ISSUE #508

508 - Grower Cost Benchmarking

3-28-08

The 2007 grower cost benchmarking was the 5th year the Agriculture Department has analyzed grower costs of production on a detailed basis. Intent was to assist growers to evaluate profitability of their sugarbeet enterprise on a field-by-field basis.

Grower Cost Benchmarking Objectives

  • Determine input cost differences
  • Compare size of operation
  • Compare high versus low revenue
  • Establish trends
  • Increase on-farm profit
  • Look for areas of improvement
  • Do break even analysis
  • Compare fields - identify problem fields

Grower Demographic Trends

  • American Crystal Sugar Company has 113 fewer growing units than in 2003.
  • American Crystal Sugar Company small grower average acreage increased by 20 acres, medium growers by 54 acres and large growers average acres increased by 158 acres since 2003.

Herbicide Pricing Trends - The Good News

  • Moorhead generally paid the least and Hillsboro and Crookston the most
  • Medium sized farms tended to pay more than large or small size farms
  • Herbicide prices have declined by 30-35 percent since 2003, figure 1.

508.1

Fertilizer Pricing Trends - The Bad News

  • Drayton growers paid 5 to 10% more for fertilizer - possibly higher freight
  • Large growers tended to pay less for starter but more for Urea and MAP
  • Fertilizer prices trended upward from 2003 - 2006, declined slightly in 2007 but have increased drastically for 2008, figure 2.

508.2

Weed Control Costs - 2007

  • Costs were greatest in Hillsboro and Drayton
  • Costs were lowest in Crookston and East Grand Forks

2007 Cost Per Acre

InputMinimumAverageMaximum
Total Seed 41.19 57.37 78.08
Total Fertilizer 17.65 44.46 87.20
Total Insecticide 4.21 13.31 29.37
Total Herbicide 18.52 66.79 147.95
Total Fungicide 12.53 35.86 56.82
    
Total Input Costs 166.95 244.07 360.00
Total Field Operations 173.28 233.52 304.04
Total Costs 399.43 492.59 643.47

(Individual input values are the minimum, average and maximum values of all participants. Adding the input values together will not equal the totals line as these are also averages for all participants).

For more information on all aspects of the 2007 Grower Cost Benchmarking summary go to www.crystalsugar.com. Much more information is available that will give insights into your sugarbeet enterprise. Contact your agriculturist or Greg Richards at grichard@cyrstalsugar.com if you have additional questions.

Contact your agriculturist to sign up for 2008.