Wine Grape Establishment and Production Costs in ...extension.wsu.edu/.../26/2013/07/Wine-Production-Costs-EB1955.pdf · Wine Grape Establishment and Production Costs in Washington,

By

Trent Ball & Raymond J. Folwell

Wine Grape Establishmentand Production Costs in

Washington, 2003

EB1955

Introduction

The Washington wine grape growing/pro-ducing sector is one of the fastest growingindustries in the state. Since overtaking NewYork as the second largest wine producer in1998, Washington wine acreage has increasedfrom 16,820 total acres to 28,000 in 2002,and there are still intentions to plant evenmore vinifera wine grapes.1 In comparingJuly 1999 with January 2002, the bearingacreage for white varieties has increased 21%,while the red varieties’ bearing acreage hasincreased 74%. Chardonnay continues tobe the leading white variety, with CabernetSauvignon slightly edging Merlot as themost popular red variety.

Since 1997, wine grape production in Wash-ington has nearly doubled from 62,000 tonsto a record high 115,000 tons in 2002. Theaverage price received by growers during2002 was $878 per ton, down slightly fromthe previous year.2 With the increase inwine grape acreage, record high productioncan continue to be expected in the nextfew years.

This study was done to assess the economiccosts and profitability of establishing and pro-ducing a vineyard based on 2002 prices andcurrent managing and growing practices. Theprimary objective of this study is to estimatethe establishment and production costs of themajor red and white varieties grown in Wash-ington, Merlot and Chardonnay. To estimatethe economic costs of establishment and pro-duction for this study it is necessary to:

1. Specify the practices commonly followedin Washington to establish and maintaina 55-acre vineyard.

2. Estimate the costs of those practices andcompare them with possible levels ofreceipts to establish profitability.

Budget Assumptions

The major assumptions made to calculate theestablishment costs of a vineyard include:

1. A 55-acre vineyard is developed on a 65-acre farm with 5 acres each of headlandand homestead. The vineyard is locatedin Yakima Valley, and has a land value of$4,000 per acre. A 7% return on the landis desired.

2. The varieties are Merlot and Chardonnay.

3. A trickle, or drip irrigation system with a29-HP pump is used and purchased at aprice of $1,100 per acre, which includesinstallation and materials.

4. The grapes are planted with a 5 x 9-footspacing with 968 plants per acre. Duringthe second year a limited number of vinesare replanted (3%). The grapevines areexpected to produce a harvestable cropin the third year.

5. Establishment costs are amortized over 16years at 8.5% interest. The total vineyardlife is 20 years.

Wine Grape Establishment andProduction Costs in Washington, 2003

ByTrent Ball & Raymond J. Folwell*

1

*Associate in Research and Professor of Agricultural Economics, Washington State University, respectively.1Washington Wine Grape Acreage, 2002.2Washington Grape Report, 2003.

6. The water charge is $80 per acre basedupon 2002 Roza Irrigation District waterfees, and the per-acre cost for irrigationelectricity is $30, based on the BentonIrrigation District. A holding pond,although required in some areas, is notaccounted for in this study.

7. Real estate property taxes are from theBenton County Assessor. The tax ratein 2002 is 1.45% of the average assessedvalue ($14.50 per $1,000 of value). For taxpurposes, real estate tax (land), irrigationsystem, trellis, and the grapevine assessedvalues are included. The values assumedand the corresponding annual taxes are:

Age of Merlot VineyardItem 1–3 years 4–15 years

Land $1,480.00 $1,480.00Grapevines 800.00 4,000.00Trellis 900.00 900.00Irrigation System 650.00 650.00Total Value 3,830.00 7,030.00Per Acre Tax 55.54 101.94

Age of Merlot VineyardItem 1–3 years 4–15 years

Land $1,480.00 $1,480.00Grapevines 800.00 2,600.00Trellis 900.00 900.00Irrigation System 650.00 650.00Total Value 3,830.00 5,630.00Per Acre Tax 55.54 81.64

8. Prices for materials and services wereassembled through growers, field persons,and industry supply firms. The prices usedin the study are the average prices of themajor suppliers in the region. These pricescan be seen in Table 7 of the Appendix.

9. The manager of the vineyard is allocateda salary of $225 per acre for a manage-ment fee.

10. All machinery and equipment costs arebased on new 2002 purchase prices. Themachinery and equipment depreciation,housing, interest and insurance are calcu-lated according to costs of using machin-ery.3 A wind machine is implemented inthe second year, and runs 50 hours perseason.

11. Bird control expense can vary from as lowas $20 per acre, using practices such asowl eyes with balloons and/or a bird dis-tress call, up to $400 per acre for netting.There is a large variance in managerialpractices and prices. The low-end priceof $20 per acre is used for bird control inthis study.

12. Pruning is done on a custom basis usingthe Pellenc mechanical pruner, whichremoves the excess brush. Pneumaticmanual pruners will then follow to touchup the remaining 4–8 inch spurs.

13. A bilateral cordon training system is usedwith a vertical trellis. The trellis system isinstalled during the first year.

14. Starting in the fourth year, a $150 peracre canopy management fee is chargedto reduce the fungicide use. The canopymanagement includes shoot thinning.

15. Harvesting begins in the third year. It isassumed that a custom mechanical har-vester is used, at a cost of $75 per ton. Thehauling is done on a custom basis at a rateof $15 per ton.

16. The interest cost on operating capital isbased on a short-term interest rate of 8.5%.

17. Wage rates for the manual laborer isbased on the Washington 2003 minimumwage of $7.01 per hour. The hourly rateis increased by 25% to $8.76 to accountfor all additional expenses incurred bythe employer (social security, labor andindustries, etc.). The wage rate for machin-ery work is $10.50 per hour, which alsoincludes employee expenses.

2

3Pacific Northwest Farm Machinery Costs: 2000.

Summary of the Budgets andResults

The economic budgets created in this studyprovide an exhibit of the full costs a vineyardoperation would incur, including both cashand non-cash costs. Examples of non-cash costsinclude depreciation and opportunity costs.An opportunity cost is an implicit cost that isnot reflected as a cash outlay, but rather is thecost associated with foregone opportunities.For instance, farmers who produce a crop onthe land they own forego the income that couldbe attained if the land were rented, minus anycost incurred as the lessor (i.e., real estate taxes).Therefore, the return foregone from the landis an opportunity cost. Since the budget includesfull costs (including opportunity costs) andreturns over the useful life of the asset, it isreferred to as an economic budget.

There are both variable and fixed costs inthe budget. A fixed cost, which can be eithercash or non-cash, does not vary, even withan increase or decrease in production. Realestate and land tax are fixed cash costs, andremain constant regardless if the crop is pro-duced. The opportunity cost for managementis a non-cash fixed cost because it can beeither used or not used during the year. Con-versely, a variable cost is one that does changewith the amount of product produced. Har-vesting and labor are examples of costs thatvary directly with the level of production.

Table 1 is a summary of the costs and revenuesthat are received over the establishment yearsand through the full production years for aMerlot vineyard. The variable costs in the firstyear of establishment are the major expensesincurred by the operation. Establishing thetrellis system in the spring of the first year isthe major variable cost. After the expense ofthe trellis materials and labor, the Merlotnursery stock is the largest expense, followedby the green poly grow tubes in the first year.Training of the vines and minor pruningoccur in the second year. By the third yearand beyond, the variable costs are composedmostly of routine cultural practices necessaryto operate a vineyard, such as applying fungi-cides, pruning, training and irrigating.

The drip irrigation system is the predominantfixed cost in the first year. By the second year,the investment plus interest is accumulatingfrom the total expenditure in year one at an8.5% interest rate. The assumption is madethat by the fifth year, the vineyard is fullyestablished, with 16 years of productive liferemaining. Over the remaining years, thevineyard must pay back the initial establish-ment expenses incurred by the operation.Amortizing the net establishment cost at8.5% over the 16-year payback period pro-duces an annual cost of $1,072.27 per acrein the mature years.

The first two years of the vineyard do notproduce a harvestable crop. By the third yearof establishment, a yield of 2.5 tons per acreis achieved. A larger crop is produced thefollowing year—4 tons per acre. In order toproduce and maintain the highest qualityproduct, the vineyard is controlled to yield4 tons per acre in the full production years.The price the grower receives is $1,080 perton, an average of the past five years for theMerlot variety.

