Citation
Evaluating livestock alternatives

Material Information

Title:
Evaluating livestock alternatives
Creator:
Eason, Mark, 1957-
Place of Publication:
Quincy Fla
Publisher:
Agricultural Research and Education Center
Publication Date:
Language:
English
Physical Description:
31 p. : ill. ; 28 cm.

Subjects

Subjects / Keywords:
Beef cattle -- Economic aspects -- Florida ( lcsh )
Beef cattle -- Marketing -- Florida ( lcsh )
Genre:
non-fiction ( marcgt )

Notes

General Note:
Caption title.
Funding:
Electronic resources created as part of a prototype UF Institutional Repository and Faculty Papers project by the University of Florida.
Statement of Responsibility:
James R. Simpson, F.S. Baker, Jr., Mark Eason.

Record Information

Source Institution:
University of Florida
Holding Location:
University of Florida
Rights Management:
The University of Florida George A. Smathers Libraries respect the intellectual property rights of others and do not claim any copyright interest in this item. This item may be protected by copyright but is made available here under a claim of fair use (17 U.S.C. §107) for non-profit research and educational purposes. Users of this work have responsibility for determining copyright status prior to reusing, publishing or reproducing this item for purposes other than what is allowed by fair use or other copyright exemptions. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder. The Smathers Libraries would like to learn more about this item and invite individuals or organizations to contact Digital Services (UFDC@uflib.ufl.edu) with any additional information they can provide.
Resource Identifier:
70860431 ( OCLC )

Full Text
Evaluating Livestock Alternatives
Mark Eason
Area Farm Management Economist
Food and Resource Economics Department Agricultural Research and Education Center Quincy, Florida
Profit margins for livestock production are still tight even though
grain is relatively cheap and selling prices have improved. The producer who is successful in the 1980's will have to be more efficient than in the past. It has been stated that many cattle producers use only about 30 to 40 percent of the available technology in their operations. A lending agency's records indicate that efficiency varies as much as 100 percent among cow-calf producers. The successful producers will be those who are skillful in marketing and production practices and who use technical advances to manage their business efficiently. The livestock producer who adopts proven practices, techniques and processes will make the greatest advances during the 1980's.
Livestock producers must critically evaluate and analyze performance
and cost effective production systems. Producers must know costs associated with production so that a breakeven price can be calculated. The breakeven price can help'the producer determine how much profit or loss is being made on a per unit basis.
This section contains decision making information that should be helpful in evaluating various operations. The following are discussed:
-- A format for evaluating grazing calves on annual pastures.
-- Beef cow-calf budgets, breakeven analysis, and returns.
-- Cost reducing opportunities for making use of crop
residue.
-- Swine budgets for various farrow to finish operations.




2
-- Pasture and confinement feeder pig production budgets.
-- Budgets for finishing purchased feeder pigs.
-- Costs and returns of various hay operations.
Florida livestock producers should use this-information to assist them in analyzing their particular operations and evaluating other alternatives. The current economic situation dictates prudent management by the successful livestock producer; however, a profit potential does exist for the efficient manager.




3
Evaluating a Beef Cow-Calf Operation
Many cow-calf producers have been forced to take a hard look at their operations due to the cost-price squeeze that they have faced for the last several years. Evaluations reflect disappointing returns many times because of low markets and high input costs.
Producers need to plan their work and then work their plan. They can start by producing an enterprise budget and then use these numbers to evaluate certain practices such as dlehorning, deworming, implanting, and castrating. These are nothing new, but when all else fails, stick to the basics. The value of these practices constantly change because of changing interest rates, costs, and selling prices. "Beef Management Practices and Economic Decision-Making" by Prevatt and Kunkle contains excellent information on cost reducing practices. Another publication that is useful in evaluating various production systems is "Evaluating North Florida Cattle Raising Alternatives" by Simpson, Baker, and Eason. This publication contains detailed budgets for backgrounding, sale at different weaning weights, grain finishing, forage finishing, and a combination of forage/grain finishing.
This paper contains a beef cow-calf budget, Coastal bermuda hay budget, break-even analysis and return tables for a 100 cow operation. The budget can be used to evaluate the cost reducing opportunities of making use of crop residue. An investment and fixed cost budget for a 100 cow herd is also included. Types of Costs
Total costs of producing livestock include (1) variable costs and (2) fixed fixed costs. The variable or cash costs include such items as feed, veterinary. medication, repairs and labor. (in some cases labor is provided by the owneroperator or his family and is not a cash cost.)




4
Fixed costs include depreciation, interest and taxes in, building and equipment. These costs are incurred regardless of the level of production; however, the fixed cpst per head varies depending on the number of head produced. The investment and -fixed costs for a 100 cow herd are given in Table 2.
Management is a necessary part of any livestock enterprise and a management charge is included in each budget. There are many different ways of valuing management and you may want to put in your own figure. In the budgets management is charged at 5% of cash cost.
Land is one of the important inputs for enterprises utilizing pasture. In the budgets the land charge used for pasture is the average pastureland rental rate fbr Florida. There are many different ways of looking at land value and you will no doubt want to use your own figure for land charge in your budget.
Below is an evaluation of utilizing crop residue in the cattle operation. A producer who feels that he can use any of the cost reducing practices should deduct that amount from the break-even price on the budget. COST REDUCING OPPORTUNITIES
Thirty days on crop residue could reduce hay requirements by 25 or more tons.
- Reduce coastal 5 acres @ $ 94 $470
- Reduce hay making 25 tons @ $24 600
- Reduce land rent 5 acres @ $20 100
- Reduce interest ($1,170 @_ 15% for 8 months) 117
Total $i1-,-9
Break-even cost reduced $3.87/cwt.
Rye planted for peanut rotation (one half of cost charged to cattle) Fifty (50) acres grazed two hours per day for 110 days Cost $100 per acre ($100 x 50 -.2) = $2,500
- Reduce hay 25 tons
- Red uce coastal 5 acres @ $94 470
- Reduce hay making 25 tons @ $24 600
- Reduce land rent 5 acres @ $20 100
- Reduce protein supplement 110 cwt. @ $12 =1,320
- Reduce interest ($2,490 @ 1 5% for 8 months) = 249
Total 2,739
Difference ($2,739 2,500) 239
Break-even cost reduced $.72/cwt.




