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2012 Year in Review Prepared by: Eric J. Deters Riverland Farm Business Management Director/Instructor.

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Presentation on theme: "2012 Year in Review Prepared by: Eric J. Deters Riverland Farm Business Management Director/Instructor."— Presentation transcript:

1 2012 Year in Review Prepared by: Eric J. Deters Riverland Farm Business Management Director/Instructor

2 In 2012, on average, each farmer… Owned 241 acres (+5) Raised crops on 642 acres (+25) Had assets totaling $2,999,653 (+405,504) Managed debt of $1,209,663 (-154,801) Had a net worth of $1,789,990 (+250,704) Net farm income of $260,813 (+48,332) Median Net Farm Income of $176,593 (+38,748) Added $32,698 of non farm income (+5,881)

3 Cash Expenses to Cash Income

4 Net Farm Income NET FARM INCOME – is total cash income minus total cash expenses and depreciation +/- any change in inventory

5 What is the source of Net Farm Income? 20082009201020112012 Cash Farm Income 791,359716,951769,397950,144990,673 Cash Farm Expenses 660,606633,306661,155778,872791,396 Net Cash Income130,75383,645108,243171,272199,278 Inventory Change23,741-20,857116,02485,881111,930 Deprecation-36,378-42,664-46,347-46,002-52,564 Capital Sales2771042106313302170 Net Farm Income118,39321,165178,983212,481260,813

6 Net Farm Income by Type of Farm (70% sales)

7 Rate of Return on Farm Assets (ROA)

8

9 Balance Sheet Analysis Money Borrowed -Vs- Debt Repaid

10 Percent in Debt Market Basis

11 Total Family Uses of Cash, 2012 51 S.E. Minnesota Farm Families ITEM Cash Living Expenses $55,119 Income Taxes 17,880 Other Capital Purchases 2,313 Personal Share New Auto 3,283 Savings & Investments 8,384 Total Family Uses of Cash $86,723

12 Farm Family Spending Where Did the $1,162,859 Go in 2012?

13 What does my banker want to know?

14 Current Ratio (Liquidity) Current farm assets / current farm liabilities

15 Working Capital (Liquidity) Current farm assets minus current farm liabilities Green 50% of Cash Operating exp. YellowYellow 20 to50 % of Cash Operating exp. Red <20 % of Cash Operating exp.

16 Debt to Asset Ratio (Solvency) Total farm liabilities / total farm assets Green <30 % Debt Yellow 30 to 70 % Debt Red >70 % in Debt

17 Term Debt Coverage Ratio >150 % Green 110 to 150 yellow <110 % Red

18 Financial Efficiency – 2001 to 2010 How was the Gross Revenue split in the Average Business?

19 2012 Crop Review

20 Corn Yields Per Acre (Rented Acres)

21 Total Direct & Overhead Cost per Bushel of Corn (Rented Acres)

22 The Average Price of Corn Sold Cash sales during the year

23

24 Soybeans Yields Per Acre (Rented Acres)

25 Total Direct & Overhead Cost per Bushel of Soybeans (Rented Acres)

26 The Average Price of Soybeans Sold Cash sales during the year

27

28 Alfalfa Hay Yields Per Acre (Rented Acres)

29 Total Direct & Overhead Cost per Ton of Alfalfa Hay (Rented Acres)

30 The Average Price of Alfalfa Hay Sold Cash sales during the year

31

32 2012 Dairy Returns

33 Average Milk Production per Cow Based on Net Return per unit

34 Cost per Cwt. of Milk with Other Revenue and Labor & Management (Combined Dairy)

35 The Average Price of Milk Sold

36 Cost per Cwt. of Finish Pigs with Other Revenue and Labor & Management (per cwt Carcass Sold)

37 The Average Price of Hogs per cwt Carcass Sold

38

39

40 The Average Price of Beef Calves Sold per cwt

41

42 The Average Price of Finished Beef Sold per cwt

43

44 Have a Great Year in 2013!


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