June 1989
A.E. Ext. 89-15
SOUTHEASTERN
NEW YORK
1988
""UE~'tm4entofAgricultural
Economics
of Agriculture and Life Sciences
College!)f tlltl StateUni;v~rsity ,
Slt:Y",ltll,aea. ~ew YOl'k'14853~'i801
1988 DAIRY FARM BUSINESS SUHHARY
SOUTHEASTERN NEW YORK REGION
Table of Contents
INTRODUCTION
1
Program Objective .................................................
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 Statement ...............................................
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 1988 DAIRY FARM BUSINESS SUMMARY
SOUTHEASTERN NEW YORK REGION*
INTRODUCTION
Dairy farmers throughout the State have been participating in Cornell
Cooperative Extension's farm business summary and analysis program since the
early 1950's. Each participating farmer receives a comprehensive business
summary and analysis of his or her farm business. The information in this
report represents an average of the data submitted from farms in the
Southeastern New York region.
Program Objective
The primary objective of the dairy farm business summary, DFBS, is to
help farm managers improve the financial management of their farm business
through appropriate use of historical farm data and the application of modern
farm business analysis 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 1988
DFBS printout received by all participating dairy farmers. Worksheets are
included to give non-DFBS participants an opportunity to summarize their
businesses. The analysis tables have an open column or section labeled My
Farm. It may be used by any dairy farm manager 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 cropping program analysis,
(5) a dairy program 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 90 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 Southeastern Region of New York State, with the number of participating
farms in parentheses, is comprised of Columbia (18), Sullivan (12), Orange
(2), and Dutchess (3) Counties.
This report was written by Stuart F. Smith, Senior Extension Associate, Farm
Management. Linda Putnam was in charge of the data preparation. Cindy
Farrell and Beverly Careelli prepared the publication. Farm business data
was collected by Cooperative Extension agents Steve Hadcock, Alan White,
Gerry Skoka. and David Tetor.
2
SUMMARY AND ANALYSIS OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of operat­
ing 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 35 Southeastern New York Region Dairy Farms, 1988 Type of Farm
Dairy
Part-time dairy
Dairy cash-crop
Part-time cash-crop dairy
Number
32
Type of Ownership
Owner
Renter
Number
26
Type of Business
Single proprietorship
Partnership
Corporation
Number
22
Business Record System
ELFAC
Account Book
Agrifax (mail-in only)
On-Farm Computer
Other
Number
a
3
a
9
11
2
Type of Barn
Stanchion/Tie-Stall
Freestall
Combination
Number
23
10
Milking System
Bucket & carry
Dumping station
Pipeline
Herringbone parlor
Other parlor
Number
Milking Frequency
2x/day
3x/day
Other
Number
35
Production Records
DHIC
Owner-Sampler
Other
None
Number
2
1
2
19
8
5
o
o
1
15
15
1
3
27
2
o
6
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. These specific
classifications are used to separate farms in the State Business Summary.
A part-time farm has less than six months of labor from all operators and
total labor is less than 12 months.
A dairy cash-crop farm has cash receipts from crop sales that exceed 10
percent of accrual milk sales. These farms were summarized using 1987 data
on page 56 of Smith, Stuart F., Wayne A. Knoblauch, and Linda D. Putnam,
Dairy Farm Management Business Summary. New York. 1987, Cornell University,
Department of Agricultural Economics, A.E. Res. 88-8, July 1988.
A farm renter does not own farm real estate at the end of the year or does
not own tillable land. These farms were summarized using 1987 data in
Putnam, Linda D. and Stuart F. Smith, Dairy Farm Business Summary. Eastern
New York Renter Summary. 1987, Cornell University, Department of Agricultural
Economics, A.E. Ext. 88-19, August 1988.
3
Income Statement
The accrual income statement begins with an accounting of all farm
business expenses.
CASH AND ACCRUAL FARM EXPENSES
35 Southeastern New York Region Dairy Farms, 1988
Expense Item
Hired Labor
Feed
Dairy grain & conc.
Dairy roughage
Nondairy
Machinery
Mach. hire, rent/lease
Machinery repairs/parts
Auto expo (farm share)
Fuel, oil & grease
Livestock
Replacement livestock
Breeding
Vet & medicine
Milk marketing
Cattle lease/rent
Other livestock expense
Crops
Fertilizer & lime
Seeds & plants
Spray, other crop expo
Real Estate
Land/bldg./fence repair
Taxes
Rent & lease
Other
Insurance
Telephone (farm share)
Electricity (farm share)
Interest paid
Miscellaneous
Total Operating
Expansion livestock
Machinery depreciation
Building depreciation
TOTAL ACCRUAL EXPENSES
Change in
Change in
Inventory
Accounts
or Prepaid
Cash
Payable
Expense* +
Paid +
$
85
$
0
$ 17,107
400
129
-193
616
55,749
3,293
o
o
3
1,532
9,282
343
5,240
o
o
-43
310
13
101
o
o
Accrual
Expenses
.$ 17,192
55,956
4,038
3
1,532
9,549
343
5,354
1,905
2,448
3,952
11,403
o
o
133
-19
1,905
2,547
3,941
11,403
o
o
o
-34
8
9,238
14
62
9,314
6,913
2,614
2,204
408
14
-56
-12
7,309
2,628
2,165
3,378
5,346
6,162
-11
10
412
69
3,377
3,549
679
5,128
9,740
2,487
$169,695
1,147
o
o
o
o
44
-1
3,593
678
-51
5,077
-12
9,728
2,517
$172,138
1,147
10,383
5,415
$189,083
o
o
o
17
o
o
$
41
917
o
$
-11
1,526
o
o
5,758
6,231
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 in advance of their use, for example, 1989 rent
paid in 1988. 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 payables is added and a decrease
is subtracted when calculating accrual expenses.
Accrual expenses are the costs of inputs actually used in this year's
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
Expense Item
Cash
Paid
+
Hired Labor
$_-Feed
Dairy grain & conc.
Dairy roughage
Nondairy
Machinery
Mach. hire, rent/lease
Machinery repairs/parts
Auto expo (farm share)
Fuel, oil & grease
Livestock
Replacement livestock
Breeding
Vet & medicine
Milk marketing
Cattle lease/rent
Other livestock expense
Crops
Fertilizer & lime
Seeds & plants
Spray, other crop expo
Real Estate
Land/bldg./fence repair
Taxes
Rent & lease
Other
Insurance
Telephone (farm share)
Electricity (farm share)
Interest paid
Miscellaneous
Total Operating
$___________
Expansion livestock
Machinery depreciation
Building depreciation
TOTAL ACCRUAL EXPENSES
Change in
Inventory
or Prepaid
Change in
Expense + Accounts Payable
Accrual
Expenses
$_--
$_--
$_-­
$_--
$_--
$_-­
$
5
CASH AND ACCRUAL FARM RECEIPTS 35 Southeastern New York Region Dairy Farms, 1988 Receipt Item
Cash
Receipts
+
Change in
Inventory
+
Change in
Accounts
Receivable
Accrual
Receipts
$185,498
$184,198
Milk sales
$ 1,301
14,574
o
13,556
Dairy cattle
$ 1,019
2,966
o
2,966
Dairy calves
-57
o
38
-95
Other livestock
6,546
3,082
-143
3,607
Crops
2,786
-57
2,843
Government receipts
0*
477
o
Custom machine work
477
160
o
160
Gas tax refund
o
1,895
1.895
Other
(-)
0
(-)
o
Less nonfarm noncash cap.** $214,847
Total Accrual Receipts
$209,740 $ 1,101 $ 4,006
*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 in­
ventory caused by herd growth and/or quality are added, and decreases caused
by herd reduction and/or 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 bal­
ance (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 December's
marketings compared with the previous January's 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
Receipt Item
Milk sales
Dairy cattle
Dairy calves
Other livestock
Crops
Government receipts
Custom machine work
Gas tax refund
Cash
Receipts
+
Change in
Inventory
$_--­
+
Change in
Accounts
Receivable
$_--­
Accrual
Receipts
$_-­
$_-­
Other
Less gifts of cattle & crops
Total Accrual Receipts
$
----
- ----
- ------._--
------------------­
(-)--­
$_-­
(-)--­
$_-­
$_--­
6
Profitability Analysis
Farm owners/operators 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 family's net annual return from working, managing, financing, and
owning the farm business. This is not a measure of cash available from the
year's 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 live­
stock, 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 35 Southeastern New York Region Dairy Farms, 1988 Item
Total accrual receipts
Appreciation: Livestock
Machinery
Real Estate
Other Stock/Certificates
Total Including Appreciation
Total accrual expenses
Net Farm Income (with appreciation)
Net Farm Income (without appreciation)
Average
My Farm
$214,847
2,060
-181
4,874
214
$221,813
·189.083
$ 32,730
$ 25,763
$_--­
$_--­
$_-­
$_-­
Return to operators' labor. management. and equity 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
35 Southeastern New York Region Dairy Farms, 1988
Item
Net farm income
Family labor unpaid
@ $700 per month
Return to operators' labor,
management, & equity
Average
With
Without
Apprec.
Apprec.
$ 32,730
$ 25,763
1,980
1.980
$ 30,750
$ 23,783
My Farm
Without
With
Apprec.
Apprec,
$_-­
$_-­
$_-­
$_-­
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 above inflation that a farmer might expect to earn in
comparable risk investments.
lABOR AND MANAGEMENT INCOME 35 Southeastern New York Region Dairy Farms, 1988 Item
Return to operators' labor, management,
& equity without appreciation
Real interest @ 5% on $394,811
average equity capital
Labor & Management Income
Labor & Management Income per
1.40 Operator/Manager
Average
My Farm
$ 23,783
$_--­
- 19,741
$ 4,042
$_--­
$
$_-­
2,887
Return on equity capital measures the net return remaining for the farmer's
equity or owned capital after a charge has been made for the owner-operator's
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
35 Southeastern New York Region Dairy Farms, 1988
Item
Return to operators' labor, management,
& equity capital with appreciation
Value of operators' labor & 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 appreciation
Rate of return on average equity capital:
with appreciation without appreciation Rate of return on average total capital:
with appreciation
without appreciation
Average
$
$
$
$
$
$
30,750
27.242
3,508
9,728
13,237
-3,459
6,270
My Farm
$_--­
$_-­
$_-­
$_-­
$_-­
$_-­
0.9%
-0,9%
---_%
---_%
2,6%
1.2%
---_%
---_%
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.
