UNIVERSITY OF CALIFORNIA - COOPERATIVE EXTENSION SAMPLE COSTS TO PRODUCE WHEAT. SAN JOAQUIN VALLEY Double Cropped

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1 1999 UNIVERSITY OF CALIFORNIA - COOPERATIVE EXTENSION SAMPLE COSTS TO PRODUCE WHEAT Prepared by: SAN JOAQUIN VALLEY Double Cropped Ron Vargas Steve Wright Marsha Campbell Mathews Michael Canevari Lee Jackson Brian Marsh Michael Smith Karen Klonsky Pete Livingston U.C. Cooperative Extension Farm Advisor, Madera/Merced Counties U.C. Cooperative Extension Farm Advisor, Tulare County U.C. Cooperative Extension Farm Advisor, Stanislaus County U.C. Cooperative Extension Farm Advisor, San Joaquin County U.C. Cooperative Extension Agronomist, Department of Agronomy and Range Science, U.C. Davis U.C. Cooperative Extension Farm Advisor, Kern County U.C. Cooperative Extension Farm Advisor, San Luis Obispo County U.C. Cooperative Extension Economist, Department of Agricultural and Resource Economics, U.C. Davis U.C. Cooperative Extension Staff Research Associate, Department of Agricultural and Resource Economics, U.C. Davis 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 1

2 UNIVERSITY OF CALIFORNIA COOPERATIVE EXTENSION 1999 SAMPLE COSTS TO PRODUCE WHEAT San Joaquin Valley Double Cropped INTRODUCTION The detailed costs to produce double cropped wheat in the San Joaquin Valley of California are presented in this study. The hypothetical farm used in this report consists of 1,200 acres of which 300 acres are in double cropped winter wheat production. This study consists of Assumptions for producing double cropped winter wheat and seven tables. It is intended as a guide only. It can be used to make production decisions, determine potential returns, prepare budgets and evaluate production loans. Sample costs given for labor, materials, equipment and contract services are based on current figures. Some costs and practices detailed in this study may not be applicable to every situation. A blank Your Cost column is also provided to enter your actual costs on Table 1. Costs Per Acre To Produce Wheat and Table 2. Costs And Returns Per Acre To Produce Wheat. This study consists of General Assumptions for Producing Wheat and seven tables. Table 1. Costs Per Acre To Produce Wheat Table 2. Costs And Returns Per Acre To Produce Wheat Table 3. Monthly Cash Costs Per Acre To Produce Wheat Table 4. Annual Equipment, Investment And Business Overhead Table 5. Hourly Equipment Costs Table 6. Ranging Analysis Table 7. Cost And Returns/Breakeven Analysis For an explanation of calculations used for the study refer to the attached General Assumptions, call the Department of Agricultural and Resource Economics, Cooperative Extension, University of California, Davis, California, (530) or call the farm advisor in your county. Other small grain and forage crop cost studies are available for commodities grown in the San Joaquin Valley. For those interested in this and other studies, they can be requested through the Department of Agricultural Economics, U.C. Davis, (530) or (530) , or from selected county Cooperative Extension offices. There is a nominal charge. The University of California, in accordance with applicable Federal and State law and University policy, does not discriminate on the basis of race, color, national origin, religion, sex, disability, age, medical condition (cancer related), ancestry, marital status, citizenship, sexual orientation, or status as a Vietnam-era veteran or special disabled veteran. Inquiries regarding the University s nondiscrimination policies may be directed to the Affirmative Action Director, University of California, Agriculture and Natural Resources, 1111 Franklin, 6 th Floor, Oakland, CA (510) San Joaquin Valley Wheat Cost Study - Double Cropped 2

