western plain region 1987 - cornell...
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April 1988 AE Ext 88-4
WESTERN PLAIN REGION 1987
Stuart F Smith
Department ofAgricultural Economics New York State College ofAgriculture and Life Sciences
A Statutory College of the State University Cornell University Ithaca New York 14853-7801
1987 DAIRY FARM BUSINESS SUMMARY WESTERN PLAIN REGION
Table of Contents
INTRODUCTION 1
Program Obj ective 1
Format Features 1
SUMMARY AND ANALYSIS OF THE FARM BUSINESS 2
Business Characteristics 2
Income Statement 3
Profitability Analysis 6
Farm and Family Financial Status 8
Cash Flow Summary and Analysis 11
Repayment Analysis 12
Cropping Program Analysis 14
Dairy Program Analysis 16
Capital and Labor Efficiency Analysis 18
COMPARATIVE ANALYSIS OF THE FARM BUSINESS 19
Progress of the Farm Business 19
Farm Business Chart 20
Financial Analysis Chart 22
Comparisons by Type of Barn and Herd Size 23
Herd Size Comparisons 23
IDENTIFY AND SET GOALS 37
1987 DAIRY FARM BUSINESS SUMMARY WESTERN PLAIN REGION
INTRODUCTION
Dairy farmers throughout the State have been participating in Cornell Cooperative Extensions farm business summary and analysis program since the early 1950s Each participating farmer receives a complete business and production summary and analysis of his or her farm business The information in this report represents an average of the complete and accurate data submitted from farms in the region described at the bottom of this page
Prosram Objective
The primary objective of the dairy farm business summary DFBS is to help farmers improve their management skills through appropriate use of historical farm data and the application of modern farm business management decision-making techniques In short DFBS identifies the business and financial information farmers need and demonstrates how it should be used in identifying and evaluating the strengths and weaknesses of the farm business
Format Features
This regional report follows the same general format as in the 1987 DFBS printout received by all participating dairy farmers Worksheets have been included to give non-DFBS participants an opportunity to summarize their businesses The analysis tables include an open column or section labeled ~ Farm It may be used by any dairy farmer who wants to compare his or her business with the average data of this region
This report features
(1) an income statement including accrual accounting for farm business expenses and receipts as well as measures of profitability with and without appreciation
(2) a complete balance sheet including financial ratios (3) a cash flow summary including debt repayment ability (4) a croppins prosram analysis (5) a dairy prosram analysis and (6) capital and labor efficiency analysis
Micro DFBS a computer program which enables Cooperative Extension agents and specialists to calculate and print individual farm business reports in their offices is now being used by the dairy farm management field staff for more than 70 percent of the farms cooperating This innovative approach provides faster processing of farm record data and increased use of the DFBS in farm management programs
The Western Plain Region of New York State with the number of participating farms in parentheses is comprised of Erie (5) Genesee (9) Livingston (9) Monroe (1) Niagara (6) Orleans (5) and Wyoming (17) counties
This report was written by Stuart F Smith Senior Extension Associate Farm Management Linda Putnam was in charge of data preparation Cindy Farrell and Beverly Carcelli prepared the publication Farm Business data was collected by Cooperative Extension agents Merville Button and David Thorp and regional specialist George Allhusen
2
SUMMARY AND ANALYSIS OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of operatshying a successful farm Various combinations of farm resources enterprises business arrangements and management techniques are used by the dairy farmers in this region The following table shows important farm business characteristics and the number of farmers reporting these characteristics
BUSINESS CHARACTERISTICS 52 Western Plain Dairy Farms 1987
T)Qe of Fatm Number T)Qe of Businessect Numbet Dairy 47 Single proprietorship 23 Part-time dairy 0 Partnership 20 Dairy cash-crop 5 Corporation 9 Part-time cash-crop dairy 0
T~e of Own~rsniQ Number T)Qe of Barn Numb~r Owner 48 StanchionTie-Stall 11 Renter 4 Freestall 33
Combination 8
Milking S)stem NDber Business Record S)stem Number Bucket amp carry 0 ELFAC 3 Dumping station 2 Account Book 19 Pipeline 16 Agrifax (mail-in only) 16 Herringbone parlor 30 On-Farm Computer 11 Other parlor 4 Other 3
Production Records Number Number DHIC 39 Other 4 Owner-Sampler 9 None 0
The averages used in this report were compiled using data from all the participating dairy farms in this region unless noted otherwise There may be regular dairy farms part-time farms dairy cash-crop farms farm renters partnerships and corporations included in the average Dairy Termination Program QarticiQants that sold their cows in 1987 are not included in the report These specific classifications are used to separate farms in the State Business Summary
A Qatt-time farm has less than six months of labor from all operators and total labor is less than 12 months
Adair) casn-croQ farm has accrual receipts from crop sales that exceed 10 percent of accrual milk sales These farms were summarized using 1986 data in Knoblauch Wayne A and Linda D Putnam Dairy Farm Businessect Summaty New York Dairy-Cash CroQ Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-20 August 1987
A farm rentet does not own farm real estate at the end of the year or does not own tillable land These farms were summarized using 1986 data in Putnam Linda D and Stuart F Smith Dairy Farm Businesects Summaty Eastern New York Renter Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-19 August 1987
3
Income Statement
The accrual income statement begins with an accounting of all farm business expenses
CASH AND ACCRUAL FARM EXPENSES 52 Western Plain Dairy Farms 1987
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable - Expenses
Hired Labor ~ Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto exp (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landjbldgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES
$ 49664
82314 7411 1061
3737 20288
673 9885
2020 5540 9460
19354 o
17083
15385 6918 6752
6194 6774 5949
11362
1025 8008
27530 3952
$328339 5633
$ 0
-3326 848
5
o -24
o -121
o 48
-24 o o
-133
-876 -207 -611
-10 -50
-159 -56
o o o
-28 $ -4724
o
$ -106
-548 -932
o
70 -54
o -6
o 51
124 -38
o 115
-42 47
508
94 -283 -214
-19
o -5
-93 24
$ -1307 o
$ 49558
78440 7327 1066
3807 20210
673 9758
2020 5639 9560
19316 o
17065
14467 6758 6649
6278 6441 5576
11287
1025 8003
27437 3948
$322308 5633
28432 13 549
$369922
Cash paid is the actual amount of money paid out during the year and does not necessarily represent the cost of goods and services actually used
Change in inventory An increase in inventory is subtracted in computing accrual expenses because it represents purchased inputs not actually used during the year A decrease in inventory is added to expenses because it represents the cost of inputs purchased in a prior year and used this year
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 2: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/2.jpg)
1987 DAIRY FARM BUSINESS SUMMARY WESTERN PLAIN REGION
Table of Contents
INTRODUCTION 1
Program Obj ective 1
Format Features 1
SUMMARY AND ANALYSIS OF THE FARM BUSINESS 2
Business Characteristics 2
Income Statement 3
Profitability Analysis 6
Farm and Family Financial Status 8
Cash Flow Summary and Analysis 11
Repayment Analysis 12
Cropping Program Analysis 14
Dairy Program Analysis 16
Capital and Labor Efficiency Analysis 18
COMPARATIVE ANALYSIS OF THE FARM BUSINESS 19
Progress of the Farm Business 19
Farm Business Chart 20
Financial Analysis Chart 22
Comparisons by Type of Barn and Herd Size 23
Herd Size Comparisons 23
IDENTIFY AND SET GOALS 37
1987 DAIRY FARM BUSINESS SUMMARY WESTERN PLAIN REGION
INTRODUCTION
Dairy farmers throughout the State have been participating in Cornell Cooperative Extensions farm business summary and analysis program since the early 1950s Each participating farmer receives a complete business and production summary and analysis of his or her farm business The information in this report represents an average of the complete and accurate data submitted from farms in the region described at the bottom of this page
Prosram Objective
The primary objective of the dairy farm business summary DFBS is to help farmers improve their management skills through appropriate use of historical farm data and the application of modern farm business management decision-making techniques In short DFBS identifies the business and financial information farmers need and demonstrates how it should be used in identifying and evaluating the strengths and weaknesses of the farm business
Format Features
This regional report follows the same general format as in the 1987 DFBS printout received by all participating dairy farmers Worksheets have been included to give non-DFBS participants an opportunity to summarize their businesses The analysis tables include an open column or section labeled ~ Farm It may be used by any dairy farmer who wants to compare his or her business with the average data of this region
This report features
(1) an income statement including accrual accounting for farm business expenses and receipts as well as measures of profitability with and without appreciation
(2) a complete balance sheet including financial ratios (3) a cash flow summary including debt repayment ability (4) a croppins prosram analysis (5) a dairy prosram analysis and (6) capital and labor efficiency analysis
Micro DFBS a computer program which enables Cooperative Extension agents and specialists to calculate and print individual farm business reports in their offices is now being used by the dairy farm management field staff for more than 70 percent of the farms cooperating This innovative approach provides faster processing of farm record data and increased use of the DFBS in farm management programs
The Western Plain Region of New York State with the number of participating farms in parentheses is comprised of Erie (5) Genesee (9) Livingston (9) Monroe (1) Niagara (6) Orleans (5) and Wyoming (17) counties
This report was written by Stuart F Smith Senior Extension Associate Farm Management Linda Putnam was in charge of data preparation Cindy Farrell and Beverly Carcelli prepared the publication Farm Business data was collected by Cooperative Extension agents Merville Button and David Thorp and regional specialist George Allhusen
2
SUMMARY AND ANALYSIS OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of operatshying a successful farm Various combinations of farm resources enterprises business arrangements and management techniques are used by the dairy farmers in this region The following table shows important farm business characteristics and the number of farmers reporting these characteristics
BUSINESS CHARACTERISTICS 52 Western Plain Dairy Farms 1987
T)Qe of Fatm Number T)Qe of Businessect Numbet Dairy 47 Single proprietorship 23 Part-time dairy 0 Partnership 20 Dairy cash-crop 5 Corporation 9 Part-time cash-crop dairy 0
T~e of Own~rsniQ Number T)Qe of Barn Numb~r Owner 48 StanchionTie-Stall 11 Renter 4 Freestall 33
Combination 8
Milking S)stem NDber Business Record S)stem Number Bucket amp carry 0 ELFAC 3 Dumping station 2 Account Book 19 Pipeline 16 Agrifax (mail-in only) 16 Herringbone parlor 30 On-Farm Computer 11 Other parlor 4 Other 3
Production Records Number Number DHIC 39 Other 4 Owner-Sampler 9 None 0