1988 FARM BUSINESS & NONFARM BALANCE SHEET 35 Southeastern New York Region Dairy Farms, January 1, 1989 Farm Liabilities
Farm Assets
Jan. 1
Current
Farm cash, checking
& savings
$ 6,406
16,415
Accounts rec.
Prepaid expo
o
42,188
Feed & supplies
Total
$ 65,009
Intermediate
Dairy cows:
owned
$ 77 ,038
leased
o
31,596
Heifers
Bulls/other 1vstk.
689
Mach./eq. owned
97,183
Mach./eq. leased
1,262
FLB/PCA stock
5,544
8,678
Other stock/cert.
Total
$221,990
Long-Term
Land/buildings:
owned
$222,900
leased
381
Total
$223,281
Total Farm Assets $510,279
Dec. 31
$
5,043
17,516
o
44,354
$ 66,913
$ 78,751
o
32,813
743
97,712
916
6,004
9,993
$226,932
$228,463
33
$228,496
$522,341
(Average for 28 farms reporting)
Nonfarm Assets*
Jan. 1
De~. 31
& Net Worth
Jan. 1
Current
Accounts payable $ 3,799
3,817
Operating debt
1,205
Short-term
Advanced govt. rec. ____~O
Dec. 31
$
5,325
5,881
1,520
o
8,821
$ 12,726
$ 35,601
$ 34,402
1,262
5.544
916
6.004
$ 42,406
$ 41,322
$ 67,698
$ 69,611
381
$ 68,079
33
$ 69,644
$119,306
$390,973
$123,692
$398,649
Nonfarm Liabi1ities*
Jan, 1
f! Net W2Ith
Dec. 31
Total
. Intermediate
Structured debt
1-10 years
Financial lease
(cattle/mach. )
FLB/PCA stock
Total
Long Term
Structured debt
l!!:10 yrs
Financial lease
(structures)
Total
Total Farm Liab.
FARM NET WORTH
$
Personal cash, chkg.
Nonfarm Liab.
$ 2,239 $ 6,661
& savings
NONFARM NET WORTH $294,061 $369,221
$ 6,310 $ 8,017
Cash value life ins.
3,988
4,764
Nonfarm real estate 269,664
342,941
De~, 31
FARM ~ NOtffARM*
Jan. 1
Auto (personal sh.)
909
907
Total Assets
$806,579 $898,223
Stocks & bonds
6,379
7,022
Total Liabilities 121,545
130,353
Household furn.
3,536
3,518
All other
5,514
8,713
TOTAL FARM & NONTotal Nonfarm $ 296,300 $375,882
FARM NET WORTH $685,035 $767,870
*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 1988 that are for participation in the 1989
program are the end year balance and payments received in 1987 for
participation in the 1988 program are the beginning year balance.
Date _____________________________
1988 FARM BUSINESS & NONFARM BALANCE SHEET
Farm Liabilities
Farm Assets
Jan. 1
Dec. 31
& Net Worth
Current
Farm cash, checking
& savings
Accounts rec,
Prepaid expense
Feed & supplies
Total
Current
Accounts payable
Operating debt:
Intermediate
Dairy cows:
owned
leased
Heifers
Bulls/other Ivstk.
Mach./eq. owned
Mach./eq. leased
FLB/PCA stock
Other stock/cert.
Total
Adv. govt. rec.
Total
Intermediate
Jan, 1
Dec. 31
Jan. 1
Dec. 31
Short Term:
Financial lease
(cattle/mach. )
FLB/PCA stock
Total
Long-Term
Long-Term
Land/buildings:
owned
leased
Financial lease
(structures)
Total
Total Farm Liab.
FARM NET WORTH
Total
Total Farm Assets
Nonfarm Liabilities
Nonfarm Assets
Jan. 1
Dec. 31
Personal cash, chkg.
& savings
Cash val. life ins. -----Nonfarm real est.
Auto (pres. share)
Stocks & bonds
Household furn.
All other
Total Nonfarm
TOTAL FARM & NONFARM
Total Farm & Nonfarm Assets
Less Total Farm & Nonfarm Liabilities
Farm & Nonfarm Net Worth
& Net Worth
Nonfarm Liab.:
Total Nonfarm
Liabilities
Nonfarm
Net Worth
Jan. 1
Dec. 31
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 35 Southeastern New York Region Dairy Farms, January I, 1989 My Farm
Average
Item
Financial Ratios - Farm:
Percent equity
Debt/asset ratio: total
long-term
intermediate/current
Change in Net Worth:
Without appreciation
With appreciation
Farm Debt Analysis:
Accounts payable as % of total debt
Long-term liabilities as a % of total debt
Current & inter. liab. as a % of total debt
Farm Debt Levels:
Per Cow
Total farm debt
$ 1,374
Long-term debt
774
Intermediate & current debt
601
76%
0.24
0.30
0.18
$
708
7,675
$
$
4%
56%
44%
Per Tillable
Acre Owned
$ 1,178
663
515
%
%
%
Per !':!oll!
$
Per Tillable
Acre Owned
$
Farm inventory 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 35 Southeastern New York Region Dairy Farms, 1988 Item
A~g.
Value beg. of year
Purchases
$
Gift/inheritance +
Lost capital
Sales
Depreciation
Net investment
Appreciation
Value end of year
*$
of Regional farms
Mach, LEg,
&....L
$222,900
$ 97,183
6,835*
$ 11,847
$
0
314
+
732
0
1,069
5,415
- 10,383
688
709
4,874
+
+
-lU
$228,463
$ 97,712
2,143 land and $
~ Farm
&....L
Mach. LEg.
$
$
$
+
-+
-+
+
$
+
$
4,692 buildings and/or depreciable improvements.
11 Cash Flow Statement
Completing anan~a1 cash flow statement is an important step in
understanding the sources and uses of funds for the business. Understanding
last year's 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
d~finition. '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 35 Southeastern New York Region Dairy Farms, 1988 Item
Cash Inflows
Beginning farm cash, checking & savings
Cash farm receipts
Sale of assets: Machinery
Real estate
Other stock & certificate
Money borrowed (intermediate & 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 & certificate
Principal payments (intermediate & long-term) Principal payments (short-term) Decrease in operating debt Personal withdrawals & family expenditures including nonfarm debt payments
Ending farm cash, checking & savings
Total
Imbalance (error)
Avera'ge
My Farm
6,406
209,740
1,069
0
0
18,603
1,226
2,065
3,190
2,545
4,114
$248,958
$_--­
$
$169,695
1,147
11,847
6,835
1,101
17,889
911
0
32,324
5,043
$246,791
$ 2,167
$_--­
$-'---­
$_--­
12 Repayment 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 1989. The cash flow projection
worksheet on the next page can be used to estimate repayment ability, which
can then be compared to planned 1989 debt payments shown below.
FARM DEBT PAYMENTS PLANNED Same 29 Southeastern New York Region Dairy Farms, 1987 & 1988 Average
1988 Payments
Planned
Made*
Debt Payments
Long-term
Intermediate-term
Short-term
Operating (net
reduction)
Accounts payable
(net reduction)
Total
Planned
1989
$ 10,913
14,855
1,210
$ 10,649
18,906
1,227
345
0
2,444
190
0
445
$ 27,512
$ 30,782
$ 25,266
Per cow
$
Per cwt. 1988 milk $
Percent of total
1988 receipts
Percent of 1988
milk receipts
292
1.94
$
$
$
9,947
11,177
1,252
327
2.17
12%
14%
14%
16%
My Farm
1988 Payments
Planned
Made
Planned
1989
$
$
$
$
$
$
$
$
$
$
*If refinancing of loans occurred in 1988, the refinanced amount is reflected
in debt payments made.
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 year's available cash
flow. Farmers who did not participate in DFBS last year will find in their
report a cash flow coverage ratio based on planned debt payments for 1989.
CASH FLOW COVERAGE RATIO Same 29 Southeastern New York Dairy Farms, 1987 & 1988 Item
Cash farm receipts - Cash farm expenses + Interest paid - Net personal withdrawals from farm** (A) - Amount Available for Debt Service
(B) - Debt Payments Planned for 1988
(as of December 31, 1987)
(A + B) - Cash Flow Coverage Ratio for 1988
Average
$219,031
176,898
10,819
26.713
$ 26,239
$ 27,512
0.95
My Farm
$
r
$_--­
$_--­
**Personal 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
Item
Average number of cows
Accrual Oper. Receipts
Milk
Dairy cattle
Dairy calves
Other livestock
Crops
Misc. receipts
Total
Accrual Oper. Expenses Hired labor
Dairy grain & conc.
Dairy roughage
Nondairy feed
Mach. hire/rent/lease
Mach. rpr./parts & auto
Fuel, oil & grease
Replacement lvstk.
Breeding
Vet & medicine
Milk marketing
Cattle lease
Other livestock expo
Fertilizer & lime
Seeds & plants
Spray/other crop expo
Land, bldg. ,fence repair
Taxes
Real estate rent/lease
Insurance
Utilities
Miscellaneous
Total Less Int. Paid
Regional
Averaie
(l\er cow)
90
$
2,062
162
33
My
Total
Farm
Per Cow
1989
Expected
Projection
e
Chani
$_ __
$_-
---_$_--­
$_ __
$_--
---_$_--­
$_ __ $_-
$_--­
-1
$
$
73
59
2,389
191
622
45
o
17
110
60
21
28
44
127
o
$
Net Accrual Operatini Income
(without interest paid)
- Change in lvstk./crop inv.
- Change in accts. rec.