5
TABLE: 1 BEEF COW-CALF
ESTIMATED COST AND RETURNS
100 COWS & 3 BULLS ON 150 ACRES OF PASTURE 90% of Calf Crop (70 calves sold & 20 kept for replacements)
Item Quantity Price Value Your Cost
CaSsaS: Bermuda pasture 75 ac. 94.00 $ 7,050
Other permanent pasture 75 ac. 54.00 4,n n
Hay harvesting 125 tons 24.00 3,000
Protein supplement 150 cwt. 12.00 1,800
Salt & minerals --- 250
Veterinary & medicine .... 800
Repairs & maintenance .... 300
Tractor & pickup operation 80....... 800
Labor 700 hrs. 4.50 3,150
Miscellaneous expense 300 ----- 300
Interest on oper. cap. (8 mo.) $21,500 15% 2.150n
Marketing cost 90 head 10.00 900
Total Cash Costs 24,550
Fixed Costs 9,282
Management Charge (5% of cash cost) 1,228
Land Charge 150 ac. 20.00 3,000
Total Fixed Costs 13,510
TOTAL COSTS 38,060
BREAKEVEN PRICES PER CWT. OF CALF SOLD (Sell 70 calves, average weaning weight of 475 pounds)
Item Total Amount Price per Your Cost
cwt.
Total Cash Costs 24,550
Less: Value of Cull Cows 7,695
Net Cash Costs 16,855 50.69
Fixed Costs 9,282 27.92
Management Charge 1,228 3.69
Land Charge 3,000 9.02
Total 30,365 91.32
RETURNS FOR 100 COW ENTERPRISE AT VARIOUS SELLING PRICES
Price of calves ($/cwt.) $60 $70 $80 $90
Price of Cull Cows ($/cwt.) $40 $45 $50 $55
Receipts:
70 calves at 475 lbs. (332.5 cwt.) $19,950 $23,275 $26,600 $29,925
18 cull cows at 950 ibs. (171 cwt.) 6,840 7,695 8,550 9,405
Gross Receipts 26,790 30,970 35,150 39,330
Less: Cash Costs 24,550 24,550 24,550
Return Over Cash Costs 2,240 6,420 10,600 14,780
Less: Fixed Costs 9,282 9,282 9,282 9,282
Returns to Land & Management -7,042 -2,862 1,318 5,498




BEEF COW-CALF
Investment and Fixed Cost (100 Cow Herd)
TABLE 2:
Years Annual Fixed Cost
I tem New Average Of Life Depr. Interest Taxes & Ins. Total
14% 1.4%
100 Brood Cows at $450* $45,000 $40,000 $5,600 $560 $6,160
17 Replacement heifers 6,800 6,800 952 95 1,047
at $400*
3 bulls at $1,200* 3,600 2,400 4 600 336 34 970
Corral & loading chute 800 400 10 80 56 6 142
Feed racks 600 300 10 60 42 4 106
Miscellaneous equip. 500 250 5 100 35 4 139
Fencing (2.5 miles at $2,000) 5,000 2,500 15 333 350 35 718
$63,300 $1,173 $7,371 $738 $9,282
*The cattle prices represent an average expected price over the entire beef cattle cycle.




TABLE 3. Coastal Bermuda Hay: Estimated 'roduction and Harvesting Expenses per Acre, North Florida, 1982.
Item Unit Quant. Price Value Your Cost
Cash expenses:
Fertilizer (5-10-15
equivalent) cwt 6 7.50 45.00 _____Lime ton .33 20.00 6.60 _____Nitrogen lb 200 .26 52.00 _____Herbicide gal .25 11.50 2.88 ____Tractor (50 hp) hr 1.75 2. 58 4.52 _____Equipment hr 1.75 .56 .98 _____Truck, pickup mi 10 .10 1.00 ____Labor hr 2.02 3.75 7.56 _____Land rent acre 1.0 20.00 20.00 _____Interest on cash expenses $ 140.54 15%(6 mos.) 10.54 ____Total Cash Expenses 151.08 _____Harvest Expenses:-a
Custom mow, rake, bale ton 6 24,00 144.00 _____Labor (machine loading) hr .5 3.75 1.88 ____Tractor (50 hp) & Equipment hr .5 3.23 1.62 ____Truck, pickup mi 10 .10 1.00 ____Total Harvest Expenses 148.50 _____Fixed Expenses:
Tractor and Equipment hr 2.25 4.24 9.54 _____Truck, pickup mi 20 .13 2.60 _____Establishment (Prorated
over 10 years) acre 1.0 18.25 18.25 _____Total Fixed Expenses 30. 39 ______TOTAL EXPENSES 329.97 ____Assumes hay harvested round bales (1000 lb.)
Coastal Bermuda Hay: Net returns per acre with varying yields and prices.
Yield Per Acre (Tons)
Price 4 5 6 7 8
$ 50 80.77 55.40 29.97 -4.53 20.85
60 40.77 5.40 30.03 65.47 100.85
70 .77 44.60 90.03 135.47 180.85
80 39.23 94.60 150.03 205.47 260.85
90 79.23 144.60 210.03 275.47 340.85
100 119.23 194.60 270.03 345.47 420.85
Coastal Bermuda Break-even Prices at Various Yields Yield (tons/acre) Price/ton
4 $ 70. 19
5 61.08
6 55. 00
7 50.65
8 47.39