The averages used in this report were compiled using data from all the participating dairy farms in this region unless noted otherwise There may be regular dairy farms part-time farms dairy cash-crop farms farm renters partnerships and corporations included in the average Dairy Termination Program QarticiQants that sold their cows in 1987 are not included in the report These specific classifications are used to separate farms in the State Business Summary
A Qatt-time farm has less than six months of labor from all operators and total labor is less than 12 months
Adair) casn-croQ farm has accrual receipts from crop sales that exceed 10 percent of accrual milk sales These farms were summarized using 1986 data in Knoblauch Wayne A and Linda D Putnam Dairy Farm Businessect Summaty New York Dairy-Cash CroQ Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-20 August 1987
A farm rentet does not own farm real estate at the end of the year or does not own tillable land These farms were summarized using 1986 data in Putnam Linda D and Stuart F Smith Dairy Farm Businesects Summaty Eastern New York Renter Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-19 August 1987
3
Income Statement
The accrual income statement begins with an accounting of all farm business expenses
CASH AND ACCRUAL FARM EXPENSES 52 Western Plain Dairy Farms 1987
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable - Expenses
Hired Labor ~ Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto exp (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landjbldgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES
$ 49664
82314 7411 1061
3737 20288
673 9885
2020 5540 9460
19354 o
17083
15385 6918 6752
6194 6774 5949
11362
1025 8008
27530 3952
$328339 5633
$ 0
-3326 848
5
o -24
o -121
o 48
-24 o o
-133
-876 -207 -611
-10 -50
-159 -56
o o o
-28 $ -4724
o
$ -106
-548 -932
o
70 -54
o -6
o 51
124 -38
o 115
-42 47
508
94 -283 -214
-19
o -5
-93 24
$ -1307 o
$ 49558
78440 7327 1066
3807 20210
673 9758
2020 5639 9560
19316 o
17065
14467 6758 6649
6278 6441 5576
11287
1025 8003
27437 3948
$322308 5633
28432 13 549
$369922
Cash paid is the actual amount of money paid out during the year and does not necessarily represent the cost of goods and services actually used
Change in inventory An increase in inventory is subtracted in computing accrual expenses because it represents purchased inputs not actually used during the year A decrease in inventory is added to expenses because it represents the cost of inputs purchased in a prior year and used this year
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 3: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/3.jpg)
1987 DAIRY FARM BUSINESS SUMMARY WESTERN PLAIN REGION
INTRODUCTION
Dairy farmers throughout the State have been participating in Cornell Cooperative Extensions farm business summary and analysis program since the early 1950s Each participating farmer receives a complete business and production summary and analysis of his or her farm business The information in this report represents an average of the complete and accurate data submitted from farms in the region described at the bottom of this page
Prosram Objective
The primary objective of the dairy farm business summary DFBS is to help farmers improve their management skills through appropriate use of historical farm data and the application of modern farm business management decision-making techniques In short DFBS identifies the business and financial information farmers need and demonstrates how it should be used in identifying and evaluating the strengths and weaknesses of the farm business
Format Features
This regional report follows the same general format as in the 1987 DFBS printout received by all participating dairy farmers Worksheets have been included to give non-DFBS participants an opportunity to summarize their businesses The analysis tables include an open column or section labeled ~ Farm It may be used by any dairy farmer who wants to compare his or her business with the average data of this region
This report features
(1) an income statement including accrual accounting for farm business expenses and receipts as well as measures of profitability with and without appreciation
(2) a complete balance sheet including financial ratios (3) a cash flow summary including debt repayment ability (4) a croppins prosram analysis (5) a dairy prosram analysis and (6) capital and labor efficiency analysis
Micro DFBS a computer program which enables Cooperative Extension agents and specialists to calculate and print individual farm business reports in their offices is now being used by the dairy farm management field staff for more than 70 percent of the farms cooperating This innovative approach provides faster processing of farm record data and increased use of the DFBS in farm management programs
The Western Plain Region of New York State with the number of participating farms in parentheses is comprised of Erie (5) Genesee (9) Livingston (9) Monroe (1) Niagara (6) Orleans (5) and Wyoming (17) counties
This report was written by Stuart F Smith Senior Extension Associate Farm Management Linda Putnam was in charge of data preparation Cindy Farrell and Beverly Carcelli prepared the publication Farm Business data was collected by Cooperative Extension agents Merville Button and David Thorp and regional specialist George Allhusen
2
SUMMARY AND ANALYSIS OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of operatshying a successful farm Various combinations of farm resources enterprises business arrangements and management techniques are used by the dairy farmers in this region The following table shows important farm business characteristics and the number of farmers reporting these characteristics
BUSINESS CHARACTERISTICS 52 Western Plain Dairy Farms 1987
T)Qe of Fatm Number T)Qe of Businessect Numbet Dairy 47 Single proprietorship 23 Part-time dairy 0 Partnership 20 Dairy cash-crop 5 Corporation 9 Part-time cash-crop dairy 0
T~e of Own~rsniQ Number T)Qe of Barn Numb~r Owner 48 StanchionTie-Stall 11 Renter 4 Freestall 33
Combination 8
Milking S)stem NDber Business Record S)stem Number Bucket amp carry 0 ELFAC 3 Dumping station 2 Account Book 19 Pipeline 16 Agrifax (mail-in only) 16 Herringbone parlor 30 On-Farm Computer 11 Other parlor 4 Other 3
Production Records Number Number DHIC 39 Other 4 Owner-Sampler 9 None 0
The averages used in this report were compiled using data from all the participating dairy farms in this region unless noted otherwise There may be regular dairy farms part-time farms dairy cash-crop farms farm renters partnerships and corporations included in the average Dairy Termination Program QarticiQants that sold their cows in 1987 are not included in the report These specific classifications are used to separate farms in the State Business Summary
A Qatt-time farm has less than six months of labor from all operators and total labor is less than 12 months
Adair) casn-croQ farm has accrual receipts from crop sales that exceed 10 percent of accrual milk sales These farms were summarized using 1986 data in Knoblauch Wayne A and Linda D Putnam Dairy Farm Businessect Summaty New York Dairy-Cash CroQ Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-20 August 1987
A farm rentet does not own farm real estate at the end of the year or does not own tillable land These farms were summarized using 1986 data in Putnam Linda D and Stuart F Smith Dairy Farm Businesects Summaty Eastern New York Renter Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-19 August 1987
3
Income Statement
The accrual income statement begins with an accounting of all farm business expenses
CASH AND ACCRUAL FARM EXPENSES 52 Western Plain Dairy Farms 1987
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable - Expenses
Hired Labor ~ Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto exp (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landjbldgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES
$ 49664
82314 7411 1061
3737 20288
673 9885
2020 5540 9460
19354 o
17083
15385 6918 6752
6194 6774 5949
11362
1025 8008
27530 3952
$328339 5633
$ 0
-3326 848
5
o -24
o -121
o 48
-24 o o
-133
-876 -207 -611
-10 -50
-159 -56
o o o
-28 $ -4724
o
$ -106
-548 -932
o
70 -54
o -6
o 51
124 -38
o 115
-42 47
508
94 -283 -214
-19
o -5
-93 24
$ -1307 o
$ 49558
78440 7327 1066
3807 20210
673 9758
2020 5639 9560
19316 o
17065
14467 6758 6649
6278 6441 5576
11287
1025 8003
27437 3948
$322308 5633
28432 13 549
$369922
Cash paid is the actual amount of money paid out during the year and does not necessarily represent the cost of goods and services actually used
Change in inventory An increase in inventory is subtracted in computing accrual expenses because it represents purchased inputs not actually used during the year A decrease in inventory is added to expenses because it represents the cost of inputs purchased in a prior year and used this year
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 4: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/4.jpg)
2
SUMMARY AND ANALYSIS OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of operatshying a successful farm Various combinations of farm resources enterprises business arrangements and management techniques are used by the dairy farmers in this region The following table shows important farm business characteristics and the number of farmers reporting these characteristics
BUSINESS CHARACTERISTICS 52 Western Plain Dairy Farms 1987
T)Qe of Fatm Number T)Qe of Businessect Numbet Dairy 47 Single proprietorship 23 Part-time dairy 0 Partnership 20 Dairy cash-crop 5 Corporation 9 Part-time cash-crop dairy 0
T~e of Own~rsniQ Number T)Qe of Barn Numb~r Owner 48 StanchionTie-Stall 11 Renter 4 Freestall 33
Combination 8
Milking S)stem NDber Business Record S)stem Number Bucket amp carry 0 ELFAC 3 Dumping station 2 Account Book 19 Pipeline 16 Agrifax (mail-in only) 16 Herringbone parlor 30 On-Farm Computer 11 Other parlor 4 Other 3
Production Records Number Number DHIC 39 Other 4 Owner-Sampler 9 None 0
The averages used in this report were compiled using data from all the participating dairy farms in this region unless noted otherwise There may be regular dairy farms part-time farms dairy cash-crop farms farm renters partnerships and corporations included in the average Dairy Termination Program QarticiQants that sold their cows in 1987 are not included in the report These specific classifications are used to separate farms in the State Business Summary
A Qatt-time farm has less than six months of labor from all operators and total labor is less than 12 months
Adair) casn-croQ farm has accrual receipts from crop sales that exceed 10 percent of accrual milk sales These farms were summarized using 1986 data in Knoblauch Wayne A and Linda D Putnam Dairy Farm Businessect Summaty New York Dairy-Cash CroQ Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-20 August 1987
A farm rentet does not own farm real estate at the end of the year or does not own tillable land These farms were summarized using 1986 data in Putnam Linda D and Stuart F Smith Dairy Farm Businesects Summaty Eastern New York Renter Summar) 1986 Cornell University Department of Agricultural Economics AE Ext 87-19 August 1987
3
Income Statement
The accrual income statement begins with an accounting of all farm business expenses
CASH AND ACCRUAL FARM EXPENSES 52 Western Plain Dairy Farms 1987
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable - Expenses
Hired Labor ~ Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto exp (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landjbldgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES
$ 49664
82314 7411 1061
3737 20288
673 9885
2020 5540 9460
19354 o
17083
15385 6918 6752
6194 6774 5949
11362
1025 8008
27530 3952
$328339 5633
$ 0
-3326 848
5
o -24
o -121
o 48
-24 o o
-133
-876 -207 -611
-10 -50
-159 -56