+ Change in feed/supply inv. + Change in accts. payable* NET CASH FLOW - Net personal withdrawals & family expenditures
Available for Farm Debt
Payments & Investments
- Farm debt payments
Available for Farm Investment
- Capital purchases: cattle,
machinery & improvements
Additional Capital Needed
104
81
29
24
38
64
69
40
64
28
1,806
$_--­
(total)
$ 52,436
$_ __ $_--­
$_ __ $_--­
4,006
1,101
917
1.538
$ 49,783
25.020
$ 24,763 $ 27,908**
$ -3,144 $ $_--­
$_--­
$ 20,930
$
*Excludes change in interest account payable.
$_--­
**See page 12.
14 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 35 Southeastern New York Region Dairy Farms, 1988 My Farm
Average
Item
Land
Tillable
Nontillable
Other nontillable
Total
Cro12 Yields
Hay crop
Corn silage
Other forage
Total forage
Corn grain
Oats
Wheat
Other crops
Tillable pasture
Idle
Total Tillable Acres
Owned
105
35
59
200
Rgntgg
149
28
22
200
~~
Farms
33
30
Acres
163
76
1
33
11
2
1
0
3
7
33
18
232
69
18
70
0
29
42
255
~
Total
255
63
82
399
ProdLAcre
2.58 tn
13.06 tn
4.28 tn
8.00 tn
3.10 tn
91.16 bu
47.86 bu
35.71 bu
Owned
Rented
Total
ProdLAcre
tn DM
tn
tn DM
tn DM
tn DM
bu
bu
bu
DM
DM
DM
DM
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
35 Southeastern New York Region Dairy Farms, 1988
Item
Total tillable acres per cow
Total forage acres per cow
Harvested forage dry matter, tons per cow
Average
2.83
2.43
7.55
My Farm
15 Cropping Program Analysis (continued)
A substantial number of cooperators have allocated crop expenses to the
hay crop, corn, and other crops produced. 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 Southeastern New York Region Dairy Farms Reporting, 1988 Total
Per
Till.
Acre
Item
Number of farms
reporting
Average number
of acres
Fertilizer & lime $
Seeds & plants
Spray & other crop
expense
Total
$
All
Corn
Per
Acre
Hay Crop
Per
Per
Acre
Ton DM
3-3
Corn
Silage
Per Ton
DM
Corn
Grain
Per Dry
Shell Bu.
15
17
255
28.71 $
10.32
145
6.63 $
1.19
2.57
0.46
8.50
47.53 $
1.43
9.25 $
0,56
3.58
$
$
64
13.81 $
6.57
3.22
1.53
1Q.38
30.76 $
2,42
7.18
$
$
0.15
0.07
0,11
0.34
My Farm:
Fertilizer & lime $ _ ­
Seeds & plants
Spray & other crop
expense
Total
$_­
$_­
$_­
$_­
$_­
$_­
$==
$==
$==
$==
Most machinery costs are associated with crop production and should be
analyzed with the crop enterprise. Total machinery expenses include the
major fixed costs (interest and depreciation), as well as the accrual
operating costs. Although machinery costs have not been allocated to
individual crops, they are shown below per total tillable acre.
ACCRUAL MACHINERY EXPENSES
35 Southeastern New York Region Dairy Farms, 1988
Av!rage
Total
Per Til.
Expenses
Acre
Machinery
Expense Item
Fuel, oil & grease
Machinery repairs & parts
Machine hire, rent & lease
Auto expense (farm share)
Interest (5%)
Depreciation
Total
5,354
9,549
1,532
343
4,872
1Q,383
$ 32,032
$
21.03
37.51
6.02
1. 35
19.14
40,79
$ 125.83
$
My Farm
Total
Per Til.
Acre
Exp!nses
$_--
$_-­
$_--
$_-­
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 all of the profitability measures on pages 6 and 7.
DAIRY HERD INVENTORY 35 Southeastern New York Region Dairy Farms, 1988 ~airy
Cows
Item
No.
Value
Beg. year (owned)
+ Change w/o apprec.
+ Appreciation
End year (owned)
End incl. leased
Average number
90
$ 77 ,038
90
90
90
476
1,237
$ 78.751
Bred
No. Value
30 $ 18,906
-678
447
27 $ 18,675
Heifers
ORen
No. V;'llue
21 $
9.381
856
82
24 $ 10,319
Calves
No. Value
19 $
20 $
3,309
364
146
3,819
71 (all age groups)
My Farm:
Beg. of year (owned)
+ Change w/o apprec.
+ Appreciation
End of year (owned)
End including leased
Average number
$_­
$_­
$_­
$_­
$_­
$_­
$_­
$_­
(all age groups)
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 cow with their rolling herd average on the test date
nearest December 31.
MILK PRODUCTION
35 Southeastern New York Region Dairy Farms. 1988
Item
Total milk sold, lbs.
Milk sold per cow, 1bs.
Average milk plant test, percent butterfat
Average
1,366.296
15,191
3.57
My Farm
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 nonmi1k accrual receipts from total
accrual operating expenses including expansion livestock purchased. Total
costs of producing milk include the operating costs of producing milk plus
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
35 Southeastern New York Region Dairy Farms, 1988
Item
Total
Accrual COsts of
Producing Milk
Operating costs
Total costs w/o
opers' labor,
mgmt. & capi tal
Total Costs
Accrual Receipts
From Milk
lb: Farm
AVfarage
Per Cow
Per Cwt,
Total
Per Cow
Per Cwt.
$143,937
$
1,600
$
10.53
$
$
$
$161,715
$208,698
$
$
1,798
2,320
$
$
11.84
15.27
$
$
$
$
$
$
$185,498
$
2,062
$
13.58
$
$
$
The accrual operating expenses most commonly associated with the dairy
enterprise are listed in the table below. Analysis of these costs per unit
of production enables further evaluation of the dairy enterprise.
DAIRY RELATED ACCRUAL EXPENSES 35 Southeastern New York Region Dairy Farms, 1988 lb: Farm
Average
Item
Purchased dairy grain
& concentrates
Purchased dairy roughage
Total Purchased
Dairy Feed
Purchased grain & conc.
as % of milk receipts
Purchased feed & crop expo
Purchased feed & crop expo
as % of milk receipts
Breeding
Veterinary & medicine
Milk marketing
Cattle lease
Other livestock expense
Per Cow
$
Per Cwt.
622
667
$
802
$
28
44
127
0
104
Per Cwt.
$
4.10
0.30
$
$
$
4.39
$
$
$
5.28
$
$
0.19
0.29
0.83
0.00
0.68
$
~
$
Per Cow
30%
39%
-­
%
$
%
$
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 management's success in generating products per unit of labor input.
CAPITAL EFFICIENCY 35 Southeastern New York Region Dairy Farms, 1988 Per
Worker
Item
Farm capital
Real estate
Machinery & equipment
Capital turnover, years
Per
Cow
$178,038
$
33,978
5,740
2,511
1,096
Per Tillable
Acre Owned
Per Tillable
Acre
$
2,028
$
4,917
2,151
387
2.33
My Farm:
Farm capital
Real estate
Machinery & equipment
Capital turnover, years
$_--­
$_-­
$_--­
lABOR FORCE INVENTORY AND ANALYSIS 35 Southeastern New York Region Dairy Farms, 1988 Labor Force Months
Age
Years of
of EdUCt
12
48
40
25
13
14
Operator number 1
Operator number 2
Operator number 3
Family paid
Family unpaid
Hired
Total
4
1
6
3
10
35 + 12 ­
My Farm: Total
Operator's
Cows, average number
Milk sold, pounds
Tillable acres
Work units
Labor C2§ts
Value of operator(s)
labor ($l,OOO/mot) $
Family unpd.($700/mo.)
Hired
Total Labor
$
Machinery Cost
$
Total Labor & Mach.
$
2.90 Worker Equivalent
1.40 Operator/Manager Equiv.
90
1,366,296
255
936
$
187
22
---ill
$
$
$
400
356
756
My Farm
Total
Per Worker
31
471,137
88
323
Averas;e
Per
Per
Cow
Til, Acre
Total
16,800
1,980
17,192
35,972
32,032
68,004
Worker Equivalent
Operator/Manager Equiv.
Average
Per Worker
Total
$ 18,876
6,423
1,943
13
+ 12 ..
+ 12 ­
Labor
Efficiency
Value of
Labor & Mgmt.
$65.99
7.78
67.53
$141.30
$125.83
$267.13
Total
My Farm
Per
Per
Cow
Til, Acre
$
$
$
$
$
$
$
$
$
$
$
$
19 COMPARATIVE ANALYSIS OF THE FARM BUSINESS
Prolress of the Farm Business
Comparing your business with average data from regional DFBS coopera­
tors 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 29 Southeastern New York Region Dairy Farms, 1987 & 1988
Average of 29 Farms*
Selected Factors
1987
1988
Size of Business
---93­
94
Average number of cows
Average number of heifers
77
75
Milk sold, lbs.
1,392,804 1,417,469
Yorker equivalent
3.09
2.99
Total tillable acres
259
272
Rates of Production
Milk sold per cow, lbs.
Hay DM per acre, tons
Corn silage per acre, tons
Labor Efficiency
Cows per worker
Milk sold/worker, lbs.
Cost Control
Grain & conc. purchased
as % of milk sales
Dairy feed & crop expo
per cwt. milk
Labor & mach. costs/cow
CaRital Efficiency**
Farm capital per cow
Mach. & equip. per cow
Capital turnover, years
Profitability
Net farm inc. w/o apprec.
Net farm inc. w/apprec.
Labor & mgt. income
per oper./manager
Rate of return on eq.
capital w/apprec.
Rate of return on all
capital w/apprec.
Fin~D~ial Summary
Farm net worth, end year
Debt to asset ratio
Farm debt per cow
15,015
2.54
15
15,052
2.56
30
450,043
32
474,307
1987
My Farm
1988
Goal
13
23%
29%
-----_%
%
$
$
4.10
774
$
$
5.22
741
$
$
$
$
$_-­
$_--
$
$
5,777
1,043
2.34
$
$
5,738
1,056
2.33
$
$
$
$
$_-­
$_-­
$ 27,487
$ 34,936
$
$
$
$
$_-­
$_-­
5,398
$
$
$_-­
$ 23,042
$ 38,678
$
1,295
$
2.53%
1.19%
---_%
---_%
--_%
5.18%
2.89%
---_%
--_%
---_%
$405,691
0.24
$ 1,387
*Farms participating both years.
