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1985 DAIRY FARM BUSINESS SUMMARY
Oneida-Mohawk Region
Introduction
Dairy farmers throughout the State have been participating in New York
Cooperative Extension's farm business summary and analysis program since the
early 1950's. Each participating farmer receives a complete summary and
analysis of his or her farm business in addition to this publication. The
information in this report is compiled by averaging data submitted from the
region described at the bottom of this page.
Program Objective
The primary objective of the dairy farm business summary, DFBS, is to
help farmers improve their management skills through appropriate use of
record data and application of modern farm business management decision­
making techniques. In short, DFBS identifies the records farmers need and
demonstrates how to use them in making business and financial management
decisions.
Program Improvements
The 1985 DFBS report features improved accrual accounting procedures, a
new measure of farm profitability, a more indepth balance sheet, an annual
cash flow statement, and several major improvements in the business analysis
format and the analysis measures used. These and other changes are
identified in the body of this report.
The revised format provides one full page for the analysis of the farm
cropping program and another for complete analysis of the dairy program.
Corn and hay crop related expenses are evaluated separately for farmers who
submitted the breakdown of expenses by crop. The cost of producing milk per
cow and per hundredweight of milk sold has been compiled. An annual cash
flow worksheet has been added to the farmer's individual report. The popular
Progress of The Farm Business report has been moved to page one of the
farmer's report and added to this publication.
Micro DFBS, which allows Cooperative Extension agents and specialists
to calculate and print individual farm business reports in their offices, is
now being used by more than 50 percent of our dairy farm management field
staff. This innovative program provides faster processing of farm record
data and increased use of DFBS in farm management programs.
*This summary was prepared by Eddy L. LaDue, Department of Agricultural
Economics, New York State College of Agriculture and Life Sciences, Cornell
University in cooperation with Cooperative Extension agents David Thompson.
Mike Kelleher, and Teddy Aber. Analysis and data management assistance was
provided by Linda Putnam.
2
SUMMARY OF THE FARM BUSINESS
Business Characteristics
Finding the right management strategies is an important part of
farming. 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 Oneida-Mohawk Region Dairy Farms, 1985 Type of Farm
Dairy
Part-time dairy
Dairy cash-crop
Part-time cash-crop dairy
Number
32
type of Ownership
Owner
Renter
Number
30
5
2
1
o
Milkini System
Bucket & carry
Dumping station
Pipeline
Herringbone parlor
Other parlor
Number
Dairy Records Service
DHIC
O.S.
Number
o
6
25
3
1
24
5
Milk Diversion Proiram Participants
Type of Business
Single proprietorship
Partnership
Corporation
Other
Number
Type of Barn
Stanchion
Freestall
Other
Number
Business Record System
CAMIS
Account Book
Agrifax (mail-in only)
On-Farm Computer
Other
Number
24
10
1
o
29
3
3
2
18
5
o
10
Number
o
Other
None
Number:
6
2
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 12 months of labor from all operators.
A dairy cash-crop farm has income from crop sales that exceed 10 percent of
milk sales.
A farm renter owns no farm real estate at the end of the year or owns no
tillable land.
Milk Diversion Proiram Participants are the farmers who were in the 1984-85
federal milk diversion program. These farms have also been included in the
regional summary averages.
3
Income Statement
The revised accrual income statement begins with an accounting of all
farm business expenses.
CASH AND ACCRUAL FARM EXPENSES
35 Oneida-Mohawk Region Dairy Farms, 1985
Cash
Paid
Expense Item
+
$ 8,536
Hired Labor
Feed
26,386
Dairy grain & cone.
681
Dairy roughage
165
Other livestock
Machinery
1,811
Mach. hire, rent/lease
4,900
Machinery repairs/parts
684
Auto expense (f.s.)
3,977
Fuel, oil & grease
Livestock
498
Replacement livestock
2,097
Breeding
2,167
Vet & medicine
8,884
Milk marketing
31
Cattle lease/rent
4,274
Other livestock expense
~
4,281
Fertilizer & lime
2,262
Seeds & plants
Spray, other crop expo
1,418
Real Estate
1,930
LandJbldg./fence repair
3,011
Taxes
2,335
Insurance
3,868
Rent & lease
Other
656
Telephone (f.s.)
3,229
Electricity (f.s.)
Interest paid
10,121
2,393
Miscellaneous
Total Operating
$100,595
Expansion livestock
$388
Machinery depreciation
Building depreciation
Increase in
Decrease in
+
Accounts
Payable
Inventory
$
$ 142
o
-119
3
-29
0
Accrual
Expenses
$
8,536
-204
-189
o
26,324
492
46
-15
-87
-19
34
1,796
4,816
665
3,982
o
498
2,095
2,136
-10
8
-2
-29
34
o
8,918
5
-23
31
4,256
771
-57
14
60
4,995
2,405
1,534
22
1,952
2,926
2,327
3,897
129
56
-85
-8
29
-2
8
o
--=..11
$ 933
---.l2.
$-490
$ 80
654
3,237
10,121
2,399
$101,038
$
468
12,373
4.875
$118,754
TOTAL ACCRUAL EXPENSES
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.
Accrual expenses are the costs of inputs actually used in this year's produc­
tion. The value of feed and supplies used out of inventory (decrease in
inventory) are included as are the costs of inputs purchased but not paid for
(net increases in accounts payable). Items paid for and not used (net
increase in inventory) are excluded from accrual expenses as are payments
made on inputs used in a prior year (net decreases in accounts payable) .
....-~~-~---.------~......
- - - - - - - - - - - - - - -................
--~-
------~---
4
Worksheets are provided to enable any dairy farmer to compute his or
her accrual farm income and compare it with averages on the opposite page.
CASH AND ACCRUAL FARM EXPENSES WORKSHEET
Expense Item
Cash
Paid
+
Hired Labor
Feed
Dairy grain & cone.
Dairy roughage
Other livestock
Machinery
Mach. hire, rent/lease
Machinery repairs/parts
Auto expense (f.s.)
Fuel, oil & grease
Livestock
Replacement livestock
Breeding
Vet & medicine
Milk marketing
Cattle lease/rent
Other livestock expense
Decrease in
Increase in
Inventory + Accounts Payable
Accrual
Expenses
$_--­
$_---
~
Fertilizer & lime
Seeds & plants
Spray, other crop expo
Real Estate
Landjb1dg./fence repair
Taxes
Insurance
Rent & lease
Other
Telephone (f.s.)
Electricity (f.s.)
Interest paid
Miscellaneous
Total Operating
$_______
Expansion livestock
Machinery depreciation
Building depreciation
TOTAL ACCRUAL EXPENSES $
$_--
$_---
$_-­
$
$
$
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.
Accrual expenses are the costs of inputs actually used in this year's
production. Purchased feed and supplies used out of inventory must be
included. Beginning of year less end of year purchased feed and supply
inventory equals the decrease in inventory to include in accrual expenses.
An increase in inventory will be a negative number in the decrease in
inventory column. Feed, supplies, and services used but not paid for must be
included by adding the net increase in operating accounts payable. Increases
in operating accounts payable are determined by subtracting the balance at
the beginning of the year from the end of year balance.
5
CASH AND ACCRUAL FARM RECEIPTS 35 Oneida-Mohawk Region Dairy Farms, 1985 Receipt Item
Cash
Receipts
Milk sales
Dairy cattle
Dairy calves
Other livestock
Crops
Government receipts
Custom machine work
Gas tax refund
Other
$118,150
6,758
1,368
74
2,175
1,505
41
141
774
Total Accrual Receipts
$130,986 +
Change in
Inventory
$
+
Change in
Accounts
Receivable
--=.l.
