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Sprayer Economics Gary Schnitkey schnitke@uiuc.edu University of Illinois

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www.farmdoc.uiuc.edu Outline Estimate costs of per acre sprayer operations for inclusion on farmdoc Evaluate for four situations

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www.farmdoc.uiuc.edu

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Custom Rate Surveys Type Avg. Range Iowa, 2005 Tractor 4.95 (3.50 – 8.50) Self propelled 5.05 (3.50 – 8.00) Airplane 5.80 (5.00 – 6.75) Purdue, 2004 Tractor 4.81 (3.32 – 6.29) Highboy 5.44 (3.77 – 7.12) Airplane 6.22 (4.30 – 8.14)

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www.farmdoc.uiuc.edu Situations Evaluated 1.Pull-type, well-equipped, 90 ft boom 2.Pull-type, economical, 40 ft boom 3.Self-propelled, High boy, 90 ft boom 4.Self-propelled, Coupe, 60 ft boom

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www.farmdoc.uiuc.edu Tendering Costs $50 per hour for truck and labor Acre/hr Cost/acre 1.Pull-type, well equip 50$1.00 2.Pull-type, economical 23 2.17 3.Self-prop, high crop 50 1.00 4.Self-Prop, coupe 41 1.21

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www.farmdoc.uiuc.edu Pull-Type Sprayer Well Equipped $25,000 purchase price 90 ft boom Hold 10 years (sell for $5,200) $1.50 fuel price, 7% interest rate, $13.50 labor price Covers about 50 acres per hour

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www.farmdoc.uiuc.edu Acres per Hour Speed 8 miles per hr. x feet per mile 5,280 feet x boom width 90 feet ÷ area per acre 43,560 square feet The. capacity 87 acres x field efficiency 60% Acres covered 52

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www.farmdoc.uiuc.edu Tractors Charges (155 HP) Based on Per Hour Costs Per YearPer Hour Depreciation $4,867 $16.22 Interest 3,714 12.38 Housing 531 1.77 Repair 627 2.09 Fuel and Lub 3,362 11.20 Labor 4,455 14.85 Total 17,555 $58.51 From Machinery Cost Estimates on farmdoc

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www.farmdoc.uiuc.edu Per Hour Tractor Cost by HP

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www.farmdoc.uiuc.edu Pull Type Sprayer (4,000 acres) Costs per Acre Sprayer Tractor Total Depreciation.50.31.81 Interest.21.24.45 Repairs.21.04.25 Ins + House.04.03.07 Fuel.21.21 Labor.28.28 Total.96 1.11 2.07

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www.farmdoc.uiuc.edu Per Acre Costs for Different Acres AcresCost 1,000$4.23 2,000 2.77 3,000 2.30 4,000 2.07 5,000 1.94 Holds tractor hour costs constant **No tendering costs ($1.00 per acre)

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www.farmdoc.uiuc.edu Pull Type Sprayer Economical $14,000 purchase price 40 foot boom Hold 10 years ($0 salvage value) 105 HP tractor 23 acres per hour (60% field efficiency)

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www.farmdoc.uiuc.edu Per Acre Costs for Different Acres AcresCost 1,000$4.19 2,000 3.22 3,000 2.90 4,000 2.76 5,000 2.69 Holds tractor hour costs constant Do not include tendering costs ($2.17)

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www.farmdoc.uiuc.edu Pull Type Sprayers, Per Acre Costs Acres90 ft. 40 ft. 1,000$4.23 4.19 2,000 2.77 3.22 3,000 2.30 2.90 4,000 2.07 2.76 5,000 1.94 2.69

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www.farmdoc.uiuc.edu Why not much difference? Tractor cost spread over fewer acre 90 foot boom (155 HP) –$58.51/ 50 acres = $1.17 per acre 40 foot boom (105 HP) –$44.13 / 23 acres = $1.92 per acre

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www.farmdoc.uiuc.edu Self Propelled Sprayer High Crop $192,000 purchase price 90 foot boom High boy Hold for 10 years ($40,000 value) 50 acres per hour (60% field efficiency)

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www.farmdoc.uiuc.edu Salvage Value Work from Kansas State http://www.agmanager.info/ Kastens and Dhuyvetter Developed OwnSpray.xls to estimate costs of self-propelled machines Salvage values: –Drop 15% for each year –Drop 1% for each 100 hours

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www.farmdoc.uiuc.edu Self Propelled, High Boy (10,000 acres) Costs per Acre Total Per Acre Depreciation 15,213 1.52 Interest 6,511.65 Repairs 4,000.40 Ins + House 1,160.12 Fuel 2,484.23 Labor 2,224.24 Total 31,920 3.16

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www.farmdoc.uiuc.edu Per Acre Costs for Different Acres High Boy ** AcresCost 5,000$5.45 7,500 3.92 10,000 3.16 12,500 2.70 15,000 2.39 ** No tendering costs ($1.00)

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www.farmdoc.uiuc.edu Self Propelled Sprayer Spray Coupe $91,000 purchase price 60 foot boom No tall crop ability Hold for 10 years ($19,000 value) 41 acres per hour (60% field efficiency)

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www.farmdoc.uiuc.edu Self Propelled (10,000 acres) Costs per Acre Total Per Acre Depreciation 7,207.72 Interest 3,084.31 Repairs 4,000.40 Ins + House 550.06 Fuel 1,743.17 Labor 3,582.36 Total 20,166 2.02

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www.farmdoc.uiuc.edu Per Acre Costs for Different Acres Spray Coupe AcresCost 5,000$3.10 7,500 2.37 10,000 2.02 12,500 1.80 15,000 1.66 ** No tendering costs ($1.21)

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www.farmdoc.uiuc.edu Self Propelled Sprayers, Per Acre Costs Acres High crop Coupe 5,000$5.42 $3.10 7,500 3.92 2.37 10,000 3.16 2.02 12,500 2.70 1.80 15,000 2.39 1.66

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www.farmdoc.uiuc.edu Why difference? Difference due to initial costs of machine

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www.farmdoc.uiuc.edu Summary Must run over sufficient acres to get costs approaching custom rates. Some instances of cost savings. Additional reasons justifying ownership from other than cost savings perspective

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Multiplication X 1 1 x 1 = 1 2 x 1 = 2 3 x 1 = 3 4 x 1 = 4 5 x 1 = 5 6 x 1 = 6 7 x 1 = 7 8 x 1 = 8 9 x 1 = 9 10 x 1 = 10 11 x 1 = 11 12 x 1 = 12 X 2 1.

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