$411,103
0.24
$ 1,418
$
$_-- $_-­
$
$_-­
**Average for the year.
20 Farm Business Charts
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 426 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
is not necessarily the most profitable.
position is somewhere near the middle or
of costs, and must be taken into account
from low to high, but the lowest cost
In some cases, the "best" management
average. Many things affect the level
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
426 New York Dairy Farms, 1987
Size of Business Worker
No.
Pounds
of
EquivMilk
alent
Sold
C2WS
(DFBS
pg. 10)
(10)
(10)
7.4
288
5,050,360
4.6
157
2,574,309
3.7
1,895,640
117
3.3
96
1,560,906
2.9
82
1,343,837
Rates of Production
Tons
Tons Corn
Pounds
Milk Sold Hay Crop Silage
Per Cow
DM,Acre Per Acre
(9)
19,730
18,109
17,473
16,851
16,370
(8)
4.5
3.7
3.2
3.0
2.7
Labor Effic ienc;:l
Cows
Pounds
Milk Sold
Per
Per Worker
Worker
(10)
49
39
36
32
31
(8)
24
20
18
17
16
(10)
.799,099
639,739
575,793
527,968
486,445
--------------------------------------------------------------------------------
2.6
2.4
2.1
1.8
1.3
Grain
Bought
Per Cow
(9)
$209 312
383
431
468
73
64
56
47
35
1,140,151
972,139
842,732
709,379
512,284
% Feed is
of Milk
Rece;Lpts
(9)
19%
24
27
29
31
15,925
15,394
14,675
13,608
11,275
2.5
2.3
2.0
1.8
1.3
29
27
25
22
17
15
14
13
12
9
Cost Control
Labor &
Machinery
Costs
Machinery
Per Cow
Costs Per Cow
(10)
(10)
$220
$ 524
285
631
320
690
351
734
383
778
Feed & Crop
Expenses
Per Cow
(9) $349
469
531
573
627
454,799
424,189
381,809
337,608
251,762
Feed & Crop
Expenses Per
Cwt. Milk
(9)
$2.46 3.11 3.47 3.68 3.93 -------------------------------------------------------------------------------508
547
595
666
769
33
35
36
39
44
415
451
493
549
706
831
894
953
1,033
1,190
678
711
759
823
943
4.19
4.40
4.70
5.01
5.63
21 The next section of the Farm Business Chart provides for comparative
analysis of the value and costs of dairy production.
The 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 426 New York Dairy Farms, 1987 Milk
Receipts
Per Cow
(9)
Milk
Receipts
Per Cwt,
(9)
$2,544
2,351
2,259
2,174
2,110
$14.27
13.56
13.18
12.97
12.81
2,037
1,968
1,889
1,733
1,462
12.72
12.61
12.51
12.36
11. 96
Total Cost
Production
Per Cow
(9)
Total Cost
Production
Per Cwt.
(9)
Oper. Cost
Milk
~er Cow
(9)
Oper. Cost
Milk
~er Cwt.
(9)
890
1,137
1,242
1,324
1,423
$ 6.03
7.31
8.01
8.54
9.04
$1,656
1,893
2,006
2,101
2,190
$11.12
12.17
12.75
13.23
13.73
1,509
1,590
1,690
1,824
2,098
9.39
9.87
10.49
11.22
13.10
2,289
2,390
2,470
2,607
3,024
14.25
14.73
15.33
16.63
19.71
$
Profitability
Net Farm Income
With
Without
Al!l!reciation
Al!l!reciation
(3)
(3)
$197,621
92,938
75,433
59,966
50,071
$136,964
62,217
46,889
37,085
29,409
Return to Operator's Labor,
Management, & Eguitl Cal!ita1
With
Without
Al!l!reciation
Al!l!reciation
(3)
(3)
$196,383
91,549
74,352
58,410
48,144
$136,268
61,167
44,671
35,784
28,474
Labor &
Management Income
Per
Per
Farm
Ol!erator
(3)
(3)
$95,478
36,159
25,310
19,308
13,697
$71,503
28,206
20,638
14,620
9,894
-------------------------------------------------------------------------------40,312
32,360
23,593
16,232
-3,558
24,442
17,870
12,737
4,764
-17,210
38,795
30,644
21,911
14,494
-5,512
23,170
15,931
10,230
2,719
-18,986
7,936
2,912
-3,450
-11,217
-37,719
6,437
2,217
-2,909
-9,828
-32,962
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 defined on pages 7, 10, 12,
and 18 of this publication. References to DFBS output page numbers for
participating dairy farmers are provided in the table headings.
FINANCIAL ANALYSIS CHART 426 New York Dairy Farms, 1987 Debt Payments
Made Per Cow
(DFBS pg. 7)
$
Liguidity (re~ayment)
Debt Payments
Cash Flow
as Percent
Coverage
of Milk Recei~t§
RS!tio
(7)
51
210
303
373
441
500
568
646
808
1,610
Percent
Eguity
(DFBS
pg. 5)
99%
90
82
75
69
63
57
50
42
22
2%
10
15
18
21
24
29
33
40
81
Solvency
DebtLAsset Ratio
Current &
Long
Int~rmediate
Term
Available for
Debt Service
Per Cow
(7)
(11)
14.14
2.18
1.63
1.35
1.22
1.06
0.93
0.79
0.57
-0.19
$937
710
634
569
520
466
414
340
246
72
Debt
Per Qow
(5)
96
636
1,137
1,508
1,840
2,199
2,523
2,904
3,407
4,837
$
Efficiency & Profitability
Capital
Rate of
Total
Return on
Farm Cap.
Turnover
Eguity Ca~.
(years)
~er Cow
(5)
(5)
(10)
(10)
(3)
0.00
0.05
0.12
0.18
0.24
0.31
0.37
0.43
0.50
0.77
0.00
0.01
0.12
0.26
0.34
0.44
0.55
0.65
0.80
1.21
$3,792
4,577
5,089
5,391
5,695
6,070
6,482
1,046
7,888
9,829
1.47
1. 78
1. 95
2.07
2.18
2.31
2.49
2.69
3.04
4.07
35%
17
12
9
7
5
3
1
-3
-34
Summarize Your Busine§s Performance
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 has as many of the same physical
characteristics as possible as the farm being analyzed. To assist in this
endeavor, dairy farms in the 1987 State Summary! 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 havebeen~mputed 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 farm's 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 $208,798 per farm for the 300 or more herd size
group and $11,140 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 size increases, percent equity generally decreases (pages 31-34).
The most dramatic decline occurs above 100 cows. However, farm net worth
increases substantially as herd size increases. The average net worth for all
size farms increased during 1987.
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 15,234
pounds on the farms with less than 40 cows to 18.808 pounds on farms with 300 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 22 at the lowest herd size
category up to 45 at the largest size category:
lS mith. Stuart F .• Wayne A. Knoblauch. and Linda D. Putnam. Dairy Farm Management Business Summary. New York. 1987. Department of Agricultural Economics, Cornell University. A.E. Res. 88-8. July 1988. 24
SELECTED BUSINESS FACTORS BY TYPE OF BARN AND HERD SIZE 426 New York Dairy Farms, 1987 Farms with:
Item
Number of farms
Conventional
<60 Cows
>60 Cows
Freestall
<120 Cows
>120 Cows
117 151 72 86 152 44 93 25 2.3
14.5
52.7
7.5
3.4
$21.10
$17,902
$118
298 104 167 52 2.6
15.5
59.8
8.2
3.4
$23.60
$35,641
$120
265 89 138 55 2.6
15.7
52.1
8.0
3.2
$28.16
$38,982
$147
560 206 221 159 3.1
17.1
51.1
7.6
2.6
$31.88
$87,013
$155
Dairy Analysis
Number of cows
45 Number of heifers
33 Milk sold, lbs.
701,939 Milk sold/cow, lbs.
15,446 Operating cost of prod. milk/cwt.
$9.34 Total cost of prod. milk/cwt.
$15.12 Price/cwt. milk sold
$12.82 Purchased dairy feed/cow
$507
Purchased dairy feed/cwt. milk
$3.28
Pure. grain & cone. as % milk rec.
24%
Pure. feed & crop exp./cwt. milk
$4.05
88 70 1,404,638 15,949 $9.19 $13.76 $12.78 $496
$3.11
24%
$3.99
83 68 1,336,813 16,026 $9.38 $14.31 $13.04 $498
$3.11
23%
$4.09
213 167 3,631,580 17,012 $9.40 $12.77 $12.93 $559
$3.29
24%
$4.21
$174,550
$6,056
$2,735
$2,910
$1,137
2.34
$185,631
$6,166
$2,922
$2,858
$1,236
2.34
$212,849
$5,522
$3,330
$2,528
$913
1.96
Cropping Program Analysis
Total Tillable acres
Tillable acres rented*
Hay crop acres*
Corn silage acres*
Hay crop, tons DM/acre
Corn silage, tons/acre
Oats, bushels/acre
Forage DM per cow, tons
Tillable acres/cow
Fert. & lime exp./til. acre
Total machinery costs
Machinery cost/tillable acre
Capital Efficiency
Farm capital/worker
Farm capital/cow
Farm capital/til. acre owned
Real estate/cow
Machinery investment/cow
Capital turnover, years
Labor Efficiency
Worker equivalent
Operator/manager equivalent
Milk sold/worker, lbs.
Cows/worker
Work units/worker
Labor cost/cow
Labor cost/tillable acre
$154,317
$6,467
$2,721
$3,436
$1,156
2.51
1.90
1.14 368,557 24 248 $432 $129 3.06
1. 33 459,672 29 308 $388 $115 2.77
1.41 482,459 30 318 $393 $124 5.54
1.48 655,667 39 393 $403 $154 Profitability & Balance Sheet Analysis
Net farm income (w/o apprec.)
$14,305
Labor & mgmt. income/operator
$2,778
Farm debt/cow
$2,216
Percent equity
65%
$31,007
$8,414
$1,901
69%
$27,432
$6,525
$2,102
66%
$77,458
$27,394
$2,098
62%
*Average of all farms, not only those reporting data.