3 UNIVERSITY OF CALIFORNIA - COOPERATIVE EXTENSION 1999 SAMPLE COSTS TO PRODUCE WHEAT San Joaquin Valley Double Cropped ASSUMPTIONS The following is a description of some general assumptions pertaining to sample costs to produce double cropped wheat in San Joaquin Valley. Practices described are not recommendations by the University of California, but rather represent production procedures considered typical of a well managed farm for the San Joaquin Valley. Costs and practices detailed in this study may not be applicable to all situations. Cultural practices for the production of wheat vary by grower and region; variations can be significant. The practices and inputs used in this cost study serve only as a sample or guide. These costs are represented on an annual, per acre basis. The use of trade names in this report does not constitute an endorsement or recommendation by the University of California nor is any criticism implied by omission of other similar products. Land and Share Rent. This report is based on a 1,200 acre field and row crop farm of which 300 acres are producing double cropped wheat and 900 acres are planted to alfalfa hay, cotton, processing tomatoes, corn, sugar beets, beans, and other small grains. Land in this study is leased on a cash-rent basis with the land owner receiving $100 per acre. The land rented includes developed wells and irrigation system. The grower owns a shop and an equipment yard to fix and store equipment. Land Rent appears as a cash overhead cost in Tables 1-4. Irrigation System. An irrigation district supplies water, though growers may supplement this with well water in some areas. The amount of water used to irrigate wheat will vary in the San Joaquin Valley. Irrigation districts in the Valley were surveyed for water pricing and the cost of pumping well water was calculated. District and well water costs were combined to obtain an average cost for water. The cost of irrigation water for this cost study is $2.20 per acre-inch or $26.40 per acre-foot. The permanent irrigation system is already in place when the land is rented. The cost of the irrigation system is included in the land rent which is cash overhead cost in Table 1-4. Labor. Basic hourly wages for workers are $8.21 and $5.75 per hour for machine operators and nonmachine (irrigators) workers respectively. Adding 34% for SDI, FICA, insurance and other benefits raises the total labor costs to $11.00 per hour for machine operators and $7.71 per hour for non-machine labor. The labor for operations involving machinery are 20% higher than the operation time to account for the additional time involved in equipment set up, moving, maintenance and repair. Any returns above total costs are considered returns to investment San Joaquin Valley Wheat Cost Study - Double Cropped 3

4 Cultural Practices and Material Inputs Land Preparation. Primary tillage and planting groundwork operations which includes chiseling, disking, pulling borders, and preplant fertilization are performed in November and December. All operations requiring equipment are performed with either a 200 hp crawler, 130, or 92 hp wheel tractors. Operations that are done on only a percentage of the acreage are noted; all other operations are done on 100% of the acreage. In November, all of the acreage is chiseled once to open the soil structure to a depth of 18 inches. The ground is disced twice to prepare the seedbed and irrigation borders are pulled. Fertilizer is applied preplant at a rate of 100 pounds of nitrogen per acre. Stand Establishment. In December, wheat is drilled into the fields at 130 pounds of seed per acre. If testing indicate a need, phosphorus is applied at planting usually in the range of 40 to 60 pounds of P 2 O 5. Irrigation. The cost of irrigations shown in Tables 1, 2, and 3 are for the cost of the water and labor to apply it. The amount of water applied will vary depending on soil moisture from winter rains. After planting, wheat is flood irrigated three time from March through May. Nitrogen fertilizer is injected once into the March irrigation. A total of 18 acre-inches is applied to the crop in this study. Fertilization. One hundred pounds per acre of UN-32 is sprayed on to the flat fields and incorporated in with a disc prior to planting. In February the wheat receives 40 pounds of nitrogen per acre in the form of urea. During March a liquid fertilizer is injected with the irrigation putting on another 40 pounds of N per acre. Weed Management. A single treatment of a herbicide (MCPA) is made in February and is applied by aircraft. The pesticides and rates, and cultural practices mentioned in this cost study are only a few of those that are listed in the UC IPM Pest Management Guidelines, Wheat and Integrated Pest Management For Small Grains. Written recommendations are required for many pesticides and are made by licensed pest control advisors. For information and pesticide use permits, contact the local county Agricultural Commissioner's office. Equipment Costs. Equipment costs are composed of three parts; capital recovery, cash overhead, and operating costs. Both capital recovery and cash overhead factors are discussed in later sections. The operating costs consist of repairs, fuel, and lubrication. Repair costs are based on purchase price, annual hours of use, total hours of life, and repair coefficients formulated by the American Society of Agricultural Engineers (ASAE). Fuel and lubrication costs are also determined by ASAE equations based on maximum PTO hp, and type of fuel used. The fuel and repair cost per acre for each operation in Table 1 is determined by multiplying the total hourly operating cost in Table 5 for each piece of equipment used for the cultural practice by the number of hours per acre for that operation. Tractor time is 10% higher than implement time for a given operation to account for setup, travel and down time. Prices for on-farm delivery of diesel and gasoline are $0.62 and $1.02 per gallon, respectively. Harvest. Wheat is combined and hauled from the field in bankout wagons to waiting trucks for transportation to storage. Harvest costs $29 per ton by a custom harvest company San Joaquin Valley Wheat Cost Study - Double Cropped 4