$117,669
7,023
1,362
105
1,611
1,341
41
127
767
$-250
$130,046 $-481
-17
281
-6
o
31
-1,003
439
-164
o
-14
$
-691 Accrual
+ Receipts
Cash receipts includes the gross value of milk checks received during the
year plus all other payments received for the sale of farm products,
services, and government programs.
Accrual receipts represent the value of all farm commodities produced and
services actually provided by the farmer during the year. Increases in live­
stock inventory caused by herd growth and/or quality, are included as accrual
receipts. Decreases in inventory caused by herd reduction are deducted.
Changes in inventories of crops grown are accounted for in accrual receipts.
Changes in accounts receivable include the January milk check for this Decem­
ber's marketings compared with the previous January's check, and the change
in other delayed payments.
CASH AND ACCRUAL FARM RECEIPT WORKSHEET
Cash
Receipts
Receipt Item
Milk sales
Dairy cattle
Dairy calves
Other livestock
Crops
Government receipts
Custom machine work
Gas tax refund
Other
$
Total Accrual Receipts
+
Change in
Inventory
Change in
Accounts
+ Receivable
$
$
$
$
Accrual
+ Receipts
$
To calculate the change in inventory to be included in the above worksheet,
subtract the beginning of year values from the end of year values excluding
appreciation. The changes in inventories caused by increasing or decreasing
prices must be excluded from the calculation of accrual receipts. Changes in
accounts receivable are also determined by subtracting beginning of year
balances from end of year balances.
- - --
..
--~-~--..........
- - - -............
~---------~
....- -
- - - - - - - - _ ............
-----~-----
6
fI9fitability Analysis
Farm owners/operators contribute labor, management, and capital to
their businesses and the best combination of these resources produces optimum
profits. Farm profitability can be measured as the return to all operator
and family supplied resources or as the return to one or more individual
resources such as labor and management.
Net faIm income is the total combined return to the farm operator(s)
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 with and without appreciation. Apprecia­
tion represents the change in livestock, machinery, and real estate inventory
values caused by changes in prices during the year. Appreciation is a major
factor contributing to changes in farm net worth and must be included in a
complete profitability analysis.
NET FARM INCOME 35 Oneida-Mohawk Region Dairy Farms, 1985 Item Average
Total accrual receipts
Appreciation: Livestock
Machinery
Real Estate
Total Including Appreciation Total accrual expenses Net Farm Income (with appreciation) Net Farm Income (without appreciation) My Farm
$130,046
-8,418
5,304
2,756
$129,688
118,754
$ 10,934
$ 11 ,292
$_-­
$_-­
$_-­
$_-­
Return to operator(s') labor, management, and equity capital measures the
total business profits for the farm operators, It is calculated by deducting
a charge for unpaid family labor from net farm income, Operator(s') labor is
not included in unpaid family labor. Return to operator(s') labor, manage­
ment, and equity capital has been compiled with and without appreciation.
Appreciation is considered an important part of the return to ownership of
farm assets.
RETURN TO OPERATOR(S') LABOR, MANAGEMENT, AND EQUITY
35 Oneida-Mohawk Region Dairy Farms, 1985
Item
Average
Without
With
Apprec.
A,pprec.
Net farm income
$11,292
$10,934
-1.100
-1,100
Return to operator(s')
labor, management, & equity $10,192
$ 9,834
Family labor unpaid
@ $550 per month
My Farm
Without
Apprec.
With
Apprec.
$_-­
$_-­
$_-­
7
Labor and management income is determined by deducting the cost of using
equity capital, at a real interest rate of five percent, from the return to
operator(s') labor, management, and equity capital excluding appreciation.
Appreciation is not included as part of the return to labor and management
because it results from ownership of assets rather than management of assets.
The interest charge 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 35 Oneida-Mohawk Region Dairy Farms, 1985 Average
Item Return to operator(s') labor, management,
& equity without appreciation
$10,192
Real interest @ 5% on $231,445
equity capital
Labor & Management Income
-11.572
$-1,380
Labor & Management Income per
Operator (1.58 operators)
$
-872
My Farm
$
Return on eguity 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 or value of operator(s') labor
and management ,estimated by the cooperators.
RETURN ON CAPITAL 35 Oneida-Mohawk Region Dairy Farms, 1985 Item Return to operator(s') labor, management
& equity capital with appreciation
Value of operator(s') 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 equity capital:
with appreciation
without appreciation
Rate of return on average total capital:
with appreciation
without appreciation
Average
$
9,834
20,131
-10,297
10,121
-176
-9,939
182
-4.4%
-4.3%
-0.1%
0.1%
My Farm
$--------------­
8
Farm and Family Financial Status
Evaluating the financial status of the farm business and the farm
family is an important part of business analysis. The balance sheet presents
a picture of the business at one point in time. Non-farm assets and
liabilities may also be an important part of that picture, particularly for
individual proprietorships.
1985 FARM BUSINESS & NONFARM BALANCE SHEET
35 Oneida-Mohawk Region Dairy Farms, 1985
Farm Liabilities
Jan. 1
Farm Assets
Current
Farm cash, checking
& savings
$ 1,727
Accounts rec.
11,607
Feed & supplies
26.220
Total
$39,554
Intermediate
Dairy cows:
owned
$ 53,359
leased
0
Heifers
21,091
Bulls/other 1vstk.
223
Mach./eq. owned
81,117
Mach./eq. leased
799
Coop stock & cert.
3.591
Total
$160,180
Lon&-Term
Land/buildings:
owned
$153,005
leased
1.831
Total
$154,836
Total Farm Assets $354,569
Nonfarm Assets*
Jan. 1
Dec. 31
$ 1,867
11,050
24.261
$37,178
& Net Worth
Jan. 1
Dec. 31
Current
Accounts payable
Operating debt
Short-term
$3,993
884
2,599
$3,583
991
3,195
$7,476
$7,768
$47,118
$44,731
799
$47,917
1,021
$45,752
$57,151
$61,165
1. 831
$ 58,982
$114,374
$240,195
1.699
$ 62,864
$116,384
$231,446
Total
Intermediate
$ 47,976
o
18,373
218
82,686
1,021
3.585
$153,859
Financial lease
(cattle/mach.)
Total
Lon&-Term
$155,094
1.699
$156,793
Financial lease
(structures)
Total
Total Farm Liab.
FARM NET WORTH
$347,830
Nonfarm Liabilities* & Net Worth
Jan, 1
Dec. 31
Personal cash, chkg.
Nonfarm Liab.
$ 2,833
& savings
$ 2,760
$2,364
NONFARM NET WORTH $18,619
Cash value life ins. 3,296
3,925 IFARM & NONFARM
Jan. 1
Nonfarm real estate 6,571
7,086 ITotal Assets
$376,021
Auto (personal sh.) 1,821
2,466 ITota1 Liabilities 117.207
Stocks & bonds
1,300
2,227
Household furn.
5,449
5,886 I
All other
255
239 ITOTAL FARM & NON­
Total Nonfarm $21,452
$24,193 I FARM NET WORTH
$258,814
*Average of 37 farms completing non-farm balance sheet.
