Crop Profitability Calculator

Note: This material including spreadsheets and all of the information it contains
are provided "as is" without warranty of any kind, whether express or implied. All
implied warranties, including, without limitation, implied warranties of
merchantability, fitness for a particular purpose, and non-infringement, are
hereby expressly disclaimed.
Designed for grain, oilseed, pulse and forage seed farms.

What it can do! This calculator will assist the user in calculating the following:

1) Contribution margin on each crop, on a per acre basis, as well as the total
farm. - Contribution margin is the amount of cash left after all the variable
production costs have been paid for. It is the amount of money left over to
cover all fixed costs like interest, insurance and depreciation.
2) Fixed costs per acre and for the total farm. Fixed costs are all costs that can
not be easily attributable to a specific crop. They are usually depreciation,
interest, general insurance, land taxes, rent, and general office overhead.
3) Net Farm Income This is the income left after all costs are covered.
4) Return on equity This is the percentage return on the equity invested into
the farm business.
5) Return on investment - This is the percentage return on the total investment
in the farm business.
6) Sensitivity analysis, which shows how sensitive profitability, is to changes in
crop prices and production costs.


How do you use it!

There are 10 linked spreadsheets. Eight of them are specific to a crop and calculate the
contribution margin for each crop. The ninth spreadsheet calculates net income and the
return on investment and equity. The last one shows how sensitive profitability is to
changes in crop prices and production costs.

All shaded cells within the spreadsheets are able to take input from the user. All non-
shaded cells are calculated by the program or are static in nature. By holding the pointer
upon a shaded cell a brief description will be provided to assist the user in identifying
what is required.

Start with the first spreadsheet, which is wheat, and move through them in order. Only
use the crop specific spreadsheets that are required to reflect what is being produced on
the farm. Spreadsheet number 7 & 8 are not labeled and can be used for any crop not
specifically identified on its own spreadsheet.

Spreadsheet # 9, or the one called Total Farm, gets most of its information from the
crop specific spreadsheets but it does provide cells for 13 new inputs. For accuracy in
the results these cells should be completed even if the required number is 0.

Crop Profitability Calculator
Note: This material including spreadsheets and all of the information it contains
are provided "as is" without warranty of any kind, whether express or implied. All
implied warranties, including, without limitation, implied warranties of
merchantability, fitness for a particular purpose, and non-infringement, are
hereby expressly disclaimed.
Designed for grain, oilseed, pulse and forage seed farms.

What it can do! This calculator will assist the user in calculating the following:

1) Contribution margin on each crop, on a per acre basis, as well as the total
farm. - Contribution margin is the amount of cash left after all the variable
production costs have been paid for. It is the amount of money left over to
cover all fixed costs like interest, insurance and depreciation.
2) Fixed costs per acre and for the total farm. Fixed costs are all costs that can
not be easily attributable to a specific crop. They are usually depreciation,
interest, general insurance, land taxes, rent, and general office overhead.
3) Net Farm Income This is the income left after all costs are covered.
4) Return on equity This is the percentage return on the equity invested into
the farm business.
5) Return on investment - This is the percentage return on the total investment
in the farm business.
6) Sensitivity analysis, which shows how sensitive profitability, is to changes in
crop prices and production costs.


How do you use it!

There are 10 linked spreadsheets. Eight of them are specific to a crop and calculate the
contribution margin for each crop. The ninth spreadsheet calculates net income and the
return on investment and equity. The last one shows how sensitive profitability is to
changes in crop prices and production costs.

All shaded cells within the spreadsheets are able to take input from the user. All non-
shaded cells are calculated by the program or are static in nature. By holding the pointer
upon a shaded cell a brief description will be provided to assist the user in identifying
what is required.

Start with the first spreadsheet, which is wheat, and move through them in order. Only
use the crop specific spreadsheets that are required to reflect what is being produced on
the farm. Spreadsheet number 7 & 8 are not labeled and can be used for any crop not
specifically identified on its own spreadsheet.

Spreadsheet # 9, or the one called Total Farm, gets most of its information from the
crop specific spreadsheets but it does provide cells for 13 new inputs. For accuracy in
the results these cells should be completed even if the required number is 0.