8
Is Grazing Profitable?
Cattlemen are interested in annual pasture grasses to provide high quality forage during the winter and spring when other forage is in short supply. Utilizing annual forages for grazing is not always profitable.
Returns calculated for the various calf purchase and selling prices indicates that it is necessary to have a sale price that is greater than the purchase price to obtain a positive return in most situations.
The return fbr grazing calves on annual pastures depends upon the marketability of the calves, the pasture cost, the nutritional value of the forage and the quantity of annual grass produced per acre.
This paper is intended as a guide. Cattlemen may want to substitute their estimates of production, costs, and selling prices into the general framework presented to analyze their expected returns. This paper analyzes the costs and returns of grazing 400 pound calves on rye-ryegrass pasture with and without supplemental feeding.
RYE-RYEGRASS PASTURES
The grazing trials at Quincy A.R.E.C. and Chipley Beef Demonstration Unit showed that rye-ryeorass can normally be grazed from about December 1 through April in a normal crcp year. One acre of rye-ryegrass will carry from 1. 5 to 2. 0 calves weighing 400 pounds. The calves can gain from 1.0 to 1.5 pounds per day without supplemental feeding. With supplemental feeding, both carrying capacity and daily rate of gain are increased. Feeding one percent of the animal's body weight per day of a 12 percent protein ration, the carrying capacity will range from 2. 5 to 3. 0 calves per acre, and the daily rate of gain will vary from 1. 25 to 1. 75 pounds per day.




One acre of rye-ryegrass costs about $128 to establish on a prepared
seed bed (Table 1). The cost includes seed, fertilizer, lime, machinery operating expense, labor, land rent, interest, and depreciation on the machinery.




10
TABLE 1.--Estimated cost of producing one acre of rye-ryegrass, North Florida,
1982.
Item Unit Quantity Price Amount Your Cost
---------------------------Dollars---I. Cash expenses: ------Dollars-------Rye.seed bu. 1.5 9.70 14.55
Ryegrass seed lb. 20.0 .30 6.00
Lime ton .33 20.00 6.60
Fertilizer, 5-10-15 cwt. 5.0 7.50 37.50
Nitrogen lb. N 75.0 .26 19.50
Machinery --- -- --- 6.38
Labor hr. 1.5 3.50 5.25
Land rent, 6 mos. acre 1.0 25.00 12.50
Interest on cash dollar 108.25 .075 8.12
expensea
Total cash expense 116.40
II. Fixed costs of machinery 11.12
III. Total estimated costs 127.52
a 15 percent for 6 months.




DETERMINING THE PROFITABILITY OF GRAZING
To determine the profitability of grazing calves on annual, pastures, the manager must compare the costs and returns from grazing. A format for this purpose is:
calf sale value = price X [I(initial weight) + (daily rate of gain X days of grazing )]
less calf purchase cost = initial weight X price paid
less pasture cost per calf =pasture cost per acre -1stocking rate
less interest cost on calf =calf purcahse cost X interest rate X time
less death loss = percent death loss X calf purchase cost
less marketing cost = percent of sale value X calf sale value
less mineral cost = cost per calf
less labor cost per calf = labor cost per calf per day X number of days grazing
less veterinarian cost =cost per calf
For example, assuming that the calves cost 60 cents per pound, sell for 60 cents per pound, and gain 1. 50 pounds per day for 150 days grazing on rye-ryegrass stocked at 1.5 calves per acre, the return per calf for grazing 400 pound calves is calculated as follows: Your Cost
calf sale value = .60 [400 + (1.50 X 150)1] .60 X 625 =$375.00______calf purchase cost ='400 X .60 -240.00 _____pasture cost per calf = 128.00 -.1.5 85. 33_______interest cost =2110 X .15 X 10- 15.00_____death loss .03 X 240 -7.20 ____marketing cost per calf =.041 X 375. 00 =-15.00 ______supplemental feed cost (salt + minerals) -2.08 _____labor cost per calf = ($. 035 X 150) -5.25 __veterinarian cost per calf -3.84 _____return per calf 1.30 _______




12
The return per calf where supplemental feeding is used along with the
rye-ryegrass pasture can be evaluated similarly. Supplemental feed cost $.06 per pound and it is assumed that the calves are fed an average of one percent of their body weight per day. Thus, a 400 pound calf gaining 1.75 pounds per day for 150 days would eat a total of 780 pounds of feed (5.2 pounds per day for 150 days). Again, assuming that the calves cost 60 cents per pound, sell for 60 center per pound, and gain 1. 75 pounds per day for 150 days grazing rye-ryegrass with supplemental feeding, the return per calf for grazing 400 pound calves in this situation is calculated as follows: Your Cost
calf sale value = .60 [(400) + (1.75 X 150)] = .60 X 662.5 = $397.50 calf purchase cost = .60 (400) = -240.00
pasture cost per calf = 128.00 2 = -64.00
interest cost per calf = 240 X .15 X 150 = -15.00
360
death loss .03 X 240 = -7.20
marketing cost per calf = .04 X 397.50 = -15.90
labor cost per calf = ($.07 X 150) = -10.50
supplemental feed cost per calf = (780 lbs. X $.06) = -46.80 veterinarian cost per calf = -3.84
return per calf = -5.74