25
FARM BUSINESS CHART FOR SMALL CONVENTIONAL STALL DAIRY FARM 117 Conventional Stall Dairy Farms with 60 or Less Cows, New York, 1987 Size Qf Business
Worker
Pounds
No.
Milk
Equiv­
of
Cows
alent
Sold
(DFBS pg. 10)
(10)
(10)
3.1
2.5
2.3
2.1
2.0
1,012,310
890,128
841,029
777 ,411
747,174
58
55
53
50
48
Rates of PIoductiQn
Tons Corn
Tons
Pounds
Milk Sold Hay Crop Silage
Per Cow
f~r Acre
DMLA~re
L~bQr
Cows
Per
Work~r
Ef£l cienc x
Pounds
Milk Sold
Per Worker
(9)
(8)
(8)
(10)
(10) 18,894
17,803
17,100
16,529
16,027
4.1
3.2
2.9
2.6
2.4
25
20
18
16
15
38
32
29
27
26
593,294
508,786
443,085
424,821
401,656
-------.-.---------------------------------------------------------.-----------­
1.8
1.6
1.5
1.3
1.1
Grain
Bought
Pet: Cow
(9)
$239
325
383
430
464
46
43
39
35
29
684,453
648,948
587,566
515,571
367,936
Feed is
of Milk
Recei:Qts
(9)
%
20%
25
27
29
30
15,530
14,825
14,114
12,986
10,705
Cost Control
Machinery
Labor &
Costs
Machinery
Pet: COlt
Ciost§ PeI ~Qw
(10)
(10)
$185
256
300
335
367
$
24
23
21
19
15
14
13
12
11
8
2.2
2.0
1.8
1.6
1.2
375,007
344,267
324,239
281,813
205,714
Feed & Crop
Expenses
f~r COlt
(9)
Feed & Crop
Expenses Per
Cltt. Hllk
(9)
$329
457
511
552
590
$2.57
3.21
3.52
3.64
3.84
531
627
687
732
786
-------------------------------------------------------------------------------497
546
589
666
756
32
34
37
39
44
398
437
475
549
640
Value and Cost Qf PtQduction
Milk
Oper. Cost
Total Cost
Receipts
Milk
Production
fer Cow
fer Cwt.
Per Cwt,
(9)
(9)
(9)
$2,512
2,298
2,208
2,129
2,062
$ 5.84
6.83
7.67
8.33
8.89
$11.72
13.04
13.54
14.12
14.64
851
921
974
1,057
1,159
646
699
740
819
953
4.07
4.31
4.77
5.11
5.55
fIofit!!gilitX
Het Farm In~ome
With
Without
Labor ~ Mgmt. Income
AR:Qrec.
fer Farm
ARRrec.
Per ORer.
(3)
(3)
(3)
(3)
$74,553
48,887
38,477
34,212
30,235
$39,463
29,518
26,217
21,938
15,948
$25,389
19,481
13,599
9,849
6,294
$22,783
17,388
11,512
8,406
5,676
2,907
568
-3,763
-10,700
-27,903
2,572
508
-3,179
-9,683
-26,962
------------------.------------------------------------------------------------­
1,969
1,887
1,774
1,637
1,350
-
--
-
-
..
-
-- -
- . _ -.•• _ - . . - .
9.31
10.01
10.80
11.64
13.39
15.12
15.82
16.97
18.11
20.88
_ . . - .__._--._-._---._-._._--_._ _ . - - - - -.•_--_._--­
..
23,800
19,827
15,627
8,111
-4,719
14,364
10,674
4,889
-1,628
-14,006
26
FARM BUSINESS CHART FOR LARGE CONVENTIONAL STALL DAIRY FARMS 151 Conventional Stall Dairy Farms with More Than 60 Cows, New York, 1987 Size of Dysiness
Worker
No.
Pounds
Equiv­
of
Milk
alent
Sold
Cow§
(DFBS
pg. 10)
(10)
(10)
5.6
3.9
3.5
3.1
3.0
163
112
94
87
82
2,674,310
1,819,161
1,583,874
1,425,022
1,318,364
Rates of Production
Tons Corn
Pounds
Tons
Milk Sold Hay Crop Silage
Per Cow
DMLAcre Per Acre
Labor
Cows
Per
Worker
Efficienc~
Pounds
Milk Sold
Per Worker
(9)
(8)
(8)
(10)
(10)
19,172
17,935
17,322
16,735
16,412
4.5
3.7
3.2
3.0
2.6
22
19
18
17
16
44
37
34
673,277
603,935
555,170
517,283
484,731
32
30
------------.--~---.~--------------------------------- --------------------------
2.6
2.5
2.4
2.2
1.8
77
73
69
65
61
1,235,135
1,145,273
1,058,575
969,689
853,701
Grain
Bought
Per Cow
(9)
% Feed is
of Milk
Recei:Qts
(9)
$202
295
369
418
455
18%
24
27
29
31
16,146
15,545
14,696
13,740
11,741
Cost Control
Machinery
Labor &
Costs
Machinery
Costs Per Cow
Per Cow
(10)
(10)
$220
281
313
350
377
$
29
27
25
23
18
15
14
13
12
10
2~5
2.2
2.0
1.7
1.4
463,541
436,780
393,204
349,386
271,522
Feed & Crop
Expenses
Per Cow
(9)
Feed & Crop
Expenses Per
Cwt. Milk
(9)
$341
460
523
573
621
$2.34
3.03
3.46
3.68
3.92
506
605
669
723
760
-------------------------------------------------_.----------------------------­
510
548
591
656
754
32
34
36
37
42
407
445
478
532
677
Value and gost of Production
Milk
Oper. Cost
Total Cost
Receipts
Milk
Production
Per Cow
PeI Cwt,
Per Cwt.
(9)
(9)
(9)
$2,452
2,323
2,216
2,138
2,092
$ 6.24
7.28
7.92
8.35
8.74
$11.00
11.99
12.47
12.91
13.42
797
863
938
1,015
1,164
670
694
740
798
893
4.16
4.34
4.54
4.84
5.31
Pq~fitabilit~
Net Farm Income
With
Without
A:Q:Qrec,
Alm rec .
(3)
(3)
$110,663
80,747
69,626
58,272
50,783
$78,030
55,205
46,659
41,337
34,419
Labor §! Mgmt, Income
~eI Farm
P~I O);!er.
(3)
(3)
$54,066
34,079
27,268
22,167
16,612
$41,523
29,685
23,376
16,361
11,210
------------------------------------------------------ -----------------~--------
2,033
1,962
1,902
1,750
1,517
9.21
9.65
10.19
10.87
12.97
14.00
14.49
14.99
15.90
19.22
43,296
35,577
27,732
19,127
-2,597
27,185
21,584
14,827
8,686
-14,835
9,802
2,691
-4,619
-10,022
-36,963
7,495
1,833
-3,704
-8,233
-33,558
27
FARM BUSINESS CHART FOR SMALL FREESTALL DAIRY FARMS Freesta11
Barn Dairy Farms with 120 or Less Cows, New York, 1987 72
Size of Business
Yorker
No.
Pounds
Equiv­
of
Milk
alent
Cows
~old
(DFBS pg. 10)
(10)
(10)
4.0
3.4
3.2
3.0
2.9
113
107
101
95
87
2,031,232
1,778,804
1,597,490
1,548,436
1,460,707
Rates of Proguction
Tons Corn
Pounds
Tons
Milk Sold Hay Crop Silage
Per Cow
DMLAcre Per Acre
Labor
Cows
Per
Yorker
Efficienc~
Pounds
Milk Sold
Per Yorker
(9)
(8)
(8)
(10)
(10) 19,930
18,585
18,005
17 ,433
16,469
4.5
3.6
3.2
3.0
2.7
28
20
19
18
49
41
34
32
30
779,317
631,701
547,217
503,134
486,247
17
-----------------------.-------.---------------------- --------~--------.--------
2.7
2.5
2.3
2.1
1.7
81
76
72
64
48
1,360,485
1,188,903
1,016,927
867,848
678,354
Grain
Bought
Per Cow
(9)
% Feed is
of Milk
Receil!ts
(9)
$197
322
378
426
470
19%
23
25
28
31
15,965
15,526
14,898
13,759
10,362
16
15
2.5
2.3
2.1
1.9
1.4
13
11
8
Cost Control
Labor &
Machinery
Costs
Machinery
Per Cow
~ost:i! Per Cow
(10)
(10)
$267
311
335
363
407
$
29
27
26
24
20
567
667
727
788
829
463,207
443,127
418,694
373,532
289,432
Feed & Crop
Expenses
Per Cow
(9)
Feed & Crop
Expenses Per
Cwt. Milk
(9)
361
479
535
568
627
$2.49 3.05 3.31 3.64 3.96 $
-------------------------------------------------------------------------------508
541
594
666
831
32
35
37
40
49
462
514
550
613
870
Value end Cost of Prodyction
Milk
Oper. Cost
Total Cost
Receipts
Milk
Production
Per Cow
Per Cwt.
P~r Cwt.
(9)
(9)
(9)
$2,594
2,419
2,293
2,225
2,168
$ 6.29
7.89
8.32
8.81
9.22
$11.99
12.78
13.07
13.49
13.93
887
928
979
1,071
1,307
690
722
768
845
1,024
4.31
4.63
4.92
5.13
6.23
Pr2fitabilit~
Net farm In~ome
Yith
Yithout
Alll!rec.
Al!l!rec .
(3)
(3)
$108,959
78,885
64,609
57,524
51,908
$85,873
55,778
42,618
32,163
29,625
Lebor & M&mt. Income
Per Farm
Per Ol!er,
(3)
(3)
$61,245
32,705
21,656
16,779
12,551
$34,091
22,189
16,354
12,477
9,268
-------------------------------------------------------------------------------2,075
2,016
1,968
1,798
1,384
9.44
10.16
10.96
11.89
13.58
14.32
15.03
16.09
17.13
20.29
45,040
35,648
26,102
18,387
-5,701
26,072
20,544
13,664
610
-21,765
8,294
5,663
-3,715
-15,345
-38,033
6,544
4,359
-3,493
-11,684
-33,341
28
FARM BUSINESS CHART FOR LARGE FREESTALL DAIRY FARMS Freesta11
Barn Dairy Farms with More Than 120 Cows, New York, 1987 86
Size of Business
No.