246450283.xls.ms_office
Wheat
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 45
3) Expected Market Price per Bushel 4.50
4) Total Wheat Acres 400
Total Per Acre Per Bus.
Production Value
Wheat Value $81,000.00 $202.50 $4.50
Misc $2,000.00 $5.00
TOTAL $83,000.00 $207.50 $4.61
Costs
Seed $5,000.00 $12.50
Fertilizer 60 lbs Nitrogen $9,600.00 $24.00
30 lb Phosphorus $3,480.00 $8.70
Other $720.00 $1.80
Pesticides $8,000.00 $20.00
Hail/crop Ins. $2,600.00 $6.50
Fuel, Oil & Lube $3,360.00 $8.40
Machinery Repairs $4,160.00 $10.40
Building Repairs $600.00 $1.50
Custom Work $800.00 $2.00
Hired Labor $1,200.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $1,086.80 $2.72
TOTAL DIRECT EXPENSES $40,606.80 $101.52 $2.26
CONTRIBUTION MARGIN $42,393.20 $105.98 $2.36
Page 3
246450283.xls.ms_office
Barley
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 70
3) Expected Market Price per Bushel 2.40
4) Total Barley Acres 200
Total Per Acre Per Bus.
Production Value
Barley Value $33,600.00 $168.00 $2.40
Misc $1,000.00 $5.00
TOTAL $34,600.00 $173.00 $2.47
Costs
Seed $2,000.00 $10.00
Fertilizer 60 lb Nitrogen $4,800.00 $24.00
30 lb Phosphorus $1,740.00 $8.70
Other $360.00 $1.80
Pesticides $4,000.00 $20.00
Hail/crop Ins. $1,000.00 $5.00
Fuel,Oil & Lube $1,680.00 $8.40
Machinery Repairs $2,080.00 $10.40
Building Repairs $300.00 $1.50
Custom Work $400.00 $2.00
Hired Labor $600.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $521.40 $2.61
TOTAL DIRECT EXPENSES $19,481.40 $97.41 $1.39
CONTRIBUTION MARGIN $15,118.60 $75.59 $1.08
Page 4
246450283.xls.ms_office
Oats
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 80
3) Expected Market Price per Bushel 2.00
4) Total Oat Acres 200
Total Per Acre Per Bus.
Production Value
Oats Value $32,000.00 $160.00 $2.00
Misc $1,000.00 $5.00
TOTAL $33,000.00 $165.00 $2.06
Costs
Seed $2,000.00 $10.00
Fertilizer 60 lb Nitrogen $4,800.00 $24.00
30 lb Phosphorus $1,740.00 $8.70
Other $360.00 $1.80
Pesticides $1,500.00 $7.50
Hail/crop Ins. $1,100.00 $5.50
Fuel,Oil & Lube $1,680.00 $8.40
Machinery Repairs $2,080.00 $10.40
Building Repairs $300.00 $1.50
Custom Work $400.00 $2.00
Hired Labor $600.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $455.40 $2.28
TOTAL DIRECT EXPENSES $17,015.40 $85.08 $1.06
CONTRIBUTION MARGIN $15,984.60 $79.92 $1.00
Page 5
246450283.xls.ms_office
Canola
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 30
3) Expected Market Price per Bushel 7.40
4) Total Canola Acres 400
Total Per Acre Per Bus.
Production Value
Canola Value $88,800.00 $222.00 $7.40
Misc $0.00
TOTAL $88,800.00 $222.00 $7.40
Costs
Seed $7,200.00 $18.00
Fertilizer 70 lbs Nitrogen $11,200.00 $28.00
35 lbs Phosphorus $4,400.00 $11.00
Other $2,000.00 $5.00
Pesticides $10,000.00 $25.00
Hail/crop Ins. $4,000.00 $10.00
Fuel,Oil & Lube $3,360.00 $8.40
Machinery Repairs $4,160.00 $10.40
Building Repairs $600.00 $1.50