13
Evaluating Hay Production
Hay remains an important winter feed for Florida livestock. As with other agricultural enterprises, producing and hervestlng hay is expensive. Estimated costs and returns for alfalfa, coastal bermuda, and bahia are presented in this study. Establishment, production, and harvesting expenses are explained in budget form. Net returns per acre with varying yields and prices, and break-even prices are shown. Expenses
Land rent expense or opportunity cost for coastal bermuda and bahia grass is assumed to be cheaper than for row crops because these grasses do not require as fertile soil as row crops. Not only do net returns vary as prices and yields vary, but also as input costs vary. The main input costs which vary in this study are the cost of harvesting. Constant production inputs for example can produce four to 8 tons of alfalfa per acre. The major difference will depend on how many tons are actually produced and harvested.
This paper does not include land clearing cost in the regular budget. It is assumed that it would not be feasible to clear land in order to plant grass in today's economy. However, a custom land clearing charge is footnoted in the coastal bermuda and bahia grass budgets. Break-even Price
Break-even prices for each enterprise provide a more specific price that one has to have in order to break-even at various yields. To determine breakeven price, simply divide total cost per acre by yield per acre. Rainfall
Hay harvesting is largely affected by rainfall. Quantity and quality of salable hay depends on whether or not it was rained on during harvest. Fifty




14
years of rainfall data (1932-1981) for the Quincy station was reviewed in order to determine a historical basis for harvesting hay. Using a cut off of .03 inch, the number of three-day dry periods in seven day intervals were tabulated from April to September. Observing the rainfall table for example, one can see that the first week in April that 36 out of 50 years had one 3-day dry period, 27 years had two 3-day dry periods, 20 years had three, 10 years had four and 9 out of 50 years had five 3-day dry periods. This information is a tool and may be used with other decision making factors such as immediate weather forecast.
Hay Making Systems
For simplicity, custom harvest rates are used in the budgets. The results of a study by J.W. Prevatt, M.A. Eason, and C.G. Chambliss is included to provide cost comparisons for different hay making systems. The study shows what it cost to own and operate a hay harvesting system. The results show that hay harvesting cost per ton decrease as increases of tons harvested annually and tons per acre are realized. The total cost of hay making is expensive, but there are factors other than cost which may influence the hay making decision. The decision to custom hire or purchase a system must include such factors as timelir:ss, convenience, and quality. Summary
The hay market is thin; very little hay is bought and sold on a large scale. As such, the prices reported may not be an accurate representation of the value of the hay because of the quantity and quality differences. Net returns per acre increase with increases in yield and price, but it is the amount of good quality salable hay that will provide a positive return. Whatever the combination, these results indicate that large yields of high quality hay which are marketed at top prices are required for hay to be considered as a feasible cash crop.




15
Estimated Establishment Cost for One Acre of Alfalfa, North Florida, 1982.
Item Unit Quant. Price Value Your Cost
Cash expenses:
Seed lb. 18 2.90 52.20
I noculant pkg. 1 .75 .75
Fertilizer (0-10-20
or equivalent) cwt. 6 7.50 45.00
Lime ton 1 18.00 18.00
Boron lb. 2.5 1.25 3.13
Herbicide acre 1 16.75 16.75
I nsecticide acre 1 12.20 12.20
Tractor (80 hp) hr. 3.5 4.26 14.91
Truck, pickup mi. 20 .10 2.00
Equipment hr. 3.5 3.02 10.57
Labor hr. 5.0 3.75 18.75
Land rent acre 1.0 30.00 30.00
Interest on cash exp. $ 224.26 .15 33.64
Total cash expenses 257.90
Fixed costs:
Tractor (80 hp) hr. 3.5 5.32 18.62
Truck, pickup mi. 20 .13 2.60
Equipment hr. 3.5 4.86 17.01
Total fixed costs 38.23
Total costs 296.13
Prepared by: Timothy D. Hewitt




Alfalfa Hay: Estimated Production and Harvesting Expenses per acre, North Florida, 1982. (Based on 4 cuttings).
Item Unit Quant. Price Value Your Cost
Cash expenses
Fertilizer (0-10-20 or
equivalent cwt. 12 7.50 90.00
Lime ton .5 20.00 10.00
Boron lb. 2.5 1.25 3.13
Herbicides acre 1.0 11.25 11.25
I nsecticides acre 1.0 8.60 8.60
Tractor (50 hp) and machinery hr. 2.0 3.14 6.28
Truck; pickup mi. 20.0 .10 2.00
Labor hr. 2.0 3.75 7.50
Land Rent acre 1.0 30.00 30.00
Interest on cash expenses $ 168.76 15% (6 mos.) 12.65
Total cash expenses 181.41
Harvest Expenses-/
Custom mow, rake, bale ton 4 24.00 96.00
Labor hr. 8 3.75 30.00
Tractor (50 hp) and equipment hr. 4 3.08 12.32
Total harvest expenses 138.32
Fixed Expenses:
Tractor and Machinery hr. 6 5.45 32.70
Truck, pickup mi. 20 .13 2.60
Establishment (prorated
over 4 years) acre 1.0 74.03 74.03
Total fixed expenses 109.33
TOTAL EXPENSES 429.06
a/Assumes hay harvested in rectangular bales (55 lbs.).
Alfalfa Hay: Net return!; per acre with varying yields and prices.
Yield Per Acre (tons)
Price 3 4 5 6 7 8
$ 90 -13-1.31 69.06 6.81 55.44 117.69 179.94
100 -101.31 29.06 43.19 115.44 187.69 259.94
110 71.31 10.94 93.19 175.44 257.69 339.94
120 41.31 50.94 143.19 235.44 327.69 419.94
130 11.31 90.94 193.19 295.44 397.69 499.94
140 18.69 130.94 243.19 355.44 467.69 579.94
Alfalfa Break-even prices at Various Yields Yield (tons/acre) Price/ton
3 $ 133.77
4 107.26
5 91.36
6 80.76
7 73.19
8 67.51




