grain hauling rates per bushel 2020

Kansas Custom Rates 2018 Computing a Grain Storage Rental Rate For the week ending December 3, unshipped balances of wheat, corn, and soybeans totaled 57.8 million metric tons (mmt). The lack of control of harvest timing may result in added costs such as drying or lower revenue due to yield loss, as discussed previously. The three southern crops peanuts, long-grain rice, and seed cotton paid in the most years: peanuts at 100% of the time, long-grain rice at 89% of the time, and seed cotton at 78% of the time. Unfortunately, input costs rose dramatically this year, too, as inflation soaked the economy. Understanding the difference in the intent of the two reports, and acknowledging some differences in general assumptions (for example, fuel rate of $2.50 versus $2.63 per gallon), explains the potential differences in rates reported from each source. Alternatively, other sources of returns will be needed to justify owning a combine on lower acreage farms. Plastina, A., A. Johanns and O. Massman. $0.330. Review size of harvest machinery with acres and bushels harvested to ensure it is in line with farm size and production. 2020 The February price for all wheat, at $9.17 per bushel, is 69 cents higher than January and $3.34 higher than February 2021. The effective reference price is capped at 115% of the statutory reference price or $9.66 for soybeans (8.40 x 1.15 = 9.66). This is particularly problematic for farmers who cash-rent their ground for a fixed price. 2020 Both locations will continue to service the communities by way of their agronomy sales. As shown in Figure 3, ARC-CO made payments in the Great Plains, particularly in North and South Dakota. Reasons for requiring PLC for the purchase of SCO are difficult to rationalize. Grain storage was going to be tight, and many producers around the country were already investing in their own grain bins. Cost of production estimates, per bushel, for herbicide-tolerant soybeans are $8.89, $8.72 and $8.57 assuming 50, 56, and 62 bushels per acre, respectively. The 2019 and 2020 crop years by March 15, 2020, The 2022 crop year by March 15, 2022, and. You can see more of his work athttp://www.boycegroupinc.com/. Annually, Iowa State University surveys those who hire and/or perform custom farm services and compiles a report of results. Schnitkey, G., K. Swanson and N. Paulson. 2019: Wet weather impacted yields over much of the Midwest in 2019. PLC was instituted in the 2014 Farm Bill, and triggers payments when the market year average (MYA) price is below the statutory reference price. Nafziger, E. Test Weight and Yield: A Connection? Department of Crop Sciences, University of Illinois at Urbana-Champaign, October 3, 2003. Eliminating the requirement to select PLC for acreage to be eligible for the Supplemental Coverage Option (SCO) insurance program also is warranted. 3.5 cents per point of moisture, per bushel, removed above 24.0%, split on half points. Except for soybeans, payments occurred on average in 64% of the years across all crops (see Table 1). 0.6% of price/point above 5.0. Rubeck harbors no ill will toward the cooperative and said hes always liked their employees. eA@ ct1(qOJ=_V! , ypVCD_<9tZA O.kkJGQGMFR'/.~i*Aiqt/WOtOym]0|xC4K^tyQ4s#s0 %q04#7CT;X8;2K(oxFuI`=Q)6E;*pQi3p#34vAGN9#24X ,FKh`i44Y%ml'Y8o9(B>S{/ t In a letter sent to Clay City and Brazil grain customers by Ceres Solutions Cooperative CEO Jeffrey Troike dated August 12, producers were informed that: It has been determined that, due to the age and condition of our grain facilities, and also due to declining utilization, Ceres Solutions will no longer receive grain at the Clay City and Brazil locations as of December 31, 2021. Another elevator offers this service at Shelburne in Sullivan County, which is about 22 miles from Clay City. These rates are only intended as a guide. PLC has provided no payments for soybeans from 2014 through 2022. "The Agricultural Risk Coverage County Level (ARC-CO) Option in the 2018 Farm Bill." WebIndustrial Hemp Grain Production Budget Estimated costs per acre, conventional tillage, Pennsylvania, 2018 Item Quantity Unit Price Total Your Estimate Variable Costs Custom operations Soil test 1.0 acre $2.00 $2.00 Combine small grain 1.0 acre $33.10 $33.10 Grain hauling 320.0 bushel-mile $0.04 $12.80 &iyxuaAa[@&w,mZ2~_ns5F|>&OaBjM0ki]Qj)-6S3MVP7d\3U:>mfSWMPE>6`cd90fbA@b6n!-x LN=9g]Lzt3@W.SD;.K7Q? Harvest decisions may also be dependent on requirements of a landlord or business owner. Size and associated cost of the combine or grain cart are also factors. The farmdoc daily website falls under University of Illinois copyright and intellectual property rights. For example: Location A is offering $13.80/bu for equivalent allows producers to compare the Timing of harvest is also critical in cost management considerations. Absolutely, he said. Thats the main reason Im renting out my ground and quitting, said Rubeck, owner of 300 acres. Yields had to be well below benchmark yields before ARC-CO would make payments. Corn triggered in 56% of the years. Guidelines are available here. ALL RATES ARE SUBJECT TO CHANGE WITH MARKET CONDITIONS. These high percentages can be attributed to the fact that PLC made no payments on soybeans since its inception in 2014, and expectations for the marketing year average price to remain well above the reference price at the time of enrollment for both the 2021 and 2022 crop years. 