,
Dec. 31 $ 2,893
$21. 300
Dec. 31
$372,023
119.277
$252,746
Financial lease obligations are included in the balance sheet. The
present values of all future payments are listed as liabilities since the
farmer (lessee) is committed to make the payments. The present values are
also listed as assets, representing the future value the item has to the
business (valued at cost) .
- -..- - -.. - - - - -..- -..-
..
...
~--
..
~~~
...
-----~
- - . - - - -...- - - - - - - - -
...
- -... - -... - - -...- - ..
~
9
1985 FARM BUSINESS & NONFARM BALANCE SHEET
Farm Liabilities
Jan. 1
Farm Assets
Dec. 31
& Net Worth
Jan. 1
Dec. 31
Nonfarm Liabilities
& Net Worth
Jan. 1
Dec. 31
Current
Accounts payable
Operating debt
Short-term:
Current
Farm cash. checking
& savings
Accounts rec.
Feed & supplies
Total
Total
In:t;ermediate
Dairy cows:
owned
leased
Heifers
Bulls/other lvstk.
Mach./eq. owned
Mach./eq. leased
Coop stock & cert.
Total
Intermedia:t;e
Long-Term
Land/buildings:
owned
leased
~ong-I~rm
Financial lease
(cattle/mach.)
Total
Total
Financial lease
(structures)
Total
Total Farm Liab.
FARM NET WORTH
Total Farm Assets
Jan, 1
Nonfarm Assets
Dec, 31
Nonfarm Liab. :
Personal cash, chkg.
& savings
Cash value
life ins.
Nonfarm real est.
Auto (pers. share)
Stocks & bonds
Household furn.
All other
Total Nonfarm
IOIA~
FARM
~
Total Nonfarm
Liabilities
Nonfarm
Net Worth
NQNFARM
Jan· 1
:Qec. 31
Total Farm & Nonfarm Assets
Less Total Farm & Nonfarm Liabilities
Farm & Nonfarm Net Worth
--_._--
----
...
~---
.... - - -
~--
-----
- - _.... _ - _ ...._- _
....
_-_
.... _ - - - - . _ . _ - ­
10 Balance sheet analysis is conducted by examining financial and debt ratios
and factors measuring levels of debt. Percent equity is calculated by
dividing net worth by assets. Equity increases as the value of assets
increase more than liabilities. 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. The debt analysis ratios show
how well the debt is structured and managed. Debt levels per unit of
production include some old standards that are still useful if used with
measures of cash flow and repayment ability.
BALANCE SHEET ANALYSIS 35 Oneida-Mohawk Region Dairy Farms, 1985 Item
Financial Ratios - Farm: Percent equity
Debt/asset ratio: total
long-term
intermediate/current
Financial Ratios - Farm & Nonfarm:
Percent equity
Total debt/asset ratio
Farm Debt Analysis: Accounts payable as % of total debt3
Long-term liabilities as a % of total debt
Current & inter. liab. as a % of total debt
Farm Debt Level§:
Total farm debt
Long-term debt
Intermediate & current debt
Per Cow
$1,940
1,048
892
Average
My Farm 67% 0.33
0.40
0.28
---_%
68%
0.32 ----_%
3% 54%
46%
---_%
Per Tillable
Acre Owned
$895
484 412 ----_%
Per Cow
$_-­
Per Tillable
Acre Owned
Balance sheet analysis concludes with a summary of the inventory balancing
procedure for farm real estate and machinery and equipment. It is important
to account for the value of these 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.
FARM INVENTORY BALANCE
35 Oneida-Mohawk Region Dairy Farms, 1985
Hem
Avli,\:, of
R.E.
Reli,\:ion~l
Farms
Mach, [t;g,
Value beg. of year
$153,005
$81,117
Purchases
$5.462*
$ 8,863
$
Lost capital
1,255
Sales
0
225
Depreciation
4,875
l2.3ZJ
Net investment
--668
--3,735
Appreciation
+5,304
+2.Z56
Value end of year
$155,094
$82,686
* $2,009
My Farm
R.E.
Mach. LEg.
$
$
-+
+
$
land and $3,454 buildings and/or depreciable improvements.
-+
+
$
11 Cash Flow Summary and Analysis
Considerable insight about a business is frequently attained through a
complete cash flow analysis. 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 in the following table is structured to
compare all the cash inflows with all the cash outflows for the year. Cash
inflows include all the cash farm receipts, receipts from the sale of farm
assets, additional funds borrowed, as well as the amount of cash available at
the beginning of the year. Cash outflows include all the cash farm expenses,
capital purchases, principal payments, money taken out of the business, and
the cash balance left at year's end. When all the cash inflows and outflows
are correct, the statement will balance. If the imbalance (error) amount is
positive, recorded cash inflows exceed outflows by this amount. If it is
negative, cash outflows are too high in relation to inflows. Positive errors
(imbalances) are frequently caused by underestimating family living expenses
while negative errors are frequently caused by omitting some new money
borrowed.
ANNUAL CASH FLOW STATEMENT
35 Oneida-Mohawk Region Dairy Farms, 1985
Item
Cash Inflows
Beginning farm cash, checking & savings
Cash farm receipts
Sale of assets: Machinery
Real estate
Money borrowed (intermediate & long-term)
Money borrowed (short-term)
Increase in operating debt
Nonfarm income
Money borrowed - nonfarm
Total
Cash Outflows
Cash farm expenses
Capital purchases: Expansion livestock
Machinery
Real estate
Principal payments (intermediate & long-term)
Principal payments (short-term)
Decrease in operating debt
Nonfarm debt payments
Personal withdrawals & family expenses*
Ending farm cash, checking & savings
Total
Imbalance (error)
*On many farms this item was estimated.
Ayerage
$
1,727
130,986
225
My Farm
$_--­
o
17,193
3,663
107
2,974
792
$157,668
$100,595
388
8,863
5,462
15,567
3,068
$_--­
$_--­
o
956
18,828
1.867
$155,592 $_--­
$ 2,076 $
12 Repayment Analysis
The second step of cash flow planning is to compare debt payments
planned and made last year, and estimate the payments required in the current
year. The data presented below are for the 21 farms that completed Farm
Business Summaries for both 1984 and 1985.
FARM DEBT PAYMENTS PLANNED Same 21 Oneida-Mohawk Region Dairy Farms, 1985 and 1986 Debt Payments
Long-term
Intermediate-term
Short-term
Operating (net
reduction)
Accounts payable
(net reduction)
Total
Average
1985 fayments
Planned
Made
Planned
1986
$ 6,998
12,195
1,986
$ 6,648
13,392
1,673
$ 6,954
13,585
1,275
0
0
425
1.424
1.427
1.045
$22,602
$23,140
$23,285
$401
2.61
$410
2.68
Per cow
Per cwt. 1985 milk
Percent of total
1985 receipts
Percent of 1985
milk receipts
19%
19%
20%
21%
My Farm
1985 Payments
Planned
Made
Planned
1986
$_-- $_-_$_-­
$_-_$_-- $_-­
$
$
$_-­
$_-­
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 this year's planned debt payments.
CASH FLOW COVERAGE RATIO Same 21 Oneida-Mohawk Region Dairy Farms, 1985 and 1986 Item
My Farm
Cash farm receipts $122,501
- Cash farm expenses 91,416
+ Interest paid - Net personal withdrawals from farm* $_--­
9,171
14.589
(A) - Amount Available for Debt Service
$25,667
$_--­
(B) - Debt Payments Planned for 1985
$22,602
$_--­
(A + B) - Cash Flow Coverage Ratio for 1985
1.14
*Persona1 withdrawals and family expenditures less nonfarm income. If family
withdrawals are excluded, the cash flow coverage ratio will be incorrect.