The economic budgets reflect costs and returnsfor a production year. The budgets are notrepresentative of a particular farm. Rather,they represent costs and revenues under theassumptions of this study. It is recommendedthat the user modify the assumptions to reflecthis/her specific situation.

Detailed Budget Results

The complete budget information for theestablishment years and for a typical fullproduction year is presented in the Appendixfor a Merlot vineyard. Below is an overviewof the information included in the itemizedcosts and schedule of operations Appendixtables for each year. Tables for the Chardonnayvariety are not included in the Appendixsince for the purpose of this study all culturaland establishment practices remain the samefor both varieties. Those items that differ(yield, harvest expense, etc.) are reflected inthe total costs and profit that are presentedin Table 2.

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Table 1. Summary of Revenue, Costs and Returns per Acre for a Merlot Vineyard

Years

First Second Third Fourth FullRevenue/Cost Production

RevenueYield (tons) 0.00 0.00 2.50 4.00 4.00

Price ($/ton) 1,080.00 1,080.00 1,080.00 1,080.00 1,080.00

Total Revenue ($) 0.00 0.00 2,700.00 4,320.00 4,320.00

Variable Cost:Custom Work/Mech pruning 220.00 – – – 45.00

Planting (Rental + Driver) 38.00 – – – –

Grow Tubes 435.60 – – – –

Nursery Stock 677.60 21.00 – – –

Rental Equip/Grass Seed 25.90 5.60 – – –

Trellis Material/Tying 1,197.34 55.54 60.92 3.99 1.35

Fertilizer 10.00 8.00 8.00 8.00 8.00

Chemicals 45.47 72.75 167.52 177.44 177.44

Custom Harvesting/Hauling – – 225.00 360.00 360.00

Canopy Mgmt/Bird Control – – 20.00 170.00 170.00

Labor 841.30 914.97 705.54 411.52 411.52

Irrigation/Elect Charge 142.00 142.00 142.00 142.00 142.00

Machinery Cost 298.00 212.03 251.21 246.58 246.57

Overhead 80.00 80.00 80.00 80.00 80.00

Interest 273.16 74.46 60.52 61.01 61.01

Total Variable Costs ($) 4,284.37 1,586.35 1,720.71 1,660.54 1,702.89

Fixed Costs:Irrigation Equipment 1,100.00 – – – –

Management Fee 225.00 225.00 225.00 225.00 225.00

Real Estate Taxes 55.54 55.54 55.54 101.94 101.94

Net Land Rent 280.00 280.00 280.00 280.00 280.00

Tractor & Machine Cost 306.63 313.67 396.08 390.55 390.55

Interest on Investment 0.00 531.38 785.69 850.55 1072.27

Total Fixed Cost ($) 1,967.17 1,405.59 1,742.31 1,848.04 2,069.76

Total Cost ($) 6,251.54 2,991.94 3,463.02 3,508.58 3,772.65

Net Return ($) -6,251.54 -2,991.94 -763.02 811.42 547.35

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Itemized Costs for Establishing aMerlot VineyardThese tables itemize the total cost of opera-tions for vineyard development by type ofactivity and the corresponding per acre costs.Included in the tables is the quantity of unitsapplied or consumed by the activity type.

Schedule of Operations for Establishinga Merlot VineyardLists of the schedule of operations and inputsused, along with the fixed and variable costsassociated with each operation, are presentedin the schedule of operations tables. The cal-endar month in which the operation occurs isincluded along with the corresponding laborand/or machine hours. The fixed costs in thetables consist of machinery, building, land,establishment costs and management.

Machinery and equipment fixed costs includedepreciation, interest, insurance, taxes andhousing. The land value is an opportunitycost, equivalent to 7% of the purchase pricefor the land. While the owner-operator willnot have a net land rent cost, it is representa-tive of the income the owner foregoes by pro-ducing a crop rather than renting the land.An opportunity cost for management is alsoincluded as a fixed cost. The establishment costis the interest expense on the accumulatedvineyard investment at an 8.5% rate, or theforegone returns that could be achieved hadthe investment (money) been made elsewhere.

Machinery, Building, andInput Costs

Appendix Table 6a lists the machinery andequipment necessary to maintain the vineyardoperation and the associated costs. Includedin the table are the machinery and equipmentpurchase prices, years of life before trade-in,and fixed and variable costs. The fixed costssuch as depreciation, interest, insurance,taxes and housing are reported on a cost perhour basis. Repair and fuel/lube costs are alsoreported as cost per hour. Annual hours ofuse for the machinery and equipment arealso reported.

Annual Establishment Costsfor 55-Acre Merlot Vineyard

The first four years of a vineyard are for estab-lishment and preparation for the next 16 yearsof full production. Soil preparation, plantingthe vines, pest management and other rou-tine cultural practices are performed. Over theremainder of this section, the annual costs ofthese activities are presented for the establish-ment years and the first year of full produc-tion (year 5).

First-Year Establishment Costs(Appendix Tables 1a, 1b)The field preparation for the vineyard landsite is done on a custom basis. The groundis ripped, plowed and disced. In March, theacreage is surveyed and marked for planting.A Merlot nursery stock is planted during thatsame time, at a total cost of $802.52 per acre.A drip irrigation system is installed after thegrapevines are planted. Using the drip system,50 pounds per acre of nitrogen fertilizer areadded. To aid in weed control and provideplant protection, green poly grow tubes areinstalled. Weed control is done in April withSurflan and in May using Roundup.

The trellis system is installed in the firstyear. Wood end posts and steel line postsare used. The wire is strung using #13 gaugewire. Total outlay in establishing the trellisis the largest variable cost in the first year.The Merlot nursery stock is the second larg-est variable cost in year one. Installation ofthe drip irrigation system, a net land rent of$280, and the management fee are the majorfixed costs. The total cost in the first year is$6,251.54. The grapes are not harvested untilthe third year, so there is no revenue gener-ated from the operation.

Second-Year Establishment Costs(Appendix Tables 2a, 2b)The drip system is moved up to the catchwire early in the second year, and some handpruning occurs on the young vines. A windmachine is installed and used for 40 hours inthe spring and in the fall. It is assumed that3% of the vines are replanted in April. Hand

5

suckering is done in May, and by June, summertraining is necessary, in addition to sprayingfungicide.

The fixed costs decrease from the first year, asdo the variable costs. During the second yearof establishment, the total annual operatingcost is $2,991.94 per acre. The interest on theestablishment costs from year one is incurredin the second year at $531.38 per acre. The inter-est is based on the establishment expense of$6,251.54 at 8.5% interest. The total fixed costfor the second year is $1,405.59 per acre, whilethe total variable cost is $1,586.35 per acre.

Third-Year Establishment Costs(Appendix Tables 3a, 3b)After pruning in early spring of year three,the last catch wire is added. The crop is fertil-ized with 40 pounds of nitrogen through thedrip system. The control of insects and pestsbecomes more intense in the third year andRally and Dimethoate are the main chemicalsin use. Additional hand suckering and sum-mer training are involved now that the vinesare beginning to mature. After developingstrong uniform vines in the first two years,the vines are able to produce a limited cropin the third year. Bird control is now neces-sary to prevent crop damage.

The harvested crop yields 2.5 tons of grapesin the third year. Harvesting cost is $187.50per acre and the hauling cost is $37.50 peracre. The interest on the investment fromthe first two years of establishment is $785.69per acre. Total cost incurred during the year is$3,463.02 per acre, while the revenue gener-ated from the harvest is $2,700.00, leaving anet loss of $763.02 per acre for the third year.

Fourth-Year Establishment Costs(Appendix Tables 4a, 4b)In the fourth year of establishment, insectand fungi control become even more intense.For this reason, a canopy management costof $150.00 per acre is added to account forthe expense and time entailed in developingand managing a healthy canopy. This practiceincludes the shoot thinning and allows forthe reduction of fungicide use throughoutthe vineyard. Weed control is maintained by

making several sprays, including a spot sprayof Roundup in June. Real estate taxes increase,as the vineyard is viewed as being in full pro-duction, for tax purposes.

The harvesting cost and hauling expense of$370.20 becomes the largest variable cost, asproduction increases to maturity and a 4-tonper acre crop is harvested. The total cost peracre is $3,508.58, with a variable cost of$1,660.54 per acre. Revenue generated fromthe harvest in the fourth year is $4,320.00per acre, providing a net positive return forthe year of $811.42 per acre.