5 Growers may choose to own harvesting equipment, purchased either new or used, or hire a custom harvester to perform the harvest. Many factors are important in deciding which harvesting option a grower uses. These considerations and appropriate method of analysis are discussed in "Acquiring alfalfa hay harvest equipment: A financial analysis of alternatives". Yields. The crop yield used in this study is 2.5 ton per acre at 9 to 10% moisture. Yields have varied over the years in the San Joaquin Valley and are shown in Table A. Table A. Average annual wheat yields for selected counties in the San Joaquin Valley County tons/acre San Joaquin Stanislaus Merced Madera Fresno Tulare Kings Kern Source: selected County Crop Reports, Returns. A selling price of a $100 per ton of grain is used to estimate income from the sale of wheat. Selling prices may range from $80 to $140 per ton; the $100 used in the cost study is, at best, an estimate taking into consideration current situations. Table 6 indicates the effects on grower returns based on varying yields and returns. Breakeven points based on estimated costs are calculated for both yields and return prices in Table 7. This study also includes income received from the Production Flexibility Contract (PFC) program administered by the USDA Farm Service Agency. The PFC income is calculated by taking 85% of the program payment yield and multiplying it times the payment rate. In this study the California program payment yield of 2.03 tons per acre and the payment rate is $21 per ton. Program support is calculated as 2.03 tons/acre X.85 X $21/ton = $36.24 per acre. In this study, every wheat acre is assumed to be covered by program payments. In reality, however, maximum payment limitations may leave some acres uncovered effectively reducing the per cwt income. Maximum contract payments are limited to $50,000 per person. Payments to growers were increased in 1998 by 50% because of a one time supplement by congress to the program. The PFC payment rate is set by a number of factors at harvest time. Because the actual rate is not determined until the end of each growing season the USDA sets future PFC payment rates in a range. PFC payment rates change annually. Contact the local Farm Service Agency office for further information about the support program. Assessments. Under a state marketing order a mandatory assessment fee is collected and administered by the California Wheat Commission. This assessment of $0.03 per hundredweight (cwt) pays for wheat research in California and is collected at the first point of sale San Joaquin Valley Wheat Cost Study - Double Cropped 5

6 Risk. Risks associated with wheat production are not assigned a production cost. While this study makes an effort to model a production system based on typical, real world practices, it cannot fully represent financial, agronomic and market risks which affect the profitability and economic viability of wheat production. Overhead and Capital Recovery Costs Cash Overhead. Cash overhead consists of various cash expenses paid out during the year that are assigned to the whole farm and not to a particular operation. These costs include property taxes, interest on operating capital, office expense, liability and property insurance, and investment repairs. Cash overhead costs are found in Tables 1, 2, 3 and 4. Property Taxes. Counties charge a base property tax rate of 1% on the assessed value of the property. In some counties special assessment districts exist and charge additional taxes on property including equipment, buildings, and improvements. For this study, county taxes are calculated as 1% of the average value of the property. Average value equals new cost plus salvage value divided by 2 on a per acre basis. Interest On Operating Capital. Interest on operating capital is based on cash operating costs and is calculated monthly until harvest at a nominal rate of 9.69% per year. A nominal interest rate is the going market cost of borrowed funds. Insurance. Insurance for farm investments vary depending on the assets included and the amount of coverage. Property insurance provides coverage for property loss and is charged at 0.713% of the average value of the assets over their useful life. Liability insurance covers accidents on the farm and costs $1,049 for the entire farm or $0.87 per acre. Office Expense: Office and business expenses are estimated at $25 per acre. These expenses include office supplies, telephones, bookkeeping, accounting, legal fees, road maintenance, etc. Capital Recovery Costs. Capital recovery cost is calculated for equipment and other farm investments. Although farm equipment used on farms in this region might be purchased new or used, this study shows the current purchase price for new equipment. The new purchase price is adjusted to 60% to indicate a mix of new and used equipment. Annual ownership costs (Equipment and Investments) are shown in Tables 1-4. Capital recovery cost is the annual depreciation and interest costs for a capital investment. It is the amount of money required each year to recover the difference between the purchase price and salvage value (unrecovered capital). Put another way, it is equivalent to the annual payment on a loan for the investment with the downpayment equal to the discounted salvage value. This is a more complex method of calculating ownership costs than straight-line depreciation and opportunity costs, but more accurately represents the annual costs of ownership because it takes the time value of money into account (Boehlje and Eidman) San Joaquin Valley Wheat Cost Study - Double Cropped 6

