Irrigated Crop Budgets

Corn Management Comparisons

Overview
Declining Resources

Crop Profitability
Extension Tools

Changing
Times

Source: NPGCD Hydrology and Groundwater Resource 2011-2012 Publication

Source: NPGCD Hydrology and Groundwater Resource 2011-2012 Publication

Active Large
Production
Wells in the
District and
Wells Added
Since 2006

Source: NPGCD Hydrology and Groundwater

Resource 2011-2012 Publication

Irrigated Crop
Profitability

Estimated Costs and Returns for

2013 Primary Irrigated Crops in Texas High Plains

Production/Ac
Price
Grazing
Income

Corn

Corn
Silage

Cotton

225 bu

27 tons
$60

$6.50

Sorghum

Sorghum
Silage

Wheat

1100 lbs

75 cwt

21 tons

65 bu

$0.68 /
250

$10.60

$54

$8.70

$102.00

Gross Returns

$1462.50

$1620.00

$955.50

$795.00

$1134.00

$667.50

Ac-In Applied*

22

20

12

14

13

15

Variable Costs

$705.09

$831.72

$644.08

$405.25

$514.98

$394.26

Returns Above
VC

$757.40

$788.27

$311.41

$389.74

$619.01

$273.23

*Ac-In Priced at $4.40/mcf assuming 1 mcf = 1 ac-in

Estimated Costs and Returns for

2013 Primary Irrigated Crops in Texas High Plains

Production/Ac
Price
Grazing
Income

Corn

Corn
Silage

Cotton

225 bu

27 tons
$55

$6.00

Sorghum

Sorghum
Silage

Wheat

1100 lbs

75 cwt

21 tons

65 bu

$0.80 /
250

$9.65

$50

$6.75

$102.00

Gross Returns

$1350.00

$1485.00

$1087.50

$723.75

$1050.00

$540.75

Ac-In Applied*

22

20

12

14

13

15

Variable Costs

$705.09

$831.72

$644.08

$405.25

$514.98

$394.26

Returns Above
VC

$644.91

$653.28

$443.42

$318.50

$535.02

$146.49

*Ac-In Priced at $4.40/mcf assuming 1 mcf = 1 ac-in

Estimated 2013 Corn returns over variable cost for various yields & prices

Yield:

170

200

225

240

bushels

Price
$/bu

Returns over Variable Costs ($)

5.50

251.91

404.91

532.41

620.91

738.91

6.00

336.91

504.91

644.91

740.91

686.91

6.50

421.91

604.91

757.41

860.91

998.91

7.00

506.91

704.91

869.91

980.91

1128.91

7.50

591.91

804.91

982.41

1100.91

1258.91

Assumes VC in budgets with variable harvest/hauling ($0.40/bu) and $4.40 natural gas

Estimated 2013 Cotton returns over variable cost or various yields & prices

Yield:

260

500

800

1100

1400

1700

lbs

Price
$ / lb

Returns over Variable Costs ($)

0.58

-37.86

81.78

201.42

312.06

440.70

0.63

-12.86

121.78

256.42

391.06

525.70

0.68

12.14

161.78

311.41

461.06

610.70

0.73

37.14

201.78

366.42

531.06

695.70

0.80

62.14

220.24

443.42

601.06

780.70

Assumes VC in budgets with variable strip ($8.00/cwt), ginning ($2.75/cwt) & $4.40 natural gas

Estimated 2013 Sorghum returns over variable cost for various yields & prices

Yield:

45

60

75

90

105

cwt

Price
$/cwt

Returns over Variable Costs ($)

9.25

27.20

157.85

288.50

435.35

582.20

9.65

45.20

181.85

318.50

455.15

591.80

10.60

87.95

238.85

389.75

556.85

723.95

11.00

105.95

262.85

419.75

592.85

765.95

11.50

128.45

292.85

457.25

637.85

818.45

Assumes VC in budgets with variable harvest/hauling (54/cwt) and $4.40 natural gas

Estimated 2013 Wheat returns over variable cost for various yields
and prices
Yield:
Price
$/bu

45

55

65

75

85

bushels

Returns over Variable Costs ($)