Production Costs and Profit Levels fora Merlot Vineyard in Full Production(Appendix Tables 5a, 5b)In the fifth year, the vineyard is consideredin its first full year of production. Operationsin the full year of production include routinecultural practices. The practices consist ofpruning in early spring, fertilizing, weedcontrol, irrigation for the year, and fungicidetreatment during the summer.

The net investment cost is amortized overthe remaining 16 years of the vineyard’s lifeat an 8.5% interest rate, for a net establish-ment cost of $1,072.27 per acre. The net invest-ment cost is the summation of the net costsand returns for year one through four, for atotal of $9,195.08 per acre. Amortizing thenet investment cost at the 8.5% rate providesfor the establishment cost. Total variable costfor the full production years is $1,702.89 andthe total fixed cost is $2,069.76 per acre. A netreturn of $547.35 per acre is received over thefull production year period.

Annual Establishment Costsfor 55-Acre ChardonnayVineyard

In general, the operations described for theMerlot vineyard are the same as those for aChardonnay vineyard. It is assumed for thepurposes of this study that all cultural prac-tices and establishment practices remain thesame. Aspects that differ for a Chardonnayvineyard compared with Merlot include lower

6

real estate taxes in the productive years and adifferent price and yield. The higher yield forChardonnay results in an increased expensefor harvesting cost and hauling, which varieswith the production level. These changes inthe costing structure will also alter the invest-ment costs and the amortized net establish-ment cost. A summary of the costs and rev-enues for the entire establishment period andfull production year for the Chardonnay vine-yard are presented in Table 2.

A harvestable crop is not received in the firsttwo years of production. A yield of 3.5 tons peracre is received in the third year. However, therevenue for that year is not sufficient to coverthe total costs, resulting in a net return of anegative $615.57 per acre. By the fourth year,the vineyard produces a yield of 5 tons peracre, which generates the first annual positivenet return. The net return per acre in full pro-duction is $351.48, which is lower than theamount received from the Merlot variety, pri-marily because of lower Chardonnay prices.

Conclusions

A large initial investment is required to estab-lish a vineyard in the first year. The first gen-eration of revenue occurs in the end of thethird year, but does not entirely offset thetotal costs. The annual costs are covered inthe fourth year of establishment and a posi-tive cash flow starts for both Merlot andChardonnay varieties. At the price and yieldlevels used in this study a positive profit isreceived in mature vineyards.

This analysis is based on a set of the assump-tions and conditions established for thisstudy. Expenses, cultural practices, and otherconditions can affect the farm-to-farm costs.Growers should recognize that the bulletinuses assumptions such as new machinerycost, and economic costs in the generationof the budgets. Nonetheless, it does providea basis for analyzing the economic implica-tions of establishing and producing a Merlotand Chardonnay wine grape vineyard.

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Table 2. Overall Production, Revenue and Costs Per Acre for a Chardonnay Vineyard

YearRevenue/Cost Category 1 2 3 4 Mature

Production (tons) 0.00 0.00 3.50 5.00 5.00

Price ($/ton) 840.00 840.00 840.00 840.00 840.00

Total Revenue ($) 0.00 0.00 2,940.00 4,200.00 4,200.00

Total Variable Costs ($) 4,284.37 1,586.35 1,813.26 1,753.08 1,795.44

Total Fixed Costs ($) 1,967.17 1,405.59 1,742.31 1,815.20 2,053.08

Total Costs ($) 6,251.54 2,991.94 3,555.57 3,568.28 3,848.52

Net Returns ($) (6,251.54) (2,991.94) (615.57) 631.72 351.48

Accumulated Net Cost ($) 6,251.54 9,243.48 9,859.05 9,227.33

Appendix

APPENDIX TABLE 1A. Year One Itemized Cost Per Acre for Merlot

PRICE OR VALUE OR YOURUNIT COST/UNIT QUANTITY COST VINEYARD

VARIABLE COSTSCUSTOM WORK ACRE $200.00 1.00 $200.00 ___________SURVEY STAKES EACH .07 15.00 1.05 ___________END POST EACH 4.19 16.00 67.04 ___________UNSPADED STAKE EACH 2.20 484.00 1064.80 ___________#11 WIRE HT FOOT .02 230.00 4.14 ___________TRACT. & DRIVER ACRE 30.00 1.00 30.00 ___________PLANTER RENTAL ACRE 8.00 1.00 8.00 ___________GRAPE PLANTS EACH .70 968.00 677.60 ___________WIRE CRIMPER ACRE 5.00 1.00 5.00 ___________#13 WIRE HT FOOT .01 5030.00 55.33 ___________SURFLAN AS GAL. 93.00 .40 37.20 ___________GROW TUBES EACH .45 968.00 435.60 ___________NITROGEN POUN .20 50.00 10.00 ___________CUSTOM DISCING ACRE 20.00 1.00 20.00 ___________ROUNDUP GAL. 33.06 .25 8.27 ___________GRASS SEEDER RT ACRE 10.00 1.00 10.00 ___________CRSTD WHEAT GRS POUN 1.06 15.00 15.90 ___________LABOR HOUR 8.76 57.19 500.99 ___________LABOR(TRAC/MACH) ACRE 340.31 1.00 340.31 ___________IRR. ELECT. CHG ACRE 30.00 1.00 30.00 ___________IRR. WATER CHRG ACRE 80.00 1.00 80.00 ___________IRR. REPAIRS ACRE 32.00 1.00 32.00 ___________TRACTOR REPAIR ACRE 71.87 1.00 71.87 ___________TRACTOR FUEL/LUBE ACRE 161.25 1.00 161.25 ___________MACHINERY REPAIRS ACRE 34.83 1.00 34.83 ___________MACHINE FUEL/LUBE ACRE 30.05 1.00 30.05 ___________INTEREST ON OP. CAP. ACRE 273.16 1.00 273.16 ___________OVERHEAD ACRE 80.00 1.00 80.00 ___________

TOTAL VARIABLE COST 4284.37 ___________

FIXED COSTSTRACTOR DEPRECIATION ACRE $78.73 1.00 $78.73 ___________TRACTOR INTEREST ACRE 70.86 1.00 70.86 ___________TRACTOR INSURANCE ACRE 4.72 1.00 4.72 ___________TRACTOR TAXES ACRE 11.02 1.00 11.02 ___________TRACTOR HOUSING ACRE 7.87 1.00 7.87 ___________MACHINE DEPRECIATION ACRE 64.59 1.00 64.59 ___________MACHINE INTEREST ACRE 51.62 1.00 51.62 ___________MACHINE INSURANCE ACRE 3.44 1.00 3.44 ___________MACHINE TAXES ACRE 8.03 1.00 8.03 ___________MACHINE HOUSING ACRE 5.74 1.00 5.74 ___________IRR. EQUIP ACRE 1100.00 1.00 1100.00 ___________ESTATE TX (1–3) ACRE 55.54 1.00 55.54 ___________LAND VALUE ACRE 280.00 1.00 280.00 ___________MANAGEMENT FEE ACRE 225.00 1.00 225.00 ___________

TOTAL FIXED COST 1967.17 ___________

TOTAL COST 6251.54 ___________

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ISC

ING

APR

1.0

0.0

0.0

0.0

0.0

020

.00

.00

1.42

21.4

221

.42

SPRA

Y W

EED

S60

HP,

100

GA

L SP

RAYE

RJU

L1

.15

.18

3.40

1.61

1.89

.00

8.27

.58

12.3

515

.75

DIS

C60

HP,

DIS

CA

UG

12.

002.

2019

.17

22.6

623

.10

.00

.00

1.95

47.7

166

.88

PLA

NT

CO

VER

60 H

P, R

ENTE

D G

RASS

SEE

DER

SEP

1.5

7.6

93.

825.

157.

2410

.00

15.9

01.

3639

.65

43.4

7IR

RIG

ATIO

NEQ

UIP

MEN

T SH

UT-

DO

WN

OC

T1

.00

.25

.00

.00

2.19

.00

.00

.06

2.25

2.25

RAIS

E G

ROW

TU

BES

RAIS

E G

ROW

TU

BES

BEFO

RE W

INTE

RO

CT

1.0

05.

