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UF FLAG IFAS PALMM



Budgeting costs and returns
ALL VOLUMES CITATION SEARCH THUMBNAILS PAGE IMAGE ZOOMABLE
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00026156/00003
 Material Information
Title: Budgeting costs and returns
Series Title: Economic information report
Portion of title: Budgeting costs and returns for Indian River citrus production
Budgeting costs and returns for for <sic> Indian river citrus production
Physical Description: v. : ; 27 cm.
Language: English
Creator: University of Florida -- Food and Resource Economics Dept
Publisher: Food and Resource Economics Dept., Agricultural Experiment Stations and Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Creation Date: 1976
Frequency: annual
regular
 Subjects
Subjects / Keywords: Citrus fruit industry -- Economic aspects -- Periodicals -- Florida -- Indian River County   ( lcsh )
Citrus fruits -- Periodicals -- Florida -- Indian River County   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
serial   ( sobekcm )
 Notes
General Note: Title varies slightly: <1992-93>- Budgeting costs and returns for Indian River citrus production.
General Note: Description based on: 1978-79; title from cover.
Funding: This collection includes items related to Florida’s environments, ecosystems, and species. It includes the subcollections of Florida Cooperative Fish and Wildlife Research Unit project documents, the Sea Grant technical series, the Florida Geological Survey series, the Coastal Engineering Department series, the Howard T. Odum Center for Wetland technical reports, and other entities devoted to the study and preservation of Florida's natural resources.
 Record Information
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000313321
oclc - 08042665
notis - ABU0054
lccn - sn 82000632
System ID: UF00026156:00003

Table of Contents
    Front Cover
        Front cover
    Abstract
        Abstract
    Table of Contents
        Table of contents
    Main
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
    Bibliography
        Page 9
Full Text











ABSTRACT


Estimated costs and returns of growing white seedless
grapefruit in the Indian River area of Florida are presented
for the third consecutive year. The format presented may be
used by individual growers to budget costs and returns
utilizing individual data on specific groves.

Key words: citrus, Indian River, budgeting, costs and
returns.















TABLE OF CONTENTS


INTRODUCTION. . . .

METHOD OF DATA COLLECTION .

THE GROVE SITUATION . .

Age and Production Per Tree

COSTS OF INPUTS . .

SPRAY PROGRAM . . .

COSTS AND RETURNS . .

BIBLIOGRAPHY. . . .


LIST OF TABLES


Tables

1

2


3

4




5





6


Calculation of production per acre . .

Costs of inputs supplied on a custom basis
used in calculating costs. . . .

Costs of chemicals used in calculating costs

Spray program used in budget based on custom
rates and application of two 500-gallon tanks
per acre . . . . .

Estimated annual per acre costs and returns
for a mature white seedless grapefruit on
sour orange rootstock, Indian River area,
Florida . . . . .

Schedule of production practices in Indian
River groves . . . . .


Page

. . . 1

. . . 1

. . . 2

. . . 3

. . . 3

. . . 3

. . . 5

. . . 9
9
















BUDGETING COSTS AND RETURNS:
INDIAN RIVER CITRUS PRODUCTION, 1976-77


R. P. Muraro and Ben Abbitt


INTRODUCTION


Current data on costs and returns are needed by citrus

growers in order to formulate realistic budgets for their

operations. Budget analysis provides the basis for many

grower decisions. For example, budget analysis can be used

to calculate potential profits from an operation, to determine

cash requirements for an operation, and to determine break-even

prices.

This paper presents a budget constructed from current

data and will serve as a format for growers to develop costs

and returns from their individual records.


METHOD OF DATA COLLECTION

The data presented here were developed by surveying

custom operators, input suppliers, growers, and colleagues at

the Agricultural Research and Education Center in Lake Alfred.

This annual survey is conducted in January.


R. P. MURARO, Farm Management Extension Agent, Polk County,
Bartow, FL 33830. BEN ABBITT, Area Economist, Food and Resource
Economics Department, University of Florida, AREC, Lake Alfred,
FL 33850.








THE GROVE SITUATION

It is difficult to define a "typical" grove; therefore,

it is necessary to state the assumptions under which a budget

was constructed. The assumptions made as to a particular

grove situation are thought to be typical of a healthy, mature,

sour-orange-rooted, white seedless grapefruit grove in the

Indian River area of the state.

Specific production practices vary from grove to grove.