Pounds
Worker
Equiv­
of
Milk
Cows
Sold
alent
(DFBS (10)
(10)
pg. 10)
11.5
7.5
6.4
5.8
5.2
9,122,233
5,443,620
4,155,570
3,557,779
3,195,642
475
303
253
217
198
Rates of Production
Tons Corn
Pounds
Tons
Milk Sold Hay Crop Silage
Per Cow
DMLAcre Per Acre
Labor Efficienc:£
Pounds
Cows
Milk Sold
Per
Per Worker
Worker
(9)
(8)
(8)
(10)
(10) 20,926
19,082
17,701
17,409
16,973
5.0
4.0
3.7
3.5
3.2
23
20
19
18
18
59
48
45
41
39
978,334
831,859
741,638
682,912
641,707
------------------------_._--------------------------- -------------~--.---------
4.8
4.4
4.0
3.6
3.2
Grain
Bought
Per Cow
(9)
$211
354
434
466
494
176
158
144
132
123
2,895,944
2,599,715
2,349,436
2,078,626
1,778,664
Feed is
of Milk
Receiyts
(9)
%
21%
26
27
30
33
16,268
15,691
15,355
14,712
12,906
3.0
3.9
2.6
2.3
1.7
Cost Control
Machinery
Labor &
Costs
Machinery
Per Cow
Costs Per Cow
(10)
(10)
$269
312
345
378
405
$
34
35
37
39
43
433
464
490
541
690
Value and Cost of PIoduction
Milk
Oper. Cost
Total Cost
Receipts
Milk
Production
Per Cow
Per Cwt.
Per Cwt,
(9)
(9)
(9)
$2,650
2,442
2,349
2,280
2,205
$ 6.33
7.76
8.66
9.18
9.44
$10.56
11.72
12.22
12.53
13.14
834
883
940
1,018
1,177
611,788
572,578
530,718
486,868
421,041
Feed & Crop
Expenses
Per Cow
(9)
Feed & Crop
Expenses Per
Cwt, Milk
(9)
$415
529
592
651
692
$2.67
3.31
3.63
3.87
4.17
547
675
704
743
787
---------------------------------------~-------
531
571
638
691
766
37
35
32
30
26
17
16
15
14
11
.. ---------~--------------------722
775
813
858
932
4.36
4.59
4.82
5.10
5.69
PIofitabilit:£
Net Farm Income
Without
With
Labor & Mgmt. Income
Ayyrec.
Per Farm
Ayyrec.
Per 2l!er.
(3)
(3)
(3)
(3)
$371,960
211,706
166,309
127,460
99,991
$269,426
146,148
105,100
77,994
66,929
$207,317
95,881
63,094
42,020
33,156
$167,283
69,329
44,853
31,897
22,003
--------------------------~--------.------------------ --------------------------
2,146
2,032
1,968
1,891
1,709
9.75
10.11
10.54
11.03
12.11
13.66
13.97
14.35
14.90
16.25
89,278
82,461
64,958
48,918
17,051
54,629
41,867
30,225
19,518
-5,150
22,169
16,389
5,583
-7,955
-44,860
17 ,498
9,426
3,831
-7,224
-35,341
29
FARM BUSINESS SUMMARY BY HERD SIZE
426 New York Dairy Farms, 1987
Item
Farm Size:
Number of farms
Less than
40 Cows
32
85 to
99 Cows
40 to
54 Cows
55 to
69 Cows
70 to
84 Cows
69
74
71
41
~~CRUAL EXP~NSES
Hired labor
Dairy grain & concentrate
Dairy roughage
Other livestock feed
Machine hire/rent/lease
Machine repairs/parts
Auto expense (farm share)
Fuel, oil & grease
Replacement livestock
Breeding
Veterinary & medicine
Milk marketing
Cattle lease/rent
Other livestock expense
Fertilizer & lime
Seeds & plants
Spray & other crop expense
Landjbui1ding/fence repair
Taxes & insurance
Telephone & electricity
Interest paid
Misc. (including rent)
Total Operating Expenses
Expansion livestock
Machinery depreciation
Building depreciation
Total Accrual Expenses
$ 2,757
17 ,025
933
444
1,163
3,091
302
1,653
2,470
1,081
1,280
4,718
14
2,503
2,070
728
521
803
3,729
2,724
5,878
2,030
$57,917
154
4,540
2,612
$65,223
$
5,999
22,287
1,098
358
817
5,150
556
2,204
988
1,535
1,663
6,109
46
4,154
3,431
1,218
942
1,075
4,746
3,329
9,279
2,846
$ 79,830
750
6,811
3,154
$ 90,545
$ 11 ,494
29,046
954
696
1,632
6,947
740
3,539
1,930
2,029
2,759
7,384
37
5,310
4,903
2,053
1,801
1,988
7,161
4,399
9,839
4,403
$111,044
1,145
9,935
5,331
$127,455
$ 15,070
37,345
1,427
686
1,720
8,775
655
3,995
1,753
2,576
3,420
9,569
175
6,835
6,178
2,522
1,939
2,025
7,526
5,311
12,703
5,395
$137,600
1,101
13,227
5,305
$157,233
$ 18,684
42,482
624
1,063
2,416
11,089
686
5,046
1,858
2,647
3,466
9,458
109
7,604
8,386
2,898
2,738
2,752
9,326
5,812
15,433
6,403
$160,980
196
13,545
6,692
$181,413
ACCRUAL RECEIPTS
Milk sales
Dairy cattle
Dairy calves
Other livestock
Crops
Misc. receipts
Total Accrual Receipts
$65,663
6,599
1,217
605
900
1,380
$76,363
$ 93,254
7,778
1,651
131
713
2,564
$106,091
$125,036
8,596
2,086
317
3,183
5,336
$144,554
$157,419
13,744
2,608
338
2,440
6,708
$183,257
$185,624
15,933
2,914
153
4,441
7,118
$216,186
$11,140
$21,927
$1,277
1.04
$1,228
$15,546
$30,098
$5,093
1.15
$4,429
$17 ,099
$31,811
$1,771
1.30
$1,362
$26,024
$44,375
$8,413
1. 28
$6,573
$34,773
$55,411
$16,249
1.25
$12,999
PROFITABILITY ~ALYSIS
Net farm income (w/o apprec.)
Net farm income (w/apprec.)
Labor & mgmt. income
Number of operators
Labor & mgmt. inc./oper.
Rates of return on:
Equity capital w/o apprec.
Equity capital w/apprec.
All capital w/o apprec.
All capital w/apprec.
-4.6%
1.8%
-0.8%
3.7%
-3.2%
5.3%
1.3%
6.2%
-2.8%
2.4%
0.5%
4.1%
0.4%
6.3%
2.9%
6.8%
2.5%
8.8%
4.6%
8.5%
30
FARM BUSINESS SUMMARY BY HERD SIZE
426 New York Dairy Farms, 1987
Item
Farm Size:
Number of farms
100 to
149 Cows
150 to
199 Cows
200 to
299 Cows
70
31
ACCRUAL EXPENSE~
Hired labor
Dairy grain & concentrate
Dairy roughage
Other livestock feed
Machine hire/rent/lease
Machine repairs/parts
Auto expense (farm share)
Fuel, oil & grease
Replacement livestock
Breeding
Veterinary & medicine.
Milk marketing
Cattle lease/rent
Other livestock expense
Fertilizer & lime
Seeds & plants
Spray & other crop expense
Land/bui1ding/fence repair
Taxes & insurance
Telephone & electricity
Interest paid
Misc. (including rent)
Total Operating Expenses
Expansion livestock
Machinery depreciation
Building depreciation
Total Accrual Expenses
$ 25,102
56,974
801
616
2,516
15,054
668
6,981
1,519
3,546
4,968
14,281
14
9,821
10,411
4,520
4,299
3,890
10,856
7,238
18,586
8,560
$211,221
2,114
19,857
9,604
$242,796
$ 47,877
86,662
1,387
2,337
3,678
24,145
12,430
4,468
5,002
7,667
21,327
814
13,907
14,729
6,186
5,252
5,188
15,566
10,360
29,497
12,652
$331,741
2,976
28,073
13,753
$376,543
$ 75,549 $ 179,681
133,931
257,093
21,695
6,292
1,356
1,925
9,670
6,636
31,332
43,448
2,512
656
14,265
20,939
1,248
6,034
7,259
12,662
26,205
12,604
28,600
52,360
0
557
21,022
37,220
20,450
29,461
15,239
8,655
7,839
18,550
6,828
25,692
19,405
28,402
13 ,821
20,876
42,206
77 ,461
20,694
34,966
$486,003 $ 917,293
3,044
16,232
31,247
58,995
21,805
37,605
$542,099 $1,030,125
ACCRUAL RECEIPT~
Milk sales
Dairy cattle
Dairy calves
Other livestock
Crops
Misc. receipts
Total Accrual Receipts
$246,068
20,536
3,653
266
4,088
9,593
$284,207
$361,325
34,740
5,566
435
5,451
21,616
$429,132
$521,194 $1,045,845
48,174
94,637
8,117
15,121
4,624
166
16,749
43,415
24,655
39,740
$623,513 $1,238,923
$41,411
$64,485
$15,647
1.49
$10,501
$52,589
$107,614
$19,218
1.57
$12,241
$81,414
$119,890
$43,070
1. 54
$27,968
PROFITABILITY ANALY~IS
Net farm income (w/o apprec.)
Net farm income (w/apprec.)
Labor & mgmt. income
Number of operators
Labor & mgmt. inc./oper.
Rate of return on:
Equity capital w/o apprec.
Equity capital w/apprec.
All capital w/o apprec.
All capital w/apprec.