00.0

0.0

043

.80

.00

.00

1.24

45.0

445

.04

IRRI

GAT

ION

IRRI

GAT

E A

PRIL

–OC

TOBE

RSE

A1

.00

6.00

.00

.00

52.5

614

2.00

.00

8.27

202.

8320

2.83

MA

NA

GEM

ENT

FEE

CO

ST O

F M

AN

AG

EMEN

TA

NN

1.0

0.0

022

5.00

.00

.00

.00

.00

.00

.00

225.

00PI

CKU

PM

ISC

. USE

AN

N1

5.60

6.16

33.2

028

.46

64.6

8.0

0.0

03.

9697

.10

130.

294-

WH

EEL

CYC

LEM

ISC

. USE

AN

N1

3.42

.00

7.82

7.18

.00

.00

.00

.31

7.49

15.3

1LA

ND

NET

LA

ND

REN

TA

NN

1.0

0.0

028

0.00

.00

.00

.00

.00

.00

.00

280.

00TA

XES

REA

L ES

TATE

AN

N1

.00

.00

55.5

4.0

0.0

0.0

0.0

0.0

0.0

055

.54

OVE

RHEA

DU

TILI

TIES

, LEG

AL,

AC

CTN

G, E

TC.

AN

N1

.00

.00

.00

.00

.00

80.0

0.0

03.

4083

.40

83.4

0

TOTA

L PE

R A

CR

E32

.58

89.6

019

67.1

729

8.00

841.

3049

5.00

2376

.93

273.

1642

84.3

762

51.5

4

12

APPENDIX TABLE 2A. Year Two Itemized Cost Per Acre for Merlot


VARIABLE COSTSWIRE CLIPS EACH $.04 1089.00 $43.56 ___________NITROGEN POUN .20 40.00 8.00 ___________SURFLAN AS GAL. 93.00 .40 37.20 ___________AUGER RENT(PLT) ACRE 5.60 1.00 5.60 ___________GRAPE PLANTS EACH .70 30.00 21.00 ___________RALLY POUN 88.00 .31 27.28 ___________ROUNDUP GAL. 33.06 .25 8.27 ___________PLASTIC RIBBON FOOT .003 4792.00 11.98 ___________LABOR HOUR 8.76 92.75 812.49 ___________LABOR (TRAC/MACH) ACRE 102.48 1.00 102.48 ___________IRR. ELECT. CHG ACRE 30.00 1.00 30.00 ___________IRR. WATER CHRG ACRE 80.00 1.00 80.00 ___________IRR. REPAIRS ACRE 32.00 1.00 32.00 ___________TRACTOR REPAIR ACRE 9.19 1.00 9.19 ___________TRACTOR FUEL/LUBE ACRE 20.61 1.00 20.61 ___________MACHINERY REPAIRS ACRE 48.34 1.00 48.34 ___________MACHINE FUEL/LUBE ACRE 133.89 1.00 133.89 ___________INTEREST ON OP. CAP. ACRE 74.46 1.00 74.46 ___________OVERHEAD ACRE 80.00 1.00 80.00 ___________


FIXED COSTSTRACTOR DEPRECIATION ACRE $10.07 1.00 $10.07 ___________TRACTOR INTEREST ACRE 9.06 1.00 9.06 ___________TRACTOR INSURANCE ACRE .60 1.00 .60 ___________TRACTOR TAXES ACRE 1.41 1.00 1.41 ___________TRACTOR HOUSING ACRE 1.01 1.00 1.01 ___________MACHINE DEPRECIATION ACRE 105.19 1.00 105.19 ___________MACHINE INTEREST ACRE 139.75 1.00 139.75 ___________MACHINE INSURANCE ACRE 9.32 1.00 9.32 ___________MACHINE TAXES ACRE 21.74 1.00 21.74 ___________MACHINE HOUSING ACRE 15.53 1.00 15.53 ___________ESTATE TX (1–3) ACRE 55.54 1.00 55.54 ___________INT ON INV (YR2) ACRE 531.38 1.00 531.38 ___________LAND VALUE ACRE 280.00 1.00 280.00 ___________MANAGEMENT FEE ACRE 225.00 1.00 225.00 ___________

TOTAL FIXED COST 1405.59 ___________

TOTAL COST 2991.94 ___________

13

APP

END

IX T

AB

LE 2

B. Y

ear

Two

Sch

edul

e o

f O

per

atio

ns

and

Est

imat

ed C

ost

s Pe

r A

cre

for

Mer

lot

VA

RIA

BLE

CO

STT

OTA

LFU

EL,

TO

TAL

MA

CH

LAB

OR

FIX

EDLU

BE,

&V

AR

IAB

LET

OTA

LO

PER

AT

ION

TO

OLI

NG

MT

HY

EAR

HO

UR

SH

OU

RS

CO

STR

EPA

IRS

LAB

OR

SER

VIC

EM

AT

ER.

INT

ER.

CO

STC

OST

MO

VIN

G T

RIC

KLE

LABO

R, C

LIPS

FEB

2.0

09.

00$.

00$.

00$7

8.84

$.00

$43.

56$.

00$1

22.4

0$1

22.4

0PR

UN

E VI

NES

HA

ND

PRU

NE

AN

D T

OU

CH

UP

MA

R2

.00

14.0

0.0

0.0

012

2.64

.00

.00

9.56

132.

2013

2.20

REPL

AN

T60

HP,

TRA

ILER

, AU

GER

, PLA

NTS

APR

2.4

64.

556.

435.

0740

.82

5.60

21.0

05.

1377

.62

84.0

5FE

RTIL

IZE

AQ

UA

TH

ROU

GH

TRI

CKL

E SY

STEM

APR

2.0

0.0

0.0

0.0

0.0

0.0

08.

00.5

78.

578.

57LO

WER

GRO

W T

UBE

SLO

WER

GRO

W T

UBE

S/2N

D S

EASO

NA

PR2

.00

5.00

.00

.00

43.8

0.0

0.0

03.

1046

.90

46.9

0W

EED

CO

NTR

OL

60 H

P, 1

00 G

AL.

SPR

AYER

APR

2.4

6.5

510

.43

4.95

5.78

.00

37.2

03.

3951

.31

61.7

4IR

RIG

ATIO

NEQ

UIP

MEN

T ST

ART

-UP

APR

2.0

0.5

0.0

0.0

04.

38.0

0.0

0.3

14.

694.

69M

OW

CO

VER

CRO

P60

HP,

MO

WER

MAY

2.4

9.5

94.

705.

726.

19.0

0.0

0.7

612

.67

17.3

8TR

AIN

ING

HA

ND

SU

CKE

RIN

GM

AY2

.00

5.00

.00

.00

43.8

0.0

0.0

02.

7946

.59

46.5

9M

OW

CO

VER

CRO

P60

HP,

MO

WER

JUN

2.4

9.5

94.

705.

726.

19.0

0.0

0.6

812

.59

17.2

9FU

NG

ICID

E60

HP,

400

GA

L. S

PRAY

ERJU

N2

.46

.55

20.2

88.

775.

78.0

027

.28

2.37

44.1

964

.47

SPRA

Y W

EED

S60

HP,

100

GA

L SP

RAYE

RJU

N2

.15

.18

3.40

1.61

1.89

.00

8.27

.67

12.4

315

.84

SUM

MER

TRA

ININ

GLA

BOR

& R

IBBO

NJU

N2

.00

25.0

0.0

0.0

021

9.00

.00

11.9

813

.09

244.

0724

4.07

SUM

MER

TRA

ININ

GLA

BOR

JUL

2.0

010

.00

.00

.00

87.6

0.0

0.0

04.

3491

.94

91.9

4M

OW

CO

VER

CRO

P60

HP,

MO

WER

JUL

2.4

9.5

94.

705.

726.

19.0

0.0

0.5

912

.50

17.2

1SU

MM

ER T

RAIN

ING

LABO

RA

UG

2.0

010

.00

.00

.00

87.6

0.0

0.0

03.

7291

.32

91.3

2IR

RIG

ATIO

NEQ

UIP

MEN

T SH

UT-

DO

WN

OC

T2

.00

.25

.00

.00

2.19

.00

.00

.06

2.25

2.25

FRO

ST P

ROTE

CTI

ON

WIN

D M

AC

HIN

E–SP

RIN

G A

ND

FA

LLSE

A2

.00

4.00

218.