13
ANALYSIS OF THE FARM BUSINESS
Analysis of the farm business requires a detailed assessment of at
least three different aspects: the cropping program, the dairy program, and
the factors affecting capital and labor efficiency.
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 Oneida-Mohawk Region Dairy Farms, 1985 Owned
130
41
50
221
1!!ru1
Tillable
Nontillable
Other nontillable
Total
Crop Yielg§
Hay crop
Corn silage
My Farm
Average
Item
Farms Reporting
Acres
Farms
118
34
42
31
Other forage
2
Total forage
35
Corn grain
17
Oats
7
Wheat
0
Other crops
3
Tillable pasture 12
Idle
7
Total Tillable Acres
20
152
56
22
0
30
R~nted
73
14
16
103
Acres
114
37
31
1
152
27
4
0
3
11
28
-2.
Total
203
54
~
Renteg
Total
.sJ..
324
ProdLAcre
2.4 tn DM
12.9 tn
4.5 tn DM
1.9 tn OM
2.9 tn OM
83 bu
93 bu
Acres
---
ProdLAcre
tn DM
tn
tn OM
tn DM
tn OM
bu
bu
bu
203
Average crop acres and yields compiled for the region are for all
farms. The number of farms reporting each crop and the average acres on farms
reporting each crop are also shown. 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 Oneida-Mohawk Region Dairy Farms, 1985 Item
Total tillable acres per cow
Total forage acres per cow
Harvested forage dry matter, tons per cow
Average
3.4
2.6
7.4
My
Farm
14 Cropping Program Analysis (continued)
A substantial number of cooperators have allocated crop expenses to hay
crop, corn, and other crop production. These additional data have been
compiled to show the traditional crop expenses per acre and per production
unit for these crops. Corn production has been converted to corn silage
equivalent using 5.88 bushels of dry shell equivalent to equal one ton of
corn silage as fed.
CROP RELATED ACCRUAL EXPENSES 35 Oneida-Mohawk Region Dairy Farms, 1985 Expense
Fertilizer & lime
Seeds & plants
Spray & other crop
expense
Total
Per
Ton Corn
Silage
Equiv.**
Total
Per
Till.
Acre
Hay Crop*
Per
Per
Acre
Ton DM
Corn*
Per
Acre
$24.64
11.86
$16.57
6.00
$5.52
2.00
$36.53
25.01
$2.17
1.48
$ 52.65
40.71
7,51
$44.07
~,04
....l....Ql
$8.53
18,49
$80.03
..l.J.Q
$25.60
11,60
$104.96
$_­
$_­
$_­
$_­
$_­
$_­
$===
$_­
$===
$===
$===
$===
$4.74
Other
Crops*
Per Acre
My Farm:
Fertilizer & lime
Seeds & plants
Spray & other crop
expense
Total
*Hay: 28 farms reporting, 114 average acres; corn: 26 farms reporting, 69
average acres; other crops: 13 farms reporting, 15 average acres.
**Corn grain converted to silage equivalent using 5.88 bushels - one ton
silage as fed.
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 per total tillable acre.
ACCRUAL MACHINERY EXPENSES 35 Oneida-Mohawk Region Dairy Farms, 1985 Machinery
Expense Item
Average
Total
Per Til.
Expenses
Acre
Fuel, oil & grease
Machinery repairs & parts
Machine hire, rent & lease
Auto expense (farm share)
Interest (5%)
Depreciation
Total
$ 3,982
4,816
1,796
665
4,095
12,313
$27,727
$ 19.64
23.75
8.86
3.28
20.20
61,03
$136.76
My Farm
Total
Expenses
$_--
$_-­
Per Til.
Acre
$_-­
15 Dairy Program Analysis
Analysis of the dairy enterprise can tell a great deal about the
strengths and weaknesses of the dairy farm business. 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 real increase in inventory
has been included as an accrual farm receipt on page 5.
DAIRY HERD INVENTORY 35 Oneida-Mohawk Region Dairy Farms, 1985 Dairy Cows
Number
Value
Item
Beginning of year (owned)
+ Change without appreciation
+ Appreciation
End of year (owned)
End including leased
Average number
Number
48
$53,359
951
-6.334
$47,976
58
59
60
60
47
Heifers
Value
$21,091
-669
-2.049
$18,373
47
My Farm:
Beginning of year (owned)
+ Change without appreciation
+ Appreciation
End of year (owned)
End including leased
Average number
$_--­
$_--­
$_--­
$_--­
Total milk sold and milk production 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.
MILK PRODUCTION 35 Oneida-Mohawk Region Dairy Farms, 1985 Item
Average
Total milk sold, lbs.
917,790
Milk sold per cow, lbs.
Average milk plant test, percent butterfat
15,399
3.4
My Farm
16 The cost of producin~ 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.
ACCRUAL RECEIPTS FROM DAIRY AND COST OF PRODUCING MILK
35 Oneida-Mohawk Region Dairy Farms, 1985
Ml farm
Per Cow
Per Cwt.
$
$
$
$
$
$
$ 9.66
$
$_-­
$_-­
$11.71
$15.16
$
$_-­
$_-­
Aver~Jz;e
Total
Per Cow
Per Cwt.
$117,669
7,023
1,362
$126,054
$1,974
118
23
$2,115
$12.82
0.77
0,15
$13.73
Operating costs
$ 88,683
Total costs with­
out op(s') labor,
mgmt. & capital $107,477
Total Costs
$139,180
$1,488
$1,803
$2,335
Item
Total
A~crua1 R~ceip:t;!i
Milk
Dairy cattle
Dairy calves
Total
A~crual Cos:t;~ of
~rgd!.!£1ng Milk
Tg:t;al cos:t;s of producing milk include the operating costs, minus non-milk
income, plus expansion livestock purchased, depreciation on machinery and
buildings, the value of operator(s') labor and management, and the interest
charge for using equity capital. Note that the cost of labor, management,
and equity capital have been excluded in the intermediate compilation.
Subtracting this cost from the price received for milk indicates the amount
the farm operator obtains for his or her inputs.
DAIRY RELATED ACCRUAL EXPENSES 35 Oneida-Mohawk Region Dairy Farms, 1985 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
Ml Farm
Per Cow
Per Cw:t;.
$442
$
---2.
$2.87
0,06
$450
$2.92
$
$3.90
$
- -% $
$0.23
0.23
0.97
0.00
0.46
$
- -% $
Per Cow
22%
$600
30%
$ 35
36
150
1
71
Per ewt.
$
$
_ ...• _ .
-
•..
_._•.- ...__
..
17
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.
CAPITAL EFFICIENCY 35 Oneida~Mohawk Region Dairy Farms, 1985 Item
Farm capital
Real estate
Machinery & equipment
Capital turnover, years
My Fa[m:
Farm capital
Real estate
Machinery & equipment
Capital turnover, years
Per Tillable
As;;[e
Per
gQW
Per
Work~[
$135,948
$5,893
2,614
1,389
32,056
2.70
$_-­
$_-­
$1,732
Per Tillable
Acre Own~Q
$2,702
1,199
408
$_-­
$_-­
LABOR FORCE INVENTORY AND ANALYSIS 35 Oneida-Mohawk Region Dairy Farms, 1985 Months
My Farm
All Farms
LabQ[ Force
Operator number
Operator number
Operator number
Operator number
Family paid
Family unpaid
Hired
Total 1
2
3
4
12
4
2
1
4
2
13
14
13
12
$13,393
4,292
1,880
566
~
31
My Fa[m: Total
Operator's
Labor
Efficiens;;y
Cows, average number
Milk sold, pounds
Tillable acres
Work units
Value of
Labo[ & Mgmt.