1 0 obj Food grain: At 120.4, the index for February increased 4.8 percent from the previous month and 35 percent from a year ago. <> But this is just one more problem in whats been a complicated season across the world. For example, if the custom rate for chopping, hauling and storing silage is $10.00/ton, the value of the standing silage to the buyer is reduced to $41.23 - $10.00 = $31.23 per ton, or $624.60 per acre. This is subject to change with market conditions. Because of the capital investment needed for harvesting equipment, the decision on how to manage harvest operations will generally be a long-run decision. If you dont have a big cart and at least 2 combines, I charge $100/hour from the time you tell me to be there, until I get either home or to my next load. 420 W. Marion Unlike some field operations which may be performed on only a portion of acres, harvest operations will cover all harvestable acres, generally all planted acres on a farm. Depending on the farm size, number of farm operators, and where grain is transported out of the field, it can be cost effective to hire a custom grain hauler. Its already bottle-necked a little as it is, he said, noting this is why many of the bigger outfits simply haul their own grain greater distances, some all the way down to the barges near Evansville. A seemingly comparable figure is the rate for hauling to market five miles away with an average and median at $0.10 per bushel, and rates ranging from $0.05 per This decision may also be dependent on the amount of fall fieldwork and if those operations are performed by the farmer. With crop production and prices at levels that should have had folks excited and optimistic, many in the field are still weeding through problems great and small related to the COVID-19 pandemic. Webpreparation, hauling hay and livestock, and other custom work for fall operations. Improve the effective reference price mechanism by raising the factor on the Olympic moving average above 85% and/or increasing the limit on the payment factor above 115% of the statutory reference price. How much should I charge to haul grain locally? A seemingly comparable figure is the rate for hauling to market five miles away with an average and median at $0.10 per bushel, and rates ranging from $0.05 per bushel to $0.20 per bushel. Planting and drilling rates appear to have increased approximately 7% to 10%, and harvesting rates range from 3% to 25% higher in 2020 from 2018. For example, the cost of running a 320 horsepower combine on a 2,000-acre farm is $39.70 per acre for corn, equal to the cost of running a 540 horsepower combine on a 2,400-acre farm. grain elevator's closure the last Biodiesel, waste vegetable oil (wvo), and The decision to invest in more grain storage units on their own farms is a weighty one. farmdoc daily (10):147, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, August 11, 2020. The effective reference price is the maximum of the statutory reference price ($8.40 per bushel for soybeans) and 85% of the five-year Olympic average of MYA prices, lagged one year. The lack of historical payment support, even during a trade war which significantly impacted soybeans, suggests that PLC has been relatively ineffective at providing price risk management for soybeans. Moisture 1.4% shrink/point of moisture. And it never helps when a local grain elevator announces its intent to stop receiving grain. % 2021 Indiana Farm Custom Rates - Purdue University When it comes to outsourcing harvest operations, often this is the first choice for a number of reasons. From 2014 to 2023, the MYA price for soybeans has never been below $8.40 (see Figure 2). Estimating Grain Transportation Costs | Ag Decision Maker ", PLC and ARC-CO for Soybeans: Payments and Perspectives, 2014 Farm Bill: The Supplemental Coverage Option, The Price Loss Coverage (PLC) Option in the 2018 Farm Bill, ARC-CO: Background, Payments, and Perspectives for Corn, ARC-IC: Payment Examples and Revised 2019 ARC-IC Payment Calculator, The Agricultural Risk Coverage County Level (ARC-CO) Option in the 2018 Farm Bill, The Case for Looking at the ARC-IC (ARC-Individual) Program Option, Effective Reference Price Past and Future, Farmland Prices in Brazil More than Doubled in the Last Three Years, Department of Agricultural and Consumer Economics, Department of Agricultural, Environmental and Development Economics. Net corn export sales were 1.362 mmt, down 1 percent from the past week. Harvesting Corn: What Grain Moisture New WOTUS Rule on Hold for More Than Half of U.S. Machinery Costs: Harvest Operations. farmdoc Business Management, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, August 2019. 