FEWER ACRES, MORE COSTS

Oct 1, 2003 12:00 PM, Compiled By Greg Lamp

Large grain farms have lower per-acre costs than smaller grain farms, up to 1,000 acres, says Gary Schnitkey, University of Illinois farm management specialist.

Based on the Farm Business Farm Management Association record-keeping program, Schnitkey and co-author Dale Lattz found that per-acre costs for farm sizes in categories less than 800-1,200 acres are higher than for larger farm size categories.

“Average total costs are the same for farms of more than 1,200 acres,” says Schnitkey. “Once farms reach 1,200 acres we find no evidence that per acre costs decrease with increased farm sizes.

“However, in our opinion, it's unlikely that farms between 4,000 and 10,000 acres have significant per acre cost advantages over farms between 1,200 and 4,000 acres.”

The data does not support one common-held belief that large farms have better purchasing power than smaller farms. “Our data does not support this contention because costs are relatively constant across farm sizes,” says Schnitkey. “In particular, crop costs remain constant across larger farm sizes suggesting that farmers do not have purchasing power with fertilizer, seed or pesticide inputs.”

Get Copyright ClearanceWant to use this article? Click here for options!
© 2010 Penton Media, Inc.


Acceptable Use Policy blog comments powered by Disqus

Most Recent Story

View the Ed Usset Exam Archive *New

Weather

Continuing Education

Click here to view more courses


Accredited for 2 Units CCA Soil/Water Management:

(New Course)
Agronomic Principles and Efficient Chemigation and Fertigation Using Center Pivot/Linear Sprinkler Systems

This online CE course details sound mechanical irrigation design and management practices to allow efficient chemigation and fertigation.

Back to Top

Browse Back Issues

Related Sites