o o o
-28 $ -4724
o
$ -106
-548 -932
o
70 -54
o -6
o 51
124 -38
o 115
-42 47
508
94 -283 -214
-19
o -5
-93 24
$ -1307 o
$ 49558
78440 7327 1066
3807 20210
673 9758
2020 5639 9560
19316 o
17065
14467 6758 6649
6278 6441 5576
11287
1025 8003
27437 3948
$322308 5633
28432 13 549
$369922
Cash paid is the actual amount of money paid out during the year and does not necessarily represent the cost of goods and services actually used
Change in inventory An increase in inventory is subtracted in computing accrual expenses because it represents purchased inputs not actually used during the year A decrease in inventory is added to expenses because it represents the cost of inputs purchased in a prior year and used this year
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 5: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/5.jpg)
3
Income Statement
The accrual income statement begins with an accounting of all farm business expenses
CASH AND ACCRUAL FARM EXPENSES 52 Western Plain Dairy Farms 1987
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable - Expenses
Hired Labor ~ Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto exp (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landjbldgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES
$ 49664
82314 7411 1061
3737 20288
673 9885
2020 5540 9460
19354 o
17083
15385 6918 6752
6194 6774 5949
11362
1025 8008
27530 3952
$328339 5633
$ 0
-3326 848
5
o -24
o -121
o 48
-24 o o
-133
-876 -207 -611
-10 -50
-159 -56
o o o
-28 $ -4724
o
$ -106
-548 -932
o
70 -54
o -6
o 51
124 -38
o 115
-42 47
508
94 -283 -214
-19
o -5
-93 24
$ -1307 o
$ 49558
78440 7327 1066
3807 20210
673 9758
2020 5639 9560
19316 o
17065
14467 6758 6649
6278 6441 5576
11287
1025 8003
27437 3948
$322308 5633
28432 13 549
$369922
Cash paid is the actual amount of money paid out during the year and does not necessarily represent the cost of goods and services actually used
Change in inventory An increase in inventory is subtracted in computing accrual expenses because it represents purchased inputs not actually used during the year A decrease in inventory is added to expenses because it represents the cost of inputs purchased in a prior year and used this year
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 6: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/6.jpg)
4
Changes in prepaid expenses apply to non-inventory categories Include any expenses that have been paid for in advance of their use for example 1988 rent paid in 1987 A positive change is the amount the prepayment account declined from beginning to end year a negative change indicates an increase in the account
Change in accounts payable An increase in payab1es is added and a decrease is subtracted when calculating accrual expenses
Accrual expenses are the costs of inputs actually used in this years production
Worksheets are provided to enable any dairy farmer to compute his or her accrual farm expenses and compare them with the averages on the previous page
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Change in Inventory
Cash or Prepaid Change in Accrual Expense Item Paid + Expense + Accounts Payable Expenses
Hired Labor Feed
$--- shy $_-shy $_-shy
Dairy grain amp conc Dairy roughage Other livestock Machinery Mach hire rentlease Machinery repairsparts Auto expo (farm share) Fuel oil amp grease Livestock Replacement livestock Breeding Vet amp medicine Milk marketing Cattle leaserent Other livestock expense Crops Fertilizer amp lime Seeds amp plants Spray other crop expo Real Estate Landb1dgfence repair Taxes Insurance Rent amp lease Other Telephone (farm share) Electricity (farm share) Interest paid Miscellaneous Total Operating Expansion livestock
$___ $_--shy $_-shy $_-shy
Machinery depreciation Building depreciation TOTAL ACCRUAL EXPENSES $
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 7: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/7.jpg)
5
CASH AND ACCRUAL FARM RECEIPTS 52 Western Plain Dairy Farms 1987
Change in Cash Change in Accounts Accrual
Receipt Item Receipts + Inventory + Receivable Receipts
Milk sales $366779 $ 4 $366783 Dairy cattle 25544 $ 12722 10 38276 Dairy calves Other livestock
5500 1027 379
0 0
5500 1406
Crops Government receipts Custom machine work
8943 16317
650
11656 -564
465 -404
0
21064 15349
650 Gas tax refund 491 1 492 Other 5216 211 5427 Less nonfarm noncash cap (-) 292 (-) 295 Total Accrual Receipts $430468 $ 23898 $ 287 $454653
Change in advanced government receipts Gifts or inheritances of cattle or crops included in inventory
Cash receipts include the gross value of milk checks received during the year plus all other payments received from the sale of farm products services and government programs Nonfarm income is not included in calculating farm profitability
Changes in inventory are calculated by subtracting beginning of year values from end of year values excluding appreciation Increases in livestock inshyventory caused by herd growth andor quality are added and decreases caused by herd reduction and for quality are subtracted Changes in inventories of crops grown are also calculated Changes in advanced government receipts are calculated by subtracting the end year balance from the beginning year balshyance (balances are listed with the current liabilities on the Balance Sheet)
Changes in accounts receivable are calculated by subtracting beginning year balances from end year balances The January milk check for this Decembers marketings compared with the previous Januarys check is included as a change in accounts receivable
Accrual receipts represent the value of all farm commodities produced and services actually generated by the farmer during the year
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Change in Cash Change in Accounts Accrual
Receipt Item Reslt~ipts + InventQIY + Reslt~1vab1e Receipts
Milk sales $ $ $ Dairy cattle $ Dairy calves Other livestock Crops Government receipts Custom machine work Gas tax refund Other Less gifts of cattle amp crops (-) (-) Total Accrual Receipts $ $ $ $
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 8: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/8.jpg)
6
Profitability Analysis
Farm ownersoperators contribute labor management and capital to their businesses and the best combination of these resources maximizes income Farm profitability can be measured as the return to all family resources or as the return to one or more individual resources such as labor and management
Net farm income is the total combined return to the farm operators and other unpaid family members for their labor management and equity capital It is the farm familys net annual return from working managing financing and owning the farm business This is not a measure of cash available from the years business operation Cash flow is evaluated later in this report
Net farm income is computed both with and without appreciation Appreciation represents the change in values caused by annual changes in prices of liveshystock machinery real estate inventory and stocks and certificates (other than FLB and PCA) Appreciation is a major factor contributing to changes in farm net worth and must be included for a complete profitability analysis
NET FARM INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total accrual receipts Appreciation Livestock
Machinery Real Estate Other StockCertificates
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation)
$454653 8933 5531
13265 984
$483366 -369922 $113444 $ 84731
$-----shy
$----- shy
$----- shy$------shy
Return to operators labor management and eguity capital measures the total business profits for the farm operator(s) It is calculated by deducting a charge for unpaid family labor from net farm income Operators labor is not included in unpaid family labor Return to operators labor management and equity capital has been calculated both with and without appreciation Appreciation is considered an important part of the return to ownership of farm assets
RETURN TO OPERATORS LABOR MANAGEMENT AND EQUITY 52 Western Plain Dairy Farms 1987
With Without With My Farm
Without Item Apprec Apprec Apprec Apprec
Net farm income Family labor unpaid
$650 per month Return to operators labor
management ampequity
$113444
950
$112494
$ 84731
950
$ 83781
$-----shy
$------ shy
$----- shy
$----- shy
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 9: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/9.jpg)
7
Labor and management income is the return which farm operators receive for their labor and management used in operating the farm business Appreciation is not included as part of the return to labor and management because it results from ownership of assets rather than management of the farm business Labor and management income is calculated by deducting the opportunity cost of using equity capital at a real interest rate of five percent from the return to operators labor management and equity capital excluding appreciation The interest charge of five percent reflects the long-term average rate of return that a farmer might expect to earn in comparable risk investments in a low inflation economy
LABOR AND MANAGEMENT INCOME 52 Western Plain Dairy Farms 1987
Item Average My Farm
Return to operators labor management amp equity without appreciation
Real interest 5 on $579406 average equity capital
Labor amp Management Income Labor amp Management Income per
158 OperatorManager
$ 83781 $-----shy
- 28970 $ 54811 $-----shy
$ 34690 $-----shy
Return on equity capital measures the net return remaining for the farmers equity or owned capital after a charge has been made for the owner-operators labor and management The earnings or amount of net farm income allocated to labor and management is the opportunity cost of operators labor and management estimated by the cooperators Return on equity capital is calculated with and without appreciation The rate of return on equity capital is determined by dividing the amount returned by the average farm net worth or equity capital Return on total capital is calculated by adding interest paid to the return on equity capital and then dividing by average farm assets to calculate the rate of return on total capital
RETURN ON EQUITY CAPITAL AND RETURN ON TOTAL CAPITAL 52 Western Plain Dairy Farms 1987
Item Average
Return to operators labor management amp equity capital with appreciation
Value of operators labor amp management Return on equity capital with appreciation Interest paid Return on total capital with appreciation Return on equity capital without appreciation Return on total capital without apprecia~ion Rate of return on average equity capital
with appreciation without appreciation
Rate of return on average total capital with appreciation without appreciation
$112494 - 34974 $ 77520 $ 27437 $104957 $ 48807 $ 76244
134 84
116 84
My Farm
$
$ $ $ $ $
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 10: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/10.jpg)
8
Farm and Family Financial Status
The first step in evaluating the financial status of the farm is to construct a balance sheet which identifies all the assets and liabilities of the business The second step is to evaluate the relationship between assets liabilities and net worth and changes that occurred during the year
1987 FARM BUSINESS amp NONFARM BALANCE SHEET 52 Western Plain Dairy Farms January 1 1988
Farm Liabilities Farm Assets Jan 1 Dec 31 amp Net Worth JaIl 1 Dec 31
Curt~llt Current Farm cash checking Accounts payable $ 8340 $ 6080 amp savings $ 7220 $ 9636 Operating debt 8058 12192
Accounts rec 33242 33528 Short-term 13226 7190 Prepaid expo 425 689 Advanced govt rec ____~7=4 638 Feed amp supplies 71943 94058
Total $118830 $137911 Total $ 29698 $ 26100 Intermediate Dairy cows Intermediate
owned $124279 $140217 Structured debt leased 0 0 1-10 years $128256 $134993