7 The calculation for the annual capital recovery costs is as follows: Purchase Salvage Pr ice Value Capital Recovery Factor + Salvage Interest Value Rate Salvage Value. Salvage value is an estimate of the remaining market value of an investment at the end of its useful life. It is calculated differently for different investments. For farm machinery (e.g., tractors and implements) the remaining value is a percentage of the new cost of the investment. Salvage value is calculated as New Price % Remaining Value Salvage value for other investments including irrigation systems, buildings, and miscellaneous equipment is zero. The salvage value for land is equal to the purchase price because land does not depreciate. Salvage value for investments can vary. The purchase price and salvage value for certain equipment and investments are shown in Table 4. Capital Recovery Factor. Capital recovery factor is the amortization factor or annual payment whose present value at compound interest is 1. It is the function of the interest rate and years of life of the equipment. Interest Rate. The interest rate of 7.40% used to calculate capital recovery cost is the United States Department of Agriculture-Economic Reporting Service s (USDA-ERS) ten year average of California s agricultural sector long-run real rate of return to production assets from current income. It is used to reflect the long-term realized rate of return to these specialized resources that can only be used effectively in the agricultural sector, not including inflation. In other words, the next best alternative use for these resources is in another agricultural enterprise. Acknowledgment. Appreciation is expressed to Dr. Dan Sumner and other cooperators who provided support and information for this study San Joaquin Valley Wheat Cost Study - Double Cropped 7

8 REFERENCES American Society of Agricultural Engineers American Society of Agricultural Engineers Standards Yearbook. Russell H. Hahn and Evelyn E. Rosentreter (ed.) St. Joseph, Missouri. 41st edition. Blank, Steve, Karen Klonsky, Kim Norris, and Steve Orloff Acquiring Alfalfa Hay Harvest Equipment: A Financial Analysis Of Alternatives. University of California. Oakland, California. Giannini Information Series No Boelje, Michael D., and Vernon R. Eidman Farm Management. John Wiley and Sons. New York, New York Integrated Pest Management Education and Publications U.C. Pest Management Guidelines, Wheat. In M. L. Flint (ed.) UC IPM pest management guidelines. University of California. Division of Agriculture and Natural Resources. Oakland, California. Publication Statewide Integrated Pest Management Project Integrated Pest Management For Small Grains. University of California. Division of Agriculture and Natural Resources. Oakland, California. Publication For information concerning the above mentioned University of California publications contact UC DANR Communications Services ( ) or your local county Cooperative Extension office San Joaquin Valley Wheat Cost Study - Double Cropped 8

9 Table 1. U.C. COOPERATIVE EXTENSION COSTS PER ACRE TO PRODUCE WHEAT SAN JOAQUIN VALLEY Labor Rate: $11.00/hr. machine labor Interest Rate: 9.69% $7.71/hr. non-machine labor Yield per Acre: 2.5 Ton ==================================================================================================================================== Operation Cash and Labor Costs per Acre Time Labor Fuel,Lube Material Custom/ Total Your Operation (Hrs/A) Cost & Repairs Cost Rent Cost Cost Cultural: Chisel 2X Finish Disc 2X Pull Borders Fertilize - Preplant 100 Lbs N/Acre Plant Fertilize - 40 Lbs N/Acre Weed Control - Post-emergent Pull Tail Ditch Irrigate & Fertilize 1X Irrigate 2X Close Ditch Pickup Truck Use TOTAL CULTURAL COSTS Harvest: Harvest - Combine California Wheat Commission TOTAL HARVEST COSTS Postharvest: Disc Stubble 2X TOTAL POSTHARVEST COSTS Interest on operating 9.69% TOTAL OPERATING COSTS/ACRE TOTAL OPERATING COSTS/TON San Joaquin Valley Wheat Cost Study - Double Cropped 9

10 U.C. COOPERATIVE EXTENSION Table 1. Continued CASH OVERHEAD: Liability Insurance 1 Office Expense 25 Rent 50 Property Taxes 2 Property Insurance 1 Investment Repairs TOTAL CASH OVERHEAD COSTS TOTAL CASH COSTS/ACRE 333 TOTAL CASH COSTS/TON CAPITAL RECOVERY COSTS (7.40% Interest Rate): Per producing -- Annual Cost -- Investment Acre Capital Recovery Fuel Tanks Fuel Wagon Shop Building Shop Tools Siphon Tubes Equipment TOTAL CAPITAL RECOVERY COSTS TOTAL COSTS/ACRE 366 TOTAL COSTS/TON ==================================================================================================================================== 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 10

