Cost of production and budgets for dry beans and field peas

Stateline Bean ProducersJessica Johnson

Asst. Extension Educator, Agricultural EconomicsPanhandle Research and Extension Center

2014 Nebraska Crop Budgets

2014 Nebraska Crop Budgets• Western Nebraska Budgets

– Alfalfa, corn, wheat, dry beans, millet, dryland peas, sugarbeets and sunflowers

– Available online http://cropwatch.unl.edu/economics/budgets• Irrigated Pea Budget go.unl.edu/pagecon

2014 W. Nebraska Crop BudgetsNo-Till

Dryland Budget # Yield Cost/Unit Change from ‘13

Millet 40 22 cwt. $8.72 NEW

Peas 43 35 bu. $5.75 NEW

Wheat 61-63 45-55 bu. $5.26 - $6.40 ↓4to↓10%

Irrigated Budget # Yield Cost/Unit

Alfalfa 12 6.6 tons $78.44 NEW

Corn 22 26 180 bu. $4.04

$4.49 ↓3%

Dry Beans 30-32 25 cwt. $23.59- $23.69 ↓6-↑2%

Wheat 65-66 85-90 bu. $5.13 - $5.65 ↓3 to ↑7%

Peas N/A 60 bu. $7.24 NEW

2014 Crop Budget

Prices of inputs were generally higher, with some notable exceptions including nitrogen and glyphosate herbicides…

increased land prices put upward pressure on the cost of production for

all crops.

http://agecon.unl.edu/documents/2369805/5842081/1-22-14.pdf/7ae6c72a-54aa-48e7-842b-7b5c4af4c0a2

Land Values

Reported Cash Rental Rates: Center Pivot Irrigated Cropland

2013 Average

% Change from 2012

High Low

Northwest 225 13 265 170

North 265 13 285 208

Northeast 379 15 477 302

Central 287 12 358 240

East 355 13 441 281

Southwest 269 14 325 210

South 313 12 363 259

Southeast 345 13 427 268Source: 2013 UNL Nebraska Farm Real Estate Market Developments Survey

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

Cash Rental Rates for the Northwest District

Dryland Gravity Irrigated Center Pivot Irrigated

Cash Rent• Rents should stabilize, or start down• Rents are still determined by supply

and demand

• Tenants need to sharpen the pencil• Landlords need to be understanding

2014 Commodity Prices

@KW@C

11/1

/13

11/8

/13

11/1

5/13

11/2

2/13

11/2

9/13

12/6

/13

12/1

3/13

12/2

0/13

12/2

7/13

1/3/

14

1/10

/14

1/17

/14

1/24

/14

1/31

/14

2/7/

14

2/14

/14

2/21

/14

2/28

/14

610

630

650

670

690

710

730

- Wall Street Journal

Market Prices…Futures • 3/4/14 Dec. Corn $4.84

– Average. Panhandle Dec. Basis -0.32– Expected Dec. Corn Price $4.53

• 3/4/14 Sept. HRW $6.83– Average. Panhandle Sept. Basis -1.11– Expected Sept. Wheat Price $5.72

• Dry Beans? • Peas?

Dry Bean Prices

2007/08

2008/09

2009/10

2010/11

2011/12

2012/13

2013/140.00

10.00

20.00

30.00

40.00

50.00

60.00

Pinto Bean Cash Price ($/cwt.)Great Northern Bean Cash Price ($/cwt.)

Yield Comparison

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

0

2,000

4,000

6,000

8,000

10,000

12,000

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Roundup Ready® Corn ReleasedDRY EDIBLE BEANSIRRIGATED CORN - WEIGHTED AVERAGE OF PANHANDLE COUNTIES

Yie

ld,

Pou

nd

s P

er

Acr

e

1969-2012, 84% ↑1998-2012, 6% ↑

1969-2012 , 30% ↑1998-2013, 23% ↑

Avg. Yield Factor

‘69- ‘12 ‘98- ‘12

3.76 4.06

Price Comparison

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

$-

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

$0.40

$0.45

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Ethonal Mandate, "New Era in Pricing"CORN, GRAIN - PRICE RECEIVEDBEANS, DRY EDIBLE - PRICE RECEIVED

Real P

rice

, $

/Lb

.

Avg. Price Factor

‘69- ‘12 ‘07- ‘12

4.54 3.95

2014 Bean Price

• Expected Dec. Corn Price $4.52$4.52/56*4=0.3229 *100=$32.29

Another way to look at it…

SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG0.85

0.90

0.95

1.00

1.05

1.10

1.15

Great Northern MPI Pinto MPI

Mon

thly

Pri

ce I

nd

ex

Feb. Avg. Great Northerns $50Pintos $34.25

2014 Prices• Strong basis during 2013/14 • USDA Outlook 2013/14

http://www.usda.gov/oce/forum/2014_Speeches/Ash.pdf

– Corn $4.50/bu. – Winter Wheat $6.80/bu.

2013/14 W. NE Corn Basis

SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG-1.00

-0.50

0.00

0.50

1.00

1.50

Western NE Corn Basis

2013/14

Net Income

Quick MathCorn Wheat Beans Peas

Futures – 3/4/14 Dec - $4.84 Sept. HRW

$6.83

Basis -0.32 -1.11

Expected $4.52 $5.72 $32.29 $8.00

Estimated Breakeven $4.49 $5.13 $23.59 $7.24

Per Unit $0.03/bu. $0.59/bu. $8.70/cwt. $0.76/bu.

Per Acre 180 bu. $5.04

85 bu. $50.15

25 cwt. $217.5

60 bu. $45.60

Limited Irrigation Calculator Available ONLINE go.unl.edu/pagecon

A little humor…

2014

www.dilbert.com, As seen http://www.usda.gov/oce/forum/2014_Speeches/Ash.pdf

Take UNL’s Bean Survey ONLINE NOW! Go.unl.edu/beansurvey

Office: 308-632-1247 go.unl.edu/[email protected] PanhandleAgEcon

Extension is a Division of the Institute of Agriculture and Natural Resources at the University of Nebraska-Lincoln cooperating with the Counties and the U.S. Department of Agriculture.

University of Nebraska-Lincoln Extension educational programs abide with the non-discrimination policies of the University of Nebraska-Lincoln and the United States Department of Agriculture.

Get current Panhandle price & basis information

TEXT “@UNLPREC” to 651-968-8358Standard message & data rates apply.

Back Page