The Relative Cost Efficiency of No-Till Farms Michael Langemeier –Professor –Department of Agricultural Economics –Kansas State University 1.

Slides:

Advertisements

Similar presentations

Agribusiness Library LESSON L060088: DEVELOPING AN INCOME STATEMENT.

Advertisements

Heartland Regional Roundtable Michael Langemeier –June 9-11, 2009 –Nebraska City, Nebraska 1.

Relative Cost Efficiency of No-Till Farms 2007 Ag Profitability Conference: Wakeeney Michael Langemeier December 20, 2007.

Heartland Regional Roundtable Michael Langemeier –March 4-5, 2009 –Nebraska City, Nebraska 1.

Long-Run Trends in Profitability and Farm Size Michael Langemeier Dept. of Ag. Econ. Kansas State University.

KAMS Mediator Training October 22, 2007 Manhattan, Kansas Kansas Farm Management Association Program Building on the past... Pursuing the Future.

These Graphs Represent An Average of Detailed Records of Farms Enrolled in Farm Management Programs located in North Central North Dakota (Region 2) and.

Farmland Values and Leasing Key Questions Chapter 20 §What determines the value of farmland? §What are the advantages and disadvantages of owning vs. leasing?

Cropland and Livestock Leasing in Montana

Financial Statement Analysis

Strategic Business Planning for Commercial Producers Measuring Financial Performance: How Do I Measure It?

Your Net Income Statement Gerry Schwab, Barbara Dartt, Sherrill Nott, & Roger Betz FIRM AoE Team.

AGEC 407 Income Statement Summary of revenue and expenses for a given accounting period Also called: –Operating Statement –Profit and Loss Statement Measures.

ND Farm & Ranch Business Management 2009 Region 3 Annual Report Steve Metzger Carrington Research Extension Center and Carrington Public Schools Carrington,

Business analysis of a custom farming operation June 23, 2009.

Jason Fewell, Dr. Kevin Dhuyvetter, Dr. Michael Langemeier National Farm Business Management Conference Fargo, ND June 14, 2010.

Improving Financial Performance: What Is the Payoff?

Missouri FBMA 2008 Analysis and Comparisons FBMA Record Summary 161 Farms Submitted Analysis –141 Included in Summary 56 with enterprise analysis.

Measuring Financial Performance: How Do I Measure It?

Financial Documentation Basics: How Do I get Started?

Missouri FBMA 2007 Analysis and Comparisons FBMA Record Summary 143 Farms Submitted Analysis –122 Included in Summary 53 with enterprise analysis.

Profitability and Economics of Northeast Organic Dairy Farms for 2005 Rick Kersbergen Tim Dalton Lisa Bragg University of Maine Bob Parsons Qingbin Wang.

Strategic Business Planning for Commercial Producers Improving Financial Performance: What Is the Payoff?

Long Term Profitability of Northeast Organic Dairy Farms Presented at the 2009 National Extension Risk Management Education Conference Reno, NV March 31-April.

Financial and Economic Terms. General Accounting and Financing Terms  Generally Accepted Accounting Principles (GAAP) – Concepts, philosophies and procedures.

Introduction to 2012 Census of Agriculture Data for Oklahoma Damona Doye Rainbolt Chair of Agricultural Finance Extension Economist.

Financial Analysis Chapter #3. Net Worth Statement (Balance Sheet) Net Worth = Assets - Liabilities Net Worth (Owner's equity)

Calculating Enterprise Net Margins Gross margins are a useful comparison but don’t always show if a crop is profitable. Net Margins include the total cost.

Annie’s Project January 30, 2007 Coweta Oklahoma

Income Statement – A Financial Management Tool. What is an Income Statement?  A financial statement that measures the profit or loss of a business for.

Farm Business Analysis—Ch.18 What are the strengths and weaknesses of the farm business? How can we measure how well the farm is doing?

Income Statement. Divide Yourselves According to What Your Are On An Income Statement. ► $ from sale of 4 calves ► $ Hay Bill ► $50.00 Vaccination.

Measuring & Analyzing Financial Performance. ANALYZING FINANCIAL POSITION AND PERFORMANCE Analyze Financial Statement information Learn two basic types.

Keith Torgerson, NDSCS. Farms in the Annual Red River Valley Annual Report FINAN, the analysis software, allows us to take a closer look at the farms.

Income Statements Uses ▸ Summarize revenues and expenses ▸ Determining profit or loss ▸ Explaining changes in owner equity ▸ Supporting Loan Application.

Strategic Business Planning for Commercial Producers Financial Documentation Basics: How Do I get Started?

Relative Cost Efficiency of No-Till Farms 2008 Ag Profitability Conference: McPherson Michael Langemeier January 15, 2008.

Farm-Level Data Use in Individual and Group Extension Settings 2005 AAEA Organized Symposium Michael Langemeier Professor Kansas State University.

2005 Red River Valley Farm Averages Ron Dvergsten, Dean Management Education Keith Torgerson, NDSCS.

Missouri FBMA 2011 Analysis and Comparisons FBMA Record Summary 153 Farms Submitted Analysis –151 Included in Summary 111 with enterprise analysis.

Does Grazing Lower My Cost of Production? Kenny Burdine University of Kentucky.