11 Table 2. U.C. COOPERATIVE EXTENSION COSTS AND RETURNS PER ACRE TO PRODUCE WHEAT SAN JOAQUIN VALLEY Labor Rate: $11.00/hr. machine labor Interest Rate: 9.69% $7.71/hr. non-machine labor =============================================================================== Price or Value or Your Quantity/Acre Unit Cost/Unit Cost/Acre Cost GROSS RETURNS Wheat 2.50 Ton Support Payment 1.73 Ton TOTAL GROSS RETURNS FOR WHEAT 286 OPERATING COSTS Fertilizer: UN Lb N Lb N Seed: Wheat Seed Lb Herbicide: MCPA 2.00 Pint Custom: Air Application 1.00 Acre Harvest - Per Ton 2.50 Ton Irrigation: Water AcIn Assessment: Assessment Fee Cwt Labor (machine) 2.08 hrs Labor (non-machine) 0.25 hrs Fuel - Gas 0.60 gal Fuel - Diesel gal Lube 2 Machinery repair 12 Interest on operating 9.69% TOTAL OPERATING COSTS/ACRE 254 TOTAL OPERATING COSTS/TON 102 NET RETURNS ABOVE OPERATING COSTS San Joaquin Valley Wheat Cost Study - Double Cropped 11

12 U.C. COOPERATIVE EXTENSION Table 2. Continued =============================================================================== Price or Value or Your Quantity/Acre Unit Cost/Unit Cost/Acre Cost CASH OVERHEAD COSTS: Liability Insurance 1 Office Expense 25 Rent 50 Property Taxes 2 Property Insurance 1 Investment Repairs TOTAL CASH OVERHEAD COSTS/ACRE 79 TOTAL CASH COSTS/ACRE 333 TOTAL CASH COSTS/TON 133 CAPITAL RECOVERY COSTS (7.40% Interest Rate): Fuel Tanks 1 Fuel Wagon 0 Shop Building 6 Shop Tools 1 Siphon Tubes 0 Equipment TOTAL CAPITAL RECOVERY COSTS/ACRE 33 TOTAL COSTS/ACRE 366 TOTAL COSTS/TON 146 NET RETURNS ABOVE TOTAL COSTS -80 =============================================================================== 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 12

13 U.C. COOPERATIVE EXTENSION Table 3. MONTHLY CASH COSTS PER ACRE TO PRODUCE WHEAT SAN JOAQUIN VALLEY =================================================================================================================================== Beginning NOV 98 NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT TOTAL Ending OCT Cultural: Chisel 2X Finish Disc 2X 8 8 Pull Borders 1 1 Fertilize - Preplant Plant Fertilize - 40 Lbs N/Acre 5 5 Weed Control - Post-emergent Pull Tail Ditch 1 1 Irrigate & Fertilize 1X Irrigate 2X Close Ditch 1 1 Pickup Truck Use TOTAL CULTURAL COSTS Harvest: Harvest - Combine California Wheat Commission TOTAL HARVEST COSTS Postharvest: Disc Stubble 2X TOTAL POSTHARVEST COSTS 8 8 Interest on oper. capital TOTAL OPERATING COSTS/ACRE TOTAL OPERATING COSTS/TON OVERHEAD: Liability Insurance 1 1 Office Expense Rent Property Taxes Property Insurance 1 1 Investment Repairs TOTAL CASH OVERHEAD COSTS TOTAL CASH COSTS/ACRE TOTAL CASH COSTS/TON San Joaquin Valley Wheat Cost Study - Double Cropped 13

14 Table 4. U.C. COOPERATIVE EXTENSION WHOLE FARM ANNUAL EQUIPMENT, INVESTMENT, AND BUSINESS OVERHEAD COSTS SAN JOAQUIN VALLEY ANNUAL EQUIPMENT COSTS ========================================================================================= - Cash Overhead - Yrs Salvage Capital Insur- Yr Description Price Life Value Recovery ance Taxes Total HP 2WD Tractor HP Crawler HP 2WD Tractor Chisel - Heavy 11' Disc - Border Disc - Finish 18' Disc - Stubble 14' Ditcher - V Grain Drill - 20' Pickup - 1/2 Ton Rear Blade - 8' Saddle Tank Gal TOTAL ========================================================================================= 60% of New Cost * * Used to reflect a mix of new and used equipment. ANNUAL INVESTMENT COSTS =================================================================================================== Cash Overhead Yrs Salvage Capital Insur- Yr Description Price Life Value Recovery ance Taxes Repairs Total INVESTMENT Fuel Tanks Fuel Wagon Shop Building Shop Tools Siphon Tubes TOTAL INVESTMENT =================================================================================================== 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 14