Years of
Qf Educ.
Age
45
33
29
44
Total
+ 12 ­
2.6 Worker Equivalent
1.6 Operator/Manager Equiv.
+ 12 ­
+ 12 ­
___ Worker Equivalent
Operator/Manager Equiv.
Ave[age
Per Wo[ker
60
917,790
203
635
Total
23
355,274
78
246
M:f farm
Per
Per
gow
Ill. Acr~
Av~[S!ge La:bO[ gosts
Value of operator(s)
labor ($800/month)
Family unpd. ($550/mo.)
Hired
Total Labor
Machinery Cost
Total Labor & Mach.
Total
$15,200
1,100
~.532
$24,836
$27,727
$52,563
My Farm
Per WQ[ker
Per
gQw
Per
Til. Acre
$255
18
143
$417
$465
$882
$ 74.97
5.43
42.10
$122.50
$136.76
$259.26
Total
$
$
$
$
$
$
$
$
$
$
$
$
18 ANNUAL CASH FLOW WORKSHEEET 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
Other 1vstk. feed
Mach. hire/rent/lease
Mach. rpr./parts & auto
Fuel, oil & grease
Replacement 1vstk.
Breeding
Vet & medicine
Milk marketing
Cattle lease
Other lvstk. exp.
Fertilizer & lime
. Seeds & plants
Spray/other crop exp.
Land, bldg. ,fence repair
Taxes
Insurance
Real est. rent/lease
Utilities
Miscellaneous
Total Less Int. Paid
Regional
Average
(per cow)
60
$1,974
My Farm
Total
Per Cow
Expected
1986
Change Projection
$_ __
$_--
$_--­
27
38
$2,182
$_ __
$_--
---_$_--­
$
$_ __
$_­
118
23
2
143
442
$_--­
9
1
30
91
66
8
35
36
150
1
71
83
40
26
33
49
39
65
65
40
$1,515
Net Accrual Operating Income
(without interest paid)
Change in 1vstk./crop inv.
- Change in accts. rec.
+ Change in feed/supply inv.
+ Change in accts. payable
NET CASH FLOW
- Personal withdrawals & family expenditures
Available for Debt Payments, Investments & Savings
- Farm Debt Payments
Available for Investment & Savings
- Capital Purchases: cattle, machinery & improvements
Additional Capital Needed $_--­
(total) $39,129 $ _ - -
$_--­
-250 933
-490 $40,535 $_--
$_--­
$_--
$_--­
$-8,039 $ _ - -
$_--­
-691 18.828 $21,707 29.746 14,793 $_--
$_--­
19
PROGRESS 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 21 Oneida-Mohawk Region Dairy Farms, 1984 and 1985
1984
1985
Size of Business
Average number of cows
Average number of heifers
Milk sold, lbs.
Worker equivalent
Total tillable acres
56
43
834,943
2.30
195
56
41
864,500
2.25
206
Rates of Production
Milk sold per cow, lbs.
Hay DM per acre, tons
Corn silage per acre, tons
15,012
2.4
14
15,333
2.1
14
Labor Efficiency
Cows per worker
Milk sold per worker, 1bs.
24
363,395
25
384,222
Selected Factors
My FaIm
1985
1984
Goal
QQst Control
Grain & conc. purchased
as % of milk sales
Dairy feed & crop expo
per cwt. milk
Labor & mach. costs/cow
$4.23
$796
$3.82
$802
$
$
$
$
$_-­
$_-­
CaRital Effici~ncy*
Farm capital per cow
Real estate per cow
Mach. & equip. per cow
Capital turnover, years
$6,314
$2,993
$1,336
2.7
$6,163
$2,950
$1,345
2.9
$
$
$
$
$
$
$_-­
$_-­
$_-­
$21,032
$21,076
$6,928
$15,780
$13,896
$2,188
$
$
$
$
$
$
$_-­
$_-­
$_-­
24%
23%
------%
%
~IQfitabllit;£
Net farm inc. w/o apprec. Net farm inc. w/apprec. Labor & mgmt. income Rate of return on eq. capital w/apprec.
fin~nciil Summlr;£
Farm net worth
Debt to asset ratio
Farm debt per cow
*Average for the year.
0.8%
$241,124
0.31
$1,968
-2.9%
$238,840
0.30
$1,841
------%
$
$
$
%
$
$
$
$_-­
$_-­
$_-­
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 458 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.
FARM BUSINESS CHART FOR FARM MANAGEMENT COOPERATORS
458 New York Dairy Farms. 1984
Size of Busine§s Worker
Equivalent
No.
of
Cows
6.8
4.3
3.6
3.1
2.8
255
138
100
83
72
Pounds
Milk
Sold
4,211,900
2,118,100
1,551,500
1.287,200
1,090,400
Rates of Production
Tons
Tons
Corn
Pounds
Hay
Crop
Silage
Milk Sold
Per Cow
OM/Acre Per Acre
18.800
17,300
16,500
15,900
15,300
4.7
3.7
3.3
2.9
2.7
Labor Efficienc;:£
Cows
Per
Worker
Pounds
Milk Sold
Per Worker
45
36
33
30
28
697,300
560.900
503,900
456,100
423,300
20
18
16
15
14
------------------------------------_._-------------------------------------­
2.5
2.2
2.0
1.7
1.4
Feed Bought Per Cow 63
56
49
43
33
950,300
818,600
691.500
577.800
395,200
% Feed is
of Milk
Receipts
14,800
14,200
13,400
12,200
10,000
Machinery
Costs
Per Cow
$214
306
369
432
474
11%
16
19
22
25
$205 286 337 379 408 523
574
624
685
809
27
28
31
33
40
445
481
519
580
765
2.5
2.3
2.0
1.7
1.3
13
12
12
10
8
26
25
23
20
16
Labor & Machinery Cost§ Per Cow 392,200
361,400
328,000
275,500
191,300
Feed & Crop Expenses Per Cwt. Milk $ 511
610
662
713
771
$2.75
3.47
3.87
4.21
4.45
818
873
4.68
4.97
928
5.31
1,004
1.201
5.72
6.73
The cost control factors are ranked from low to high. but the lowest
co§t i§ not nece§§ari1;:£ 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.
21 Financial Analysis Chart
The farm financial analysis chart is designed just like the ~
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, 12, and 17 of this publication.
FINANCIAL ANALYSIS CHART 458 New York Dairy Farms, 1984 Debt Payments
Per Cow
.02
.12
.24
.37
.51
.70
.94
1.22
1.72
5.04
7.67
2.16
1.41
1.10
.91
.75
.58
.46
.28
-.56
$909
640
537
469
411
357
279
216
126
-95
$ 36
176
277
362
438
500
571
656
752
971
Leverage
Ratio!
