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Budgeting costs and returns
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Permanent Link: http://ufdc.ufl.edu/UF00026157/00001
 Material Information
Title: Budgeting costs and returns
Series Title: Economic information report
Portion of title: Budgeting costs and returns for Central Florida citrus production
Budgeting costs and returns for for <sic> Central Florida 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: 1974
Frequency: annual
regular
 Subjects
Subjects / Keywords: Citrus fruit industry -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Citrus fruits -- Marketing -- Periodicals -- Florida   ( lcsh )
Genre: governmental publication   ( marcgt )
serial   ( sobekcm )
 Notes
General Note: Title varies slightly: <1992-93>- Budgeting costs and returns for Central Florida Citrus Production.
General Note: Description based on: 1978-79; cover title.
 Record Information
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000313320
oclc - 08042638
notis - ABU0053
lccn - sn 82000631 /g
System ID: UF00026157:00001

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
Full Text

Economic Information


Auraro


Report 28


Budgeting


Costs


and Returns in


-ntral Florida


Citrus


Production,


1974-75


sourcee Economics Department
cultural Experiment Stations
>perutive Extension Service
.f Food and Agricultural Sciences
rsity of Florida, Gainesville 32611


. June 1975


i_


An de rson















ABSTRACT


Estimated costs and returns of growing Valencia oranges in the
central Florida citrus area are presented. The format may be used
by individual growers to determine costs and returns from their
individual data on specific groves.

Key words: Citrus, central Florida, budgeting, costs and
returns.














TABLE OF CONTENTS

Page

INTRODUCTION. . . ... . . . 1

METHOD. . . . ... . . . 1

THE GROVE SITUATION . . . .... . .. 2

Age and Production per Tree. . . . . 2
Calculations of Production per Acre. . . . 3

PRICES. . . . ... . . ....... 3

SPRAY PROGRAM . . .... . . 4

COSTS AND RETURNS . . ... . . .. 4

BIBLIOGRAPHY. . . ... . . . 7



LIST OF TABLES


Table
1 Prices of inputs on a custom basis used in calculating
costs and returns for citrus in Florida, 1974-75 . 3

2 Prices of chemicals used in calculating costs and returns
for citrus in Florida, 1974-75 . .... . .. 4

3 Spray program used in budget based on custom rates and two
500 gallon tanks per acre . . . .. 5

4 Estimated annual per acre costs and returns for a mature
'Valencia' grove producing citrus for processing in
Central Florida, 1974-75 . . . . 6

5 Schedule of production practices in Central Florida citrus
groves . . . . . . 8














BUDGETING COSTS AND RETURNS IN CENTRAL FLORIDA CITRUS
PRODUCTION, 1974-75


C. L. Anderson and R. P. Muraro

INTRODUCTION


There has always been a lag between the time production cost and

returns data are collected and they are analyzed and published. This

is due to the manner in which these data become available. Production

costs in one year are understood to relate to the crop which is harvest-

ed the following season. In order to obtain current data for various

decision-making purposes, a budget may be synthesized from present costs

and returns data.


METHOD


The data presented here were developed by surveying custom opera-

tors and input suppliers and from discussions with colleagues at the

Agricultural Research and Education Center at Lake Alfred. The assump-

tions made as to a particular grove situation are thought to be typical

of a healthy, mature, rough, lemon-rooted 'Valencia' grove in the

ridge area. The generation of costs and returns data is designed to be





C. L. ANDERSON is an assistant professor of food and resource
economics and farm management extension economist stationed at the
Agricultural Research and Education Center, Lake Alfred. R. P. MURARO
is a farm management extension agent stationed in Polk County.

I








2.

applicable to any grove situation. A grower can .', ~tute individual grove

costs and expected returns into the budget format and develop a budget for

a particular grove.

