THE COST OF FARMING OPERATIONS
Several millions of the inhabitants of the United States, not to
mention those of other countries, are engaged each year in the
preparation of the soil for the cereal and forage crops and on the
work of seeding and harvesting them. The welfare of one-third the
population is directly and that of the other two-thirds, although less
directly, is quite as surely dependent upon the effectiveness of this
effort. If, for example, as sometimes happens, one-third the
population receives on account of untoward seasonal conditions but
four-fifths of the usual product, everyone must suffer on account of
this unrewarded labor. Many, perhaps most, financial panics have their
origin in crop failures aided, doubtless, by an improper financial
system.
Although widely and sometimes bitterly discussed, little is really
known concerning the relation between the effort expended and the
returns obtained in producing the great staple farm products; yet one
of the most important and vital considerations in the organization of
a farm enterprise is the income, both gross and net, which may be
expected from the different crops contemplated. Obviously the yield
and price of the several crops will vary with the locality and with
the season. It is, therefore, impossible to predict for any year
either what yield may be obtained or what price will be secured. If,
however, a sufficient number of years are selected, an average may be
found which will form a basis for calculating the probable result for
another series of years. The following table gives the yield and the
average farm values per acre for five staple crops for five years,
1905-1909 inclusive, for the United States and for four widely
separated states, viz., Pennsylvania, Iowa, Texas and Oregon.
AVERAGE YIELD PER ACRE, 1905-1909.
Pennsylvania Iowa Texas Oregon
Maize, bu. 36.6 33.4 21.1 27.3
Wheat, bu. 17.8 15.5 9.6 20.6
Oats, bu. 28.9 28.9 26.6 32.8
Potatoes, bu. 84.4 85.8 67.0 119.0
Hay, tons 1.39 1.56 1.32 2.11
AVERAGE FARM VALUE PER ACRE, 1905-1909
Pennsylvania Iowa Texas Oregon
Maize $22.59 $13.80 $12.17 $19.58
Wheat 16.61 12.42 9.11 16.10
Oats 13.33 9.28 12.97 15.20
Potatoes 55.87 44.75 65.15 71.18
Hay 18.74 10.13 13.92 19.60
Such figures as the above may be compiled by anyone at any time for
any year or series of years from the yearbooks of the United States
Department of Agriculture. They form a fairly sound basis for
calculating the gross income which may be expected from the staple
farm crops, particularly for the cereals, potatoes, hay, cotton and
tobacco. Five questions, however, present themselves, which should, as
far as possible, be settled before applying them to an individual
problem.
(1) How nearly do the conditions, especially those of soil and
climate, of the given location correspond to the averages of the
state? The question can be settled only by a thorough study of soils
and their crop adaptation. It is a matter requiring study, experience
and judgment.
(2) How much larger yields may be expected on account of better
methods employed? It is here that most mistakes are made in estimating
possible farm profits. Necessarily, all statistical averages of
production are much below those which an enterprising farmer considers
an average crop and habitually produces. Not more than 50% increase
upon these figures, however, should be anticipated by reason of the
improved methods which one is going to employ.
While the average yield of maize, even in the so-called corn states,
is not far from 30 bushels an acre, and while it is quite common for
good farmers to produce 60 to 75 bushels of maize per acre, it would
not be safe to assume a yield of more than 45 bushels unless the
conditions are more than ordinarily favorable.
The application of the averages given on pages 149-150 to an
individual farm enterprise may be illustrated by calculating the
possible results which might be obtained on 80 acres of arable land in
Iowa and Pennsylvania with the four great soil products of northern
United States.
Iowa Pennsylvania
Acres Income Acres Income
Maize 40 $552.00 15 $340.85
Oats 20 185.60 15 200.25
Wheat 5 62.10 15 249.25
Hay 15 151.95 35 655.90
Total 80 $951.65 80 $1,446.25
If 50% is added for the increased yields which may be expected on
account of the employment of better methods, the total yield from 80
acres of arable land would become for Iowa $1,428 and for Pennsylvania
$2,169. This does not mean that farming is necessarily more profitable
in Pennsylvania than in Iowa. Not only may the cost of cultivating an
acre of arable land be greater in Pennsylvania, but usually a larger
territory must be owned in order to obtain 80 acres of arable land.