Heifers 55860 61352 Financial lease Bullsother lvstk 1026 1630 (cattlemach ) 797 1469 Macheq owned 172325 171496 FLBPCA stock 7182 6756 Macheq leased 797 1469 FLBPCA stock 7182 6756 Total $136235 $143217 Other stockcert 37471 38010
Total $398946 $426930 Long Term Long-Tem Structured debt Landbuildings ~10 yrs $162739 $155319
owned $357256 $372248 Financial lease leased 896 990 (structures) 896 990 Total $358152 $373238 Total $163634 $156309
Total Farm Assets $875927 $938078 Total Farm Liab $329567 $325627 FARM NET WORTH $546360 $612452
(Average for 27 farms reporting) Nonfarm Assets Jan 1 Dec 31
Personal cash chkg amp savings $ 8470 $ 8667
Cash value life ins 3958 4626 Nonfarm real estate 9259 9630 Auto (personal sh) 3516 4564 Stocks amp bonds 4010 4821 Household furn 7630 7833 All other 1042 1849
Total Nonfarm $ 37886 $ 41991
Nonfarm Liabilities amp Net Worth Jan 1 Dec 31
Nonfarm Liab $ 1912 $ 1500 NONFARM NET WORTH $ 35974 $ 40491
FARM ~ NONFARM Jill 1 Il~~ 31 Total Assets $913813 $980069 Total Liabilities 331479 327127
TOTAL FARM amp NONshyFARM NET WORTH $582334 $652943
Assumes that average nonfarm assets and liabilities for the nonreporting farms were the same as for those reporting
Financial lease obligations are included in the balance sheet The present value of all future payments is listed as a liability since the farmer is committed to make the payments by signing the lease The present value is also listed as an asset representing the future value the item has to the business
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 11: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/11.jpg)
9
Advanced government receipts are included as current liabilities Government payments received in 1987 that are for participation in the 1988 program are the end year balance and payments received in 1986 for participation in the 1987 program are the beginning year balance
Date _____________________________
1987 FARM BUSINESS amp NONFARM BALANCE SHEET
Farm Liabilities FaIm Asectsect~ts Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Current Current Farm cash checking Accounts payable amp savings Operating debt
Accounts rec Prepaid expense Feed amp supplies Short Term
Total
Intermediate Adv govt rec Dairy cows Total
owned Intermediate leased
Heifers Bullsother lvstk Macheq owned Macheq leased FLBPCA stock Financial lease Other stockcert (cattlemach )
Total FLBPCA stock Total
Lans-Term LanS-Term Landjbuildings
owned leased
Financial lease Total (structures)
Total Total Farm Assets Total Farm Liab
FARM NET WORTH
Nonfarm Liabilities Nonfam Assets Jan 1 Dec 31 sect Net Worth Jan 1 Dec 31
Personal cash chkg Nonfarm Liab amp savings
Cash val life ins Nonfarm real est Auto (pres share) Stocks amp bonds Total Nonfarm Household furn Liabilities All other Nonfarm Total Nonfarm Net Worth
IOIAL FARM sect NONFARM Jan 1 Dec 31 Total Farm amp Nonfarm Assets Less Total Farm amp Nonfarm Liabilities Farm ampNonfarm Net Worth
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 12: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/12.jpg)
10
Balance sheet analysis requires an examination of financial and debt ratios measuring levels of debt Percent equity is calculated by dividing end of year net worth by end of year assets The debt to asset ratio is compiled by dividing liabilities by assets Low debt to asset ratios reflect strength in solvency and the potential capacity to borrow Debt levels per unit of production include some old standards that are still useful if used with measures of cash flow and repayment ability The change in farm net worth without appreciation is an excellent indicator of financial progress
BALANCE SHEET ANALYSIS 52 Western Plain Dairy Farms January I 1988
Item Average My Farm
Financial Ratios - Farm Percent equity 65 Debtasset ratio total 035
long-term 042 intermediatecurrent 030
Change in Net Worth Without appreciation $ 37378 $ With appreciation 66091 $ Farm Debt Analysis Accounts payable as of total debt 2 Long-term liabilities as a of total debt 48 Current amp inter liab as a of total debt 52
Per Tillable Per Tillable Farm Debt Levels Per Cow Acre Owned Per Cow Acre Owned
Total farm debt $ 1962 $ 1252 $ $ Long-term debt Intermediate amp current debt
942 1020
601 651
Farm inventoIY balance is an accounting of the value of assets used on the balance sheet and the changes that occur from the beginning to end of year Changes in the livestock inventory are included in the dairy analysis Net investment indicates whether the capital stock is being expanded (positive) or depleted (negative)
FARM INVENTORY BALANCE 52 Western Plain Dairy Farms 1987
Item Ayg of Regional Farms My Farm ~ MachEg
Value beg of year $357256 $172325 Purchases $ 25040 $ 28881 Giftinheritance + 0+0 ~ Lost capital 6977 Sales 2528 810 Depreciation - 13549 - 28432 Net investment 1986 -361 Appreciation + 13005 + 5531 Value end of year $372248 $177496
RE MachEg
$_-shy $_-shy$_-- $_-shy+---- +---shy
-+---shy -+---shy+---- +---shy$_-- $_-shy
$ 5342 land and $ 19698 buildings andor depreciable improvements Excludes $260 of appreciation on assets sold during the year
----~~--- -~-- ----~------ ---------------
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 13: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/13.jpg)
11
Cash Flow Summary and Analysis
Completing an annual cash flow statement is an important step in understanding the sources and uses of funds for the business Understanding last years cash flow is the first step toward planning and managing cash flow for the current and future years
The annual cash flow statement is structured to compare all the cash inflows with all the cash outflows for the year A complete list of cash inflows and cash outflows are identified in the following table By definition total cash inflows must equal total cash outflows when beginning and ending balances are included Any imbalance is therefore the error from incorrect accounting of cash inflows and cash outflows
ANNUAL CASH FLOW STATEMENT 52 Western Plain Dairy Farms 1987
Item Average My Farm
Cash Inflows
Beginning farm cash checking amp savings
Cash farm receipts
Sale of assets Machinery
Real estate
Other stock amp certificate
Money borrowed (intermediate amp long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Cash from nonfarm capital used in the business
Money borrowed - nonfarm Total
Cash Outflows
Cash farm expenses
Capital purchases Expansion livestock
Machinery
Real estate
Other stock amp certificate
Principal payments (intermediate amp long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals amp family expenditures
Ending farm cash checking amp savings
Total
Imbalance (error)
$ 7220
430468
810
2651
5894
69204
7121
4134
2422
399
22
$530345
$328341
5633
28881
25040
5443
69886
13157
o 300
35393
9636
$521710
$ 8635
$_--shy
$_--shy
$_--shy
$_--shy$_--shy
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 14: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/14.jpg)
12
Repgyment Analysis
The second step in cash flow analysis is to compare the debt payments planned for the last year with the amount actually paid The measures listed below provide a number of different perspectives on the repayment performance of the business However the critical question to many farmers and lenders is whether planned payments can be made in 1988 The cash flow projection worksheet on the next page can be used to estimate repayment ability which can then be compared to planned 1988 debt payments shown below
FARM DEBT PAYMENTS PLANNED Same 41 Western Plain Dairy Farms 1986 amp 1987
Debt Pgyments
Av~rage
1987 Payments Planned Made
Planned 1988
My Farm 1987 Payments
Planned Made Planned
1988
Long-term Intermediate-term Short-term Operating (net
reduction) Accounts payable
(net reduction)
$ 17001 40473
5863
372
3596
$ 21626 66239 15229
0
2181
$ 22855 45215
5043
371
1880
$ $ $
Total $ 67305 $105275 $ 75364 $ $ $
Per cow $ 418 Per cwt 1987 milk $ 230 Percent of total
1987 receipts 15 Percent of 1987
milk receipts 18
$ 654 $ 360
23
28
$ $
$ $
The cash flow coverage ratio measures the ability of the farm business to meet its planned debt payment schedule The ratio shows the percentage of planned payments that could have been made with last years available cash flow Farmers that did not participate in DFBS last year will find in their report a cash flow coverage ratio based on planned debt payments for 1988
CASH FLOW COVERAGE RATIO Same 41 Western Plain Dairy Farms 1986 amp 1987
Item My Farm
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm
(A) - Amount Available for Debt Service (B) - Debt Payments Planned for 1987
(as of December 31 1986) (A + B) - Cash Flow Coverage Ratio for 1987
$440366 328215 26024 35757
$102418
$ 67305 152
$_--shy
$_--shy
$_--shy
Persona1 withdrawals and family expenditures less nonfarm income and nonfarm money borrowed If family withdrawals are excluded the cash flow coverage ratio will be incorrect
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 15: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/15.jpg)
13
ANNUAL CASH FLOW WORKSHEET
Regional My Farm Expected 1988 Item Average Total Per Cow Change Projection
(per cow) Average number of cows 160 Accrual Oper Receipts Milk $ 2299 Dairy cattle 240 Dairy calves 34 Other livestock 9 Crops 132 Misc receipts
Total 137
$ 2852
Accrual Oper Expenses Hired labor $ 311 Dairy grain amp conc 492 Dairy roughage 46 Other lvstk feed 7 Mach hirerentlease 24 Mach rprparts amp auto 131 Fuel oil amp grease 61 Replacement lvstk 13 Breeding 35 Vet amp medicine 60 Milk marketing 121 Cattle lease o Other lvstk expo 107 Fertilizer amp lime 91 Seeds amp plants 42 Sprayother crop expo 42 Land bldgfence repair 39 Taxes 40 Insurance 35 Real est rentlease 71 Utilities 57 Miscellaneous 25
Total Less Int Paid $ 1848
$___ $_shy ------- $--------shy
$___ $_-- $_--shy
$___ $_-- ---_$_----shy
$_--shy
Net Accrual Operating Income (total) (without interest paid) $160077
- Change in lvstkcrop inv 23898 - Change in accts rec 287 + Change in feedsupply inv -4724 + Change in accts payab1e -1 214 NET CASH FLOW $129955 - Net personal withdrawals amp
family expenditures 32949 Available for Farm Debt
Payments amp Investments $ 97006 - Farm debt payments 111 525 Available for Farm Investment $-14518 - Capital purchases cattle
machinery amp improvements $ 64997 Additional Capital Needed
$___ $_--shy
$___ $_--shy
$___ $_--shy
$___ $_--shy
$_-- $_--shy
Exc1udes change in interest account payable
---
---
---
14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 16: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/16.jpg)
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14
ANALYSIS OF THE FARM BUSINESS
Cropping Program Analysis
The cropping program is an important part of the dairy farm business and sometimes it is overlooked and neglected A complete evaluation of available land resources how they are being used how well crops are producing and what it costs to produce them is required to evaluate alternative cropping and feed purchasing choices
LAND RESOURCES AND CROP PRODUCTION 52 Western Plain Dairy Farms 1987
Item Average My Farm
Land Tillable Nonti11able Other nontillable
~ 260
21 23
Renteg 238
11 15
Total 498
33 88
Owned
--shy
Relt~d Total
Total 354 264 618
Crop Yields ~ Acres ProdLAcre Acres PrQgLAcr~ Hay crop 52 173 321 tn DM tn DM Corn silage 50 109 1754 tn tn
607 tn DM tn DM Other forage 8 35 317 tn DM tn DM Total forage 52 282 427 tn DM tn DM Corn grain 44 121 12871 bu bu Oats 24 32 6304 bu bu Wheat 16 40 4079 bu bu Other crops 16 50 Tillable pasture 19 30 Idle 37 84 Total Tillable Acres 52 498
Average crop acres and yields compiled for the region are for the number of farms reporting each crop Yields of forage crops have been converted to tons of dry matter using dry matter coefficients reported by the farmers Grain production has been converted to bushels of dry grain equivalent based on dry matter information provided