0013

8.85

35.0

4.0

0.0

07.

3918

1.28

399.

28IR

RIG

ATIO

NIR

RIG

ATE

APR

IL–O

CTO

BER

SEA

2.0

06.

00.0

0.0

052

.56

142.

00.0

08.

2720

2.83

202.

83M

AN

AG

EMEN

T FE

EC

OST

OF

MA

NA

GEM

ENT

AN

N2

.00

.00

225.

00.0

0.0

0.0

0.0

0.0

0.0

022

5.00

PIC

KUP

MIS

C. U

SEA

NN

25.

606.

1633

.20

28.4

664

.68

.00

.00

3.96

97.1

013

0.29

4-W

HEE

L C

YCLE

MIS

C. U

SEA

NN

23.

42.0

07.

827.

18.0

0.0

0.0

0.3

17.

4915

.31

ESTB

. CO

STIN

TERE

ST O

N E

STA

BLIS

HM

ENT

CO

STA

NN

2.0

0.0

053

1.38

.00

.00

.00

.00

.00

.00

531.

38LA

ND

REN

TN

ET L

AN

D R

ENT

AN

N2

.00

.00

280.

00.0

0.0

0.0

0.0

0.0

0.0

028

0.00

TAX

ESRE

AL

ESTA

TEA

NN

2.0

0.0

055

.54

.00

.00

.00

.00

.00

.00

55.5

4O

VERH

EAD

UTI

LITI

ES, L

EGA

L, A

CC

TNG

, ETC

.A

NN

2.0

0.0

0.0

0.0

0.0

080

.00

.00

3.40

83.4

083

.40

TOTA

L PE

R A

CR

E12

.02

102.

5114

05.5

921

2.04

914.

9722

7.60

157.

2974

.46

1586

.35

2991

.94

14

APPENDIX TABLE 3A. Year Three Itemized Cost Per Acre for Merlot


VARIABLE COSTSPLASTIC RIBBON FOOT $.003 2236.00 $5.59 ___________#13 WIRE HT FOOT .01 5030.00 55.33 ___________SURFLAN AS GAL. 93.00 .40 37.20 ___________NITROGEN POUN .20 40.00 8.00 ___________RALLY POUN 88.00 .93 81.84 ___________DIMETHOATE POUN 4.04 12.00 48.48 ___________BIRD CONTROL ACRE 10.00 2.00 20.00 ___________CUSTOM HARVEST TON 75.00 2.50 187.50 ___________CUSTOM HAULING TON 15.00 2.50 37.50 ___________LABOR HOUR 8.76 65.75 575.97 ___________LABOR (TRAC/MACH) ACRE 129.57 1.00 129.57 ___________IRR. ELECT. CHG ACRE 30.00 1.00 30.00 ___________IRR. WATER CHRG ACRE 80.00 1.00 80.00 ___________IRR. REPAIRS ACRE 32.00 1.00 32.00 ___________TRACTOR REPAIR ACRE 15.86 1.00 15.86 ___________TRACTOR FUEL/LUBE ACRE 35.60 1.00 35.60 ___________MACHINERY REPAIRS ACRE 65.86 1.00 65.86 ___________MACHINE FUEL/LUBE ACRE 133.89 1.00 133.89 ___________INTEREST ON OP. CAP. ACRE 60.52 1.00 60.52 ___________OVERHEAD ACRE 80.00 1.00 80.00 ___________


FIXED COSTSTRACTOR DEPRECIATION ACRE 17.38 1.00 17.38 ___________TRACTOR INTEREST ACRE 15.64 1.00 15.64 ___________TRACTOR INSURANCE ACRE 1.04 1.00 1.04 ___________TRACTOR TAXES ACRE 2.43 1.00 2.43 ___________TRACTOR HOUSING ACRE 1.74 1.00 1.74 ___________MACHINE DEPRECIATION ACRE 140.89 1.00 140.89 ___________MACHINE INTEREST ACRE 162.72 1.00 162.72 ___________MACHINE INSURANCE ACRE 10.85 1.00 10.85 ___________MACHINE TAXES ACRE 25.31 1.00 25.31 ___________MACHINE HOUSING ACRE 18.08 1.00 18.08 ___________ESTATE TX (1–3) ACRE 55.54 1.00 55.54 ___________INT ON INV (YR3) ACRE 785.69 1.00 785.69 ___________LAND VALUE ACRE 280.00 1.00 280.00 ___________MANAGEMENT FEE ACRE 225.00 1.00 225.00 ___________

TOTAL FIXED COST 1742.31 ___________

TOTAL COST 3463.02 ___________

15

APP

END

IX T

AB

LE 3

B. Y

ear

Thre

e Sc

hed

ule

of

Op

erat

ion

s an

d E

stim

ated

Co

sts

Per

Acr

e fo

r M

erlo

t

VA

RIA

BLE

CO

STT

OTA

LFU

EL,

TO

TAL

MA

CH

LAB

OR

FIX

EDLU

BE,

&V

AR

IAB

LET

OTA

LO

PER

AT

ION

TO

OLI

NG

MT

HY

EAR

HO

UR

SH

OU

RS

CO

STR

EPA

IRS

LAB

OR

SER

VIC

EM

AT

ER.

INT

ER.

CO

STC

OST

PRU

NE

HA

ND

PRU

NE

AN

D T

OU

CH

UP

FEB

3.0

017

.00

$.00

$.00

$148

.92

$.00

$.00

$.00

$148

.92

$148

.92

MO

W P

RUN

ING

S60

HP,

MO

WER

FEB

3.4

9.5

94.

705.

726.

19.0

0.0

0.0

011

.91

16.6

2C

ATC

H W

IRE

60 H

P, T

RAIL

ER, #

13 W

IRE

FEB

3.4

66.

556.

435.

0758

.34

.00

55.3

3.0

011

8.74

125.

17TI

ELA

BOR

& R

IBBO

NFE

B3

.00

8.00

.00

.00

70.0

8.0

05.

59.0

075

.67

75.6

7W

EED

CO

NTR

OL

60 H

P, 1

00 G

AL.

SPR

AYER

APR

3.4

6.5

510

.43

4.95

5.78

.00

37.2

03.

3951

.31

61.7

4FE

RTIL

IZE

AQ

UA

TH

ROU

GH

TRI

CKL

E SY

STEM

APR

3.0

0.0

0.0

0.0

0.0

0.0

08.

00.5

78.

578.

57IR

RIG

ATIO

NEQ

UIP

MEN

T ST

ART

-UP

APR

3.0

0.5

0.0

0.0

04.

38.0

0.0

0.3

14.

694.

69FU

NG

ICID

E60

HP,

400

GA

L. S

PRAY

ERM

AY3

.46

.55

20.2

88.

775.

78.0

027

.28

2.67

44.4

964

.77

SUC

KERI

NG

HA

ND

SU

CKE

RIN

GM

AY3

.00

5.00

.00

.00

43.8

0.0

0.0

02.

7946

.59

46.5

9M

OW

CO

VER

CRO

P60

HP,

MO

WER

MAY

3.4

9.5

94.

705.

726.

19.0

0.0

0.7

612

.67

17.3

8SU

MM

ER T

RAIN

ING

LABO

RM

AY3

.00

10.0

0.0

0.0

087

.60

.00

.00

5.58

93.1

893

.18

MO

W C

OVE

R C

ROP

60 H

P, M

OW

ERJU

N3

.49

.59

4.70

5.72

6.19

.00

.00

.68

12.5

917

.29

INSE

CT

CO

NTR

OL

60 H

P, 4

00 G

AL.

SPR

AYER

JUN

3.4

6.5

520

.28

8.77

5.78

.00

24.2

42.

2040

.98

61.2

6FU

NG

ICID

E60

HP,

400

GA

L. S

PRAY

ERJU

N3

.46

.55

20.2

88.

775.

78.0

027

.28

2.37

44.1

964

.47

SUC

KERI

NG

HA

ND

SU

CKE

RIN

GJU

N3

.00

5.00

.00

.00

43.8

0.0

0.0

02.

4846

.28

46.2

8M

OW

CO

VER

CRO

P60

HP,

MO

WER

JUL

3.4

9.5

64.

705.

725.