Eighty acres of these four crops is probably as often grown on a farm of
100 acres in Iowa as on one of 160 acres in Pennsylvania. The total farm
acreage in Iowa is, in round numbers, 35 millions; in Pennsylvania, 19
millions. In Iowa about one-half the farm area is in the farm crops
under consideration, while in Pennsylvania these four crops occupy only
one-third the farm area.
[Illustration: Mr. R. D. Maurice Wertz, after several years in railroad
offices, took charge of his fathers farm at Quincy, Pa., in 1891, and
converted it into a fruit farm. He now has about 220 acres in peaches and
apples. It is understood that he has sent from the above shipping station
and one other about $200,000 worth of fruit in the last six years.]
[Illustration: Mr. T. E. Martin, Rush, N. Y., is one of the most
successful potato growers in the United States. He has a farm of 57 acres
of the Dunkirk series of soil. He has three 18-acre fields in rotation
consisting of potatoes, wheat and clover and alfalfa. Mr. Martin has
increased the yield of potatoes from 60 bushels per acre in 1892 to 417
bushels in 1906. In 1906 he produced 7,510 bushels on 18 acres. In 1907
he sold $2,807.89 worth of potatoes from 18 acres, or $160 per acre. He
attributes his large yields mainly to drainage, thorough preparation of
the soil, good tillage, spraying, clover and alfalfa, manure and
commercial fertilizers.]
(3) Will there be a general increase or decrease in the price of crops
during the coming years?
The following table gives the average farm price for Missouri by
five-year periods.
THE AVERAGE DECEMBER FARM PRICE BY
PREVIOUS DECADES COMPARED WITH
AVERAGE OF FIVE YEARS, 1906-10.
1866 1875 1886 1896 1906
to to to to to
1875 1885 1895 1905 1910
cts. cts. cts. cts. cts.
Maize, bu. 40 33 33 35 49
Wheat, bu. 103 87 64 71 87
Oats, bu. 30 27 26 27 39
Potatoes, bu. 57 48 49 53 68
Hay, ton 902 799 704 700 875
An examination of the last column shows that the average price of
these staple farm products has been considerably greater during five
recent years than during the previous thirty years. Will this increase
in price continue, or will there be a series of years of unusually low
prices which will bring the average price of the decade down to that
of the previous three decades? Few persons will care to venture an
answer to this question, which is of the utmost importance to all
farmers and especially to the beginner.
(4) The figures employed are taken from the yearbook of the United
States Department of Agriculture and are the estimated farm price on
December 1 of each year. Can the commodities be sold for the December
farm price? Will potatoes sold at the time of digging bring less than
the December price? Will wheat or maize held until May bring a higher
price? To what extent, by the judicious holding of products, can
advance in price be obtained?
(5) Will the products be sold for cash, or may they be turned into
animal products at an increased profit? In some sections of the United
States animals are reared primarily because of the increased profit
due to manufacturing soil products into animal products; in other
regions, however, they are kept primarily for the purpose of
maintaining the fertility of the soil and only incidentally on account
of the increased profits.
COST OF PRODUCTION
For a number of reasons it is difficult to determine the cost of
growing farm crops. One reason deserves to be especially emphasized. In
any business enterprise it may be necessary to run at a loss, because
to stop would entail a still greater loss. This is particularly true in
farming, where men are employed by the month in order that they may be
had when needed. Since they are receiving pay, it is better that such
men should be employed some days at farm operations which return only a
portion of their wages rather than not to have them employed at all.
Under such circumstances, therefore, the cost of producing a given crop
may be greater than is indicated by the time actually employed in its
production.
Many other factors also enter, as the average number of hours per day
which it is possible to work. This is greatly influenced by weather
conditions. The Minnesota station determined that the working day on
about thirty farms in that state varied from seven and one-half to
eight and one-half hours, with two to three and one-half hours on
Sunday. The average length of the working day for horses varied from
3.1 to 3.3 hours.
The cost for labor of cultivating a given area of land will depend not
only on the crop or crops to be raised, the climate, the topography
and character of the soil, the size and shape of the fields and the
system of cropping, but also upon the man's ability for organization.
It is said that the European farmers, and even the farmers from
eastern Canada, are several years in adjusting themselves to farming
in western Canada. When the farmers from Iowa, Kansas, Nebraska or
surrounding states move into western Canada with their three-horse
teams and other suitable equipment, applying their thorough knowledge
of prairie farming, they are at once successful. The man is thus an
important factor.
