As would be expected with increasing fuel costs, average 2011 custom rates for farm work have a1so risen, compared to 2010 and 2009 custom rates. Most custom rates for farm work in 2011 are listed at 3-6% above the rates a year earlier, with an average increase of about 4%. In addition to higher fuel costs, increasing cost for new and used machinery is also a factor in the higher custom rates.
These results are based on the annual Iowa Farm Custom Rate Survey coordinated and analyzed by Iowa State University. The survey sampled 179 custom operators, farm managers and ag lenders on what they expected 2011 custom farm rates to be for various farm operations. The survey summary lists the average custom rate and the range for various tillage, planting, fertilizer and chemical application, grain harvesting and forage harvesting functions on the farm. The survey also includes many miscellaneous faming practices, lists average machine rental rates for some equipment, and includes a formula for estimating average machinery rental rates. Also listed are average custom farming rates for corn, soybeans and wheat. Over the years, the average custom rates for farm operations in southern and western Minnesota has been very close to the average Iowa custom rates. The complete 2011 “Iowa Farm Custom Rate Survey” is available as a pdf download.
All listed custom rates in the Iowa survey results include fuel and labor, unless listed as rental rates or otherwise specified. The average price for diesel fuel assumed for the quoted custom rates was $2.75/gal. A fuel price increase of 50¢/gal. would cause most custom rates to increase by approximately 5%.
These average rates are only meant to be a guide for custom rates, as actual custom rates charged may vary depending on further increases in fuel costs, availability of custom operators, timeliness, field size, etc. Following are the average custom rates for some common farming practices for 2011, based on the Iowa Farm Custom Rate Survey.
Custom Farming Rates (includes tillage, planting and harvesting costs)
Editor’s note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at email@example.com.