Custom Work $800.00 $2.00
Hired Labor $1,200.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $1,345.30 $3.36
TOTAL DIRECT EXPENSES $50,265.30 $125.66 $4.19
CONTRIBUTION MARGIN $38,534.70 $96.34 $3.21
Page 6
246450283.xls.ms_office
Peas
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 40
3) Expected Market Price per Bushel 4.00
4) Total Pea Acres 100
Total Per Acre Per Bus.
Production Value
Peas Value $16,000.00 $160.00 $4.00
Misc $500.00 $5.00
TOTAL $16,500.00 $165.00 $4.13
Costs
Seed $3,000.00 $30.00
Fertilizer 0 lbs Nitrogen $0.00 $0.00
50 Lbs Phosphorus $870.00 $8.70
Other $180.00 $1.80
Pesticides $2,500.00 $25.00
Hail/crop Ins. $800.00 $8.00
Fuel,Oil & Lube $840.00 $8.40
Machinery Repairs $1,040.00 $10.40
Building Repairs $150.00 $1.50
Custom Work $200.00 $2.00
Hired Labor $300.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $271.70 $2.72
TOTAL DIRECT EXPENSES $10,151.70 $101.52 $2.54
CONTRIBUTION MARGIN $6,348.30 $63.48 $1.59
Page 7
Forage Seed
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Lbs. ) 400
3) Expected Market Price per Bushel 0.40
4) Total Forage Seed Acres 150
Total Per Acre Per LB.
Production Value
Forage Seed Value $24,000.00 $160.00 $0.40
Misc $1,500.00 $10.00
TOTAL $25,500.00 $170.00 $0.43
Costs
Seed $0.00
Fertilizer 50 Lbs Nitrogen $3,000.00 $20.00
50 Lbs Phosphorus $1,305.00 $8.70
Other $0.00 $0.00
Pesticides $1,200.00 $8.00
Hail/crop Ins. $750.00 $5.00
Fuel,Oil & Lube $450.00 $3.00
Machinery Repairs $1,200.00 $8.00
Building Repairs $225.00 $1.50
Custom Work $300.00 $2.00
Hired Labor $450.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $244.20 $1.63
TOTAL DIRECT EXPENSES $9,124.20 $60.83 $0.15
CONTRIBUTION MARGIN $16,375.80 $109.17 $0.27
Page 6
Other Crop 1 Corn
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 120
3) Expected Market Price per Bushel 2.30
4) Total Crop 1 Acres 100
Total Per Acre Per Bus.
Production Value
Crop 1 Value $27,600.00 $276.00 $2.30
Misc $0.00 $0.00
TOTAL $27,600.00 $276.00 $2.30
Costs
Seed $1,000.00 $10.00
Fertilizer 100 lbs Nitrogen $2,800.00 $28.00
50 Lbs Phosphorus $870.00 $8.70
Other $0.00 $0.00
Pesticides $1,500.00 $15.00
Hail/crop Ins. $600.00 $6.00
Fuel,Oil & Lube $1,000.00 $10.00
Machinery Repairs $900.00 $9.00
Building Repairs $150.00 $1.50
Custom Work $200.00 $2.00
Hired Labor $300.00 $3.00
Misc $0.00 $0.00
Misc $0.00 $0.00
Operating Interest 5.50% $256.30 $2.56
TOTAL DIRECT EXPENSES $9,576.30 $95.76 $0.80
CONTRIBUTION MARGIN $18,023.70 $180.24 $1.50
Page 7
Other Crop 2 Soybeans
Assumptions
1) Higher level of inputs
2) Yield Per Acre ( Bushel ) 40
3) Expected Market Price per Bushel 5.00
4) Total Crop 2 Acres 100
Total Per Acre Per Bus.
Production Value
Crop 2 value $20,000.00 $200.00 $5.00
Misc $0.00 $0.00
TOTAL $20,000.00 $200.00 $5.00
Costs
Seed $1,200.00 $12.00
Fertilizer Nitrogen $0.00 $0.00
50 lbs Phosphorus $1,000.00 $10.00