88.0

0.0

0.5

812

.17

16.8

8IN

SEC

T C

ON

TRO

L60

HP,

400

GA

L. S

PRAY

ERJU

L3

.46

.55

20.2

88.

775.

78.0

024

.24

1.92

40.7

060

.98

SUM

MER

TRA

ININ

GLA

BOR

JUL

3.0

02.

00.0

0.0

017

.52

.00

.00

.87

18.3

918

.39

FUN

GIC

IDE

60 H

P, 4

00 G

AL.

SPR

AYER

JUL

3.4

6.5

520

.28

8.77

5.78

.00

27.2

82.

0743

.90

64.1

7SU

MM

ER T

RAIN

ING

LABO

RA

UG

3.0

02.

00.0

0.0

017

.52

.00

.00

.74

18.2

618

.26

BIRD

CO

NTR

OL

LABO

R A

ND

MAT

ERIA

LSA

UG

3.0

0.0

0.0

0.0

0.0

010

.00

.00

.43

10.4

210

.42

BIRD

CO

NTR

OL

LABO

R A

ND

MAT

ERIA

LSSE

P3

.00

.00

.00

.00

.00

10.0

0.0

0.3

510

.35

10.3

5H

ARV

EST

CU

STO

M H

ARV

ESTI

NG

OC

T3

.00

.00

.00

.00

.00

225.

00.0

06.

3823

1.37

231.

37IR

RIG

ATIO

NEQ

UIP

MEN

T SH

UT-

DO

WN

OC

T3

.00

.25

.00

.00

2.19

.00

.00

.06

2.25

2.25

FRO

ST P

ROTE

CTI

ON

WIN

D M

AC

HIN

E–SP

RIN

G A

ND

FA

LLSE

A2

.00

4.00

218.

0013

8.85

35.0

4.0

0.0

07.

3918

1.28

399.

28IR

RIG

ATIO

NIR

RIG

ATE

APR

IL–O

CTO

BER

SEA

3.0

06.

00.0

0.0

052

.56

142.

00.0

08.

2720

2.83

202.

83M

AN

AG

EMEN

T FE

EC

OST

OF

MA

NA

GEM

ENT

AN

N3

.00

.00

225.

00.0

0.0

0.0

0.0

0.0

0.0

022

5.00

PIC

KUP

MIS

C. U

SEA

NN

35.

606.

1633

.20

28.4

664

.68

.00

.00

3.96

97.1

013

0.29

4-W

HEE

L C

YCLE

MIS

C. U

SEA

NN

33.

42.0

07.

827.

18.0

0.0

0.0

0.3

17.

4915

.31

ESTB

. CO

STIN

TERE

ST O

N E

STA

BLIS

HM

ENT

CO

STA

NN

3.0

0.0

078

5.69

.00

.00

.00

.00

.00

.00

785.

69LA

ND

NET

LA

ND

REN

TA

NN

3.0

0.0

028

0.00

.00

.00

.00

.00

.00

.00

280.

00TA

XES

REA

L ES

TATE

AN

N3

.00

.00

55.5

4.0

0.0

0.0

0.0

0.0

0.0

055

.54

OVE

RHEA

DU

TILI

TIES

, LEG

AL,

AC

CTN

G, E

TC.

AN

N3

.00

.00

.00

.00

.00

80.0

0.0

03.

4083

.40

83.4

0

TOTA

L PE

R A

CR

E14

.20

78.0

917

42.3

125

1.21

705.

5446

7.00

236.

4460

.52

1720

.71

3463

.02

16

APPENDIX TABLE 4A. Year Four Itemized Cost Per Acre for Merlot


VARIABLE COSTSPLASTIC RIBBON FOOT $.003 1597.00 $3.99 __________NITROGEN POUN .20 40.00 8.00 __________SURFLAN AS GAL. 93.00 .40 37.20 __________RALLY POUN 88.00 .93 81.84 __________ROUNDUP GAL. 33.06 .30 9.92 __________DIMETHOATE POUN 4.04 12.00 48.48 __________CANOPY MANAGE ACRE 150.00 1.00 150.00 __________BIRD CONTROL ACRE 10.00 2.00 20.00 __________CUSTOM HARVEST TON 75.00 4.00 300.00 __________CUSTOM HAULING TON 15.00 4.00 60.00 __________LABOR HOUR 8.76 32.75 286.89 __________LABOR (TRAC/MACH) ACRE 124.63 1.00 124.63 __________IRR. ELECT. CHG ACRE 30.00 1.00 30.00 __________IRR. WATER CHRG ACRE 80.00 1.00 80.00 __________IRR. REPAIRS ACRE 32.00 1.00 32.00 __________TRACTOR REPAIR ACRE 14.58 1.00 14.58 __________TRACTOR FUEL/LUBE ACRE 32.71 1.00 32.71 __________MACHINERY REPAIRS ACRE 65.39 1.00 65.39 __________MACHINE FUEL/LUBE ACRE 133.89 1.00 133.89 __________INTEREST ON OP. CAP. ACRE 61.01 1.00 61.01 __________OVERHEAD ACRE 80.00 1.00 80.00 __________

TOTAL VARIABLE COST 1660.53 __________

FIXED COSTSTRACTOR DEPRECIATION ACRE $15.97 1.00 $15.97 __________TRACTOR INTEREST ACRE 14.37 1.00 14.37 __________TRACTOR INSURANCE ACRE .96 1.00 .96 __________TRACTOR TAXES ACRE 2.24 1.00 2.24 __________TRACTOR HOUSING ACRE 1.60 1.00 1.60 __________MACHINE DEPRECIATION ACRE 139.84 1.00 139.84 __________MACHINE INTEREST ACRE 161.69 1.00 161.69 __________MACHINE INSURANCE ACRE 10.78 1.00 10.78 __________MACHINE TAXES ACRE 25.15 1.00 25.15 __________MACHINE HOUSING ACRE 17.97 1.00 17.97 __________ESTATE TX (3+) ACRE 101.94 1.00 101.94 __________INT ON INV (YR4) ACRE 850.55 1.00 850.55 __________LAND VALUE ACRE 280.00 1.00 280.00 __________MANAGEMENT FEE ACRE 225.00 1.00 225.00 __________

TOTAL FIXED COST 1848.04 __________

TOTAL COST 3508.58 __________

17

APP

END

IX T

AB

LE 4

B. Y

ear

Four

Sch

edul

e o

f O

per

atio

ns

and

Est

imat

ed C

ost

s Pe

r A

cre

for

Mer

lot

VA

RIA

BLE

CO

STT

OTA

LFU

EL,

TO

TAL

MA

CH

LAB

OR

FIX

EDLU

BE,

&V

AR

IAB

LET

OTA

LO

PER

AT

ION

TO

OLI

NG

MT

HY

EAR

HO

UR

SH

OU

RS

CO

STR

EPA

IRS

LAB

OR

SER

VIC

EM

AT

ER.

INT

ER.

CO

STC

OST

PRU

NE

HA

ND

PRU

NE

AN

D H

AN

D T

OU

CH

UP

FEB

4.0

017

.00

.00

.00

148.

92.0

0.0

0.0

014

8.92

148.

92M

OW

PRU

NIN

GS

60 H

P, M

OW

ERFE

B4

.49

.59

4.70

5.72

6.19

.00

.00

.00

11.9

116

.62

TIE

LABO

R, R

IBBO

NFE

B4

.00

5.00

.00

.00

43.8

0.0

03.

99.0

047

.79

47.7

9FE

RTIL

IZE

AQ

UA

TH

RU T

RIC

KLE

SYST

EMA

PR4

.00

.00

.00

.00

.00

.00

8.00

.57

8.57

8.57

WEE

D C

ON

TRO

L60

HP,

100

GA

L. S

PRAY

ERA

PR4

.46

.55

10.4

34.

955.

78.0

037

.20

3.39

51.3

161

.74

IRRI

GAT

ION

EQU

IPM

ENT

STA

RT-U

PA

PR4

.00

.50

.00

.00

4.38

.00

.00

.31

4.69

4.69

MO

W C

OVE

R C

ROP

60 H

P, M

OW

ERM

AY4

.49

.59

4.70

5.72

6.19

.00

.00

.76

12.6

717

.38

FUN

GIC

IDE

60 H

P, 4

00 G

AL.

