Estimated resource use and costs for field operations, per acre. Pumpkin, wholesale/freshmarket, irrigated,
8 ft row spacing, 12 gpm with 5,445 ft of drip tape, Georgia, MALTAG, 2009.
________________________________________________________________________________________
21
22
Table 10.Estimated resource use and costs per acre for field operations. Snap beans, fresh market-hand harvest,
Georgia, MALTAG, 2009.
23
Table 11. Estimated resource use and costs per acre for field operations. Snap beans, fresh market - mechanical harvest.
Georgia, MALTAG, 2009.
24
Table 12. Estimated resource use and costs for field operations, per acre. Southern peas, fresh market - hand harvest. Georgia,
MALTAG, 2009.
25
Table 13. Estimated resource use and costs per acre for field operations. Southern peas, fresh market-mechanical harvest,
Georgia, MALTAG, 2009.
26
Table 14. Estimated resource use and costs per acre for field operations. Squash - summer, fresh market, irrigated,
5 ft row spacing, 20 gpm with 8,712 ft of drip tape, Georgia, MALTAG, 2009.
continued
27
28
Table 15. Estimated resource use and costs per acre for field operations. Sweet corn, fresh market - hand harvest.
Georgia, MALTAG, 2009.
29
Table 16. Estimated resource use and costs for field operations, per acre. Sweet corn, fresh market-train harvest
(shipping). Georgia, MALTAG, 2009.
30
Table 17. Estimated resource use and costs for field operations, per acre. Sweet potatoes. Georgia, MALTAG, 2009.
Continued.
31
32
Table 18. Estimated resource use and costs for field operations, per acre. Tomatoes, fresh market, irrigated,
6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia, MALTAG, 2009.
continued
33
continued
34
35
Table 19. Estimated resource use and costs for field operations, per acre. Watermelons, irrigated, 8 ft row spacing,
12 gpm with 5,445 ft of drip tape. Georgia, MALTAG, 2009.
continued
36
37
Appendix 1: Tractors/Harvesters: estimated purchase price, annual use, useful life, fuel use, and direct and fixed cost per hour, Georgia, MALTAG, 2009.
38
Appendix 2: Self-propelled machines: estimated purchase price, annual use, useful life, fuel use, performance rate, and direct and fixed cost per acre, Georgia,
MALTAG, 2009.
39
Appendix 3: Towed equipment: estimated purchase price, annual use, useful life, performance rate and direct and fixed cost per acre, Georgia, MALTAG, 2009.
40
41
continued
42
43
Appendix 4: Operating inputs: estimated prices, Georgia, MALTAG 2009
44
45
Continued
46
47
Appendix 5: Estimated fuel prices and interest rates, Georgia, MALTAG, 2009.
48
Appendix 6: Labor types, wage rates and unallocated labor multiplier, Georgia, MALTAG, 2009.
49
Appendix 7: Estimated costs per acre drip tape irrigation system, 5 ft row spacing, 20 gpm with 8,712 ft of drip tape, Georgia,
MALTAG, 2009.
50
Appendix 8: Estimated costs per acre Drip tape irrigation system, 6 ft row spacing, 16 gpm with 7,260 ft of drip tape, Georgia,
MALTAG, 2009.
51
Appendix 9: Estimated costs per acre drip tape irrigation system, 8 ft row spacing, 12 gpm with 5,445 ft of drip tape, Georgia,
MALTAG, 2009.
52