News

Harvest Is "Over" Now Calculate Your Break-Even and Place an Offer

Sillouette Sunset Location Rail

On the day before Thanksgiving, our customer receipts hit our harvest bushel estimates. We know harvest is not yet complete statewide, so we’re pleased that we will surpass our expectations on bushels. During the planting and growing season, we received more rain than most of us would have liked, and for the most part, at some of the worst times of the year, we fared much better than many of our neighboring states. Reports from many of the Landus Cooperative farmer-owners indicate that soybean harvest was about on par with expectations. Corn yields appear to be somewhat above expectations to much above expectations. With everything Mother Nature threw at us this year, we should indeed be grateful to be in Iowa. 

YEAR-END BREAK-EVEN CALCULATION

Preparing for year-end is a great time to calculate a break-even for your farming operation. You should have a good idea of total bushels raised across your entire operation. And, once you have a chance to check with your bookkeeper or accountant, you’ll also have a good idea of your expenses. Then, it’s just a matter of allocating those costs to your bushels. If you’re in a 50/50 rotation between soybeans and corn, some of your fixed expenses could be split using that ratio. Other input costs will need to be allocated to one crop or the other until all expenses are accounted for. 

Using some simple math will tell you what your break-even per bushel is. Then, using this information, you can make decisions on selling prices you need as you determine your marketing plan. Don’t forget to add in any outside income, like government payments, including MFP and any crop insurance proceeds. 

We are working on creating this calculator in our customer portal, so you have all of your information in one spot. Look for it late winter/early spring. 

USE AN OFFER 

As you already know, we encourage the use of offers, whether that is for bushels in the elevator or in bins on the farm. We also encourage you to use the costs from this year to estimate expenses for next year and then estimate a “normal” yield for your acres. Using this information will then help guide you as you start to make sales for the 2020 crop. 

As always, our Grain Marketing Advisors are available to help with any of this. Just let us know how we can assist you as you look forward to 2020, whether that is pricing Old Crop or New Crop bushels.