17
Estimated Establishment Cost for One Acre of Coastal Bermuda Grass in North Florida, 1982.P'
Item Unit Quant. Price Value Your Cost
Cash Expenses:
Li me ton 1.0 20.00 20.00
Fertilizer (5-10-15 or
equivalent) cwt 3. 0 7. 50 22. 50 __Custom sprigging (sprigs included) acre 1.0 55.00 55.00
Nitrogen lb 60 .26 15.60 __Herbicide lb 2.0 3.75 7.50 _Tractor (50 hp) hr 1.75 2.58 4.52 __Truck, pickup mi 20 .10 2.00 __Eq uipment h r 1.75 1.04 1.82 ___Labor h r 2.0 3.75 7.50 ___Land rent acre 1 20.00 20.00 ____Interest on cash expenses $ 156.44 15%(6 mos.) 11.73 __Total Cash Expenses 168.17_Fixed Expenses:
Tractor (50 hp) hr 1.75 3.12 5.46 ___Truck, pickup mi 20 .13 2.60 ___Equipment hr 1.75 3.60 6.30 ___Total fixed expenses 14.36
Total Expenses 182.53 __a! Add $300 per acre for custom land clearing; includes bulldozing, root raking, and heavy
diski ng.




18
Table 3. Coastal Bermuda Pasture: Estimated Variable Costs Per Acre. Item Quantity Price Value Your Cost
Establ ishment
(.Prorated over 10 yrs.) $18.00
Fertilizer (5-10-15 or
equivalent) 5 cwt. $ 7.50 38.00
Nitrogen 120 lbs. .26 31.00
Lime .33 ton 20.00 7.00
Total costs $94.00
Table 4. Other Permanent Pasture (Bermuda or Bahia): Estimated Variable
Costs Per Acre.
Item Quantity Price Value Your Cost
Fertilizer (.5-10-15
or equivalent) 3 cwt. $ 7.50 $23.00
Nitrogen 80 lbs. .26 21.00
Lime .33 tons 20.00 7.00
Herbicide .25 gal. 11.50 3.00
Total costs $54.00




19
Estimated Establishment Cost for One Acre of Bahia Grass in North Florida, 1982.a/
I tem Unit Quant Price Value Your Cost
Cash Expenses:
Lime ton .33 20.00 6.60
Fertilizer (5-10-15 or
equivalent) cwt 4.0 7.50 30.00
Seed Ib 20 1.50 30.00
Nitrogen Ib 40 .26 10.40
Herbicide gal .25 11.50 2.88
Tractor (50 hp) hr 1.75 2.58 4.33
Truck, pickup mi 20 .10 2.00
Equipment hr 1.75 5.16 9.03
Labor hr 2.00 3.75 7.50
Land Rent acre 1.0 20.00 20.00
Interest on cash exp. (1 year) $ 122.74 15% 18.41
Total cash expenses 141.15
Fixed Expenses:
Tractor hr 1.75 3.12 5.46
Truck, pickup mi 20 .13 2.60
Equipment hr 1.75 10.04 17.57
Total fixed expenses 25.63
TOTAL EXPENSES 166.78
Add $300 per acre for custom land clearing; includes bulldozing, root raking, and heavy
disking.




Bahia. Hay: Estimated Production and Harvesting Expenses Per Acre, North Florida, 1982.
Item Unit Quant Price Value Your Cost
Cash Expenses:
fertilizer (5-10-15 or
equivalent) cwt 6. 0 7. 50 45. 00 ______Li me ton .33 20.00 6.60 ______Nitrogen lb 200 .26 52.00 _____Herbicide gal .5 11.50 2.88 ______Tractor (50 hp) hr 1.75 2.58 4.52 ______Equipment hr 1.75 .56 .98 ______Truck, pickup mi 10 .10 1.00 ______Labor hr 2.00 3.75 7.50 ______Land rent acre 1.0 10.00 20.00 ______Interest on cash expenses $ 140.48 15%(6 mos.) 10.54 ______Total Cash Expenses 151 .02 _____Harvest Expenses:-a
Custom mow, rake,bale tons 5 24.00 120.00 ______Labor (machine loading) hr .42 3. 75 1.58 ______Tractor (5-0 hp) & Equipment hr .42 3.23 1.36 ______Truck, pickup mi 10 .10 1.00 ______Total Harvest Expenses 123. 94 _____Fixed Expenses:
Tractor and equipment hr 2.17 4.24 9.20 ______T ruck, pickup mi 20 .13 2.60 ______Establishment (prorated over
10 years) acre 1.0 16.68 16.68 ______Total Fixed Expenses 28.48 ______TOTAL EXPENSES 303.44 _____a! Assumes hay harvested round bales (1000 lb.).
Bahia Hay: Net returns pcr acre with varying yields and prices.
Yield Per Acre (Tons)
Price 3 4 5 6 7
$ 50 104.25 78.83 53.44 28.00 2.57
60 74.25 38.83 3.44 32.00 67.43
70 44.25 1.17 46.56 92.00 137.43
80 14.25 41.17 96. 56 152.00 207.43
90 15.75 81.17 1246. 56 212. 00 277.43
100 45.75 121.17 196.56 272.00 347.43
Bahia Hay Break-even Prices at Various Yields Yield (tons/acre) Price/ton
3 $ 84.75
4 69.71
5 60.69
6 54.67
7 50.37