TIME REQUIRED FOR CULTURAL OPERATIONS
The following table will be helpful as showing time required to
perform certain operations, since it is a record of labor actually
employed on a field of 18 acres of easily tilled land in central Ohio.
All labor was employed at prices named, board for man and food for
horses being furnished in addition at the prices estimated. The owner
of the land furnished the horse for the harvester.
Plowing 7.5 days at $2 $15.00
Harrowing 3 days at 2 6.00
Planting 2 days at 2 4.00
Cultivating (4 times) 7 days at 2 14.00
Cultivating with harvester 6 days at 1 6.00
Husking and cribbing by the job 45.54
Estimated cost of board 25-1/2 days 7.95
Estimated team maintenance 25-1/2 days 4.90
-------
$103.39
According to these figures the cost for labor of raising the crop and
the cost of harvesting was almost exactly the same, each being a
little less than $3 an acre.
THE COST OF PRODUCING FARM CROPS
The Minnesota station has determined the cost of growing the staple
farm crops on 45 farms in different sections of the State. The total
expense per acre for an average of six years is shown in the following
table, not including land rental or cost of marketing.
COST OF PRODUCING FARM CROPS IN MINNESOTA.
Spring wheat, land fall plowed $5.54
Oats, land fall plowed 5.80
Barley, land spring plowed 6.89
Maize, husked from standing stalks 9.41
Hay, timothy and clover 3.68
Potatoes, land not fertilized 23.36
Potatoes, land fertilized 34.72
Some years ago the writer made an estimate of the cost of producing
maize, oats, wheat and clover hay in a four-course rotation on a
tenant farm in central Pennsylvania. The soil was a heavy clay and
required plowing for each crop, except, of course, the hay crop, one
acre a day being considered a good day's work.
Counting the expense of man and team at $2 per day, the labor cost per
acre was found to be $7 for maize, $5.10 for both wheat and oats, and
$2.30 for hay, or an average of about $4.90 per acre for the four
crops. The interest on the capital invested in operating this farm,
exclusive of the land, was estimated at $1.45 per acre.
INFLUENCE OF YIELD UPON THE COST OF
PRODUCTION
The Illinois station has prepared a set of estimates upon the cost of
producing an acre of maize, showing variations in cost due to
differences in yield. In these estimates, instead of making a charge
for the actual cost of manure or fertilizer applied, an estimate is
made of the value of the plant food removed.
COST OF PRODUCING ONE ACRE OF MAIZE IN
ILLINOIS AS MODIFIED BY YIELD.
Yield Yield Yield Yield
50 bu. 75 bu. 100 bu. 35 bu.
Disking $0.40 $0.40 $0.40 $0.40
Plowing 1.00 1.00 1.00 1.00
Preparation .75 .75 .75 .75
Planting .15 .15 .15 .15
Seed .35 .35 .35 .35
Cultivation 1.00 1.00 1.00 1.00
Plant food 1.02 1.53 2.04 .71
Husking 1.25 1.87 2.50 .88
Marketing 1.00 1.50 2.00 .70
----- ----- ------ -----
Cost per acre $6.92 $8.55 $10.19 $5.94
Cost per bushel .14 .11 .10 .17
The average yield per acre in Illinois for 12 years preceding date of
this estimate was 35 bushels per acre; the average price per bushel
during the same period was 32 cents.
LABOR COST OF PRODUCING A BUSHEL OF
GRAIN
Not counting rent of land or interest on capital invested in
equipment, nor depreciation of soil fertility, it has been shown that
under favorable conditions, the labor cost of growing and harvesting
an acre of wheat or oats may be as low as $4.50, and that of maize as
low as $5 per acre. Assuming the average labor cost of producing an
acre of wheat or oats at $5.50 and of maize at $6 per acre, and taking
the average yields per acre for a series of years to be 13.8 for
wheat, 30.9 bushels for oats and 24.9 bushels for maize, the average
labor cost per bushel will be: Wheat, 40 cents; oats, 17-1/2 cents;
and maize, 28 cents.
The data given in this chapter are to be accepted as suggestive rather
than as determinative. The chief purpose in presenting them is to
place before the young farmer an appreciation of some of the problems
involved in the production of the chief and basic agricultural
commodities. The young farmer's success will be modified by the role
which they occupy in his farming system and by his ability to adjust
them to the economic conditions in which he may find himself placed. A
thorough understanding of the principle underlying the data submitted
will go far toward enabling him to make this adjustment, although none
of the illustrations given may have been obtained under conditions
identical to his own.