I was alerted to something posted by a member at another forum this evening. He's a hobby farmer rather than commercial, but has been facing many of the same problems the article was talking about. Interesting how in such circumstances as they have now, weather may play a make-or-break role in whether they even turn a profit or not, as one of the farmers in the article was saying.
Excerpts from the thread, entitled "Stuck Between Rock And Hard Place":
This year when I pre-ordered my fertilizer I was hit with the realization that the price was 4x higher than it was for the same fertilizer last year. I couldn't see spending that much on fertilizer and hoping the price would remain high enough to cover that cost so I ordered 1/2 as much, which is still very expensive, hoping it will give my wheat a boost and maintain some of my product quality. Fuel prices are more than double what they were last year so that too is adding to the challenge...
To give some idea of what the future looks like for me this year I'll share what my wheat looks like.
I farm a total of about 60 acres. I have 10 acres of hay ground and I rotate wheat and soybeans on the remaining 50 acres. This year, I'm planting 30 acres of wheat and 20 acres of soybeans.
If I purchased the same amount of fertilizer per acre for my wheat as I did last year, it would have cost me over $6,000.00 but I chose to purchase 1/2 the amount. Here's my anticipated input costs for 2022 so far for wheat.
Seed: $950.95. It would have been more but I had about 9 bags of seed (about 4 acres coverage) left over from last year.
Fertilizer: $3,109.07. This is misleading because that amount was for about 212 lbs. per acre but because it got so late and I expect additional yield losses I decided to reduce it to 150 lbs per acre. So the actual cost per acre applied was $2,198.11. Since I prepaid for the fertilizer, I still have the remainder on my account and will be able to apply it to herbicide later on.
Herbicide: $1,680.00 (est.) Not purchased yet but I have heard that glyphosate has increased about 300% since last year. I don't use glyphosate on my wheat. I use 2,4-D and another chemical to help control foxtail grasses. Last year it cost me about $28.00 per acre and assuming the cost will be double this year I'm preparing for $56.00 per acre for the herbicide. I am going to have to purchase that soon and hopefully I can get what I need.
Harvest: $750.00 (est.) I hire my neighbor to swath and combine my wheat. We help each other quite a bit with things both related to farming and not related to farming so he gives me a pretty good deal at about $25.00 per acre. If I hired anyone else I'm sure it would cost a bit more.
Fuel: $460.00 I use about 175 gallons of diesel fuel per year in my farming. Haying doesn't use very much so I estimate only about 8% used for haying. I just checked the price for farm diesel and was told it is $4.75 per gallon. Thirty acres is 60% of my crop ground so I used that to calculate my estimated fuel cost for wheat.
Gasoline: $41.00 My grain truck runs on gasoline and gets about 6 miles per gallon loaded (about 400 bushel) so I used 8mpg average. I sell my wheat to a place 20 miles away so with only 65% yield I will probably need two trips (80 miles) or about 10 gallons of gasoline. The price of gasoline at the pump today is $4.10 so that's where I came up to $41.00.
Maintenance: This cost varies quite a bit from year to year depending on what I run into. My equipment is old so things do break down. I didn't put a figure on this because the amount is too volatile to make a reasonable estimate.
$950.95 + $2198.11 + $1680.00 + $750.00 + $460.00 + $41.00 = $6,080.06.
Estimating a 35% drop in yield and assuming I get no deductions for quality (yeah, right!) I'm looking at a yield of about 780 bushels before discounts. I just checked the cash price for wheat at my buyer's and it is about double what it was last year at $12.25 per bushel. 780 X $12.25 = $9,555.00.
With the late planting I can expect my protein will be low. That happens when wheat is rushed to maturity due to higher temperatures in late July and August. I have experienced as much as $3.50 dockage for protein as little as 2% below premium. If I get docked that much this year we can subtract 780 X $3.50 = $2,730.00 leaving me with a gross income of $6,825.00.
Three years ago I had a really bad year. It was a wet year and the protein was down 3% below premium, test weight was low, had some mold, and a vomitoxin. By the time it was done, I was paid $650.00 for all my wheat. The seed alone that year cost me more than that. I lost money that year and was lucky to be able to sell the wheat at all.
If my estimate is even close I can look forward to making about $750.00 from my wheat. Of course my estimate doesn't include maintenance, repairs, misc. supplies, grain truck insurance and licensing, etc... (and) Let's not forget that I will have to buy seed for next year from this.