THE GROVE SITUAlI~luN


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

sary to state the assumptions under which a budget was constructed. Speci-

fic production practices may vary from grove to grove. Many combinations

of practices and of combinations of trees seem to 4l-."*lish the production

of acceptable yields. 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 grove, irrigated;
2. Variety is 'Valencia' on rough lemon rootstock;
3. Tree loss is 2 percent annually;
4. Trees are pulled and replaced when production
falls below 50 percent of expected yield;
5. Production is for processing only- an,
6. Trees are spaced 70 per acre.

Age and Production per Tree


Situation Boxes/tree

2% pulled and replanted 0
2% 1 year old 0
2% 2 years old 0
2% 3 years old .6
2% 4 years old .9
28% 5-19 years old 3.6
2% producing 50% of expected yield 3.0
60% 20 years old 6.1









Calculations of Production per Acre


70 x .02 x
70 x .02 x
70 x .28 x
70 x .02 x
70 x .60 x

Boxes/acre


.6=
.9 =
3.6 =
3.0 =
6.1 -


.84
1.26
70.56
4.20
256.20

333.06


PRICES


Prices for various production input items are an average of the

data obtained in a survey in January 1975 of custom operators and

suppliers of fertilizer, chemicals, etc. These prices are shown in

Tables 1 and 2. On-tree orange prices reported by the Florida Crop

and Livestock Reporting Service were used.


Table l.--Prices of inputs on a custom basis used in calculating costs
and returns for citrus in Florida, 1974-75

Item Unit Low High Average Your cost

- Dollars - - -
Dilute spray Tank 7.00 10.00 8.63
Dusting, ground Acre 2.50 5.00 3.44
Dusting, aerial Lb. .06
Fertilizing Acre 2.50 5.00 2.89

Dolomite application Acre 2.50 4.00 3.07
Chopping Acre 3.25 4.40 3.69
Discing Acre 3.25 4.41 3.79
Topping Hr. 105.00
Hedging, 2-sides Hr. 29.50 105.00 56.50

Bulldozer Hr. 22.50
Truck and driver Hr. 5.00 12.00 7.74
Tractor and driver Hr. 5.00 10.00 7.95
Chain saw Hr. 1.83
Labor Hr. 2.50 4.00 3.24







4

Table 2.--Prices of chemicals used in calculating costs and returns for
citrus in Florida, 1974-75

Item Unit rice Your cost


Chlorobenzilate Pint 2___
Neutral copper, 53% cu Lb. ,94_
Zinc, 36% zn Lb. .3__
Borates Lb. '
Manganese, 24-27% mg Lb. .(
Ethion Pint ____

Oil Gal. 1.16
Delnav Pint 2.81
Sulphur Lb. .055
Sticker Pint ,..____
Krovar II Lb. 5.05
16-0-16 Ton 112.00


SPRAY PROGRAM

The spray program presented here is believed to be of the type

followed by a majority of growers. It may not be the exact program out-

lined in the 1975 Spray and Dust Schedule nor is it necessarily the most

economical spray program. Most growers of fruit for processing continue

to use at least two sprays and one dust in their insect and disease

control program. This is presented in the budget. Table 3 outlines this

program as a post bloom, a summer oil and a fall miticide. The first two

are dilute sprays and the third is an aerial application of sulphur. Table

3 also shows a supplemental miticide that might be used when additional

control for rust mite is needed.


COSTS AND RETURNS


Table 4 shows the estimated costs and returns based on data presented

earlier and with a custom-caretaker providing grove management. This table,









Table 3.--Spray program used in budget based on custom rates
gallon tanks per acre


and two 500


Item Amount/A. Cost Your cost
Post bloom
Chlorobenzilate 2 pints $ 4,47 $
Zinc 15 Ibs. 4.95
Borates 1.25 Ibs. .03
Manganese 15 Ibs. .94
Sticker 1 pint .80
Application 2 tanks 17.26

Total $28.72
Summer oil
Ethion 6 pints $ 8.88
Oil 8 gal. 9.28
Copper, 53% cu 3 Ibs. 2.82
Application 2 tanks 17.26

Total $38.24
Fall miticide
Sulphur 70 Ibs. $ 3.85
Application, aerial $0.6/1b. 4.20

Total $ 8.05
Grand total $75.01
Supplemental miticide
Delnav 5 pints $14.05
Sticker 1 pint .80
Application 2 tanks 17.26

Total $32.11



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.

