Ohio Corn and Soybean Enterprise Budgets project slightly lower costs but low to negative returns

Production costs for Ohio field crops may be flat to slightly lower in 2015 but the profit picture looks poor, much the same as it did 2014. Variable costs for trend line Ohio corn and soybean production for 2015 will be slightly lower than 2014. Variable costs for corn (163 bushels per acre) for 2015 are projected to be $412 per acre. Variable costs for 2015 Ohio soybeans (48 bushels per acre) are projected to be $210 per acre. Lower energy and crop insurance costs and zero to slight increases for many other inputs have led to the slightly lower production cost projections for Ohio’s two major commodity crops.

With continued lower crop prices expected for 2015 returns will likely be low to negative for many producers. Projected returns above variable costs (contribution margin) range from $138 to $272 per acre for corn and $236 to $439 per acre for soybeans. (This is assuming fall cash prices of $3.65 per bushel for corn and $9 per bushel for soybeans which are both higher than present prices.)

Returns to land for Ohio corn (gross Revenue minus all costs except land cost) are projected to range from -$86 to $35 per acre in 2015 depending on land production capabilities. Returns to land for Ohio soybeans are expected to range from -$10 to $132 per acre depending on land production capabilities.

Total costs projected for trend line corn production in Ohio are estimated to be $847 per acre. This includes all variable costs as well as fixed machinery, labor, management and land costs. Fixed machinery costs of $130 per acre include depreciation, interest, insurance and housing. A land charge of $205 per acre is based on data from the Western Ohio Cropland Values and Cash Rents Survey Summary. Labor and management costs combined are calculated at $76 per acre. Returns Above Total Costs for trend line corn production are negative at -$230 per acre.

Total costs projected for trend line soybean production in Ohio are estimated to be $592 per acre. (Fixed machinery costs — $108 per acre, land charge — $205 per acre, labor and management costs combined – $57 per acre.) Returns Above Total Costs for trend line soybean production are also negative at -$143 per acre.

These projections are based on OSU Extension Ohio Crop Enterprise Budgets. Newly updated Enterprise Budgets for 2015 have been completed and posted to the Farm Management Website of the Department of Agricultural, Environmental and Development Economics. Updated Enterprise Budgets can be viewed and downloaded from the following website:

http://aede.osu.edu/research/osu-farm-management/enterprise-budgets

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