1 第九章投資報酬分析 — 損益表 Returns Analysis :The Income Statement (profit & loss statement)

Costs and returns project Congress decreed that USDA conduct cost of production (COP) studies for selected commodities National survey for 15 commodities.

Financial Statements Damona Doye OSU Extension Economist.

Budgets: Uses in Farm Management

Comparing Feed Costs of Wisconsin Dairy Systems From 1995 to 2010 Thomas S. Kriegl University of Wisconsin Center for Dairy Profitability University of.

ND Farm & Ranch Business Management 2010 Region 3 Annual Report Steve Metzger Carrington Research Extension Center and Carrington Public Schools Carrington,

Budgeting Tools Enterprise Budgeting Partial Budgeting

1 Enterprise Analysis l The analysis evaluates the income and costs as they were in the past l The analysis answers the question What was the profit gained.

1 RISING INPUT COSTS: IMPLICATIONS FOR CROP ROTATIONS AND CASH RENT LEVELS Gary Schnitkey.

FINANCIAL STATEMENT ANALYSIS

Enterprise Accounting: Key Questions Chapter 18 How are enterprises defined? How are income and expenses allocated by enterprise? How are internal transactions.

INCOME STATEMENT KEY CONCEPTS NET INCOME IS THE BEST MEASURE OF BUSINESS PERFORMANCE ACCRUAL NET INCOME IS A MORE ACCURATE MEASURE OF PROFITABILITY THAN.

Managing In Tough Times “Bits & Tips” Using Financial Records to Measure Farm Profitability.

Using Production Costs and Breakeven Levels to Determine Income Possibilities by Gary Schnitkey and Dale Lattz.

Missouri FBMA 2009 Analysis and Comparisons FBMA Record Summary 149 Farms Submitted Analysis –134 Included in Summary 71 with enterprise analysis.

Photo: United Soybean Board (Flickr) / Farm Financial Performance Measures ©2015 Rural Business Research- University.

Record Keeping and Cost Classification Parr Rosson Professor and Director Center for North American Studies Texas A&M University.

Managing With Tight Operating Margins Ron Haugen North Dakota State University Extension Service 2016 Extension Risk Management Educational National Conference.

Financial Performance Analysis Charles Brown Field Specialist - Farm Management

Farm Finance and Analysis: Part 2 National Farm Viability Conference Albany, NY May 22nd -24th Mark Cannella Web:

Tillage and Planting Cost Comparisons

Farm Business Analysis

2005 Red River Valley Farm Averages

Ag & Resource Economics

Farm Financial Statements

Record Keeping and Cost Classification

Characteristics of Top Producers

Financial Analysis Original Power Point created by Casey Osksa

Presentation transcript:

The Relative Cost Efficiency of No-Till Farms Michael Langemeier –Professor –Department of Agricultural Economics –Kansas State University 1

Objectives and Data Examine the relative efficiency of no-till farms in central Kansas. Kansas Farm Management Association (KFMA ) Data –Continuous data from 2003 to 2007 –To be designated as a no-till farm, a farm had to utilize a no- till production system for all of their crops –Farms categorized into two groups: No-till (73 farms) Reduced or conventional tillage (239 farms) 2

Kansas Farm Management Associations 3

Definitions Value of Farm Production –Sum of livestock, crop, and other income computed on an accrual basis minus accrual feed purchased. Net Farm Income –Return to operators labor, management, and equity (net worth) computed on an accrual basis. Less Tillage Index –Computed by dividing herbicide and insecticide cost by total crop machinery cost which includes repairs, fuel, auto expense, machinery and equipment depreciation, crop machine hire, and an opportunity interest charge on crop machinery and equipment investment. 4

Definitions Profit Margin –Computed by dividing net farm income plus cash interest paid minus opportunity charges on operator and family labor by value of farm production. Asset Turnover Ratio –Computed by dividing value of farm production by total farm assets. Technical Efficiency Index (ranges from 0 to 1) –Farms with an index of 1 are using the best available technologies and producing on the production frontier. Cost Efficiency Index (ranges from 0 to 1) –Farms with an index of 1 are producing at the lowest cost per unit of aggregate output. 5

Comparison of Tillage and No-Till Farms, Central Kansas Farm Characteristics No-TillMixed Tillage Value of Farm Production $360,109$266,618 Net Farm Income$74,432$53,114 Total Hectares Less Tillage Index

Comparison of Tillage and No-Till Farms, Central Kansas Financial Ratios and Efficiency No-TillMixed Tillage Profit Margin Asset Turnover Ratio Cost Efficiency Note: Technical Efficiency was not significantly different between the two groups of farms. 7

Comparison of Tillage and No-Till Farms, Central Kansas Income SharesNo-TillMixed Tillage Feed Grains Oilseeds Small Grains There was not a significant difference between hay and forage, beef, or dairy income shares. 8

Comparison of Tillage and No-Till Farms, Central Kansas Cost SharesNo-TillMixed Tillage Labor Seed Chemicals Capital There was not a significant difference between livestock and fertilizer cost shares. 9

Conclusions Summary –In addition to having a higher cost efficiency index, the no-till farms were larger, had a higher level of financial performance, produced relatively more feed grains and oilseeds, produced relatively less wheat, and more efficiently utilized their labor and capital inputs. Implications –Labor utilization –Management –Farm Size 10

Contact Information Contributor Site – Langemeier – 11