Stuck Between Rock and Hard Place
Excerpts from the thread, entitled "Stuck Between Rock And Hard Place":
This year when I pre-ordered my fertilizer I was hit with the realization that the price was 4x higher than it was for the same fertilizer last year. I couldn't see spending that much on fertilizer and hoping the price would remain high enough to cover that cost so I ordered 1/2 as much, which is still very expensive, hoping it will give my wheat a boost and maintain some of my product quality. Fuel prices are more than double what they were last year so that too is adding to the challenge...
To give some idea of what the future looks like for me this year I'll share what my wheat looks like.
I farm a total of about 60 acres. I have 10 acres of hay ground and I rotate wheat and soybeans on the remaining 50 acres. This year, I'm planting 30 acres of wheat and 20 acres of soybeans.
If I purchased the same amount of fertilizer per acre for my wheat as I did last year, it would have cost me over $6,000.00 but I chose to purchase 1/2 the amount. Here's my anticipated input costs for 2022 so far for wheat.
Seed: $950.95. It would have been more but I had about 9 bags of seed (about 4 acres coverage) left over from last year.
Fertilizer: $3,109.07. This is misleading because that amount was for about 212 lbs. per acre but because it got so late and I expect additional yield losses I decided to reduce it to 150 lbs per acre. So the actual cost per acre applied was $2,198.11. Since I prepaid for the fertilizer, I still have the remainder on my account and will be able to apply it to herbicide later on.
Herbicide: $1,680.00 (est.) Not purchased yet but I have heard that glyphosate has increased about 300% since last year. I don't use glyphosate on my wheat. I use 2,4-D and another chemical to help control foxtail grasses. Last year it cost me about $28.00 per acre and assuming the cost will be double this year I'm preparing for $56.00 per acre for the herbicide. I am going to have to purchase that soon and hopefully I can get what I need.
Harvest: $750.00 (est.) I hire my neighbor to swath and combine my wheat. We help each other quite a bit with things both related to farming and not related to farming so he gives me a pretty good deal at about $25.00 per acre. If I hired anyone else I'm sure it would cost a bit more.
Fuel: $460.00 I use about 175 gallons of diesel fuel per year in my farming. Haying doesn't use very much so I estimate only about 8% used for haying. I just checked the price for farm diesel and was told it is $4.75 per gallon. Thirty acres is 60% of my crop ground so I used that to calculate my estimated fuel cost for wheat.
Gasoline: $41.00 My grain truck runs on gasoline and gets about 6 miles per gallon loaded (about 400 bushel) so I used 8mpg average. I sell my wheat to a place 20 miles away so with only 65% yield I will probably need two trips (80 miles) or about 10 gallons of gasoline. The price of gasoline at the pump today is $4.10 so that's where I came up to $41.00.
Maintenance: This cost varies quite a bit from year to year depending on what I run into. My equipment is old so things do break down. I didn't put a figure on this because the amount is too volatile to make a reasonable estimate.
$950.95 + $2198.11 + $1680.00 + $750.00 + $460.00 + $41.00 = $6,080.06.
Estimating a 35% drop in yield and assuming I get no deductions for quality (yeah, right!) I'm looking at a yield of about 780 bushels before discounts. I just checked the cash price for wheat at my buyer's and it is about double what it was last year at $12.25 per bushel. 780 X $12.25 = $9,555.00.
With the late planting I can expect my protein will be low. That happens when wheat is rushed to maturity due to higher temperatures in late July and August. I have experienced as much as $3.50 dockage for protein as little as 2% below premium. If I get docked that much this year we can subtract 780 X $3.50 = $2,730.00 leaving me with a gross income of $6,825.00.
Three years ago I had a really bad year. It was a wet year and the protein was down 3% below premium, test weight was low, had some mold, and a vomitoxin. By the time it was done, I was paid $650.00 for all my wheat. The seed alone that year cost me more than that. I lost money that year and was lucky to be able to sell the wheat at all.
If my estimate is even close I can look forward to making about $750.00 from my wheat. Of course my estimate doesn't include maintenance, repairs, misc. supplies, grain truck insurance and licensing, etc... (and) Let's not forget that I will have to buy seed for next year from this.
Stuck Between Rock and Hard Place