LiguiditI ~ReEa~ent~
Cash Flow Available for Debt Service Coverage Ratio Per Cow Solvency
Debt/Asset Ratio
Percent
Long
Intermediate
EquitI
& Current
Term
99
90
81
73
67
60
53
46
38
20
.00
.02
.14
.30
.41
.51
.62
.73
.85
1.27
.00
.04
.11
.16
.23
.29
.37
.45
.55
.80
Debt Payments
as Percent of
Milk Sales
2
9
14
19
22
26
30
35
40
52
Debt
Per Cow
$
104
638
1,142
1,625
1,930
2,377
2,688
3,161
3,770
5,072
Efficiency & Profitability
Capital
Rate of Return on
Turnover
(Iears)
EguitI
Investment 2
1. 60
1. 90
2.06
2.20
2.34
2.51
2.66
2.95
3.25
4.54
18%
8
5
3
1
-1
-3
-6
-11
-37
13%
9
7
6
4
3
1
o
-3
-8
IDo11ars of debt per dollar of equity, computed by dividing total liabilities
by total equity.
2Return on all farm capital (no deduction for interest paid) divided by total
farm assets.
22
FARM BUSINESS SUMMARY BY HERD SIZE
458 New York Dairy Farms, 1984
Less than
4Q Cow§
40 to
54 Cows
55 to
69 Cow§
70 to
84 Cow§
Livestock
Feed & supplies
Machinery & equipment
Land & buildings
$ 39,803
11,239
40,402
120,96Z
$ 58,991
17,653
53,984
142,160
$ 81,180
26,056
76,669
193,Z10
$100,136
34,432
97,951
225,287
TOTAL INVESTMENT
$212,411
$272,788
$377,615
$457,806
$ 58,562
4,531
1,004
425
3,791
$ 68,313
-589
501
1,609
$ 89,405
5,287
1,626
738
J,991
$101,047
687
10
3,371
$123,086
8,630
2,110
1,411
:2,448
$140,685
889
2,085
6,243
$155,027
10,295
1,890
2,271
:2,64Q
$175,123
3,018
435
5,188
$ 69,834
$ 68,225
$105,115
$101,744
$149,902
$143,659
$183,764
$178,576
$
2,503
16,993
1,632
764
3,072
446
2,072
549
875
1,072
4,893
0
2,362
2,355
697
693
936
3,292
2,018
5,789
1,441
$ 54,454
60
6,475
2,001
1,844
7,4J3
$
5,326
23,274
1,422
949
4,013
415
3,157
766
1,238
1,617
7,345
55
3,650
3,446
1,081
813
1,190
4,120
2,879
9,300
3,088
$ 79,144
238
7,623
3,166
1,750
9,162
$
8,539
30,095
2,227
1,494
5,929
502
4,494
1,692
2,062
2,641
9,676
87
5,511
6,291
1,933
1,438
1,971
5,922
3,875
12,660
4,125
$113,164
702
11,531
5,605
1,821
12.6Z8
$ 13,584
36,692
1,486
1,501
7,527
485
6,131
1,116
2,548
3,098
12,223
125
6,278
8,000
2,602
1,988
2,339
7,203
4,700
14,845
5.609
$140,080
1,062
15,287
5,742
1,805
15, ZZl
$ 72,267
$101,083
$145,501
$179,747
$13,859
$-4,042
1.07
$-3,778
$4,673
$21,903
$661
1.18
$560
$11,181
$27,521
$-1,842
1.32
$-1,395
$12,939
$35,043
$-1,171
1.34
$-874
$14,767
Item
Ca~ita1 Investm~nt
F51rms with;
(end of year)
Recei~ts
Milk sales
Dairy cattle sold
Other livestock sales
Crop sales
Miscellaneous receipts
Total Cash Receipts
Increase in livestock
Increase in feed & supplies
Appreciation
TOTAL FARM RECEIPTS
TOTAL FARM REC. EXCL. APPREC.
Ex~enses
Hired labor
Dairy grain & concentrate
Other feed
Machine hire
Machinery repair
Auto expense (farm share)
Gas & oil
Replacement animals
Breeding fees
Veterinary & medicine
Milk marketing
Cattle lease
Other livestock expense
Fertilizer & lime
Seeds & plants
Spray & other crop expense
Land, bldg., fence repair
Taxes & insurance
E1ec. & phone (farm share)
Interest paid
Misc. expenses (incl. rent)
Total Cash Expenses
Expansion livestock
Machinery depreciation
Building depreciation
Unpaid family labor
Interest on equity @ 5%
TOTAL FARM EXPENSES
Finan£ia1 Summ51r~
NET CASH FARM INCOME
Labor & Management Income
Number of Operators
LABOR & MGT. INCOME/OPER.
LABOR, MGT. & OWNSHP. INC./OPER.
23
FARM BUSINESS SUMMARY BY HERD SIZE
458 New York Dairy Farms, 1984
85 to
100 to
150 to
200 to
250 or
Item
Farms with: 99 Cows 149 Cows 199 Cows 249 Cows
More Cows
Capital Investment (end of year)
Livestock
$124,747 $166,776 $223,343 $ 317,993 $ 470,722
Feed & supplies
41,199
60,934
81,393
113,736
189,321
Machinery & equipment
111,838 134,403 183,205
190,946
259,528
242,050 348.070 415,970
581,058
879,980
Land & buildings
TOTAL INVESTMENT
Receipts
Milk sales
Dairy cattle sold
Other livestock sales
Crop sales
Miscellaneous receipts
Total Cash Receipts
Increase in livestock
Increase in feed & supplies
Appreciation
$519,834 $710,183 $903,911 $1,203,733 $1,799,551
$189,618 $256,245 $343,599
16,560
24,102
12,783
5,448
2,448
3,855
1,066
2,528
5,851
9,564
18,177
4,502
$210,424 $288,752 $397,177
5,264
2,971
7,534
7,022
6,856
281
2,746
10,566
11.658
TOTAL FARM RECEIPTS
$218,715 $309,311 $423,225
TOTAL FARM REC. EXCL. APPR.$215,969 $298,745 $411,567
Expenses
Hired labor
Dairy grain & concentrate
Other feed
Machine hire
Machinery repair
Auto expense (farm share)
Gas & oil
Replacement animals
Breeding fees
Veterinary & medicine
Milk marketing
Cattle lease
Other livestock expense
Fertilizer & lime
Seeds & plants
Spray & other crop expense
Land, bldg., fence repair
Taxes & insurance
E1ec. & phone (farm share)
Interest paid
Misc. expenses (incl. rent)
Total Cash Expenses
Expansion livestock
Machinery depreciation
Building depreciation
Unpaid family labor
Interest on equity @ 5%
TOTAL FARM EXPENSES
$505,975 $
37,420
8,275
4,013
19,824
$575,507 $
4,471
4,218
24.203
838,467
48,329
9,101
14,125
11,764
921,786
51,943
14,687
12,861
$609,099 $1,001,277
$584,196
$988,416
$ 16,688 $ 27,852 $ 46,503
49,523
61,297
78,388
1,616
3,305
3,705
1,049
1,539
2,704
10,347
14,395
20,231
608
307
534
7,220
10,651
13,739
1,045
1,673
4,834
2,715
3,811
5,028
3,776
5,339
6,729
19,404
15,285
26,629
0
150
104
8,091
9,643
15,299
9,363
13,360
21,445
3,122
4,101
7,169
2,126
4,726
7,328
2,697
3,860
3,746
7,346
10,300
13,188
5,464
6,851
8,877
19,120
27,319
39,003
5,312
8,375
10,210
$172,663 $238,212 $335,289
1,040
729
3,596
16,720
21,513
29,514
7,497
10,826
11,453
1,698
1,348
760
22,692
12,8~4
22,~69
$ 77 ,411
115,416
4,065
3,679
27,963
696
19,720
1,189
8,061
12,980
39,971
0
17,745
26,273
9,889
6,131
6,384
16,264
11,927
50,300
20,000
$476,064
7,173
32,577
22,077
938
38,653
$117,236
201,481
10,626
4,676
38,467
329
24,792
1,354
12,013
20,847
52,277
732
32,245
32,100
12,436
15,530
9,185
18,689
15,604
87,833
23,600
$732,052
20,888
48,605
31,860
1,433
$216,502 $295,320 $410,181
$577,482
$894,371
$99,443
$6,714
1.44
$4,663
$48,799
$189,734
$94,045
1.80
$52,247
$92,466
[inancia1 Summar~
NET CASH FARM INCOME
$37,761
Labor & Management Income
$-533
Number of Operators
1.37
LABOR & MGT. INCOME/OPER.