Many combinations of practices and various tree combinations

seem to accomplish production of acceptable yields and returns.

The generation of costs and returns procedure is designed to

be applicable to any grove situation. A grower, realtor, or

land appraiser can substitute individual grove costs and expected

returns into the budget format and develop a budget for a

particular grove.

In the following budget, good management and cultural

practices are assumed. Beyond this general assumption, the

following specifics are assumed.



1. A 20-year-old irrigated grove;
2. Variety is white seedless on sour orange
rootstock;
3. Tree loss is 3 percent annually;
4. Trees are pulled and replaced when production
falls below 50 percent of expected yield;
5. Production is for fresh use; and
6. Tree spacing is 70 trees per acre.








Age and Production Per Tree
Situation
3% pulled and reset
3% 1 year old
3% 2 years old
3% 3 years old
3% 4 years old
57% 5-19 years old
3% producing 50% of expected yield
25% mature producing


Boxes/tree
0.0
0.0
0.0
0.5
1.1
4.4
3.75
7.5


Table 1.--Calculation of production per acre

Trees Percentage age Boxes/tree Total boxes

70 0.03 0.50 1.05
70 0.03 1.10 2.31
70 0.57 4.40 175.56
70 0.03 3.75 7.88
70 0.25 7.50 131.25
Total boxes/acre 318.05


COSTS OF INPUTS

Costs for various production inputs are the average

of the data obtained from the survey. These average costs

are shown in Tables 2 and 3.


SPRAY PROGRAM

The spray program presented here is believed to be of

the type followed by a majority of growers. It is not the

exact program outlined in the 1977 Spray and Dust Schedule,

nor is it necessarily the most economical spray program.

Most growers in the Indian River area produce grapefruit for

the fresh market and their spray program is formulated to

produce a fruit of this quality. Table 4 outlines the spray

program which is used for calculations in the budget which follows.








Table 2.--Costs of inputs supplied on a custom basis used in
calculating costs
Cost
Item Unit Low High Avg. Your cost

- Dollars- - -

Labor Hr. 2.97 4.00 3.60
Mowing (9' 10' rotary) Hr. 8.75 12.50 10.19
Mowing (sickle) Hr. 8.75 11.50 10.58
Herbiciding Hr. 9.00 13.50 10.35
Topping Hr. 135.00

Hedging (2-side) Hr. 36.00 135.00 85.50
Chipping Hr. 11.30
Removing trees (plus driver)
(front end loader) Hr. 18.00
Power saw w/o operator Hr. 4.00 5.00 4.75
Tractor and driver Hr. 8.00 11.50 9.75

Truck and driver Hr. 7.50 10.00 8.75
Water truck Hr. 8.25 11.50 9.92
Mound builder Hr. 9.00 10.50 13.45
Rotary ditcher Hr. 9.63
Irrigation, flood In. 1.76

Fertilize, bulk Acre 2.75
Spray, dilute Tank 8.00 11.87 9.96
Dust, Aerial Lb. 3.54


Table 3.--Costs of chemicals used in calculating costs

Item Unit Cost Your cost
-Dollars- -

Copper, tri-basic Lb. .70
Zinc, 36% zn Lb. .33
Manganese-sulfate Lb. .09
Chlorobenzilate Gal. 15.64
Ethion Gal. 12.86
Kelthane Gal. 14.72
Benlate Lb. 7.39
Oil, 97% Gal. .86
Sticker Gal. 5.74
Sulphur dust Ton 107.60
Krovar II Lb. 5.33
16-0-16 fertilizer Ton 101.35
16-0-16-4 MgO fertilizer Ton 107.87
8-2-8 fertilizer Ton 72.87








Table 4.--Spray program used in budget based on custom rates and
application of two 500-gallon tanks per acre

Item Amount/acre Cost Your cost

-Dollars- -


Dormant application
Copper
Manganese
Zinc
Sticker
Application
Total

Post bloom application
Chlorobenzilate
Application
Total

Summer oil application
Oil
Copper
Application
Total

Miticide application
Kelthane
Sticker
Application
Total


3 Ibs.
7 Ibs.
7 lbs.
1 pint
2 tanks




2.5 pints
2 tanks



8 gals.
3 Ibs.
2 tanks



5 pints
1 pint
2 tanks


COSTS AND RETURNS

Table 5 shows the estimated costs and returns based on

data presented earlier and with a custom-caretaker providing

grove management. This table, as do the others, has a column

reserved for the individual grower to insert data from a

particular grove. This will allow a comparison of the

grower's costs and returns with those of the hypothetical

case presented.