The following measures of crop management measure how efficiently the land resource is being used and how well total forage requirements are being met
CROP MANAGEMENT FACTORS 52 Western Plain Dairy Farms 1987
Item Average My Farm
Total tillable acres per cow Total forage acres per cow Harvested forage dry matter tons per cow
312 177 756
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 17: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/17.jpg)
15
Croppinamp Proampram Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay crop corn and other crop production Fertilizer and lime seeds and plants and spray and other crop expenses have been computed per acre and per production unit for hay and corn Additional expense items such as fuels labor and machinery repairs are not included
CROP RELATED ACCRUAL EXPENSES Western Plain Dairy Farms Reporting 1987
Item
Total Per Till Acre
Hay Crop Per Per Acre Ton DM
All Corn Per Acre
Corn Silage Per Ton
DM
Corn Grain
Per Dry Shell Bu
Number of farms reporting
Average number of acres
Fertilizer amp lime Seeds amp plants Spray amp other crop
expense Total
$
$
52
498 2905 $ 1357
1Jmiddot35 5598 $
36
159 1426 $
731
333 2490 $
444 228
104 775
$
$
36
193 3077 $ 1287
1276 5640 $
507 212
210 929
$ 024 010
010 $ 044
My Farm
Fertilizer amp lime Seeds amp plants Spray amp other crop
$_shy $_shy $_shy $_shy $_shy $_shy
expense Total $== $== $== $_shy $== $_shy
Most machinery costs are associated with crop production and should be analyzed with the crop enterprise Total machinery expenses include the major fixed costs operating costs individual crops
(interest and depreciation) as well as the accrual Although machinery costs have not been allocated to they are shown below per total tillable acre
ACCRUAL MACHINERY EXPENSES 52 Western Plain Dairy Farms 1987
Av~age My Farm Machinery Total Per Til Total Per Til
Expense Item Expenses Acre Expenses Acre
Fuel oil amp grease Machinery repairs amp parts
$ 9758 20210
$ 1960 4059
$_--shy $_--shy
Machine hire rent amp lease 3807 765 Auto expense (farm share) 673 135 Interest (5) 8746 1756 Depreciation 28432 5710
Total $ 71625 $ 14385 $_-shy $_-shy
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 18: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/18.jpg)
16
Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the strengths and weaknesses of the dairy farm business Information on this page should be used in conjunction with DHI and other dairy production information Changes in dairy herd size and market values that occur during the year are identified in the table below The change in inventory value without appreciation is attributed to physical changes in herd size and quality This increase in inventory is included as an accrual farm receipt when calculating profitability without appreciation impacts
DAIRY HERD INVENTORY 52 Western Plain Dairy Farms 1987
Dairy Cows Heif~Isect Bred ORen Calves
Item No Value No Value No Value No Value
Beg year (owned) 153 $124279 50 + Change wo apprec 10034 + Appreciation 5904 End year (owned) 166 $140217 52 End incl leased 166 Average number 160 130
My Farm
Beg of year (owned) $_shy+ Change wo apprec + Appreciation End of year (owned) $_shyEnd including leased Average number
$31258 2479 1259
$34996
49 $17 731 -1021 1032
44 $17742
33 $ 6872 1229
514 40 $ 8615
(all age groups)
$_shy $_shy $_shy
$_shy $_shy
(all age groups)
$_shy
Total milk sold and milk sold per cow are extremely valuable measures of productivity on the dairy farm These measures of milk output are based on pounds of milk marketed during the year Farm managers on DHI should compare milk sold per 31
cow with rolling herd average on the test date nearest December
MILK PRODUCTION 52 Western Plain Dairy Farms 1987
Item
Total milk sold lbs
Average
2835073
My Farm
Milk sold per cow lbs 17770
Average milk plant test percent butterfat 358
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 19: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/19.jpg)
17
The cost of producing milk has been compiled using the whole farm method and is featured in the following table Accrual receipts from milk sales can be compared with the accrual costs of producing milk per cow and per hundredweight of milk Using the whole farm method operating costs of producing milk are estimated by deducting nonmilk accrual receipts from total accrual operating expenses Total costs of producing milk include the operating costs plus expansion livestock purchased depreciation on machinery and buildings the value of operators labor and management and the interest charge for using equity capital Note that the cost of labor management and equity capital has been excluded in the intermediate calculation
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK 52 Western Plain Dairy Farms 1987middot
AveSlge M~ FaD Item Total Per Cow Per Cwt Total Per Cow Per Cwt
Accrual Costs 2f Prodycing Milk Operating costs $234438 $ 1469 $ 827 $ $ $ Total costs wo
opers labor mgmt amp capital $283002 $ 1774 $ 998 $ $ $
Total Costs $346946 $ 2175 $ 1224 $ $ $ Accrual Receipts From Iilk $366783 $ 2299 $ 1294 $ $ $
The accrual operating expenses most commonly associated with the enterprise are listed in the table below Evaluating these costs per production enables an evaluation of the dairy enterprise
dairy unit of
DAIRY RELATED ACCRUAL EXPENSES 52 Western Plain Dairy Farms 1987
Av~age M~ Fam Item Per C2W Per Cwt Pe Cow Per Cwt
Purchased dairy grain amp concentrates $ 492 $ 277 $ $
Purchased dairy roughage Total Purchased
~ O2sect
Dairy Feed $ 538 $ 303 $ $ Purchased grain amp conc as of milk receipts 21 --
Purchased feed amp crop expo $ 712 $ 401 $ $ Purchased feed amp crop expo as of milk receipts 31 --
Breeding $ 35 $ 020 $ $ Veterinary amp medicine 60 034 Milk marketing 121 068 Cattle lease 0 000 Other livestock expense 107 060
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 20: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/20.jpg)
18
Capital and Labor Efficiency Analysis
Capital efficiency factors measure how intensively the capital is being used in the farm business Measures of labor efficiency are key indicators of managements success in generating products per unit of labor input
CAPITAL EFFICIENCY 52 Western Plain Dairy Farms 1987
Per Per Per Tillable Per Tillable Item Wotk~r CQw asore Asore Owned
Farm capital Real estate Machinery amp equipment Capital turnover years
$200343 $ 5685 2292
38885 1103 1 88
$ 1822
354
$ 3488 1407
MY Farm Farm capital Real estate Machinery amp equipment Capital turnover years
$_-- $_--shy $_--shy $_--shy
LABOR FORCE INVENTORY AND ANALYSIS 52 Western Plain Dairy Farms 1987
Years of Value of Labot Fotce Months age of EduSO Labot amp Mgmt
Operator number 1 Operator number 2 Operator number 3 Family paid Family unpaid Hired
Total
My Fatm Total Operators
12 5 2 4 1
30 54
47 41 31
+ 12 shy
+ 12 shy+ 12 shy
14 $ 22188 14 9671 13 3115
453 Worker Equivalent 158 OperatorManager Equiv
___ Worker Equivalent OperatorManager Equiv
Labor Efficiency
avetage Total Pet Wotker Total
My Farm Per Wotket
Cows average number Milk sold pounds Tillable acres
160 2835073
498
35 626225
110 Work units 1663 367
Average ~ Farm Per Per Per Per
Lab2I COlts Iota1 Cow Tl1 Asote Iota1 COli Iil Asote
Value of operator(s) labor ($900mo) $ 17135 $ 107 $3441 $ $ $
Family unpd($650mo) 950 6 1 91 Hired 4955sect --ll1 9953 Total Labor $ 67643 $ 424 $13585 $ $ $ Machinery Cost $ 71625 $ 449 $14385 $ $ $ Total Labor amp Mach $139267 $ 873 $27970 $ $ $
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 21: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/21.jpg)
19
COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Proiress of the Farm Business
Comparing your business with average data from regional DFBS cooperators that participated in both of the last two years is one part of a business checkup It is equally important for you to determine the progress your business has made over the past two or three years and to set targets or goals for the future
PROGRESS OF THE FARM BUSINESS Same 41 Yestern Plain Dairy Farms 1986 amp 1987
My Farm Selected Factors 1986 1987 1986 1987 Goal
Size of Business Average number of cows Average number of heifers Milk sold 1bs Yorker equivalent Total tillable acres
Rates of Production Milk sold per cow 1bs Hay DM per acre tons Corn silage per acre tons
Labor Efficiency Cows per worker Milk soldworker 1bs
Cost Control Grain amp conc purchased
as of milk sales Dairy feed amp crop expo
per cwt milk Labor amp mach costscow
CaRital EffipoundlenpoundY Farm capital per cow Mach amp equip per cow Capital turnover years
frofitabllUy Net farm inc wo apprec Net farm inc wapprec Labor amp mgmt income Rate of return on eq
capital wapprec Rate of return on all
capital wapprec
Financial SummaIY Farm net worth end year Debt to asset ratio Farm debt per cow
Average for the year
150 132
2695437 449
483
17 973 319
16
33 600614
20
$ 365 $ 896
$ 5633 $ 1163
1 97
$ 60322 $ 85577 $ 32108
886
655
$560221 036
$ 1996
161 135
2922151 459
491
18150 320
18
35 636150
21
$ 386 $ 889
$ 5746 $ 1128
1 87
$ 92330 $124906 $ 61050
1446
1233
$646972 032
$ 1861
-----
$ $
$ $
$ $ $
---_
--_
$
$
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy
$ $_-shy$ $_-shy$ $_-shy
--_ --_
--_ --_
$_-_$_-shy
$ $_-shy
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 22: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/22.jpg)
20
Farm Business Chart
The Farm Business Chart is a tool which can be used in analyzing a business by drawing a line through the figure in each column which represents the current level of management performance The figure at the top of each column is the average of the top 10 percent of the 414 farms for that factor The other figures in each column are the average for the second 10 percent third 10 percent etc Each column of the chart is independent of the others The farms which are in the top 10 percent for one factor would not necessarily be the same farms which make up the top 10 percent for any other factor
The cost control factors are ranked from low to high but the lowest cost is not necessarily the most profitable In some cases the best management position is somewhere near the middle or average Many things affect the level of costs and must be taken into account when analyzing the factors
References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS 414 New York Dairy Farms 1986
Size Qf Bl1~inesectsect Rates of Pt0ducton Labor EfficLency Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent QOlisect ~olg eer COli IlHLAcrg eer Acte Worket eir Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
74 286 5067341 19686 46 21 48 767478 42 137 2199034 18065 37 18 38 614002 35 106 1711440 17165 33 17 34 545894 31 88 1394330 16585 30 15 32 499543 28 77 1214123 15981 27 15 29 462369
---------------------------shy_ _---------- -------------- - - _------_ _---_ _-
25 68 1053490 15498 25 14 27 432308 23 59 896427 15025 23 13 26 402824 20 52 779541 14393 21 12 24 358752 19 45 671587 13423 18 10 21 304576 14 34 468617 11150 14 6 16 230949
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per QOli Receipts Pet Cow Costsect Per QQw Pet Qow Qwt MUt
(9) (9) (10) (10) (9) (9)
$188 10 $197 $ 496 $352 $244 290 15 262 599 449 300 354 18 310 663 502 336 402 21 351 712 550 359 445 23 384 757 590 383
483 25 411 805 632 404 528 27 441 868 682 428 573 29 481 916 728 450 629 31 542 1007 794 485 765 37 712 1201 936 586
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 23: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/23.jpg)
21