Other $300.00 $3.00
Pesticides $1,600.00 $16.00
Hail/crop Ins. $600.00 $6.00
Fuel,Oil & Lube $1,000.00 $10.00
Machinery Repairs $900.00 $9.00
Building Repairs $125.00 $1.25
Custom Work $200.00 $2.00
Hired Labor $300.00 $3.00
Misc $0.00
Misc $0.00
Operating Interest 5.50% $198.69 $1.99
TOTAL DIRECT EXPENSES $7,423.69 $74.24 $1.86
CONTRIBUTION MARGIN $12,576.31 $125.76 $3.14
Page 8
246450283.xls.ms_office
Estimated Farm Profitability
Grain Farm - Projected Accrual Income Statement
Assumptions
1) Machinery investment per acre $275.00
2) Building investment per acre $75.00
3) Land value per acre $600.00
4) Long term debt per acre $300.00
5) Ave. interest on long term debt 8.50%
6) Operating loan interest rate 5.50%
7) Building depreciation rate 5.00%
8) Machinery depreciation rate 15.00%
9) Value of family labour $30,000.00
Production Value Total Value Per Acre Seeded Acres
Wheat $83,000.00 $207.50 400
Barley $34,600.00 $173.00 200
Oats $33,000.00 $165.00 200
Canola $88,800.00 $222.00 400
Peas $16,500.00 $165.00 100
Forage Seed $25,500.00 $170.00 150
Corn $27,600.00 $276.00 100
Soybeans $20,000.00 $200.00 100
TOTAL $329,000.00 $199.39 1650
Variable Costs
Seed $21,400.00 $12.97
Fertilizer Nitrogen $36,200.00 $21.94
Phosphorus $15,405.00 $9.34
Other $3,920.00 $2.38
Pesticides $30,300.00 $18.36
Hail/crop Ins. $11,450.00 $6.94
Fuel,Oil & Lube $12,570.00 $7.62
Machinery Repairs $16,520.00 $10.01
Building Repairs $2,450.00 $1.48
Custom Work $3,300.00 $2.00
Hired Labor $4,950.00 $3.00
Misc $0.00 $0.00
Mics $0.00 $0.00
Operating Interest $4,379.79 $2.65
TOTAL VARIABLE EXPENSES $162,844.79 $98.69
CONTRIBUTION MARGIN $166,155.21 $100.70
Fixed Costs
Land Taxes $1,500.00 $0.91
Office/General Overhead $2,000.00 $1.21
Insurance/Licenses $4,500.00 $2.73
Land Rent $6,000.00 $3.64
Interest on Long Term Debt $42,075.00 $25.50
Depreciation Buildings $6,187.50 $3.75
Machinery $68,062.50 $41.25
TOTAL FIXED COSTS $130,325.00 $78.98
NET INCOME $35,830.21 $21.72
Minus return to family labour & mgmt $30,000.00 $18.18
Equals Return on Equity $5,830.21 0.54%
and Return on Investment $47,905.21 2.98%
Page 9
246450283.xls.ms_office
E 30% $230.98 ($91.41) ($71.47) ($51.53) ($31.59) ($11.65) $8.29 $28.23
X 20% $213.21 ($73.64) ($53.70) ($33.76) ($13.82) $6.12 $26.06 $46.00
P 10% $195.45 ($55.87) ($35.93) ($15.99) $3.95 $23.89 $43.83 $63.77
E Estimate $177.68 ($38.10) ($18.16) $1.78 $21.72 $41.65 $61.59 $81.53
N -10% $159.91 ($20.34) ($0.40) $19.54 $39.48 $59.42 $79.36 $99.30
S -20% $142.14 ($2.57) $17.37 $37.31 $57.25 $77.19 $97.13 $117.07
E -30% $124.38 $15.20 $35.14 $55.08 $75.02 $94.96 $114.90 $134.84
S adjusted $139.58 $159.52 $179.45 $199.39 $219.33 $239.27 $259.21
-30% -20% -10% Estimate 10% 20% 30%
INCOME
Sensitivity Analysis
As total income and expenses increase and decrease by
10% increments the impact upon net income per acre is
calculated
Page 10