15 Table 4. Continued U.C. COOPERATIVE EXTENSION ANNUAL BUSINESS OVERHEAD COSTS =============================================================== Units/ Price/ Total Description Farm Unit Unit Cost Liability Insurance Acre Office Expense Acre Rent Acre =============================================================== Table 5. U.C. COOPERATIVE EXTENSION HOURLY EQUIPMENT COSTS SAN JOAQUIN VALLEY ================================================================================================================== COSTS PER HOUR Actual - Cash Overhead Operating Hours Capital Insur- Fuel & Total Total Yr Description Used Recovery ance Taxes Repairs Lube Oper. Costs/Hr HP 2WD Tractor HP Crawler HP 2WD Tractor Chisel - Heavy 11' Disc - Border Disc - Finish 18' Disc - Stubble 14' Ditcher - V Grain Drill - 20' Pickup - 1/2 Ton Rear Blade - 8' Saddle Tank Gal ================================================================================================================== 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 15

16 Table 6. U.C. COOPERATIVE EXTENSION RANGING ANALYSIS SAN JOAQUIN VALLEY COSTS PER ACRE AT VARYING YIELDS TO PRODUCE WHEAT YIELD (TON/ACRE) OPERATING COSTS/ACRE: Cultural Cost Harvest Cost Postharvest Cost Interest on operating capital TOTAL OPERATING COSTS/ACRE TOTAL OPERATING COSTS/TON CASH OVERHEAD COSTS/ACRE TOTAL CASH COSTS/ACRE TOTAL CASH COSTS/TON CAPITAL RECOVERY COSTS/ACRE TOTAL COSTS/ACRE TOTAL COSTS/TON NET RETURNS PER ACRE ABOVE OPERATING COSTS FOR WHEAT PRICE YIELD (DOLLARS/TON) (TON/ACRE) Wheat Support Payment San Joaquin Valley Wheat Cost Study - Double Cropped 16

17 Table 6 continued U.C. COOPERATIVE EXTENSION NET RETURNS PER ACRE ABOVE CASH COSTS FOR WHEAT PRICE YIELD (DOLLARS/TON) (TON/ACRE) Wheat Support Payment NET RETURNS PER ACRE ABOVE TOTAL COSTS FOR WHEAT PRICE YIELD (DOLLARS/TON) (TON/ACRE) Wheat Support Payment San Joaquin Valley Wheat Cost Study - Double Cropped 17

18 Table 7. U.C. COOPERATIVE EXTENSION COSTS AND RETURNS / BREAKEVEN ANALYSIS SAN JOAQUIN VALLEY COSTS AND RETURNS - PER ACRE BASIS ========================================================================================================================== 1. Gross 2. Operating 3. Net Returns 4. Cash 5. Net Returns 6. Total 7. Net Returns Returns Costs Above Oper. Costs Above Cash Costs Above Total Crop Costs (1-2) Costs (1-4) Costs (1-6) Wheat ========================================================================================================================== COSTS AND RETURNS - TOTAL ACREAGE ========================================================================================================================== 1. Gross 2. Operating 3. Net Returns 4. Cash 5. Net Returns 6. Total 7. Net Returns Returns Costs Above Oper. Costs Above Cash Costs Above Total Crop Costs (1-2) Costs (1-4) Costs (1-6) Wheat ========================================================================================================================== BREAKEVEN PRICES PER YIELD UNIT ========================================================================================== Breakeven Price To Cover Base Yield Yield Operating Cash Total CROP (Units/Acre) Units Costs Costs Costs $ per Yield Unit Wheat 2.5 Ton ========================================================================================== BREAKEVEN YIELDS PER ACRE ========================================================================================== Breakeven Yield To Cover Yield Base Price Operating Cash Total CROP Units ($/Unit) Costs Costs Costs Yield Units / Acre Wheat Ton ========================================================================================== 1999 San Joaquin Valley Wheat Cost Study - Double Cropped 18