by Rich Maples
How much does it cost to grow soybeans? It varies from farm to
farm and from field to field, but an economist for the
Cooperative Extension Service can give you a pretty good idea.
"On average, in Arkansas it costs about $150 to grow an acre of
soybeans," says Dr. Tony Windham, who work with Extension soybean
specialists to calculate production and fixed costs for various
soybean production systems.
Windham says production, or out-of-pocket, expenses account for
about $120 of the cost. The largest production expense is
herbicides. "They can account for 20 to 30 percent of your out-of-pocket costs, depending on your production system. Fertilizer
is generally the second biggest expense, followed by equipment
repairs and maintenance, seed, interest on the operating loan and
so on."
Fixed, or ownership, costs are the second category of expenses
that Windham calculates for Arkansas crops. "The primary
ownership cost is depreciation, or the cost of wearing out
equipment to produce a crop. Taxes, insurance and the interest
on money invested in equipment are also included in fixed costs.
"In the crop cost estimates we've calculated, fixed costs have
ranged from $25 to $60 an acre. The higher figure is for center
pivot irrigated soybeans. The low number is for dryland beans."
Windham also compiles cost data for the farms enrolled in the
checkoff-funded Extension Soybean Research Verification Program.
"We've found in the verification program that when you compare
no-till with conventional tillage, you don't necessarily save
money with no-till production," the economist noted. "The
savings in tillage costs can be offset by the cost of herbicides.
The benefit of no-till is a savings in time.
"We estimate that no-till saves one-third hour of production time
per acre. For 100 acres, the savings would be 30 hours--time in
which a worker, tractor and implement could be used on another
part of the farm.
"Over a period of time, no-till could allow a reduction in labor
and equipment."
Windham said economic data collected from farms enrolled in the
Soybean Research Verification Program are presented in the annual
SRVP report available at county Extension offices. The
information is also shared at farm meetings.
The cost of production estimates for soybeans are also available
at county Extension offices. They present the costs of dryland
production; no-till, flood irrigated production; early season
production; and irrigated production using furrow and center
pivot systems.
"These cost of production estimates, or crop budgets, are used by
farmers to determine their cash flow needs for the coming season,
and by lenders to better understand the cash requirements of
growers who are coming in to borrow money," said Windham.