With about 450 acres of corn and soybeans each, Dave Mitchell and Jerry Reichert might be considered small farmers in today's world. But that doesn't mean their production costs are proportionately any lower than a five-section farmer.
To help cut harvest costs and preserve their labor outlays, the two Nebraskans joined a third grower in leasing a late-model combine from a custom harvester.
The savings were big considering that hiring their corn and soybeans custom harvested would have cost $25/acre or more. Also, repairing their older combines would have cost $3,000-5,000 each, with no guarantees they would make it through the final turn row.
“Jerry and I had talked about leasing a combine together for a couple of years,” says Mitchell, Elm Creek, NE. “But some dealers don't want to lease any more (especially for low hour usage). They would just as soon sell them.”
The two contacted a custom harvester Reichert knew. He advised them of several other custom crews. But the minimum separator hours for that type of lease was 100.
“We figured we only had 70 separator hours between us,” says Mitchell. “Then we found out that another area grower, Emmett Bosshammer, was also interested in the idea. With his production, we put together more than 100 hours.”
The grower-trio obtained the John Deere 9610 combine in plenty of time for harvest. However, they had to provide their own headers. Mitchell bought a flex header for soybeans and Reichert bought the corn header.
The three growers, along with Bosshammer's son-in-law John Herrick, helped each other with harvesting chores. Their efforts together provided an average harvest rate of about 10 acres/separator hour of combine usage.
“We kept track of the hours for each farm,” says Mitchell. “We pooled our other equipment and manpower for other field work, too.”
Mitchell and Reichert also sold their older combines to help offset some of the lease charges. The lease cost ran roughly $4,500 for each grower, based on combining about 10 acres/hour at a cost of $100/separator hour.
The growers were able to hold their harvest costs to about $10/acre. That was much lower than the $25/acre, or $11,000-plus for 450 acres custom harvested.
“Leasing is the way to go if you are small,” says Reichert. “There's no property tax, no depreciation and few repairs.”
Mitchell hopes they'll do it again in 2006. “If you can pool your equipment and your labor, a deal like this really works.”