Cumulative Number of Three-Day Dry Periods for Seven Day Intervals between April and September, 50 years data, Quincy, Florida, 1932-1981.
No. of 3-day
dry periods Number of Years Out of 50
ONE 36 43 45 47 45 42 39 38 37 37 36 32 32 25 26 22 25 23 32 35 25 29 33 42 38 41
TWO 27 34 40 35 40 32 32 26 28 32 26 20 20 14 15 11 13 12 21 22 12 18 24 35 31 33
THREE 20 20 29 27 29 22 31 20 19 23 19 11 11 5 10 3 7 6 13 10 6 12 15 29 21 19
FOUR 10 14 20 18 20 14 21 13 12 11 11 5 5 4 6 1 3 3 5 6 2 7 10 17 15 11
FIVE 9 12 15 13 17 9 17 7 6 8 10 1 2 1 4 1 1 1 4 5 0 3 7 12 9 8
Lfn CN Z
c
I I I I II I
- O C' o O I OIA I I I
L_ o_ ( -NCu-




22
Evaluating Four Hay Harvesting Systems.
System 1 -- mower-conditioner (9-foot)
tedder (16-foot)
side delivery rake (9 foot)
small round baler (4.5' x 4.25')
bale fork
rear hydraulic bale fork
hay wagon
tractor (70 hp) tractor (55 hp)
pickup (0.5 ton)
System 2-- mower-conditioner (9-foot)
tedder (16-foot)
side delivery rake (9-foot)
large round baler (5.5' x 5.5')
bale fork
rear hydraulic bale fork
hay wagon
tractor (70 hp) tractor (55 hp)
pickup (0.5 ton)
System 3-- mower-conditioner (9-foot)
tedder (16-foot)
side delivery rake (9 foot)
rectangular baler (14" x 18" x 36")
pull type bale wagon (104 bales)
tractor (70 hp) tractor (55 hp)
pickup (0.5 ton)
System 4 -- mower-conditioner (9--foot)
tedder (16-foot)
side delivery rake (9-foot)
rectangular baler (14" x 18" x 36")
self-propelled bale wagon (160 bales)
tractor (70 hp) tractor (55 hp)
pickup (0.5 ton)




23
Operating costs per tons of four hay harvesting systems.19.
.Harvested Annually Tons/acre System 1 System 2 System 3 System 4
------------ Dollars ---------------100 Tons 1 T /AC 22.00 20.84 16.65 32.35
2 T /AC 10.71 10.14 8.71 15.93
3 T/AC 7.05 6.67 5.72 10.54
500 Tons 1 T /AC 24.20 22.98 19.97 34.19
2 T /AC 11.53 10.94 9.47 16.63
3 TI/AC 7.51 7.12 6.15 10.94
1000 Tons 1 T /AC 25.74 24.46 21.36 35.45
2 T /AC 12.10 11.49 9.99 17.10
3 T/AC 7.83 7.43 6.44 11.20
1500 Tons 1 T /AC 26.89 25.56 22.38 36.39
2 T /AC 12.53 11.90 10.37 17.44
3 TI/AC 8.07 7.60 6.66 11.40
2000 Tons 1 T /AC 27.85 26.47 23.23 37.16
2 TI/AC 12.87 12.23 10.68 17.73
3 TI/AC 8.26 7.85 6.83 11.55
AOperating costs per ton include the costs of inputs such as fuel, oil, lubricants, repairs and labor.
Ownership Costs Per Ton of Four Hay Harvesting Systems.19.B
Tons
HarvestedAnnually System 1 System 2 System 3 Sse
----------------------------------- Dollars------------------100 Tons 188.17 188.23 176. 80 278.65
500 Tons 37. 63 37.64 36.44 55. 72
1000 Tons 18.82 18.82 18.22 27. 86
1500 Tons 12. 54 12. 54 12.15 28, 57
2000 Tons 9.41 9.41 9.11 13.93
B Ownership costs per ton include depreciation, insurance taxes and interest.




24
C
Total Cost Per Ton of Four Hay Harvesting Systems. 1981.
Tons
Harvested Annually Tons /acre System 1 System 2 System 3 System 4
-------------------- Dollars ------------------100 Tons 1 T /AC 210.16 209.07 193.46 311.00
2 T /AC 199.88 198.37 190.92 294.61
3 T /AC 195.28 194.98 187.98 289.31
500 Tons 1 T /AC 61.83 60.62 56.41 89.91
2 T /AC 49.17 48.59 45.91 72.35
3 T /AC 45.15 44.77 42.59 66.66
1000 Tons 1 T /AC 44.55 43.28 39.57 63.31
2 T /AC 30. 9:2 30. 31 28.21 44.96
3 T /AC 26.65 26.26 24.66 39.06
1500 Tons 1 T /AC 39.43 38.11 34.53 54.96
2 T /AC 25.00 24.44 22.51 36.02
3 T /AC 20.61 20.21 18.80 29.97
2000 Tons 1 T /AC 37.25 35.89 32.34 51.09
2 T /AC 22.28 21.64 19.79 31.66
3 T /AC 17.67 17.26 15.94 25.49
C Total cost per ton is the summation of operating and ownership cost. The sum of operating and ownership costs may not exactly equal total cost due to rounding erros.