2.10
.63
2.31
.72
19.92
25.68


4.90
19.92
24.82


6.88
2.10
19.92
28.90


11.04
.76
19.92
31.72










Table 5.--Estimated annual per acre costs and returns for a mature white seedless
on sour orange rootstock, Indian River area, Florida


grapefruit


Item Description Amount Your cost

I. Revenue 318 boxes @ $2.00 $636.00 $

II. Expenses
Spray Program From Table 3 111.12
Fertilizer
Material 16-0-16, 625 Ibs. $31.69
Application 2 @ $2.50 5.50 37.19
Weed Control
Mow Middles 5 times per year $25.48
Mow Under Trees 4 times per year 20.38
Pull Vines By hand 5.51
Herbicide 2 Ibs. Krovar II, incl. appl. .15.18 66.55
Pruning (Maintenance)
Topping $15.88
Hedging 10.80
Removing Brush 13.56 40.24
Irrigation (Flood) 6 appl., total 18 in./year 31.68
Tree Replacement and Care
Remove Trees 2.1 trees per acre $20.96
Prepare Site Use of mound builders 6.73
Plant Resets Including 2.1 trees per acre 8.92
Water 2.98
Fertilizer Including application 5.94 45.53
Management 5% of gross sale 31.80

III. Total Specified Costs $364.11

IV. Return to Land and Trees $271.89








Two items of cost which are not included in the budget

are ad valorem taxes and interest on grove investment. These

costs vary from grove to grove depending on age, location,

soil, and time of purchase or establishment. They should

both be considered in arriving at a net return to land and

trees (total return minus costs).

Shown in Table 6 are production practices for Indian

River citrus and a range of times during the year when they

would likely be performed.

There are two benefits to developing such a table for

an individual grove. First, it shows what work is needed

and when, so that operations can be planned well in advance.

Second, it can be helpful if an annual cash flow analysis is

developed to plan financing. The individual grower can

achieve benefits by developing a plan for a particular grove.







a
Table 6.--Schedule of production practices in Indian River groves
Grove practice Date performed Comments

Mowing middles Five times each year One-way mowing

Mowing under trees Four times each year One-way mowing

Pull vines and
general grove work Throughout year Primarily winter months

Herbicide (vine control) After pulling vines

Topping February thru June After fruit is harvested

Hedging & remove brush February thru June After fruit is harvested

Remove trees Winter months When other grove practices


Irrigation


Throughout year


are not being performed

Average six irrigation applica-
tions per year (18.0 inches/yr.)


Clean ditches Twice each year Fall and summer

Young trees Throughout year As needed

Fertilize Twice each year At least 130 pounds of nitrogen
(February & August) applied per acre each year

Dust (sulphur) September or October As needed

Spray (dilute) Dormant, Post bloom
Summer oil, and Fall Two tanks per acre;
miticide 500 gallons per tank
a This is a suggested schedule of practices. Actual practices would not necessarily
be carried out on the exact schedule shown here.








BIBLIOGRAPHY


[1] DuCharme, E. P. "Tree Loss in Relation to Young Tree
Decline and Sand Hill Decline of Citrus in Florida."
Proceedings of the Fla. State Hort. Soc. 84:48-52
(Oct. 1970).


[2] 1977 Florida Spray and Dust Schedule. Univ. of Fla.
Coop. Ext. Serv. Cir. 393C, Jan. 1977.


[3] Muraro, Ronald P. "Comparative Citrus Budgets."
Polk County Ext. Serv., Mar. 1976.


Bartow:


[4] Muraro, Ronald P. "Summary Custom Rate Survey for Nine
Indian River Citrus Caretakers." Bartow: Polk
County Ext. Serv., Mar. 1976.


[5] Muraro, Ronald P. "Cost of Resetting a Citrus Grove."
Bartow: Polk County Ext. Serv., Sept. 1976.


[6] Reitz, H. J., C. D. Leonard, et al. Recommended
Fertilizers and Nutritional Sprays for Citrus. Univ.
of Fla. Agr. Exp. Sta. Bull. 536C, Dec. 1972.



















This public document was promulgated at an annual
cost of $372 or $.34 per copy to furnish the
citrus industry with current data on cost of
production for the Food and Resource Economics
Department, Institute of Food and Agricultural
Sciences, and the University of Florida.