Profitability vs. Feasibility and the Paradox of Purchasing Farmland

Profitability implies that the present value of the return flows over the life of the investment is greater than the present value of the cost flows over the life of the investment, where present value is the discounted (current) value of the flows. The cash inflows include annual returns from the investment, tax savings from depreciation and interest, and the salvage value, or selling price, of the asset at the conclusion of the investment.
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September Dairy Budget

September milk productions returns for the NE-IA budget improved compared to August. On the 20,000 pound budget, total feed cost annual declined by $38 and income rose by $48 for a total improvement of $86 or about $0.10 per cow per day. The improved income came from higher butterfat production and price even though protein price declined. Soybean meal price decline contributed the most to feed cost declines while corn price added a little as well.
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Cash Rent Flex-Calc

The Cast Rent Flex-Calc is an Excel spreadsheet designed to help landowners and tenants set up terms for using a base rental rate with bonus to adjust cash rental rates for price or revenue fluctuations. Users must have Microsoft Excel or a compatible program to use the decision aid.
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August Dairy Budget

Below is a link to the budget for milk produced in August 2015. This budget showed improvement compared to July by as much as 49 cents per cwt. The 24,000 pound budget showed recovery of all costs including labor and management while the same budget did not in July. The 20,000 pound freestall budget showed only 26 cents per cwt. short of capturing all costs, due to a drop of $90 per cow in feed costs with income increasing by $21. The 24,000 pound budget had $26 more income per cow and $122 less feed cost.

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A Historical Comparison of Heifer Replacement Costs

The value of heifer replacements is an interesting question which is affected by time (e. g. future cattle prices), animal longevity and the individual production and management system of the cow-calf producer. If we ignore the differences among producers we can study the effects that price and longevity have on the net value of replacement animals.
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Annual Forage Insurance Plan Available

The Rainfall Index – Annual Forage Insurance Plan is a new pilot insurance program from the USDA – Risk Management Agency (RMA). It was first offered in 2014 for the states of Nebraska, North Dakota, South Dakota, Kansas, Oklahoma, and Texas and has expanded to Colorado for 2016. The Annual Forage Insurance Plan is designed to meet the production risk management needs of producers planting annual forage crops for use as livestock feed or fodder. This includes but is not limited to grazing, haying, grazing/haying, grain/grazing, green chop, grazing/green chop, or silage.
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Working With Your Banker

Commercial ag bankers are in the business of making loans. But not just any loans. They want to make good loans. A good loan is somewhat subjective, but there are many factors that lenders evaluate to help them decide if you will be able to pay back both the principal and the interest, as well as maintain a mutually profitable, long-term business relationship.
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Farm Lease Termination

Dave Aiken, Agricultural and Water Law Specialist, has prepared a handout discussing how farm leases may legally be terminated.
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Syngenta Lawsuit: Who Will Win?

The following is a radio transcript of Professor Dave Aiken discussing a lawsuit against Syngenta. Audio available here.

In November 2013 China blocked US corn imports if the corn had traces of
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July 2015 Dairy Budget

The net per cow per cwt. has improved compared to the June budget. The July budget shows that 24,000 lb. milk sales per cow met all costs of production and earned $0.76 per cwt or $206.97 annually. But that was the only budget that did. All other lost money when calculated for all costs. But all budgets did cash flow.
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