6.75

-26.89

86.69

153.24

206.58

247.31

7.75

41.09

141.69

211.49

281.29

332.31

8.70

83.84

193.94

273.23

352.54

413.06

9.25

108.59

224.16

308.99

393.79

459.81

9.75

131.09

251.69

341.49

431.29

502.31

Assumes VC in budgets with variable harvest/hauling (77/bu) and $4.40 natural gas

Estimated 2013 Corn Silage returns over variable cost for various yields & prices

Yield:

18

22

27

32

38

tons

Price
$/bu

Returns over Variable Costs ($)

45

43.53

194.53

383.28

644.53

958.03

55

266.98

457.98

696.73

935.48

1221.98

60

313.53

524.53

788.28

1124.53

1528.03

68

457.53

700.53

1004.28

1380.53

1832.03

75

583.53

854.53

1193.28

1604.53

2098.03

Assumes VC in budgets with variable harvest/hauling ($7.25/ton) and $4.40 natural gas

Estimated 2013 Sorghum Silage returns over variable cost for various yields &
prices

Yield:

12

16

21

26

30

tons

Price
$/cwt

Returns over Variable Costs ($)

40

30.27

161.27

325.02

561.27

750.27

50

150.27

321.27

535.02

748.77

919.77

54

198.27

385.27

619.02

925.27

1170.27

60

270.27

481.27

745.02

1081.27

1350.27

67

354.27

593.27

892.02

1263.27

1560.27

Assumes VC in budgets with variable harvest/hauling ($7.25/ton) and $4.40 natural gas

Irrigated Corn Costs of Production 2009-2013

$220
$210
$200
$190
$180
$170
$160
$150
$140
$130

$120
$110
$100
$90
$80
$70
$60

$50
$40
$30
$20
$10
$-

Seed
(per acre)
Fertilizer
(per acre)
Insecticide
(per acre)
Herbicide
(per acre)
Irrigation
Labor
Cash Rent
&Leases

Making the Decision

Utilize Extension Resources to Aid in Decision
Making
Drought Spreadsheets, Commodity Budgets,
Market Outlook Reports,
http://agecoext.tamu.edu/
FARM Assistance (Like Us on Facebook)
QuickBooks Premier 2012/ Ipad Training
Crop Profitability/Lease Spreadsheets
Irrigated Decision Aid

Projected Risk in Net Farm Income

for Base Scenario & Alternative 1
Base Scenario

Alternative 1

$1,000

$1,000

1400

1400

1300

1300

1200

1200

1100

1100

1000

1000

900

900

800

800

700

700

2001
5%

2004
25%

Mean

2007
75%

2010
95%

2001
5%

2004
25%

2007
Mean

75%

2010
95%

Irrigated Decision Aid Methodology

Adapt southern plains profitability spreadsheet
to a useable version for the northern plains
Crop Profitability/Lease Agreements/Breakeven
Easy to update on an annual basis

Extend analysis to evaluate MVP of water applied

per crop to assist in optimal planting decisions
Considering circle size, GPM and crop water
requirements
Profitability of crop or crop combination for the year

Disseminate results and decision aid to producers

via meetings, workshops and web

Irrigated Decision Aid Applications

Assist irrigated producers in making
management decisions on the optimal
crop mix for their land.

KEY Calculation
ROVC/Acre-Inch applied
Corn Example
Total ROVC
$754.37 = $34/Ac-in
Divided by Ac-Inches
22
Applied

Real World Examples

Scenario 1
Joe Farmer can pump 300 gpm on a 120
acre pivot
He is considering planting either corn, cotton,
or sorghum as a summer crop. Based on
2013 Enterprise Budgets, the ROVC for each
commodity is as follows:
Corn
$754.37/Acre
Cotton $313.64/Acre
Sorghum $389.53/Acre
Which irrigated crop should he plant to
maximize ROVC under limited water
conditions?

Real World Examples

Scenario 2
Joe Farmer decides to plant 50 acres of corn
since it has the highest revenue potential in
Scenario 1
He must now decide which dryland crop to
plant on the remaining 70 acres
He is considering either dryland cotton, grain
sorghum, or sunflowers
Which irrigated/dryland combination will
maximize ROVC on the land?

Thanks!