SPR

AYER

MAY

4.4

6.5

520

.28

8.77

5.78

.00

27.2

82.

6744

.49

64.7

7SP

OT

WEE

D C

TRL.

60 H

P, 1

00 G

AL.

SPR

AYER

JUN

4.0

4.0

5.9

1.4

3.5

3.0

09.

92.6

211

.49

12.4

0IN

SEC

T C

ON

TRO

L60

HP,

400

GA

L. S

PRAY

ERJU

N4

.46

.55

20.2

88.

775.

78.0

024

.24

2.20

40.9

861

.26

MO

W C

OVE

R C

ROP

60 H

P, M

OW

ERJU

N4

.49

.59

4.70

5.72

6.19

.00

.00

.68

12.5

917

.29

CA

NO

PY M

AN

AG

EC

AN

OPY

MA

NA

GEM

ENT

JUN

4.0

0.0

0.0

0.0

0.0

015

0.00

.00

8.50

158.

5015

8.50

FUN

GIC

IDE

60 H

P, 4

00 G

AL.

SPR

AYER

JUN

4.4

6.5

520

.28

8.77

5.78

.00

27.2

82.

3744

.19

64.4

7FU

NG

ICID

E60

HP,

400

GA

L. S

PRAY

ERJU

L4

.46

.55

20.2

88.

775.

78.0

027

.28

2.07

43.9

064

.17

INSE

CT

CO

NTR

OL

60 H

P, 4

00 G

AL.

SPR

AYER

JUL

4.4

6.5

520

.28

8.77

5.78

.00

24.2

41.

9240

.70

60.9

8M

OW

CO

VER

CRO

P60

HP,

MO

WER

JUL

4.4

9.5

94.

705.

726.

19.0

0.0

0.5

912

.50

17.2

1BI

RD C

ON

TRO

LLA

BOR

AN

D M

ATER

IALS

AU

G4

.00

.00

.00

.00

.00

10.0

0.0

0.4

310

.42

10.4

2BI

RD C

ON

TRO

LLA

BOR

AN

D M

ATER

IALS

SEP

4.0

0.0

0.0

0.0

0.0

010

.00

.00

.35

10.3

510

.35

IRRI

GAT

ION

EQU

IPM

ENT

SHU

TDO

WN

OC

T4

.00

.25

.00

.00

2.19

.00

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2.25

2.25

HA

RVES

TC

UST

OM

HA

RVES

TIN

G A

ND

HA

ULI

NG

OC

T4

.00

.00

.00

.00

.00

360.

00.0

010

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370.

2037

0.20

FRO

ST P

ROTE

CTI

ON

WIN

D M

AC

HIN

E–SP

RIN

G A

ND

FA

LLSE

A2

.00

4.00

218.

0013

8.85

35.0

4.0

0.0

07.

3918

1.28

399.

28IR

RIG

ATIO

NIR

RIG

ATE

APR

IL–O

CTO

BER

SEA

4.0

06.

00.0

0.0

052

.56

142.

00.0

08.

2720

2.83

202.

83M

AN

AG

EMEN

T FE

EC

OST

OF

MA

NA

GEM

ENT

AN

N4

.00

.00

225.

00.0

0.0

0.0

0.0

0.0

0.0

022

5.00

PIC

KUP

MIS

C. U

SEA

NN

45.

606.

1633

.20

28.4

664

.68

.00

.00

3.96

97.1

013

0.29

4-W

HEE

L C

YCLE

MIS

C. U

SEA

NN

43.

42.0

07.

827.

18.0

0.0

0.0

0.3

17.

4915

.31

ESTB

. CO

STIN

TERE

ST O

N E

STA

BLIS

HM

ENT

CO

STA

NN

4.0

0.0

085

0.55

.00

.00

.00

.00

.00

.00

850.

55LA

ND

NET

LA

ND

REN

TA

NN

4.0

0.0

028

0.00

.00

.00

.00

.00

.00

.00

280.

00TA

XES

REA

L ES

TATE

AN

N4

.00

.00

101.

94.0

0.0

0.0

0.0

0.0

0.0

010

1.94

OVE

RHEA

DU

TILI

TIES

, LEG

AL,

AC

CTN

G, E

TC.

AN

N4

.00

.00

.00

.00

.00

80.0

0.0

03.

4083

.40

83.4

0

TOTA

L PE

R A

CR

E13

.78

44.6

218

48.0

424

6.57

411.

5275

2.00

189.

4361

.01

1660

.53

3508

.58

APPENDIX TABLE 5A. Full Production Itemized Cost Per Acre for Merlot


VARIABLE COSTSMECH PRUNING ACRE $45.00 1.00 $45.00 ___________PLASTIC RIBBON FOOT .003 540.00 1.35 ___________NITROGEN POUN .20 40.00 8.00 ___________SURFLAN AS GAL. 93.00 .40 37.20 ___________RALLY POUN 88.00 .93 81.84 ___________ROUNDUP GAL. 33.06 .30 9.92 ___________DIMETHOATE POUN 4.04 12.00 48.48 ___________CANOPY MANAGE ACRE 150.00 1.00 150.00 ___________BIRD CONTROL ACRE 10.00 2.00 20.00 ___________CUSTOM HARVEST TON 75.00 4.00 300.00 ___________CUSTOM HAULING TON 15.00 4.00 60.00 ___________LABOR HOUR 8.76 32.75 286.89 ___________LABOR (TRAC/MACH) ACRE 124.63 1.00 124.63 ___________IRR. ELECT. CHG ACRE 30.00 1.00 30.00 ___________IRR. WATER CHRG ACRE 80.00 1.00 80.00 ___________IRR. REPAIRS ACRE 32.00 1.00 32.00 ___________TRACTOR REPAIR ACRE 14.58 1.00 14.58 ___________TRACTOR FUEL/LUBE ACRE 32.71 1.00 32.71 ___________MACHINERY REPAIRS ACRE 65.39 1.00 65.39 ___________MACHINE FUEL/LUBE ACRE 133.89 1.00 133.89 ___________INTEREST ON OP. CAP. ACRE 61.01 1.00 61.01 ___________OVERHEAD ACRE 80.00 1.00 80.00 ___________


FIXED COSTSTRACTOR DEPRECIATION ACRE $15.97 1.00 $15.97 ___________TRACTOR INTEREST ACRE 14.37 1.00 14.37 ___________TRACTOR INSURANCE ACRE .96 1.00 .96 ___________TRACTOR TAXES ACRE 2.24 1.00 2.24 ___________TRACTOR HOUSING ACRE 1.60 1.00 1.60 ___________MACHINE DEPRECIATION ACRE 139.84 1.00 139.84 ___________MACHINE INTEREST ACRE 161.69 1.00 161.69 ___________MACHINE INSURANCE ACRE 10.78 1.00 10.78 ___________MACHINE TAXES ACRE 25.15 1.00 25.15 ___________MACHINE HOUSING ACRE 17.97 1.00 17.97 ___________ESTATE TX (3+) ACRE 101.94 1.00 101.94 ___________INT ON INV (YR5) ACRE 1072.27 1.00 1072.27 ___________LAND VALUE ACRE 280.00 1.00 280.00 ___________MANAGEMENT FEE ACRE 225.00 1.00 225.00 ___________

TOTAL FIXED COST 2069.76 ___________

TOTAL COST 3772.65 ___________

18

19

APP

END

IX T

AB

LE 5

B. F

ull P

rod

ucti

on

Sch

edul

e o

f O

per

atio

ns

and

Est

imat

ed C

ost

s Pe

r A

cre

for

Mer

lot

VA

RIA

BLE

CO

STT

OTA

LFU

EL,

TO

TAL

MA

CH

LAB

OR

FIX

EDLU

BE,

&V

AR

IAB

LET

OTA

LO

PER

AT

ION

TO

OLI

NG

MT

HY

EAR

HO

UR

SH

OU

RS

CO

STR

EPA

IRS

LAB

OR

SER

VIC

EM

AT

ER.

INT

ER.

CO

STC

OST

PRU

NE

CU

STO

M P

RUN

E &

HA

ND

TO

UC

H U

PFE

B5

.00

17.0

0.0

0.0

014

8.92

45.0

0.0

0.0

019

3.92

193.

92TI

ELA

BOR,

RIB

BON

FEB

5.0

05.