$-389
LABOR,MGT. & OWNSHP. INC.IOP. $13,939
$50,540
$3,425
1.41
$2,429
$26,016
$61,888
$1,386
1.52
$912
$28,035
~9,533
24
SELECTED BUSINESS FACTORS BY HERD SIZE
458 New York Dairy Farms, 1984
Item
Farms with:
Number of farms
Size of Business
Number of cows
Number of heifers
Pounds of milk sold
Worker equivalent
Total work units
Total tillable acres
(Tillable acres rented)*
Rates of Production
Milk sold per cow
Tons hay crop dry matter per acre
Tons corn silage per acre
Bushels of oats per acre
Labor Efficiency
Cows per worker
Pounds milk sold per worker
Work units per worker
Feed Costs
Feed purchased per cow
Crop expense per cow
Feed cost per cwt. milk
Feed & crop expo per cwt. milk
% feed is of milk receipts
Tons forage dry matter per cow
Tillable acres per cow
Fertilizer & lime per crop acre
Less Than
40 Cows
45
40 to
54 Cows
55 to
69 Cows
100
94
64
70 to
84 Cows
33
27
443,000
1. 75
366
112
(26)
47
38
664,700
2.08
526
164
(50)
61
52
919,900
2.50
694
213
77
13,424
2.2
12.9
39.8
14,143
2.3
13.0
51. 7
15,080
2.4
12.8
56.8
15,057
2.7
12.9
49.5
19
253,143
209
23
319,567
253
24
367,960
278
26
397,055
298
$515
$113
$3.84
$5.05
29%
7.6
3.4
$21
$495
$114
$3.50
$4.52
26%
7.7
3.5
$21
67
1,159,400
2.92
870
271
(71)
(80)
$493
$158
$3.27
$4.56
24%
7.8
3.5
$30
$477
$164
$3.16
$4.38
24%
8.0
3.5
$30
Machinery & tabor Costs
Total machinery costs
Machinery cost per cow
Machinery cost per cwt. milk
Labor cost per cow
Labor cost per cwt. milk
$14,820
$449
$3.35
$425
$3.17
$18,829
$401
$2.83
$376
$2.66
$27,749
$455
$3.02
$364
$2.42
$35,813
$465
$3.09
$358
$2.38
Capital Efficiency
Investment per worker
Investment per cow
Investment per cwt. milk
Land & buildings per cow
Machinery investment per cow
Capital turnover
$121,378
$6,247
$48
$3,558
$1,188
3.0
$131,148
$5,683
$41
$2,962
$1,125
2.6
$151,046
$6,190
$41
$3,176
$1,257
2.5
$156,783
$5,795
$39
$2,852
$1,240
2.5
$13.22
$13.45
104
28
$13.38
125
41
$13.37
140
53
Qther
Price per cwt. milk sold
Acres hay crops*
Acres corn silage*
*Average of all farms.
77
17
25
SELECTED BUSINESS FACTORS BY HERD SIZE
458 New York Dairy Farms, 1984
Item
85 to
99 CQws
F,u:ms with;
43
Number of farms
SiZ~ Qf Bu§ines§
Number of cows
Number of heifers
Pounds of milk sold
Worker equivalent
Total work units
Total tillable acres
(Tillable acres rented)*
100 to
149 Cows
56
150 to
129 CQ!llS
25
200 to
242 Cows
16
250 or
More Cows
15
124
229
359
91
170
134
200
285
83
111
1,399,400 1,878,500 2,553,000 3,692,600 6,247,600
3.92
4.67
6.17
8.58
3.08
1,030
1,398
1,907
2,541
3,801
290
383
549
622
790
(101)
(136)
(220)
(222)
(260)
Rates Qf ~roductlQn
Milk sold per cow
15,378
2.7
Tons hay crop dry matter/acre
Tons corn silage per acre
13.4
Bushels of oats per acre
53.0
Labor r;fficienc;)!:
Cows per worker
Pounds milk sold/worker
Work units per worker
Feed Costa
Feed purchased per cow
Crop expense per cow
Feed cost per cwt. milk
Feed & crop exp./cwt. milk
% feed is of milk receipts
Tons forage dry matter/cow
Tillable acres per cow
Fertilizer & lime/crop acre
30
454,351
334
$544
$161
$3.54
$4.70
26%
8.1
3.2
$32
15,149
2.9
13.8
45.8
15,018
3.0
14.4
50.1
16,125
3.3
15.4
57.1
17 ,403
4.0
16.3
80.0
32
479,209
357
36
546,681
408
37
598,476
412
42
728,159
443
$494
$179
$3.26
$4.62
24%
8.0
3.1
$35
$461
$211
$3.07
$4.62
23%
8.7
3.2
$39
$504
$185
$3.13
$4.38
23%
8.5
2.7
$42
$561
$167
$3.22
$4.36
24%
8.0
2.2
$41
MacbineI;)!: ~ ~bOI Costs
Total machinery costs
$41,499
Machinery cost per cow
$456
Machinery cost per cwt. milk $2.97
Labor cost per cow
$337
Labor cost per cwt. milk
$2.19
$54,991
$443
$2.93
$338
$2.23
$75,651
$445
$2.96
$360
$2.39
$94,090
$411
$2.55
$399
$2.47
$129,309
$360
$2.07
$375
$2.15
C§Rital Effi£ienc;)!:
Investment per worker
$168,777
Investment per cow
$5,590
Investment per cwt. milk
$37
Land & buildings per cow
$2,603
Machinery investment per cow $1,203
Capital turnover
2.4
$181,169
$5,636
$38
$2,762
$1,067
2.3
$193,557
$5,165
$35
$2,377
$1,047
2.1
$195,094
$5,144
$33
$2,483
$816
2.0
$209,738
$4,699
$29
$2,298
$678
1.8
$13.64
176
102
$13 .46
258
144
$13.70
237
235
$13.42
245
326
Q.truu:
Price per cwt. milk sold
Acres hay crops*
Acres corn si1age*
*Average of all farms.