The next section of the Farm Business Chart provides for comparative analysis of the value of production as measured by milk receipts per cow and dairy receipts per hundredweight of milk sold and the costs of production The final or profitability section shows the variation in farm income by decile and enables a dairy farmer to determine where he or she ranks by using several measures of farm profitability Remember that each column is independently established and the farms making up the top decile in the first column will not necessarily be on the top of any other column The dairy farmer who ranks at or near the top of most of these columns is in a very enviable position
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
414 New York Dairy Farms 1986
Milk Receipts Per Cow
(9)
Dairy Receipts ~er Qwt
(9)
Oper Cost Milk
fer Cow (9)
Oper Cost Milk
Per Cwt (9)
Total Cost Production fer Cow
(9)
Total Cost Production Per Cwt
(9)
$2747 2518 2401 2293 2189
$1565 1469 1430 1401 1382
$ 922 1149 1274 1368 1445
$ 641 769 829 880 926
$1678 1920 2026 2124 2218
$1139 1248 1319 13 69 1404
2115 2026 1932 1812 1517
1357 1336 1311 1280 1210
1533 1599 1693 1798 2039
959 1012 1064 1120 1318
2308 2415 2522 2671 3026
1454 1523 1597 1698 2035
Profitability
Return to Operators Labor Labor amp N~t Fam Iwome Management sect EguitX Cmita1 Managem~nt IncQme
With Without With Without Per Per AQQreciation AQQre~1atiQn AQQreciat1on AQQreciatiQn farm Ql2erator
(3) (3) (3) (3) (3) (3)
$157944 $112483 $157154 $111814 $72075 $50073 72699 46862 70487 44957 25129 18115 51682 33290 49335 31000 15514 12290 40559 25457 39083 23381 9128 7659 33904 19749 32076 17627 4136 3599
26429 15395 23588 13469 21 -24 19844 10520 18127 8427 -4171 -3475 14690 4432 12898 2090 -9752 -8829
6680 -3173 4611 -5189 -20244 -16770 -13617 -23915 -15804 -25722 -44712 -39924
Farm Business Charts for farms with freesta11 barns and 120 cows or less and more than 120 cows and farms with conventional barns with 60 cows or less and more than 60 cows are discussed in the section on pages 23-28
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 24: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/24.jpg)
22
Financial Analysis Chart
The farm financial analysis chart is designed just like the Farm Business Chart and may be used to measure the financial health of the farm business Most of the financial measures used in the chart are presented on pages 7 10 13 and 18 of this publication References to DFBS output page numbers for participating dairy farmers are provided in the table headings
FINANCIAL ANALYSIS CHART 414 New York Dairy Farms 1986
Liguidity (re~aymentl Debt Payments Cash Flow Available for
Debt Payments as Percent Coverage Debt Service Debt Made Per Cow of Mil~ Re~ei~ts RatiQ Pet Cow Per gow (DFBS pg 7) (7) (7) (11) (5)
$ 48 2 468 $984 $ 136 204 10 199 726 705 291 15 156 635 1249 367 19 131 571 1670 426 22 116 522 2036 488 25 102 461 2402 578 29 089 400 2751 670 35 076 336 3053 804 42 053 244 3567
1525 78 002 76 4482
l) olvellCY ~ffi~lency ~ PtQfitability llebtLAs~u~t RaUo Total Capital Rate of
Percent Current amp Long Farm Cap Turnover Return on ~gYity Intemegiate I~m P~t gow y~arsl Iguity Ca~ (DFBS pg 5) (5) (5) (10) (10) (3)
98 001 000 $3753 152 38 88 007 002 4529 188 12 79 014 015 4963 206 8 73 020 030 5276 220 5 65 026 038 5620 234 3 58 032 048 5901 250 1 52 039 060 6322 268 -1 46 047 071 6945 290 -4 37 056 086 7751 319 -9 15 088 133 9489 439 -45
Summatlze IQur BUiinesi PerfQrmallce
The Farm Business and Financial Analysis Charts can be used to help identify strengths and weaknesses of your farm business Identify three major strengths and three areas of your farm business that need improvement
Strengths Need Improvement
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 25: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/25.jpg)
23
Comparisons by Type of Barn and Herd Size
When analyzing a dairy farm business by comparing it to a group of farms it is important that the group of farms used have as many of the same physical characteristics as possible as the farm being analyzed To assist in this endeavor dairy farms in the 1986 State Summaryl have been divided into those with freestall and those with conventional housing Within each group is a further classification by size of the dairy herd
The table on page 24 shows the average values for the resulting four groups of dairy farms Within each housing type the larger herd size has the highest crop yields and pounds of milk sold per cow The cost of producing milk was lower on the larger farms and labor efficiency greater Profitability was also greater on the larger farms within each housing type
Farm business charts have been computed for each of the four housing and herd size categories From these charts on pages 25-28 the range in size of business rates of production labor efficiency value and cost of producing milk and profitability can be observed The range in every category of business performance is tremendous
By comparing the farms performance on the most appropriate business chart a farm manager will be better able to evaluate his or her business performance Farm managers should remember however that their competition is not limited to the other farms in their own barn type and herd size category They should observe how their management performance compares with farms in other categories as well
Herd Size Comparisons
A detailed comparison of profitability financial situation and business analysis factors across herd sizes is contained on pages 29-36 As herd size increases the average profitability also increases (pages 29-30) Net farm income without appreciation was $123246 per farm for the 250 or more herd size group and $6845 per farm for those with less than 40 cows This relationship holds for all measures of profitability including rate of return on equity capital
As herd sizes increase above 55 cows percent equity decreases (pages 31shy34) However farm net worth increases substantially as herd size increases The average net worth for all size farms increased during 1986
Crop yields increased as herd size increased but fertilizer and lime expenses and machinery cost per tillable acre also increased (pages 35-36) Milk sold per cow also increased as herd size increased ranging from 14525 pounds on the farms with less than 40 cows to 18593 pounds on farms with 250 or more cows Farm capital per worker increased as herd size increased while farm capital per cow decreased as herd size increased Cows per worker increased dramatically as herd size increased ranging from 20 at the lowest herd size category up to 41 at the largest size category
lSmith Stuart F Wayne A Knoblauch and Linda D Putnam DaiIY Farm Manaampement Business Summary New York 1986 Department of Agricultural Economics Cornell University AE Res 87-20 July 1987
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 26: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/26.jpg)
24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE
414 New York Dairy Farms 1986
Farms with COllventional FI~estal1 Item s6Q Cowsect gt60 cQws lt120 cQws gt120 Cows
124
274 97
155 48
27 137 704 79 34
$2275 $33257
$121
81 68
1286440 15802
$933 $1437 $1253
$459 $291
23 $379
$173780 6233 2867 3066 1223
252
292 l33
440562 28
299 $381 $113
$19138 $455
$2090 66
71
273 99
139 62
28 140 687
78 31
$2870 $41281
$151
88 73
1388642 15866
$936 $1422 $1284
$459 $289
22 $394
$183971 5970 2986 2749 1214
237
284 l4l
488958 31
328 $361 $116
$24475 $4275 $2050
65
73
588 205 243 181 32
152 565 78 27
$3111 $83046
$141
222 182
3787019 17093
$960 $1296 $1272
$548 $321
24 $412
$204899 5355 3098 2424
869 205
579 l47
654062 38
399 $385 $145
$60243 $16090 $2145
60
Number of farms
CrQRRing Program AIlal~s1sect Total Tillable acres Tillable acres rented Hay crop acres Corn silage acres Hay crop tons DMacre Corn silage tonsacre Oats bushelsacre Forage DM per cow tons Tillable acrescow Fert amp lime exptil acre Total machinery costs Machinery costtillable acre
Dair~ AIld~sis Number of cows Number of heifers Milk sold lbs Milk soldcow lbs Operating cost of prod milkcwt Total cost of prod milkcwt Pricecwt milk sold Purchased dairy feedcow Purchased dairy feedcwt milk Pure grain amp cone as milk rec Pure feed amp crop expcwt milk
CaRital gfflceIl~~ Farm capitalworker Farm capitalcow Farm capitaltil acre owned Real estatecow Machinery investmentcow Capital turnover years
LaboI EfficieIl~~ Worker equivalent Operatormanager equivalent Milk soldworker lbs Cowsworker Work unitsworker Labor costcow Labor costtillable acre
Profitabi11t~ ~ Balan~~ Sh~~t AIlal~sis Net farm income (wo apprec) $9341 Labor amp mgmt incomeoperator $-999 Farm debtcow $2428 Percent equity 59
146
157 51 96 27
23 123 561 72 34
$1990 $17584
$112
46 35
698200 15171
$951 $1538 $1247
$499 $329
25 $405
$137144 6020 2614 3109 1147
257
202 l15
345644 23
240 $417 $122
Average of all farms not only those reporting data
-- ---_-- -- -------- --_----- ---- --_--------- -__--------_
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 27: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/27.jpg)
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25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARMS 146 Conventional Stall Dairy Farms with 60 or Less Cows New York 1986
Sl~e of ~usinlllU Rates of PIoduction LDbor Efficillncy Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cgws Sgld PeI Cow DMLA~re Per Acre Worker Per Worker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
31 58 1007751 18878 41 20 34 544485 26 55 873140 17368 33 17 30 459871 23 54 832613 16639 29 16 27 428718 22 51 787319 16037 26 15 26 404025 20 49 740807 15438 24 14 25 375361
20 47 700379 15034 22 13 23 343283 19 44 653090 14416 21 12 21 316418 17 41 580976 13938 19 10 20 286500 15 36 501065 12992 16 8 18 255798 12 28 352058 10736 11 5 14 192273
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per COl Reclli]2ts PeI Cow ggsts Per ggw PeI Cow gwt Milk
(9) (9) (10) (10) (9) (9)
$189 11 $117 $520 $338 $251 320 17 249 611 455 315 386 22 285 666 503 344 422 24 323 734 535 370 459 25 365 785 580 386
488 27 397 827 611 405 532 29 429 884 661 428 580 30 464 916 721 459 631 32 522 1000 783 497 765 38 648 1176 954 606
VDlue and gost of frodu~tion Profitahility Milk Oper Cost Total Cost Net ~arm Income
Receipts Milk Production With Without LahgI ~ Mgmt Incomll Per Cow fer Cwt PeI gwt A]2]2rec A]2Rrec fer ~DIm PeI Q]2er
(9) (9) (9) (3) (3) (3) (3)
$2709 $ 623 $1198 $60893 $35087 $22396 $17562 2425 749 1342 35933 24247 12646 10953 2294 811 1384 29970 18994 7722 6887 2188 867 1432 25464 14971 4609 4089 2101 926 1516 20230 11729 1702 1658
------------------------------------------------------------------------------shy2000 987 1563 16582 8614 -1464 -1401 1937 1047 1612 12687 5490 -5240 -4394 1853 1092 1710 7202 814 -8463 -8524 1740 1150 1857 -257 -3988 -15131 -14528 1403 1336 2195 -12299 -18796 -28918 -26431
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 28: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/28.jpg)
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 124 Conventional Stall Dairy Farms with More Than 60 Cows New York 1986
Size of Ihlsectinels Rate~ Qf Prodyction LIlQor Effic ilDCY Yorker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent Cows SQld P~) Cow DMLAcre Per ASOre Yo)ker Pe) YQr1ser (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
47 124 2093475 19571 48 22 44 652718 37 99 1649764 18016 36 19 37 571684 34 90 1441447 17121 33 17 34 530017 31 85 1317509 16694 30 16 31 496060 30 79 1251151 16141 28 15 29 471986 ------------------------------------------------------------------------------shy28 76 1206039 15667 26 14 28 446181 25 72 1147970 15233 24 13 26 425808 24 68 1074750 14662 22 12 25 396893 21 65 967717 13618 20 10 22 346946 18 62 810022 11546 15 6 18 256917
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per CQw R~ceilts Pe) Cow CQsts Per Cow Per Cow Cwt Milk
(9) (9) (10) (10) (9) (9)