00.0

0.0

043

.80

.00

1.35

.00

45.1

5 4

5.15

MO

W P

RUN

ING

S60

HP,

MO

WER

FEB

5.4

9.5

94.

705.

726.

19.0

0.0

0.0

011

.91

16.6

2FE

RTIL

IZE

AQ

UA

TH

RU T

RIC

KLE

SYST

EMA

PR5

.00

.00

.00

.00

.00

.00

8.00

.57

8.57

8.57

WEE

D C

ON

TRO

L60

HP,

100

GA

L. S

PRAY

ERA

PR5

.46

.55

10.4

34.

955.

78.0

037

.20

3.39

51.3

161

.74

IRRI

GAT

ION

EQU

IPM

ENT

STA

RT-U

PA

PR5

.00

.50

.00

.00

4.38

.00

.00

.31

4.69

4.69

MO

W C

OVE

R C

ROP

60 H

P, M

OW

ERM

AY5

.49

.59

4.70

5.72

6.19

.00

.00

.76

12.6

717

.38

FUN

GIC

IDE

60 H

P, 4

00 G

AL.

SPR

AYER

MAY

5.4

6.5

520

.28

8.77

5.78

.00

27.2

82.

6744

.49

64.7

7SP

OT

WEE

D C

TRL.

50 H

P, 1

00 G

AL.

SPR

AYER

JUN

5.0

4.0

5.9

1.4

3.5

3.0

09.

92.6

211

.49

12.4

0IN

SEC

T C

ON

TRO

L60

HP,

400

GA

L. S

PRAY

ERJU

N5

.46

.55

20.2

88.

775.

78.0

024

.24

2.20

40.9

861

.26

MO

W C

OVE

R C

ROP

60 H

P, M

OW

ERJU

N5

.49

.59

4.70

5.72

6.19

.00

.00

.68

12.5

917

.29

CA

NO

PY M

AN

AG

EC

AN

OPY

MA

NA

GEM

ENT

JUN

5.0

0.0

0.0

0.0

0.0

015

0.00

.00

8.50

158.

5015

8.50

FUN

GIC

IDE

60 H

P, 4

00 G

AL.

SPR

AYER

JUN

5.4

6.5

520

.28

8.77

5.78

.00

27.2

82.

3744

.19

64.4

7FU

NG

ICID

E60

HP,

400

GA

L. S

PRAY

ERJU

L5

.46

.55

20.2

88.

775.

78.0

027

.28

2.07

43.9

064

.17

INSE

CT

CO

NTR

OL

60 H

P, 4

00 G

AL.

SPR

AYER

JUL

5.4

6.5

520

.28

8.77

5.78

.00

24.2

41.

9240

.70

60.9

8M

OW

CO

VER

CRO

P60

HP,

MO

WER

JUL

5.4

9.5

94.

705.

726.

19.0

0.0

0.5

912

.50

17.2

1BI

RD C

ON

TRO

LLA

BOR

AN

D M

ATER

IALS

AU

G5

.00

.00

.00

.00

.00

10.0

0.0

0.4

310

.42

10.4

2BI

RD C

ON

TRO

LLA

BOR

AN

D M

ATER

IALS

SEP

5.0

0.0

0.0

0.0

0.0

010

.00

.00

.35

10.3

510

.35

IRRI

GAT

ION

LABO

RO

CT

5.0

0.2

5.0

0.0

02.

19.0

0.0

0.0

62.

252.

25H

ARV

EST

CU

STO

M H

ARV

ESTI

NG

OC

T5

.00

.00

.00

.00

.00

360.

00.0

010

.20

370.

2037

0.20

FRO

ST P

ROTE

CTI

ON

WIN

D M

AC

HIN

E–SP

RIN

G A

ND

FA

LLSE

A2

.00

4.00

218.

0013

8.85

35.0

4.0

0.0

07.

3918

1.28

399.

28IR

RIG

ATIO

NIR

RIG

ATE

APR

IL–O

CTO

BER

SEA

5.0

06.

00.0

0.0

056

.56

142.

00.0

08.

2720

2.83

202.

83M

AN

AG

EMEN

T FE

EC

OST

OF

MA

NA

GEM

ENT

AN

N5

.00

.00

225.

00.0

0.0

0.0

0.0

0.0

0.0

022

5.00

PIC

KUP

MIS

C. U

SEA

NN

55.

606.

1633

.20

28.4

664

.68

.00

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3.96

97.1

013

0.29

4-W

HEE

L C

YCLE

MIS

C. U

SEA

NN

53.

42.0

07.

827.

18.0

0.0

0.0

0.3

17.

4915

.31

ESTB

. CO

STIN

TERE

ST O

N E

STA

BLIS

HM

ENT

CO

STA

NN

5.0

0.0

010

72.2

7.0

0.0

0.0

0.0

0.0

0.0

010

72.2

7LA

ND

NET

LA

ND

REN

TA

NN

5.0

0.0

028

0.00

.00

.00

.00

.00

.00

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280.

00TA

XES

REA

L ES

TATE

AN

N5

.00

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101.

94.0

0.0

0.0

0.0

0.0

0.0

010

1.94

OVE

RHEA

DU

TILI

TIES

, LEG

AL,

AC

CTN

G, E

TC.

AN

N5

.00

.00

.00

.00

.00

80.0

0.0

03.

4083

.40

83.4

0

TOTA

L PE

R A

CR

E

21

.78

44.

62 2

069.

76 2

46.5

7 4

11.5

2 7

97.0

0 1

86.7

9 6

1.01

170

2.89

377

2.65

APP

END

IX T

AB

LE 6

A. H

our

ly M

ach

iner

y C

ost

s fo

r a

55-A

cre

Mer

lot

Vin

eyar

d

YEA

RS

TO

TAL

FUEL

TO

TAL

PU

RC

HA

SET

OA

NN

UA

LD

EPR

EC-

INSU

R-

FIX

EDA

ND

VA

RIA

BLE

TO

TAL

MA

CH

INER

YP

RIC

ET

RA

DE

HO

UR

SIA

TIO

NIN

TER

EST

AN

CE

TAX

ESH

OU

SIN

GC

OST

REP

AIR

LUB

EC

OST

CO

ST

$C

OST

PER

HO

UR

60 H

P TR

AC

TOR

30,5

00.0

020

500

3.05

2.75

.18

.43

.31

6.71

2.78

6.25

9.03

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20

APPENDIX TABLE 7. Prices of the materials and services

Items Units Price($)/Unit

Materials:Gasoline gal 1.50Diesel gal 1.56Propane gal 1.29Nitrogen lb 0.20Surflan gal 93.00Roundup gal 33.06Rally lb 88.00Dimethoate lb 4.00Crst Wheat Grass lb 1.06Plastic ribbon foot 0.003#11 Wire HT foot 0.02#13 Wire HT foot 0.01Wire clips each 0.20Unspaded stake each 2.20Trellis Post 5" x 8" (wood) each 4.19Nursery Stock each 0.70

Services:Labor–Manual hour 8.76Labor–Tractor hour 10.50Overhead acre 80.00Irrigation Water Charge acre 80.00Irrigation Energy Charge acre 30.00Real estate taxes (1–3) acre 55.54Real estate taxes (4+) acre 101.94Canopy manage acre 150.00

21

College of Agriculture and Home Economics

Copyright 2003 Washington State University

WSU Cooperative Extension bulletins contain material written and produced for public distri-bution. You may reprint written material, provided you do not use it to endorse a commercialproduct. Alternate formats of our educational materials are available upon request for personswith disabilities. Please contact the Information Department, College of Agriculture and HomeEconomics, Washington State University for more information.

You may order copies of this and other publications from the WSU Bulletin office, 1-800-723-1763,or online http://pubs.wsu.edu

Issued by Washington State University Cooperative Extension and the U.S. Department of Agri-culture in furtherance of the Acts of May 8 and June 30, 1914. WSU Cooperative Extensionprograms and policies are consistent with federal and state laws and regulations on nondiscrimina-tion regarding race, sex, religion, age, color, creed, national or ethnic origin; physical, mentalor sensory disability; marital status, sexual orientation, and status as a Vietnam-era or disabledveteran. Evidence of noncompliance may be reported through your local WSU CooperativeExtension office. Trade names have been used to simplify information; no endorsement isintended. Published July 2003. Price code C. Subject code 233. EB1955

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