April 2001
Guidelines for Estimating
Alfalfa Hay Cost of Production
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This guide is designed to provide planning information and a format for calculating the
costs of production in a forage enterprise. The production costs included in this budget
were not obtained from a survey of producers, nor do they necessarily represent the
average cost of production for alfalfa grass hay in Manitoba.
The assumptions on which the costs were calculated are clearly defined in the
supporting pages. They were developed by using a combination of recommended practices and
methods followed by many producers.
When interpreting the costs contained in this budget for an individual situation,
adjustments may be necessary. Each assumption must be examined and adjustments made where
necessary.
The budget can be useful for comparative purposes. Comparison of costs can be made with
other similar farms; comparing farm costs over time; or comparing actual results with
projections made earlier.
Disclaimer: This budget is only a guide and is not
intended as an in-depth study of the cost of production of this industry. Interpretation
and utilization of this information is the responsibility of the user. No liability for
decisions based on this publication is assumed. If you require assistance with developing
your individual budget, please contact your local MAF Farm Management Specialist or the
Farm Management Section in Winnipeg at (204) 945-4937.
2001 ALFALFA HAY COST OF PRODUCTION - PER ACRE
|
|
$/Acre |
$/ton |
Your Farm |
| A. OPERATING COSTS |
|
|
|
|
1.01 |
Seed |
$5.50 |
$2.20 |
_________ |
|
1.02 |
Fertilizer |
$27.53 |
$11.01 |
_________ |
|
1.03 |
Herbicides |
$2.50 |
$1.00 |
_________ |
|
1.04 |
Fuel and Repairs |
$8.67 |
$3.47 |
_________ |
|
1.05 |
Crop Insurance |
$5.21 |
$2.08 |
_________ |
|
1.06 |
Land Taxes |
$5.00 |
$2.00 |
_________ |
|
1.07 |
Miscellaneous |
$2.00 |
$0.80 |
|
| Subtotal Operating Costs |
$56.41 |
$22.56 |
_________ |
|
1.08 |
Interest on Operating |
$2.40 |
$0.96 |
_________ |
| Total Operating Costs |
$58.81 |
$23.52 |
_________ |
|
| B. FIXED COSTS |
|
|
|
| 2.0 |
Investment |
|
2.01 |
Land |
$15.00 |
$6.00 |
_________ |
|
2.02 |
Machinery |
$5.96 |
$2.38 |
_________ |
|
2.03 |
Storage |
$0.63 |
$0.25 |
_________ |
| 3.0 |
Depreciation |
|
3.01 |
Machinery |
$19.50 |
$7.80 |
_________ |
|
3.02 |
Storage |
$5.00 |
$2.00 |
_________ |
| Total Fixed Costs |
$46.09 |
$18.43 |
_________ |
|
| Total Operating and Fixed |
$104.90 |
$41.95 |
_________ |
|
| C. LABOUR |
$10.00 |
$4.00 |
_________ |
|
| Total Cost of Production |
$114.90 |
$45.95 |
_________ |
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ASSUMPTIONS
- Assumed a 'total' of 300 acres' of alfalfa grass hay at a market value of $300 per acre.
- Assumed 6 years of production with an average yield of 2.5 tons per acre.
- Machinery and equipment for the grass hay enterprise included a tractor (alfalfa
portion), trailer, baler and mower conditioner which were valued at $65000 in total.
- In the first year the cover crop is assumed to be taken as green feed.
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