$186 10 $191 $476 $342 $232 269 14 259 554 428 291 333 17 317 625 487 329 380 21 353 704 528 343 429 22 381 750 579 365
----------------------------------_ ---------------------------------shy473 24 409 800 624 395 512 26 456 877 671 421 557 27 504 950 713 441 624 30 556 1050 773 465 761 37 713 1219 897 552
Vsectlue and Cost of Proguctign Prof1tabLlity Milk Oper Cost Total Cost Net Farm Income
Receipts Milk Production P~r Qow ~er Cwt Pet Cwt
(9) (9) (9)
$2661 $653 $1161 2517 783 1260 2406 831 1314 2311 868 1367 2201 914 1411
2124 946 1443 2041 986 1481 1936 1041 1566 1835 1087 1656 1594 1321 1948
Yith A1U1~so
(3)
$137617 60290 49563 42248 37685
31717 23127 17079 12251 -8813
Yithout Allrec
(3)
$61175 39547 32130 27056 21315
18215 14332
7417 -2565
-20714
LaQo) ~ Mampmt Income Pex [aIm Pex 0ler
(3)
$40774 21148 14942
9103 3905
283 -4262
-12508 -20966 -44612
(3)
$27242 16925 11965
7194 3225
-3498 -9625
-16753 -42011
175
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 29: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/29.jpg)
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS 71 Freesta11 Barn Dairy Farms with 120 or Less Cows New York 1986
H~e of Budnels R~t~sect gf P~oguction Labgr Efficlencx Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold a1~nt Cgwsect SQld f~r ~Qw DMLAc~~ P~~ Ac~e WoIlse~ P~r Wg~ker
(DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
43 117 1964379 19630 45 21 52 746199 35 110 1842322 18599 39 19 40 621768 33 105 1711514 17868 35 17 36 565788 30 97 1588855 16927 30 16 33 530646 28 91 1453928 16098 27 15 31 506808 ------------------------------------------------------------------------------shy27 86 1350208 15704 25 14 29 484530 26 82 1217728 15246 24 14 29 454169 23 74 1094868 14733 23 13 27 422903 21 67 975911 13879 19 11 25 394665 17 52 721949 10706 14 7 21 304171
Cost Control Grain Feed is Machinery Labor amp Feed amp Crop Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per Per ~gw Recd]2tsect P~~ Cow COSt12 P~~ Cow P~l CQll Cwt Milk
(9) (9) (10) (10) (9) (9)
$183 9 $239 $546 $383 $240 291 14 309 653 449 285 321 17 354 682 509 335 317 19 393 712 517 369 423 22 422 759 607 390
------------------------------------------------------------------------------shy489 24 453 822 652 406 534 26 488 885 693 433 551 28 532 940 719 453 597 30 648 1084 797 509 735 35 891 1323 935 615
V~lu~ ang Cosectt of PrQguctlQn f~ofit5bilitX Milk Oper Cost Total Cost Net Film Income
Receipts Milk Production With Without La12Q~ ~ Mgmt Incom~ Per CQw P~r Cwt Pel Cwt AR]2re~ A]2]2re~ PeI Fam f~l O]2eI
(9) (9) (9) (3) (3) (3) (3)
$2763 $ 652 $1116 $119436 $85723 $56843 $31786 2517 784 1233 75141 51430 29843 19619 2456 822 1318 58064 39357 19804 14086 2349 883 1370 45183 34141 14167 9502 2247 926 1400 40801 25936 7804 6962
2179 955 1448 34830 20431 2896 2591 2113 1011 1497 27217 14804 -1786 -1478 2041 1062 1579 19458 8785 -5399 -4633 1932 1155 1671 11308 -531 -16982 -13373 1494 1308 1953 -6317 -27829 -46468 -39164
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 30: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/30.jpg)
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS 73 Freesta11 Barn Dairy Farms with More Than 120 Cows New York 1986
S1iie of ~usectiness Rit~s of ProdyctiQn LabQr Effic1en~x Worker No Pounds Pounds Tons Tons Corn Cows Pounds Equivshy of Milk Milk Sold Hay Crop Silage Per Milk Sold alent CQwsect ~old P~J Cow DMLAcJe Per Acre loJker Per WQrker (DFBS pg 10) (10) (10) (9) (8) (8) (10) (10)
133 540 10200698 20554 51 20 59 926835 76 311 5862327 19208 40 18 46 821108 67 254 4456278 17921 37 17 43 728084 60 226 3713183 17284 34 16 40 678995 53 194 3138231 16825 33 16 39 644490
------------------------------------------------------------------------------shy49 173 2616444 16360 31 15 37 611932 44 156 2458443 15867 30 15 35 565128 40 145 2327342 15350 27 13 33 541569 36 132 2099647 14395 24 12 31 476755 30 122 1739656 12476 19 9 27 415285
Cost Control Grain Feed is Machinery Labor amp Feed amp C-op Feed amp Crop Bought of Milk Costs Machinery Expenses Expenses Per PeJ CQw Rece1ats Pe CQw Costs Per CQw Per CQw Cwt M11~
(9) (9) (10) (10) (9) (9)
$216 12 $229 $500 $401 $271 322 16 284 627 505 315 389 19 338 683 564 347 425 20 380 715 609 373 463 23 397 747 658 404
-----~------------------------------------------------ --------------------------522 25 411 775 690 424 578 27 429 830 741 440 622 29 446 887 797 461 680 31 491 929 848 491 776 35 590 1033 955 567
Value ang Cosectt of Poduction Milk Oper Cost Total Cost
Receipts Milk Production Pe ~ow ~e Q P~ ~wt
(9) (9) (9)
Prof1tabUitx N~t Fam Incom~ With Without Labor ~ Mgmt In~om~
ARarec AaRrec P~r Fam ~er QRer (3) (3) (3) (3)
$2900 2631 2554 2424 2350
$ 673 821 903 930 947
$1094 1191 1238 1281 1321
$277840 144680 111557
94081 79443
$227537 122770
89415 67102 55090
$163935 71851 47475 36270 21997
$122334 48890 35630 23042 16870
2257 2169 2104 1977 1756
979 1013 1055 1116 1273
1353 1378 1418 1516 1690
70133 54017 40369 26284
-15577
44237 27750 20173
5277 -30415
13125 122
-11512 -30939 -60131
10248 -210
-8932 -20499 -57094
-~ ----~----- ---~- - ---~------~--~--~------~--~----------~ ----~-
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 31: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/31.jpg)
29
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
Less than 40 to 55 to 70 to 85 to Item Farm Size 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32 87 76 60 46
aCCRUAL EXftNSES Hired labor $ 2783 $ 5555 $ 9003 $ 14979 $ 16565 Dairy grain amp concentrate 14087 23314 28109 34369 38303 Dairy roughage 948 1261 1229 1062 1191 Other livestock feed 863 271 548 603 1326 Machine hirerentlease 739 948 1326 1419 2711 Machine repairsparts 2846 3908 5511 7365 10511 Auto expense (farm share) 641 456 449 477 771 Fuel oil amp grease 1496 2355 3319 4251 5833 Replacement livestock 1061 1279 1143 812 1946 Breeding 1077 1372 2053 2303 2303 Veterinary amp medicine 974 1702 2840 2826 3997 Milk marketing 4828 6606 7792 10424 11482 Cattle leaserent 48 16 43 2 10 Other livestock expense 2119 3969 4968 6070 6814 Fertilizer amp lime 1456 3135 4782 6506 7355 Seeds amp plants 873 1171 1865 2889 3272 Spray amp other crop expense 533 898 1710 2448 2683 Landbui1dingfence repair 1113 1154 1509 1683 2523 Taxes amp insurance 3743 4807 6408 7257 9077 Telephone amp electricity 2543 3414 4225 5328 6122 Interest paid 6487 10078 10104 13570 17334 Misc (including rent) 1589 2374 428Z 5267 6998
Total Operating Expenses $52847 $80043 $103223 $131910 $159127 Expansion livestock 456 283 664 474 985 Machinery depreciation 4657 7458 10906 13388 16449 Building depreciation 2570 3740 5019 6469 8182
Total Accrual Expenses $60530 $91524 $119812 $152241 $184743
ACCRUaL RECEIPTS Milk sales $58125 $89125 $121096 $149343 $180096 Dairy cattle 5294 6411 9025 10559 14433 Dairy calves 971 1295 1674 1837 2357 Other livestock 454 200 317 235 156 Crops 1144 197 86 1724 1582 Misc receipts 1387 1940 37Z8 4143 5480
Total Accrual Receipts $67375 $99168 $135976 $167841 $204104
fROFITABILITY ANALYSIS Net farm income (wo apprec) $6845 $7644 $16164 $15600 $19361 Net farm income (wapprec) $14484 $17774 $25724 $31524 $40888 Labor amp mgmt income $-2533 $-2450 $1797 $-1674 $518 Number of operators 100 113 132 122 137 Labor amp mgmt incoper $-2533 $-2168 $1361 $-1372 $378 Rate of return on equity
capital (wo apprec) -88 -86 -37 -28 -21 Rate of return on equity
capital (wapprec) -32 -21 01 25 42
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 32: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/32.jpg)
30
FARM BUSINESS SUMMARY BY HERD SIZE 414 New York Dairy Farms 1986
100 to 150 to 200 to 250 or Item Farm Size 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
ACCRUAL EXPENSES Hired labor $ 23213 $ 46159 $ 68294 $ 145034 Dairy grain amp concentrate 53781 77 088 122806 224158 Dairy roughage 1576 1573 5901 11045 Other livestock feed 1066 1162 1900 754 Machine hirerentlease 2622 2627 4523 4140 Machine repairsparts 13261 15449 27760 41273 Auto expense (farm share) 558 550 262 1383 Fuel oil amp grease 6944 11345 12368 18665 Replacement livestock 1996 7347 7535 4336 Breeding Veterinary ampmedicine
3629 4985
4076 6909
7832 12373
12224 23522
Milk marketing 16715 22704 28678deg 56326 Cattle leaserent Other livestock expense Fertilizer amp lime
65 10053 10159
598 13968 13 391
18995 20410
499 37792 30533
Seeds ampplants Spray amp other crop expense
4438 4358
6510 5755
7633 8207
13922 14950
Landbui1dingffence repair Taxes amp insurance
2954 10320
2912 14487
5095 20465
12813 25083
Telephone amp electricity 7271 9442 12178 20281 Interest paid 21682 34929 42595 78770 Misc (including rent) 6999 10459 22781 29228
Total Operating Expenses $208645 $309440 $458591 $ 806731 Expansion livestock 582 2139 2297 12572 Machinery depreciation 20893 26190 37063 52995 Building depreciation 9226 15992 20451 __36105
Total Accrual Expenses $239346 $353761 $518402 $ 908403
ACCRUAL RECEIPTS Milk sales $245627 $334063 $474437 $ 902482 Dairy cattle 18626 28784 42300 77186 Dairy calves 3038 3468 4742 9618 Other livestock 345 1275 9333 877 Crops 3668 5490 4850 16858 Misc receipts 7122 14311 25621 24628
Total Accrual Receipts $278426 $387391 $561283 $1031649
PROFITABILITY ANALYSIS Net farm income (wo apprec) $39080 $33630 $42881 $123246 Net farm income (wapprec) $65839 $58481 $65595 $163623 Labor ampmgmt income $14011 $5359 $7205 $65171 Number of operators 156 145 150 154 Labor ampmgmt incoper $8981 $3696 $4803 $42319 Rate of return on equity
capital (wo apprec) 15 07 18 71 Rate of return on equity
capital (wapprec) 73 53 5U 106
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 33: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/33.jpg)
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 CQws 40 to 59 Cowsect 55 to 69 Cows Item JBn 1 D~~ 31 Jan 1 D~c 31 Jan 1 De~ 31
ASSETS Farm cashchkgsav $ 1986 $ 2198 $ 1938 $ 2701 $ 2526 $ 3408 Accounts receivable 4661 4646 7038 7400 10126 10700 Feed amp supplies 10565 11503 16819 16887 25547 25019 Livestock 35537 37823 50999 54104 72821 74528 Machinery amp equipment 40675 41786 54251 54042 76061 76061 FLB amp PCA stock 893 874 1522 1645 1584 1560 Coop stocks amp cert 1697 1905 1637 1879 2951 2984 Land amp bui1dings 116480 119878 14Z042 150445 180616 187073 Total Farm Assets $212494 $220613 $281246 $289103 $372232 $381333
Pers cashchkgsav$ 7733 $ 7940 $ 5478 $ 5390 $ 4292 $ 4848 Cash value of life ins 2634 2007 2977 3252 3476 3842 Nonfarm real estate 15208 19250 1956 1964 18045 17580 Auto (personal share) 1866 1923 2398 2906 2870 3669 Stocks amp bonds 866 773 2262 3430 17622 19198 Household furnishings 8083 8167 8936 9139 6732 7755 All other 899 Z52 3105 2782 1889 2015 Total Nonfarm
Assets $ 37285 $ 40812 $ 27113 $ 28865 $ 54925 $ 58908 Total Farm amp Nonfarm
Assets $249779 $261425 $308359 $317968 $427157 $440241
LIAIILITIfS Accounts payable $ 2287 $ 2224 $ 3367 $ 4389 $ 3650 $ 4504 Operating debt 597 811 1315 963 1468 1366 Short term 1638 1406 1106 1704 1420 1738 Intermediate 20880 20413 43165 43747 44828 43302 Long term 2sect147 53569 80763 78938 77 843 Z7Z41 Total Farm Liab $ 81550 $ 78423 $129716 $129741 $129208 $128651 Tot Nonfarm Liab 1354 981 1046 1083 191Z 2034 Total Farm amp Nonfarm
Liabilities $ 82904 $ 79404 $130762 $130824 $131125 $130685 Farm Net Worth
(Equity Capital) $130944 $142190 $151530 $159362 $243024 $252682 Farm amp Nonfarm
Net Worth $166875 $182021 $177597 $187144 $296032 $309556
FINANCIAL MEASURES Lesects thBn 40 Cows 40 to 24 Cows 55 tQ 69 Cows Percent equity 64 55 66 Debtasset ratio-long term 045 052 042 Debtasset ratio-inter amp current 025 037 026 Change in net worth with apprec $11246 $7832 $9658 Total farm debt per cow $2376 $2703 $2075 Debt payments made per cow $600 $526 $446 Debt payments as of milk sales 33 28 22 Amount avail for debt service $15290 $22426 $32964 Cash flow coverage ratio for 1986 125 104 133