Several items of cost were not included in Table 4. For instance,

the supplemental miticide would add'$32.11 to operating costs. Ad









Table 4.--Estimated annual per acre costs and returns for a mature 'Valencia' grove producing
processing in Central Florida, 1974-75


Item


Description


Amount


citrus for


Your grove


333 boxes @$1.50


II. Expenses
Spray program
Fertilizer
Material
Application
Dolomite
Material
Application
Weed co'ntr- .l
Material
SFpplication
Discing
.-" .ing
r., ing (maintenance)


rC!. .. brush
Irrigation
Tree replacement
Pull trees and
remove
Prepare site,
plant and ring
Water
Fertilizer
SjnkI' and uLa'.3nk
'ianageiKr.t
III. Total specified costs

IV. Return to land and trees


From Table 3


16-0-16, 832 lbs.
2 @$2.89

1/3 ton @$9.00
1 ton .: _".'* third ,.."r

..rovar II, 2 lbs./acre

Twi ce/yi -
Twi ce/:.- -

($ r, e 8.5 a

13,2 inches/ -


1.4 trees/acre

(I.'.-lude trees)


(Includes -? pli. :- on)

5% of gross sales


I. Revenue


$46.59
5.78

3.00


10.10
2.62


$499.50


75.01


52.37


4.03


12.72
7.58
7..

3,
3. 9
g1^


9.69
1.83
4.95
3.35


35.03
24.98
$324.32

$175.18


~_ __ ~ ~ ~I


L --


___









valorem taxes in Polk County last year would hvv added another $30-$40

per acre. A crew just standing by to light .eator'- -lo nights in one

season would result in an extra cost of apprcxitely $7.50 per acre;

this does not consider the cost of setting up aond removing heaters or

the amount of fuel necessary for one or c w : ;r:;. A wide variation

may exist in the cost of fuel from one area r. a.-other. An individual

grower would be in a better position to estimate these costs.

Shown in Table 5 are production practices f;o Florida citrus and

a range of times during the year when they would1 likely be carried out.

There are two possible values to developing a table such as this for an

individual grove. First, it shows work that is needed and when, so that

operations can be planned. Second, it is a must if an annual cash flow

analysis is to be developed to plan financing. ihe individual grower

can achieve benefits by developing a plant for d particular grove.


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] Florida Citrus Spray and Dust Schedule 1c)' Univ. of Fla.
Coop. Ext. Serv. Cir. 393A, Feb. 1975.

[3] Harrison, D. S. and R. C. J. Koo. Sprinkler Irrigation Systems
for Citrus. Univ. of Fla. Agr. Ext. Rpt. AE 73-15 (Rev.).
Gainesville: Aug. 1974.

[4] Muraro, Ronald P. "Comparative Citrus Budgets." Bartow: Polk
County Agricultural Department, Mar. 1975.

[5] 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.







Table 5.--Schedule of production practices in Central Florida citrus grovesa


Month
Practices Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

Spray program
Post bloom X X
Summer oil X X
Fall X X X
Fertilizer (custom) X X
Dolomite (custom) X X X X
Weed control
Chemical X X
Mechanical X X X X X X X X
Hand (pulling vines) X X X
Pruning
Hedging (custom) X
Topping (custom) X
Irrigation X X X X X
Tree replacement
Pull trees X X
Prepare site X X
Plant resets X
Ring X
Water X
Fertilizer X X X X X X X X
Weed control X
Harvesting (custom) X X


They are not


aThis schedule of practices shows suggested times when practice should be done.
necessarily done on the exact schedule shown here.