$13.55
154
71
26
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
458 New York Dairy Farms, January 1, 1985
Item
Farms with:
Number of farms
Assets
Livestock (includes
discounted lease payments)
Feed & supplies
Machinery & equip (includes
discounted lease payments)
Land & buildings (includes
discounted lease payments)
Co-op investment
Accounts receivable
Cash & checking accounts
Total Farm Assets
Savings accounts
Cash value life insurance
Stocks & bonds
Nonfarm real estate
Auto (personal share)
All other
Total Nonfarm Assets
TOTAL ASSETS
LiBbil1t1es
Long-term
Intermediate
Financial lease
Short-term
Other farm accounts
Total Farm Liabilities
Total Nonfarm Liabilities
TOTAL LIABILITIES
Farm Net Worth (Eq. Cap, )
FAMILY NET WORTH
40 to
54 Cows
55 to
69 Cows
70 to
84 Cows
45
100
94
64
$ 39,803
(0)
11,239
40,617
(215)
121,757
(608)
950
5,903
1,084
$221,171
2,892
2,071
990
3,853
1,464
7.871
$ 59,013
(22)
17,653
55,212
(1,228)
144,453
(2,293)
2,842
8,170
1,664
$289,007
3,025
2,119
2,082
2,905
1,903
9,212
$ 81,180
(0)
26,056
77 , 650
(981)
194,790
(1,080)
3,971
11,281
2.Q28
$396,956
2,751
3,115
2,195
8,897
2,005
6,298
$100,161 $124,747
(25)
(0)
34,432
41,199
98,722 112,637
(799)
(771)
227,936 246,366
(2,649) (4,316)
4,747
7,902
14,229
17,314
2,463
3,492
$483,719 $552,628
4,773
3,694
2,670
1,908
3,755
2,155
5,656
3,616
1,806
1,979
5,231
6.887
$ 19,141
$240,312
$ 21,246
$310,253
$ 25,261
$422,217
$ 25,547 $ 18,583
$509,266 $571,211
$ 48,126
20,644
823
500
2,414
$ 72,507
190
$ 72,697
$148,664
$167,615
$ 61,437
35,075
3,543
2,191
3.526
$105,772
830
$106,602
$183,235
$203,651
$ 80,274
54,202
2,061
2,547
!i.311
$143,395
856
$144,251
$253,561
$277,966
$ 97,144 $130,575
59,859
68,539
3,445
5,115
2,059
5,511
5,2Q9
~.789
$168,296 $214,949
1,816
5Z0
$170,112 $215,519
$315,423 $337,679
$339,154 $355,692
Less Than
40 Cows
Financial Mef!§YIes
Percent equity
70%
Farm debt per cow
$2,133
Available for debt service
& living
$22,264
Scheduled annual debt pymt,
$13,695
Scheduled debt pymts./cow
$398
Payment as % of milk check
23%
Debt/Asset ratio - long-term
0,40
Debt/Asset ratio - intermediate
& short-term
0,22
Cash flow coverage ratio
0,57
66%
$2,204
66%
$2,351
$33,907
$21,704
$447
24%
0,43
$43,287
$29,930
$486
24%
0,41
0,28
0,78
0,29
0,78
67%
$2,130
85 to
99 Cows
43
62%
$2,311
$50,678 $57,557
$35,772 $45,664
$450
$487
23%
24%
0,43
0,53
0.26
0,81
0,26
0,75
27
FARM FAMILY FINANCIAL SITUATION BY HERD SIZE
458 New York Dairy Farms, January 1, 1985
Item
Farms with:
Number of farms
Assets
Livestock (includes
discounted lease payments)
Feed & supplies
Machinery & equip (includes
discounted lease payments)
Land & buildings (includes
discounted lease payments)
Co-op investment
Accounts receivable
Cash & checking accounts
Total Farm Assets
Savings accounts
Cash value life insurance
Stocks & bonds
Nonfarm real estate
Auto (personal share)
All other
Total Nonfarm Assets TOTAL ASSETS Liabilities
Long-term
Intermediate
Financial lease
Short-term
Other farm accounts
Total Farm Liabilities
Total Nonfarm Liabilities
TOTAL LIABILITIES
Farm Net Worth (Eq. Cap.)
FAMILY NET WORTH
Financial Measures
Percent equity
Farm debt per cow
Available for debt service
& living
Scheduled annual debt pymt.
Scheduled debt pymts./cow
Payment as % of milk check
Debt/Asset ratio - long-term
Debt/Asset ratio - intermediate
& short-term
Cash flow coverage ratio
100 to
149 Cows
150 to
199 Cows
200 to
249 Cows
56
25
16
250 or
More Cows
15
28,568
31,420
4.236
969,385
8,721
6,789
8,108
13,880
3,173
7,340
317,993 $ 470,722
(0)
(0)
113,736
189,321
196,961
260,222
(6,015)
(694)
879,980
581,058
(0)
(0)
32,536
41,442
50,181
76,619
9,117
6,807
$1,301,582 $1,925,113
3,796
9,126
3,796
9,126
2,455
4,079
6,867
o
1,063
667
7.019
4.411
$ 30,742
$784,926
$
48,000
$1,017,385
$
16,029 $
27,500
$1,317,611 $1,9523,613
$164,375
116,134
1,387
7,550
10.893
$300,339
742
$301,081
$453,845
$483,845
$218,110
135,883
1,250
10,275
12.494
$378,012
1.578
$379,590
$591,373
$637,795
$166,776
$
223,343
(0)
(0)
60,934
135,106
(703)
348,754
(684)
14,180
23,033
5.401
$754,184
3,921
3,560
5,664
7,632
1,817
8.148
81,393
184,455
(1,250)
415,970
(0)
$
$
$272,541
228,449
6,015
5,801
15,708
$528,514
250
$528,764
$773,068
$788,847
$399,185
298,210
694
13,752
22.605
$734,446
400
$734,846
$1,190,667
$1,217,767
62%
$2,384
63%
$2,160
60%
$2,259
62%
$1,918
$79,761
$67,136
$531
26%
0,47
$103,180
$92,504
$526
27%
0,52
$150,134
$118,968
$508
34%
0.47
$277,674
$186,887
$488
22%
0.45
0.31
0,78
0.27
0.76
0.33
0.94
0.30
1.18
28 MEASURE YOUR PERFORMANCE
After you have entered your farm business data on the pages of this
workbook, categorize your farm business performance into three groups. List
the strong points, those which indicate average performance, and those areas
which need improvement. Your business factors that exceed the regional
average should be listed as strong points, factors that are close to the
regional average should be identified as average, and factors that are below
average should be listed under need improvement.
The Farm Business Chart on page 20 and the Financial Analysis Chart on
page 21 can be used to identify strengths and weaknesses by comparing your
business with a large number of New York dairy farms summarized for the
previous year. It is recommended that you use more than one standard for
comparison when analyzing the farm business.
STRONG POINTS: AVERAGE:
NEED IMPROVEMENT:
After identifying opportunities for improvement, consider alternative
ways of solving each problem. List each alternative and analyze the
consequences in detail. Cooperative Extension conducts many schools,
meetings, and provides many printed materials that should be of assistance.
Local agribusinesses often provide helpful information and assistance. Seek
out information related to the problem under consideration.
Another way to measure your management performance is to compare your
current business factors with those from previous years. Page 19 is provided
for this purpose. Answering the following questions may also help evaluate
your farm business progress.
1. Do livestock number, labor force, and crop acres make up a well balanced
unit of resources?
2. Have rates of production shown a steady increase?
3. When will milk output per worker reach 700,000 pounds?
4. Have some costs of production declined over the last two years?
5. Is net farm income improving fast enough to meet your needs?
6. Is growth in net worth keeping up with increased capital investment?
7. Have you reached the business goals set for 1985 and have you set new
goals for 1986?