25
Evaluating Florida Swine Production
Hog production makes up an important and expanding part of Florida's live'stock industry. in order to determine the profitability of a swine enterprise, it is necessary to make an extensive economic evaluation. This paper (which is taken from Tim Hewitt's "Cost Analysis For Swine Production for Florida") presents budgets which are helpful in evaluating existing hog enterprises and planning potential hog operations.
Costs
Two types of costs are involved in producing swine: variable and fixed.
Variable costs are the cash expenses necessary to produce swine and these costs may vary depending on the level of production. The fixed costs are the ownership costs of producing swine and include items such as depreciation, interest, insurance, and taxes on buildings and equipment. Once a commitment has been made to produce hogs and facilities are constructed, the fixed costs are incurred regardless of the level of production. The budgets developed in this report should be useful for planning and analyzing with some adjustments needed to fit the budget to the particular farm situation.
Five budgets have been developed that should reflect most of the swine systems in Florida. The budgeted systems include:
Table 1) Farrow to Finish Operation, total confinement
Table 2) Farrow to Finish Operation, pasture and confinement
Table 3) Pasture and Confinement Feeder Pig Production
Table 4) Pasture System Feeder Pig Production
T able 5) Finishing Purchased Feeder Pigs




26
Relatively high investments are required for some of the above systems. Even though hog prices are encouraging at the present time, the price situation may change as producers expand their hog operations to take advantage of high prices. If expansion occurs, prices are likely to decrease. Producers need to consider the future price proposals in their economic evaluation of swine enterprises. Good management dictates careful economic planning and subsequent activity by the efficient swine producer.




27
Table 1. Estimated Costs and Returns, Farrow to Finish (Total Confinement)
200 Sows, 4.1 Farm Feed Efficiency, 8 Pigs Weaned/Litter,
2.2 Litters/Sow/Year.
I tern Quantity Price Amount Your Farm
Cash Expenses:
Corn 49,060 bu. $ 2.30 $112,838.00
Soybean Meal 251.3 tons 270.00 67,851.00
Vitamins & Minerals 8,615 lbs 1.20 10,338.00
Veterinary & Medicine .... 5,013.00
Boar Purchase 10 600.00 6,000.00
Maintenance & Repair .... 6,000.00
Utilities .... 5,500.00
Machinery .... 350.00
Truck Expenses .... 6,300.00
Miscellaneous .... 3,000.00
Labor 3,000 hrs 4.00 12,000.00
Interest on Cash
Expenses $235,190 15% 35,278.50
Total Cash Expenses $270,468.50
Fixed Costs:
Interest on Livestock
Capital $ 5,250.00
Interest on Other
Equ i pment 29,437.00
Other Overhead Costs 28,715.00
Machinery 825.00
Insurance & Taxes 3,500.00
Total Fixed Costs $ 67,727.00
TOTAL COSTS $338,195.50
Break-Even Price Per Cwt. of Market Hogs Sold
Item Total Amount Price Per Cwt. Your Farm
Total Cash Expenses $270,468
Less: Value of 80 Cull Sows 15,360
Less: Value of 10 Cull Boars 1,912
Net. Operating Costs 35294 $32.94
Fixed Costs 67,727 8.81
TOTAL COSTS $320,923 $41.75
Returns from Operation:
Gross Receipts:
TIarket Hogs (3342 at 230 lbs. at $.52) =399,703.20
ICull Sows (80 at 400 lbs. at $.48) 15,360.00
Cull Boars (10 at 425 lbs. at $.45) 1,912.50
Non-Breeding Gilts (36 at 280 lbs. at S.50) = 5,040.00
Total Gross Receipts $T2 5.7U
Less Total Costs 338,195.50
Returns to Management
Prepared by: T. D. Hewitt, Marianna, ARC.




28
Table 2. Estimated Costs and Returns, Farrow to Finish (Pasture and Confinement)
50 Sows, 4.2 Farm Feed Efficiency, 8 Pigs Weaned/Litter, 2 Litters/Sow/Year.
Item Quantity Price Amount Your Farm
Cash Expenses:
Corn 11,216 bu. $ 2.30 $25,796.80
40% Complete Supplement 1,256 cwt. 14.00 17,584.00
Veterinary & Medicine -- -- 1 ,200.00
Boar Purchase 3 600.00 1,800.00
Maintenance & Repair .-- 2,772.00
Utilities .. 2,100.00
Machinery .... 850.00
Truck Expenses .... 1,800.00
Miscellaneous -- -- 600.00
Labor 1,272 hrs. 4.00 5,088.00
Interest on Cash
Expenses 59,590.80 15% 8,938.62
Total Cash Expenses $68,529.42
Fixed Costs:
Interest on Livestock
Capital $ 1,260.00
Interest on Equipment
and Facilities 5,145.00
Other Overhead Costs 6,250.00
Machinery 1,925.Q0
Insurance & Taxes 1,500.00
Total Fixed Costs $16,080.00
TOTAL COSTS $84,609.42
Break-Even Price Per Cwt. of Market Hogs Sold
Item Total Amount Price Per Cwt. Your Farm
Total Cash Expenses $68,529
Less: Value of 20 Cull Sows 3,840
Less: Value of 3 Cull Boars 574
Net Operating Costs- $64,115 $37.87
Fixed Costs 16,080 9.50
TOTAL COSTS $80,195 $47.37
Returns from Operation:
Gross Receipts:
Market Hogs (736 at 230 lbs. at $.52) $88,025.60
Cull Sows (20 at 400 lbs. at $.48) 3,840.00
Cull Boars (3 at 425 lbs. at $.45) 573.75
Non-Breeding Gilts (3 at 280 lbs. at $.50) = 420.00
Total Gross Receipts S2-,8-5-_Less Total Costs 84,609.42
Returns to Management $ 249.9 3
Prepared by: T. D. Hewitt, Marianna ARC.