2021: The 2021 MYA price was $13.30, well above the 2021 ARC-CO benchmark price of $8.95. SCO is a crop insurance product providing county coverage above farm-level coverage (see farmdoc daily, February 27, 2014). And while interest rates for ag-lending are favorable right now, a sudden drop in crop prices could leave even the bigger farmers in the lurch. ARC-CO accounts for 86% and 85% of soybean base acre enrollment in 2021 and 2022. Rubeck said he made it a point to arrange for his land to be farmed next year by another family farmer, who may be able to pick up more ground yet as a result of this move. replacedby_title | Is Replaced By - Title, hastranslation_title | Has Translation - Title, usageconsiderations | Usage Considerations. 3 cents a point above 5.0%, Test Weight 1 cent from 53.9 51.0 This publication presents a summary of custom work and rental rates. Farmers who own and operate their own machinery for harvest operations are able to make these decisions and select an optimal harvest order and timing. Cost Management: Harvest Operations - farmdoc daily WebIf 1,000 bushels are hauled each trip, the price at the second location would have to be ($208 / 1,000 miles) = $.208 per bushel higher to make up for the greater hauling cost. In some areas it may be difficult to outsource, either based on availability of a custom operator, timeliness of completing the task, or not aligning properly with how the crops were planted. The quality of data is dependent on the cooperation received by producers as well as commercial custom operators. Ive heard more small farmers say theyre not going to continue farming after this year than any other in my 15 years in the ag business, Rubeck said. ,`~SH"XN endobj "ARC-IC: Payment Examples and Revised 2019 ARC-IC Payment Calculator." Farms that own a grain drying and storage facility may have additional incentive to do all harvest operations themselves. Web4.0 cents per point of moisture, per bushel, removed from 19.1 24.0%, split on half points. Wheat: To trigger in 67% of the years, soybeans statutory reference price would have to be above $10.10, 20% higher than the current statutory reference price. Alberta Roughly 60 percent of U.S. grain is transported by truck (according to USDAs Agricultural Marketing Service), and well-functioning roadways are essential to sustaining low transportation costs and the competitiveness of U.S. grain. It is generally most cost effective in the long-run to own and operate a combine and grain cart for corn and soybeans, but important that equipment to be scaled appropriately to the farm. %PDF-1.7 Unlike other field operations which are typically reported on a per acre basis, grain hauling is generally factored on a per bushel basis. Despite the drop in grain inspections, total rail deliveries of grain to U.S. ports remained strong; increasing 122 percent from last year and increasing 64 percent from the 3-year average in the last 4 weeks. The seeds can absorb moisture overnight, so timing of harvest within a day may be important (see Nafziger, September 16, 2017). Although the actual costs will vary from farm to farm, and are dependent on the number of acres and the size or capacity of the equipment used, the averages presented here can be used as a guide. = 28). Recently released crop budgets (farmdoc daily, August 4, 2020) project losses for corn and soybeans on Illinois farms, given current assumptions for 2021. On 1100 that would be 33 bushel X 6.50 that would be 215 -60 for WebAlberta custom rates survey : grain harvesting operations. Although it is likely easier to secure trucking when hauling direct to a market, in some areas custom trucking to a farm bin site is also possible. Im hearing a lot of that and Im seeing it, Litz said. Having a combine adequately sized for acres to be harvested is an important consideration when making harvest equipment decisions. Disclaimer: We request all readers, electronic media and others follow our citation guidelines when re-posting articles from farmdoc daily. "The Case for Looking at the ARC-IC (ARC-Individual) Program Option." USDA Releases Report Showing Manures Use By Crop, U.S., Five Other Ag Exporting Countries Say India Is Vastly Underreporting Its Wheat, Rice Subsidies, Ag Credit Tightens with Rising Interest Rates and Following Bank Collapses, Ideas Big and Small: Create a Culture of Creativity on Your Farm, Dust Bowl 2.0? I think it is a good time to borrow rate-wise, with some precautions. The desirable moisture level for harvested soybeans is 13% moisture. These include resurfacing, restoration, and rehabilitation projects on all National Highway System (NHS) roadways, including interstates. PLC and ARC-CO for Soybeans: Payments and Perspectives PLC and ARC-CO for Soybeans: Payments and Perspectives Another consideration is owning equipment that is sized appropriately for acres and production. Iowa State University custom farming surveys are useful for outsourcing decisions. According to the study, from 2018 to 2019, the average marginal cost per mile incurred by motor carriers decreased 9.3 percent to $1.65. But with a recent farm-related injury, young children at home, and a successful farm insurance brokerage to run, the added prospect of hauling his grain nearly 40 miles instead of 10 was just too much. Webcorn price, at $6.10 per bushel, is up 53 cents from last month and $1.35 from February 2021. As a result, the MYA had to be below the $8.40 statutory reference price for PLC to pay since its inception in 2014 