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Includes FLBPCA stock and discounted lease payments for cattle and machinery
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 34: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/34.jpg)
Farms with 70 to 84 Cows 85 to 22 Cows Dec 31
$ 4311 13731 33003 91004 93896
3362 4016
232659 $475981
$ 12071 4257 8474 3312 4383 9259 3032
$ 44789
$520770
$ 6211 1840 2047
57039 94Z22
$161859 800
$162659
$314122 $358111
to 84 Cows 66
041 028
$17456 $2102
$484 24
$34979 112
Jan 1 Dec 31
$ 4152 $ 4674 15052 16928 41277 41802
104001 109208 116081 117533
3246 2959 4055 5362
244511 257618 $532375 $556084
$ 5906 $ 6958 3120 3430 3577 3423 2175 2536 3912 4181 7281 7788 4423 5554
$ 30394 $ 33869
$562769 $589953
$ 5443 $ 5899 3774 3883
827 1540 78119 80681
1138ll 111042 $202034 $203045
115 77
$202149 $203122
$330342 $353039 $360620 $386831
82 to 99 Cows 63
043 031
$22698 $2207
$465 23
$42858 118
Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land ampbui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm ampNonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm amp Nonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
Jan 1
$ 3624 13182 32473 86471 92371
3140 3587
226185 $461034
$ 11952 4330 8671 3198 4062 9168 4362
$ 45745
$506779
$ 5836 1932 1955
55996 98649
$164368 1213
$165581
$296666 $341198
70
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 35: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/35.jpg)
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
Farms with 100 to 149 CQws 150 to 129 Cowsect Item Jan 1 Dec 31 Jan 1 Dec 31
ASSETS Farm cashchkgsavings $ 5440 $ 6624 Accounts receivable 20835 22677 Feed amp supplies 58288 60473 Livestock 142725 147952 Machinery amp equipment 128625 127761 FLB amp PCA stock 5968 6358 Coop stocks amp cert 9312 9610 Land amp bui1dings 322502 343761 Total Farm Assets $693695 $725216
Pers cashchkgsavings $ 4272 $ 4744 Cash value of life ins 4278 4382 Nonfarm real estate 9270 11871 Auto (personal share) 2762 3248 Stocks amp bonds 6834 7596 Household furnishings 8716 8689 All other 326~ 3429 Total Nonfarm Assets $ 39398 $ 43960 Total Farm amp Nonfarm
Assets $733093 $769176
LIABILITIES Accounts payable $ 5090 $ 5192 Operating debt 4056 3204 Short term 3768 4257 Intermediate 99966 96334 Long term 131951 132876 Total Farm Liab $250831 $241863 Total Nonfarm Liab 1546 254~ Total Farm amp Nonfarm
Liabilities $252377 $244408 Farm Net Worth
(Equity Capital) $442864 $483354 Farm amp Nonfarm Net Worth $480716 $524768
FINANCIAL MEASURES 100 to 149 CQws Percent equity 67 Debtasset ratio-long term 039 Debtasset ratio-inter amp current 029 Change in net worth with apprec $40489 Total farm debt per cow $1982 Debt payments made per cow $532 Debt payments as of milk sales 26 Amount avail for debt service $62953 Cash flow coverage ratio for 1986 120
$ 3576 $ 4521 27738 33021 73223 74490
188540 199263 167695 172506
11845 11879 9224 10601
41Z368 421326 $899209 $933607
$ 7433 6743
26500 4370
12388 14790 ~050
$ 77274
$ 7561 8120
26000 4780
12524 14850 11770
$ 91605
$976483 $1025212
$ 13306 9115 3209
181693 161152
$368475 U159
$ 15005 8569 6496
179730 161L331
$ 378130 1Q833
$380234 $ 388963
$530734 $596249
$ 555477 $ 636249
15Q to 199 CQws 59
039 041
$24743 $2136
$536 28
$81720 104
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 36: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/36.jpg)
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE 414 New York Dairy Farms 1986
More than 250 Cows Jan 1 Dec 31
$ 3098 $ 5509 77139 88644
197236 207932 442895 466645 265465 274285 15298 14356 32024 53851
882690 934130 $1915845 $2045352
$ 1741 $ 3824 4170 4166 5889 5889 1046 1889 7208 8332 4000 4000
14 377 12205 $ 38430 $ 40305
$1954275 $2085657
$ 15482 $ 23393 27204 50242 12870 13488
364772 349232 380025 428144
$ 800354 $ 864499 o o
$ 800354 $ 864499
$1115491 $1180853 $1153921 $1221158
More than 250 Cows 58
046 039
$65361 $2194
$769 33
$206413 125
Farms with Item
ASSETS Farm cashchkgsavings Accounts receivable Feed amp supplies Livestock Machinery amp equipment FLB amp PCA stock Coop stocks amp cert Land amp bui1dings Total Farm Assets
Pers cashchkgsavings Cash value of life ins Nonfarm real estate Auto (personal share) Stocks amp bonds Household furnishings All other Total Nonfarm Assets Total Farm amp Nonfarm
Assets
LIABILITIES Accounts payable Operating debt Short term Intermediate Long term Total Farm Liab Total Nonfarm Liab Total Farm ampNonfarm
Liabilities Farm Net Worth
(Equity Capital) Farm amp Nonfarm Net Worth
FINANCIAL MEASURES Percent equity Debtasset ratio-long term
200 to 249 Cowsect Jan 1 Dec 31
$ 5182 $ 5285 47222 48353
110301 112044 272218 280550 203740 207527 14501 14456 21898 29283
486214 492339 $1161276 $1192837
$ 7629 $ 8086 17877 6118 17 429 17429
5429 7357 3643 5286 6714 7714
10493 17 023 $ 69213 $ 69012
$1230489 $1261849
$ 15676 $ 9132 6258 5947 2925 7172
215166 243542 232444 215211
$ 472468 $ 481004 o 2217
$ 472468 $ 483221
$ 688808 $ 711833 $ 758021 $ 778628
Debtasset ratio-inter amp current Change in net worth with apprec Total farm debt per cow Debt payments made per cow Debt payments as of milk sales Amount avail for debt service Cash flow coverage ratio for 1986
200 to 249 Cows 60
043 038
$23026 $2073
$638 30
$96415 098
Inc1udes discounted lease payments Average of farms reporting nonfarm assets and liabilities for 1986
Inc1udes FLBPCA stock and discounted lease payments for cattle and machinery
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 37: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/37.jpg)
35
SELECTED BUSINESS FACTORS BY HERD SIZE 414 New York Dairy Farms 1986
Farms with Less than 40 to 55 to 70 to 85 to Item 40 Cows 54 Cows 69 Cows 84 Cows 99 Cows
Number of farms 32
Cropping Program Analysis Total Tillable acres 117 Tillable acres rented 28 Hay crop acres 76 Corn silage acres 14 Hay crop tons DMacre 21 Corn silage tonsacre 118 Oats bushelsacre 433 Forage DM per cow tons 69 Tillable acrescow 36 Fert amp lime exptil acre $1243 Total machinery costs $12414 Machinery costtillable acre $106
Dairy Analysis Number of cows 32 Number of heifers 25 Milk sold lbs 470234 Milk soldcow lbs 14525 Operating cost of prod milkcwt $927 Total cost of prod milkcwt $1634 Pricecwt milk sold $1236 Purchased dairy feedcow $464 Purchased dairy feedcwt milk $320 Purchased grain amp cone as
of milk receipts 24 Purchased feed amp crop
expensecwt milk $381
Capital Efficiency Farm capitalworker $128138 Farm capitalcow 6689 Farm capitaltil acre owned 2433 Real estatecow 3650 Machinery investmentcow 1274 Capital turnover years 289
Labor Efficiency Worker equivalent l69 Operatormanager equivalent l00 Milk soldworker lbs 278245 Cowsworker 20 Work unitsworker 204 Labor costcow $480 Labor costtillable acre $133
87
162 58
100 30
22 123 605 74 34
$1938 $17793
$110
47 36
716437 15180
$977 $1540 $1244
$521 $343
26
$416
$141878 6042 2742 3152 1147
261
201 113
356436 23
247 $411 $120
76
198 62
110 38
26 131 671 76 33
$2413 $25291
$128
61 50
966374 15825
$914 $1475 $1253
$480 $304
23
$390
$155055 6170 2750 3011 1246
259
243 l32
397685 25
266 $400 $123
60 46
266 301 91 114
148 168 48 56
26 27 136 l37 701 644 80 80 35 33
$2442 $2442 $31515 $42081
$118 $140
76 90 62 73
1185995 1430399 15605 15840
$956 $945 $1457 $1429 $1259 $1259
$466 $437 $299 $276
23 21
$399 $369
$163243 $184485 6165 6027 2677 2910 3019 2780 1225 1293
255 241
287 295 l22 l37
413239 484881 26 31
287 327 $388 $357 $111 $107
Average of all farms not only those reporting data
-- ------------------------------------------------------------------------ ----~---------
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 38: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/38.jpg)
Farms with 100 to 150 to 200 to 250 or Item 149 Cows 199 Cows 249 Cows More Cows
Number of farms 62 22 10 19
Cto~~ini Ptoitgm Anal~sisect Total tillable acres 364 506 678 839 Tillable acres rented 126 202 277 267 Hay crop acres 180 228 268 310 Corn silage acres 81 129 158 351 Hay crop tons DMacre 30 29 31 35 Corn silage tonsacre 145 138 155 161 Oats bushelsacre 674 554 500 575 Forage DM per cow tons 79 76 74 78 Tillable acrescow Fert amp lime exptil acre
31 $2787
30 $2645
30 $3013
22 $3638
Total machinery costs $50654 $64609 $92196 $131927 Machinery costtillable acre $139 $128 $136 $157
12Sl1t~ AnSll~sis Number of cows 119 172 226 382 Number of heifers 102 139 176 314 Milk sold lbs 1917759 2608778 3744053 7104584 Milk soldcow lbs 16055 15199 16552 18593 Operating cost of prod milkcwt $917 $982 $993 $954 Total cost of prod milkcwt $1365 $1371 $1326 $1237 Pricecwt milk sold $1281 $1281 $1267 $1270 Purchased dairy feedcow $463 $458 $569 $616 Purchased dairy feedcwt milk Purchased grain amp cone as
$289 $302 $344 $331
of milk receipts Purchased feed amp crop
22 23 26 25
expensecwt milk $387 $400 $441 $415
Ca~ital Efflcienc~ Farm capitalworker $198727 $196654 $201206 $211602 Farm capitalcow 5939 5339 5204 5183 Farm capitaltil acre owned 2968 3014 2943 3463 Real estatecow 2789 2461 2170 2377 Machinery investmentcow 1073 991 909 706 Capital turnover years 232 222 202 185
Labot Effipoundienpound~ Worker equivalent 357 466 585 936 Operatormanager equivalent 156 145 1 50 1 54 Milk soldworker lbs 537187 559824 640009 759037 Cowsworker 33 37 39 41 Work unitsworker 355 385 407 422 Labor costcow $343 $362 $372 $423 Labor costtillable acre $113 $123 $124 $192
Average of all farms not only those reporting data
-_ -_ --_--- _- ---------~---------~----~-- ~---------_---_--shy
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 39: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/39.jpg)
37
IDENTIFY AND SET GOALS
If businesses are to be successful they must have direction Written goals help provide businesses with an identifiable direction over both the long and the short term Goal setting is as important on a dairy farm as it is in other businesses Written goals are a tool which farm operators can use to ensure that the business continues to move in the proper direction
1 Goals should be specific
2 Goals should be realistic and achievable
3 The achievement of the goal should be verifiable
4 You should designate a time when each goal will be achieved
Goal setting on a dairy farm does not have to be a complex process In many cases it provides a process for writing down and agreeing on goals that you have already given some thought to It is also important to remember that once you write out your goals they are not cast in concrete If a change takes place which has a major impact on the farm business the goals should be reworked to accommodate that change Refer to your goals as often as necessary to keep the farm business progressing
It is important to identify both long and short range goals when looking at the future of your farm business
A suggested format for writing out your goals is as follows
a Begin with a general philosophy statement which incorporates both business and family goals
b Identify 4-6 long range goals
c Identify specific short range goals for a given time period (ie one year)
Worksheet for Setting Goals
I General Philosophy and Objectives
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University
![Page 40: WESTERN PLAIN REGION 1987 - Cornell Universitypublications.dyson.cornell.edu/outreach/extension... · represents the change in values caused by annual changes in prices of live stock,](https://reader033.vdocuments.net/reader033/viewer/2022050512/5f9cec490781743cd0575843/html5/thumbnails/40.jpg)
38
Yorksheet for Setting Goals (continued)
II Long Range Goals (require two or more years to achieve)
III Short Range Goals (possible to achieve in one or two years)
What IHow IWhen
NOTE Once long and short range goals have been identified it is helpful to rank them in order of priority
Prepared by TR Maloney Extension Associate Cornell University