29
Table 3. Estimated Costs and Returns, Feeder Pig Production (Pasture and Confinement)
50 Sows, 8 Pigs Weaned/Litter, 2 Litters/Sow/Year.
I tem Quantity Price Amount Your Farm
Cash Expenses:
Corn 3,536 bu. $ 2.30 $ 8,132.80
40% Complete Supplement 398 cwt. 14.00 5,572.00
Veterinary & Medicine .... 1,100.00
Boar Purchase 3 600.00 1,800.00
Maintenance & Repair .... 2,152.00
Utilities .... 1,300.00
Machinery ...400.00
Truck Expenses .... 1,800.00
Miscellaneous .-- 400.00
Labor 1,112 hrs. 4.00 4,448.00
Interest on Cash
Expenses 27,104.80 15% 4,065.72
Total Cash Expenses $31,170.52
Fixed Costs:
Interest on Livestock
Capital $1,260.00
Interest on Equipment
and Facilities 3,395.00
Other Overhead Costs 4,880.00
achinery 1,120.00
Insurance & Taxes 1,500.00
Total Fixed Costs $12,155.00
TOTAL COSTS 143,325.52
Break-Even Price Per Cwt. of Market Hogs Sold..
Item Total Amount Price Per Cwt. Your Farm
Total Cash Expenses $31,170
Less: Value of 20 Cull Sows 3,840
Less: Value of 3 Cull Boars 574
Net Operating Costs- $26,756 $60.53
Fixed Costs 12,155 27.50
TOTAL COSTS- $38,911 588.03
Returns from Operation:
Gross Receipts:
Cull Sows (20 at 400 lbs. at S.48) S S 3,840.00
Cull Boars (3 at 425 lbs. at $.45) 573.75
Non-Breeding Gilts (3 at 280 lbs. at $.50) 420.00
Feeder Pigs (736 at 60 lbs. at $.70) 30,912.00
Total Gross Receipts ST5,'45_7_U
Less Total Costs 43,325.52
Returns to management $7 57 .82
Prepared by: T. D. Hewitt, Marianna, ARC.




30
Table 4. Estimated Costs and Returns, Feeder Pig Production (Pasture System)
10 Sows, 6.5 Pigs Weaned/Litter, 1.8 Litters/Sow/Year.
Item Quantity Price Amount Your Farm
Cash Expenses:
Complete Feed 403 cwt. $ 9.50 $3,828.50
Veterinary & Medicine -- 136.00
Boar Purchase 1 350.00 350.00
Maintenance & Repair .... 240.00
Utilities .... 360.00
Machinery ...200.00
Truck Expenses .. 270.00
Miscellaneous -- 250.00
Labor 340 hrs. 3.35 1,139.00
Interest on Cash
Expenses 6,773.50 15% 1,016.03
Total Cash Expenses $7,789.53
Fixed Costs:
Interest on Livestock
Capital $ 245.00
Interest on Equipment
and Facilities 110.00
Other Overhead Costs 330.00
Machinery 650.00
Insurance & Taxes 100.00
Total Fixed Costs $1 ,435.00
TOTAL COSTS $9,224.53
Break-Even Price Per Cwt. of Market Hogs Sold
Item Total Amount Price Per Cwt. Your Farm
Total Cash Expenses $7,790.00
Less: Value of 2 Cull Sows 384.00
Less: Value of 1 Cull Boar 191.00
Net Operating Costs $7,215.00 $1.11
Fixed Costs 1,435.00 .22
TOTAL COSTS $8,650.00 $1.33
Returns from Operation:
Gross Receipts:
Cull Sows (2 at 400 lbs. at $.48) = $ 384.00
Cull Boars (I at 425 lbs. at $.45) 191.25
Non-Breeding Gilts (2 at 280 lbs. at S.50) 280.00
Feeder Pigs (108 at 60 lbs. at $.70) = 4,536.00
Total Gross Receipts $5,-F97 .2_5
Less Total Costs 9,224.53
Returns to Management $3,-J32
Prepared by: T. D. Hewitt, Marianna ARC.




31
Table 5. Estimated Costs and Returns, Finishing Purchased Feeder Pigs (Confinement)
Facilities for 200 Feeder Pigs, 3.5 Feed:Gain, 2% Death Loss.
Item Quantity Price Amount Your Farm
Cash Expenses:
Feeder Pigs (55 lbs.) 800 head $ 44.00 $35,200.00
Corn 6,928 bu. 2.30 15,934.40
40% Complete Supplement 776 cwt. 14.00 10,864.00
Veterinary & Medicine -- -- 784.00
Maintenance & Repair .... 1,440.00
Utilities .... 480.00
Machinery .... 200.00
Truck Expenses .... 550.00
Miscellaneous --- 240.00
Labor 720 hrs. 4.00 2,880.00
Interest on Cash
Expenses 68,572.40 15% 10,285.86
Total Cash Expenses $78,858.26
Fixed Costs:
Interest on Equipment
and Facilities $ 1,960.00
Other Overhead Costs 2,720.00
Machinery 650.00
Insurance & Taxes 400.00
Total Fixed Costs $ 5,730.00
TOTAL COSTS $84,588.26
Break-Even Price Per Cwt. of Market Hogs Sold
Item Total Amount Price Per Cwt. Your Farm
Total Cash Expenses $78,815 $43.71
Fixed Costs 5,730 3.18
TOTAL COSTS $84,545 $46.89
Returns from Operation:
Gross Receipts:
Market Hogs (784 at 230 lbs. at $.52) $93,766.40
Less Total Costs 84,588.26
Returns to Management $ 9,178.14
Prepared by: T. D. Hewitt, Marianna, ARC