1. 7%
6.5%
3.8%
7.0%
610~
2.8%
11.4%
4.7%
10.2%
27
300 or
More Cows
6.2%
11. 3%
7.0%
10.1%
11
$208,798
$280,560
$142,561
1.43
$99,693
12.7%
18.2%
10.7%
13.9%
-
31
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
426 New York Dairy Farms, 1987
Item
Farms with: Less than 40 Cows
Jan. 1
Dec. 31
40 to 54 Cows
Jan. 1
Dec. 31
ASSETS
Farm cash/chkg./sav. $ 2,988 $ 3,087 $ 1,764
7,596
5,782
5,451
Accounts receivable
6
o
o
Prepaid expenses
17,453
12,245
11,161
Feed & suppUes
52,858
42,463
39,311
Livestock*
52,278
38,853
Machinery & equipment* 37,645
1,612
FLB & PCA stock
683
751
1,707
Other stock & cert.
1,381
1,225
153,697
141. 005
Land & bui1dings*
137.681
Total Farm Assets
$236,145 $245,567 $288,971
$
$
18,024
59,009
55,305
1,731
1,888
158.724
$304,788
4,560
10,917
14
24,803
74,084
75,451
2,532
2,681
197.233
$392,275
$
2,431
7,669
6
4,362
11,287
14
26,963
78,802
78,455
2,525
2,701
205,744
$410,853
6,580
4,609
31,488
3,090
3,146
7,345
888
$ 57,145
$
1,907
1,567
32,211
1,032
2,831
7,737
5.327
$ 52,611
$
3,309
2,451
4,601
3,163
2,380
8,744
2,955
$ 27,603
$
3,032
3,119
7,939
3,329
2,405
8,750
3.082
$ 31,656
$
6,011
4,122
23,463
2,479
2,959
6,923
1.872
$ 47,830
$
$298,178
$316,574
$336,444
$440,105
$467,998
1,797
1,071
213
0
22,548
48.256
$ 73,885
____~3~4~2
$
$
$
$
42,818
77 .121
$126,435
1.539
3,355
1,080
2,387
52
42,814
69,963
$119,651
3.078
$
22,764
43.842
$ 69,374
86
4,184
1,014
1,030
53
43,905
75.139
$125,325
2,235
$ 74,227
$ 69,460
$127,974
$127,560
$122,729
$125,163
$162,261
$176,193
$162,536
$179,463
$272,624
$288,499
$206,137
$228,718
$188,600
$208,884
$317,376
$342,835
Pers. cash/chkg./sav.$ 8,935
Cash value of life ins. 1,418
Nonfarm real estate
24,316
Auto (personal share)
1,195
Stocks & bonds
637
Household furnishings
7,684
All other
34
Tot. Nonfarm Assets**$ 44,219
Total Farm & Nonfarm
Assets
$280,364
LIABILITIES
Accounts payable
Operating debt
Short term
Advanced gov't, rec.
Intermediate***
Long term*
Total Farm Liab.
Tot, Nonfarm Liab.**
Total Farm & Nonfarm
Liabilities
Farm Net Worth
(Equity Capital)
Farm & Nonfarm
Net Worth
55 to 69 Cows
Jan. 1
Dec. 31
$
1,539
687
543
o
4,395
1,023
1,079
o
FINANCIAL MEASURES
Less than 40 Cows
Percent equity
72%
Debt/asset ratio-long term
0.31
Debt/asset ratio-inter. & current
0.24
Change in net worth with apprec.
$13,932
Total farm debt per cow
$1,982
Debt payments made per cow
$653
Debt payments as % of milk sales
33%
Amount avail. for debt service
$19,356
Cash flow coverage ratio for 1987
1.31
40 to 54 Cows
59%
0.47
0.34
$16,927
$2,558
$619
30%
$25,901
1. 30
3,693
819
1,837
200
43,353
72 ,453
$122,354
2.809
55 to 69 Cows
70%
0.35
0.24
$15,875
$1,912
$502
24%
$31,362
1.29
*Includes discounted lease payments,
**Average of farms reporting nonfarm assets and liabilities for 1987.
***Includes FLB/PCA stock and discounted lease payments for cattle and
machinery.
32
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
426 New York Dairy Farms, 1987
Farms with:
Item
ASSETS
Farm cash/chkg./savings
Accounts receivable
Prepaid expenses
Feed & supplies
Livestock*
Machinery & equipment*
FLB & PCA stock
Other stock & cert.
Land & bui1dings*
Total Farm Assets
Pers. cash/chkg./savings
Cash value of life ins.
Nonfarm real estate
Auto (personal share)
Stocks & bonds
Household furnishings
All other
Total Nonfarm Assets**
Total Farm & Nonfarm
Assets
LIABILITIES
Accounts payable
Operating debt
Short term
Advanced gov't. rec.
Intermediate***
Long term*
Total Farm Liab.
Total Nonfarm Liab.**
Total Farm & Nonfarm
Liabilities
Farm Net Worth
(Equity Capital)
Farm & Nonfarm Net Worth
70 to 84 Cows
Jan. 1
Dec. 31
85 to 99 Cows
Jan. 1
Dec. 31
$
3,853
13,616
0
32,595
91,006
92,636
3,794
4,770
226,609
$468,878
$
4,783
14,094
0
33,144
98,832
96,188
3,942
5,317
231,725
$488,025
$
5,165
15,956
42
39,290
104,319
102,537
3,517
4,175
228,748
$503,750
$
$ 14,048
2,610
10,708
2,746
1,798
6,085
1,778
$ 39,773
$ 15,373
2,878
11,670
3,707
2,060
6,508
1,819
$ 44,014
$ 18,808
2,534
17,682
1,864
5,034
7,455
6,685
$ 60,062
$ 15,424
4,301
27,750
2,545
5,225
7,682
5,568
$ 68,495
$508,651
$532,039
$563,812
$606,163
5,626
1,414
1,997
0
57,651
100,481
$167,170
2,231
$
6,299
1,044
2,357
131
58,466
95,358
$163,655
2,193
$
$
$169,401
$301,709
$339,250
$
FINANCIAL MEASURES
Percent equity
Debt/asset ratio-long term
Debt/asset ratio-inter. & 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 1987
4,327
3,546
2,341
o
6,842
16,322
42
43,702
114,263
109,990
3,630
3,941
238,936
$537,668
4,632
2,551
1,896
o
86,091
96,662
$192,968
83,656
94,019
$186,754
$165,848
$192,968
$186,754
$324,369
$366,191
$310,782
$370,844
$350,913
$419,409
70 to 84 Cows
66%
0.41
0.27
$22,661
$2,072
$573
28%
$38,245
1. 28
o
o
85 to 99 Cows
65%
0.39
0.31
$40,132
$2,008
$596
28%
$51,041
1.41
*Inc1udes discounted lease payments.
**Average of farms reporting nonfarm assets and liabilities for 1987.
***Includes FLB/PCA stock and discounted lease payments for cattle and
machinery.
33
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
426 New York Dairy Farms, 1987
Farms with:
Item
ASSETS
Farm cash/chkg./savings
Accounts receivable
Prepaid expenses
Feed & supplies
Livestock*
Machinery & equipment*
FLB & PCA stock
Other stock & cert.
Land & bui1dings*
Total Farm Assets
Pers. cash/chkg./savings
Cash value of life ins.
Nonfarm real estate
Auto (personal share)
Stocks & bonds
Household furnishings
All other
Total Nonfarm Assets**
Total Farm & Nonfarm
Assets
LIABILITIES
Accounts payable
Operating debt
Short term
Advanced gov't. rec.
Intermediate***
Long term*
Total Farm Liab.
Total Nonfarm Liab.**
Total Farm & Nonfarm
Liabilities
Farm Net Worth
(Equity Capital)
Farm & Nonfarm Net Worth
150 to 199 Cows
Jan. 1
Dec. 31
100 to 149 Cows
Jan. 1
Dec. 31
4,975
32.791 27
78,542
201,180
167,023
10,338
14,209
464,613
973,698
$
8,211
34,990
46
78,949
220,938
177,120
10,276
15,368
490.415
$1,036,3l3
5,855
8,453
49,118
2,518
13,108
10,588
8.266
97,905
$
8,425
20,959
49
52,784
142,344
132,545
6,788
6,087
326,668
$696,649
$ 11,325
21,796
49
56,272
154,411
139,451
6,712
6,881
334,553
$731,449
$
$
4,243
4,205
45,880
1,985
3,932
6,500
3,629
$ 70,374
$
5,803
5,000
59,987
1,942
3,502
6,571
3,138
$ 85,943
$
$767,023
$817,392
$1,071,603
$1,167,430
$
$
$
$
$
4,154
1,875
2,719
o
3,625
3,241
3,074
$
$
o
5,559
5,535
5,515
$
o
5,683
8,611
67,059
2,359
15,000
10,912
21.494
131,117
6,350
5,074
4,782
558
143,167
200.919
360,850
1,843
92,101
130.697
$23l,546
2,230
88,843
130,718
$229,501
1,967
$233,776
$231,468
$
370,554
$
362,693
$465,103
$533,247
$501,948
$585.924
$
$
604,850
701,049
$
$
675,463
804,737
FINANCIAL MEASURES
Percent equity
Debt/asset ratio-long term
Debt/asset ratio-inter. & 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 1987
100 to 149 Cows
69%
0,39
0.25
$36,845
$1,897
$512
24%
$62,095
1.26
$
138,604
213.633
368,847
1.707
$
150 to 199 Cows
65%
0.41
0.29
$70,613
$2,027
$530
25%
$90,571
1.35
*Inc1udes discounted lease payments.
**Average of farms reporting nonfarm assets and liabilities for 1987.
***Inc1udes FLB/PCA stock and discounted lease payments for cattle and
machinery.
34
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
426 New York Dairy Farms, 1987
Farms with:
ASSETS
Farm cash/chkg./savings
Accounts receivable
Prepaid expenses
Feed & supplies
Livestock*
Machinery & equipment*
FLB & PCA stock
Other stock & cert.
Land & bui1dings*
Total Farm Assets
Pers. cash/chkg./savings
Cash value of life ins.
Nonfarm real estate
Auto (personal share)
Stocks & bonds
Household furnishings
All other
Total Nonfarm Assets**
Total Farm & Nonfarm
Assets
LIABILITIES
Accounts payable
Operating debt
Short term
Advanced gov't. rec.