through 2023. Drought in this area had a large negative impact on yields. endobj However, it may be a challenge to find a low cost custom harvester in some areas and this takes control over timing out of the farmers hands. The rate from PNW to Japan was $23.25 per mt, unchanged from the last available rate on December 3. On a 900 bushel load, that would give me 27 bushel. Typically combining costs are expressed on a per acre basis and run about $30.00 per acre ($0.20/bu @150 bu/acre). Grain transportation costs can be divided into two categories: ownership costs, which occur regardless of how much the truck or tractor is used, and operating costs, which vary directly with the number of miles driven. Also called fixed costs, include depreciation, interest, insurance, and licenses. The most significant appreciation in the land market in Brazil occurred in areas used for grain production, followed by sugar cane and coffee, according to the S&P Global Commodity Insights report (see Figure 1). 2 0 obj A number of assumptions are made to estimate economic costs for combining and grain cart, but cost of hauling grain is even more complex. Elevated autumn temperatures can lead to rapid grain moisture loss, with losses as great as 1% per day when temperatures are high and particularly when also breezy (see Nafziger, September 16, 2017). Since 1975 Alberta Agriculture & Rural Development has annually surveyed custom rates and rental rates to provide information to farmers and custom operators. Fall contracts and DP are shrunk to 15% moisture. For the week ending December 12, barge grain movements totaled 1,120,459 tons. When combines or grain carts are used on fewer acres than those referenced, the cost of operation rises. The effective reference price is the maximum of the statutory reference price ($8.40 per bushel for soybeans) and 85% of the five-year Olympic average of MYA prices, lagged one year. The views or opinions expressed in this article are those of the author and may not reflect those of AGDAILY. Swanson, K., G. Schnitkey, N. Paulson, C. Zulauf and J. Coppess. Table 1: Grain Transport Cost Indicators (xlsx) - Weekly changes in truck, rail, barge, and ocean freight rates using diesel prices, nearby secondary rail market rates, Illinois barge rates, and ocean freight rates from U.S. Gulf and PNW to Japan as proxies. To obtain the lowest costs, newer combines must be used on 1,500 acres or more per year. Clay County farmer and insurance agent Scot Rubeck said for him and a number of his neighbors, this will be the last growing season, and the lack of access to local grain elevators going forward is a major factor in that decision. There were no non-shuttle bids/offers this week. endobj The economic costs of owning and operating a grain cart exceed even the maximum reported custom rate for corn, and are near the upper end of custom rates reported for soybeans. And American producers responded in kind this year, with both corn and bean production up 3 percent and 5 percent, respectively, from 2020. Transportation costs run another $0.05 per bushel (for the first 10 miles to initial storage). Zulauf, C., G. Schnitkey, K. Swanson, N. Paulson and J. Coppess. The 2021 season may well be remembered as one where irony was the top crop harvested. However, mature soybeans can dry quickly, in a matter of hours, rather than days. And people are still quitting due to the costs.. Farmers who hire a custom operator may not be able to find an operator who can harvest in optimal timing, or may not be able to find an operator who is willing to switch between crops or follow an order of maturity. farmdoc daily(10):20,Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign,February 4, 2020. Theres no way to really blame them for making a business decision based on the numbers, but he feels matter-of-factly that irrespective of the reason, the end result here will be more consolidation and fewer small farmers. farmdoc daily (10):143, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, August 4, 2020. Corn: To trigger in 56% of the years, soybeans statutory reference price would have to be above $9.40, 16% higher than the current statutory reference price. The estimated machinery costs can also be useful when determining what equipment has the greatest economic return to the farm as compared to what it would cost to outsource the associated task. Inputs are going to be significantly higher next year. With a larger machine harvest could progress faster, but the cost is an extra $6 per acre. They are not to be interpreted as the rates you must charge or pay. Grain Hauling Average 0.6% of price/point 10.1 and above. WebThe total number of bushels in one load can not exceed 1,200. due to weight restrictions per load imposed by the Tennessee Department of Transportation (80,000 lb maximum). The goal is to report what is being charged, not what should be charged. 2020 Nebraska Agricultural Custom Rates with WebWHEREAS, on April 14, 2020, due to the increased unemployment rates and continued shelter-in-place Orders, the City Council approved by Resolution extending to May 31, Machinery Cost Estimates: Harvesting - farmdoc
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