Managing input costs is key

As spring approaches, farmers are eager to get in the field to plant new crops. But before you fire up the tractor and attach the planter, don’t forget to plan all your inputs and develop budgets to help with marketing 2010 crops.

The first input cost to examine is fertilizer, notes Bob Kelly, University of Missouri Extension agriculture business specialist, St. Joseph. “We’re looking at fertilizer costs lower than last year,” he says. “Nitrogen and phosphate have seen some small reduction in price, but potassium has seen a large drop in price, as much as 50%.”

Chemical prices are also more favorable. They have been impacted by the Roundup and generic glyphosate cost cut — some reductions in the range of 50%. “This gets an application of generic glyphosate at a quart rate to around $4 per acre,” Kelly says. Other conventional chemical programs will see steady to slight increases in price, he adds.

Seed prices are on the increase as more traits are injected into the seed market. “We can see seed costs for corn approaching $100 per acre, and soybeans approaching $50 to $60 per acre,” Kelly says. Knowing all costs allows you to calculate an approximate break-even cost to aid in marketing your crop. “If you know what it costs per bushel to produce the crop, you have a target minimum for watching the marketing opportunities throughout the year,” Kelly says.

Source: University of Missouri Extension

This article published in the March, 2010 edition of MISSOURI RURALIST.

All rights reserved. Copyright Farm Progress Cos. 2010.