Intermediate***
Long term*
Total Farm Liab.
Total Nonfarm Liab.**
Total Farm & Nonfarm
Liabili ties
Farm Net Worth
(Equity Capital)
Farm & Nonfarm Net Worth
l1ol:;e tban 300 Cows
Dec. 31
Jan. 1
200 to 229 Cows Dec. 31 Jan. 1
Item
$
5,533
46,864
°
98,091
284,010
191,392
14,980
30,591
554,758
$1,226,219
$
$
5,556
5,206
9,188
3,969
7,664
8,000
18,165
57,748
$
6,331 48,027 °
112,705
302,384 200,085 15,096 31,973 572,889 $1,289,490
$
$
5,662
5,806
22,063
3,563
9,351
9,000
15,798
71,243
5,013
86,323
2,156
225,951
461,034
321,564
15,414
60,604
992,:205
$2,170,564
$
$
$
1,981
1,450
13,250
500
17 ,498
4,500
13,363
52,541
11,348
83,269
3,570
275,171
511,184
334,952
15,132
66,876
1,077,050
$2,378,532
$
$
$
2,020
1,814
32,000
3,669
20,591
8,250
17 ,399
85,743
$1,283,967
$1,360,733
$2,223,105
$2,464,295
$
$
$
$
17 ,018
7,171
16,151
°
$
220,564
247,034
507,938
7,402
$
15,638
9,605
15,277
258
226,605
233,601
500,985
5,466
25,541
59,452
36,860
o
$
374,108
492,358
970,992
$
970,992
o
515,340
$
506,451
$
$
$
718,281
768,627
$
$
788,505
854,282
$1,206,479
$1,259,020
200 to 299 Cows
61%
0.41
0.37 $70,224 $2,053 $531 24%
$129,196
1.31
°
351,692
490.540
$ 964,085
$
FINANCIAL MEASURES
Percent equity
Debt/asset ratio-long term
Debt/asset ratio-inter. & 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 1987
11,155
78,052
15,320
964,085
o
$1,407,560
$1,493,303
More than 300 Cows
59%
0.46
0.37
$201,081
$2,167
$644
27%
$273,984
1.51
*Inc1udes discounted lease payments.
**Average of farms reporting nonfarm assets and liabilities for 1987.
***Inc1udes FLB/PCA stock and discounted lease payments for cattle and
machinery.
35
SELECTED BUSINESS FACTORS BY HERD SIZE
426 New York Dairy Farms, 1987
Farms with:
Item
Number of farms
40 to
54 Cows
55 to
69 Cows
70 to
84 Cows
85 to
99 Cows
32
69
74
71
41
108
22
71
15
2.1
12.7
35.5
6.3
3.2
$19.21
$12,615
$117
156
51
96
27
2.3
14.5
49.4
7.7
3.3
$21.94
$18,201
$116
224
71
126
35
2.6
14.4
60.5
8.1
3.6
$21.92
$26,607
$119
256
81
136
47
2.6
15.1
56.7
8.0
3.4
$24.11
$33,050
$129
316
105
173
56
2.4
15.4
50.0
7.8
3.5
$26.57
$38,073
$121
47
36
727,966
15,380
$9.31
$14.74
$12.81
$494
$3.21
90
62
77
49
63
73
976,763 1,223,662 1,456,641
16,098
15,816
15,982
$9.49
$9.22
$8.97
$14.04
$15.05
$13.30
$12.80
$12.86
$12.74
$486
$506
$476
$3.07
$3.17
$2.96
Less than
40 Cows
Cro~~ing ~rogIam Ana1~sis
Total Tillable acres
Tillable acres rented*
Hay crop acres*
Corn silage acres*
Hay crop, tons DM/acre
Corn silage, tons/acre
Oats, bushels/acre
Forage DM per cow, tons
Tillable acres/cow
Fert. & lime exp./ti1. acre
Total machinery costs
Machinery cost/tillable acre
Diir~ Ana1~sis
Number of cows
33
Number of heifers
22
Milk sold, 1bs.
509,393
Milk sold/cow, 1bs.
15,234
Operating cost of prod. mi1k/cwt. $9.30
Total cost of prod. mi1k/cwt.
$16.08
Price/cwt. milk sold
$12.89
Purchased dairy feed/cow
$537
Purchased dairy feed/cwt. milk
$3.53
Purchased grain & conc. as %
of milk receipts
26%
Purchased feed & crop
expense/cwt. milk
$4.18
24%
23%
24%
23%
$3.98
$3.97
$4.04
$3.92
$163,199
6,502
2,625
3,263
1,246
2.52
$170,205
6,249
2,718
2,993
1,233
2.37
$173,452
5,754
2,468
2,584
1,174
2.20
2.46
2.81
1.28
435,307
27
290
$404
$121
3,00
1.25
485,218
30
323
$378
$108
Ca~ita1 Efficienc~
Farm capital/worker
Farm capital/cow
Farm capital/til. acre owned
Real estate/cow
Machinery investment/cow
Capital turnover, years
$155,705
7,203
2,801
4,167
1,144
2.76
$154,213
6,272
2,801
3,300
1,136
2.46
Libor Efficienc~
Yorker equivalent
Operator/manager equivalent
Milk sold/worker, 1bs.
Cows/worker
York units/worker
Labor cost/cow
Labor cost/tillable acre
1.55
1.04
329,305
22
222
$462
$143
1. 93
1.15
378,140
25
258
$431
$131
1. 30
396,964
25
273
$436
$120
*Average of all farms, not only those reporting data.
36
SELECTED BUSINESS FACTORS BY HERD SIZE
426 New York Dairy Farms, 1987
Farms with:
Item
Number of farms
Cronning Program Ana1~sis
Total tillable acres
Tillable acres rented*
Hay crop acres*
Corn silage acres*
Hay crop, tons OM/acre
Corn silage, tons/acre
Oats, bushels/acre
Forage OM per cow, tons
Tillable acres/cow
Fert. & lime exp./ti1. acre
Total machinery costs
Machinery cost/tillable acre
100 to
149 Cows
150 to
199 Cows
200 to
299 Cows
300 or
More Cows
70
31
27
11
360
127
190
76
2.8
17.2
63.6
8.2
3.0
$28.94
$51,831
$144
524
240
229
122
3.0
15.8
55.3
7.9
3.1
$28.09
$77,405
$148
612
218
235
187
3.0
17.4
52.8
7.7
2.5
$33.44
$93,784
$153
924
291
302
339
3.5
17.6
0.0
7.1
2.1
$31.89
$151,843
$164
119
96
1,894,774
15,915
$9.25
$13.83
$12.99
$485
$3.05
171
136
2,773,091
16,217
$9.62
$13.55
$13.03
$515
$3.18
241
183
4,023,474
16,710
$9.61
$12.74
$12.95
$582
$3.49
436
329
8,195,157
18,808
$9.04
$11.53
$12.76
$640
$3.40
Dair~ 6nal~sis
Number of cows
Number of heifers
Milk sold, 1bs.
Milk sold/cow, lbs.
Operating cost of prod. mi1k/cwt.
Total cost of prod. milk/cwt.
Price/cwt. milk sold
Purchased dairy feed/cow
Purchased dairy feed/cwt. milk
Purchased grain & cone. as %
of milk receipts
Purchased feed & crop
expense/cwt. milk
Canital Efficienc~
Farm capital/worker
Farm capital/cow
Farm capital/til. acre owned
Real estate/cow
Machinery investment/cow
Capital turnover, years
Labor Effi£1enc~
Yorker equivalent
Operator/manager equivalent
Milk sold/worker, 1bs.
Cows/worker
York units/worker
Labor cost/cow
Labor cost/tillable acre
23%
24%
26%
25%
$4.06
$4.12
$4.40
$4.17
$201,546
5,998
3,065
2,777
1,142
2.32
$212,060
5,877
3,539
2,792
1,006
2.08
$197,933
5,224
3,193
2,342
813
1. 90
$234,931
5,220
3,593
2,375
753
1. 74
3.54
1.49
534,815
34
352
$360
$119
4.74
1.57
585,133
36
375
$388
$126
6.35
1. 54
633,126
38
384
$386
$152
9.68
1.43
846,448
45
443
$450
$212
*Average of all farms, not only those reporting data.
No. 89-3
Regional Differences in the Dairy Industry
and Their Use in Evaluating Dairy Surpluses
A. Novakovic
M. Keniston
No. 89-4
Agricultural District Legislation in
New York, As Amended Through 1988
K. Gardner
No. 89-5
Microcomputers and Small Local Governments
in New York: Five Case Studies Executive
Summary
D. Wilcox
No. 89-6
Regional Factors Affecting the Impact of
Biotechnology in U.S. Crop Production
J. Love
No. 89-7
National Dairy Markets and Policy and Some
Implications for New York
A. Novakovic
No. 89-8
Dairy Farm Business Summary, Northern
New York, 1988
S. Smith
L. Putnam
No. 89-9
Dairy Farm Business Summary, Western Plain
Region, 1988
S. Smith
L. Putnam
No. 89-10
Dairy Farm Business Summary, Northern
Hudson Region, 1988
S. Smith
L. Putnam
No. 89-11
Dairy Farm Business Summary, Eastern
Plateau Region, 1988
R. Milligan
L. Putnam
C. Crispell
J. Mierek
G. LeC1ar
No. 89-12
Dairy Farm Business Summary, Oneida-Mohawk
Region, 1988
E. LaDue
G. Andrew
B. Aldrich
No. 89-13
Dairy Farm Business Summary, Central New
York and Central Plain Regions, 1988
W. Knoblauch
L. Putnam
No. 89-14
Dairy Farm Business Summary, Western
Plateau Region, 1988
G. Casler
L. Tauer
38
Worksheet for Setting Goals (continued)
II. Long Range Goals (require two or more years to achieve)
III.
What
Short Range Goals (possible to achieve in one or two years).
I How
IWhen
NOTE: Once long and short range goals have been identified, it is helpful to
rank them in order of priority.
Prepared by T.R. Maloney, Extension Associate, Cornell University