D6—Lancaster Farming, Saturday, March 6; 1982
What can over feed
coats tell yon?
Do you know how much your
feeds are really costing you? You
should, because feed is your
largest item of cost in producing
milk.
How close are your DHIA feed
costs to your, actual feed costs?
Remember, your DHIA figures do
not reflect feed losses, the cost of
feeding heifers, nor the high cost of
that expensive new harvesting
equipment, feed storage and
feeding equipment, you have
recently purchased, or are
thinking about purchasing.
How much profit istbat cow that
returns |BOO over feed costs really
making for you? Maybe none! It
wuiid be that a cow returning
11,200 over feedcostsisooly half as
profitable as one returning |I,«W.
• these are important questions
lor you to cudnder as you use your
DHIA reports' to evaluate in
dividual cows in your herd, and to
evaluate the overall efficiency of
your dairy operation.
Now, while you are-working on
■ your farm tax returns, is a good
tim» to find answers to these
questions, aud it really isn’t too
hard W do. Using your Form 1040 F
We are qualified to handle any poured concrete job you may
need. We use a practical aluminum forming system to create
concrete structures of maximum strength and durability. For a
highly satisfactory job at an affordable price, get in touch with us.
POURED FOR DURABILITY
Gref fdole /II
poured wallsMUL
BRICK CHURCH RD. LEOLA, PA. 17540
FOR SALES « LAYOUT KEN GROFF (717) 687-6668, days & evenings
GROFFOALE POURED WALLS{7I7)6S6-2016
JAKE KING (717) 656-7566
Daily
Pipeline
By
Glenn A. Shirk
divide your farm expenses into two
general columns: those that are
affected by the number of cows you
have on the farm and those that
would occur regardless of whether
you had cows or not. The latter
oTppnggg, m refer to as overhead
costs.
Now, divide those cow-related
costs into two additional columns:
feed-related and non-feed costs.
The feed-related costs would in
clude purchased feeds plus all
those other costs associated with
the growing, harvesting, storing
and feeding of crops.
To illustrate this, I’ve taken the
1960 Pennsylvania Dairy Farm
Business Analysis Summary
figures for the 50-59 cow herds and
allocated them—right or wrong—
to one of three columns as shown
below. Then, 1 compared them to
our 1980 DHIA figures for Lan
caster County. Remember, these
are 1900 figures; they do not reflect
today’s costs and returns.
'The average cow on test in
Lancaster County in 1980 returned
$1,155 over feed costs. How much
of that was true profit? We’ll see in
aminute.
Her DHIA feed costs were |742;
that is |293 less than the figure
JWR
SVE
Extension
Dairy
Agent
11l [I.
($1,035) in line 33, above, which
includes the cost of feeding heifers.
Other costs which she has to carry
are non-feed cow-related costs
($436) and overhead costs ($241).
When combined, these unac
counted for expenses total $970 per
cow! Subtract this from her $1,155
return over feed cost, and we
discover that she only made you
$lB5 profit per year!
In this example, a cow had to
return $970 over feed costs just to
Cost Item
(Col. A)
1. Hired labor
2. Breeding, testing
3. Vet, medicine
4. Livestock
purchase
5. Feed purchase
6. Lime, fertilizer
7. Supplies - crop
8. Supplles-dairy
9. Custom work
10. Repair
machinery
11 Repair
dairy
equipment
12. Repair
buildmg
13. Truck-auto
14. Gas, oil
15. Utilities
16. Rent
17. Taxes
Insurance.
18. Buildings
19. Cows, milk
equipment
20. l-eed,
machinery
Interest:
21. Buildings
22. Cows,
equipment
23. Teed,
machinery
Depreciation.
24. Buildings
25. Cows, milk
equipment
26. Machinery
2/. Other
28. TOTAL
29. No. Cows-54
30. Avg. per cow
Look For
The Right One!
Vertical-Shaft Pump
"LIQUID MANURE
EQUIPMENT IS OUR
ONLY BUSINESS"
RD 3 - Box 84, MiHlinburg, Pa. 17844 - Phone: 717-966-2736
break-even. What is (he hieak
even figure for your farm? Plug in
the costs, and savings, of any
changes you anticipate in your
cropping program, machinery
purchases, construction of feed
storage or housing facilities, or
changes in the size of your heifer or
cow herd to see how these changes
would affect your break-even
level.
Does this mean that your DHIA
figures are worthless? On the
COSTS AFFECTED BY COWS
Feed-Related
(Col. B)
$4,500
23,637
7,248
2,752
1,303
3,000
473
3,000
500
1,968
500
2,500
4,000
-500 854
$55,881 $23,534 $13,000
1,035
Also Available In Stock
CALUMET DISTRIBUTOR
F. ERNEST SNOOK
Jverheai
Costs
(Col D)
Non-Feed
(Col. C)
$651
2,025
1,584
4,410
2,514
1,088
400
1,357
1,651
500
2,500
4,000
436
Pumps any size lagoon with 2:1 slope wall so
you don't need docks or loading platforms.
Delivers 5,500 gallons per minute. Driven at
540 RPM from tractor PTO. Heavy-duty 25-inch
impellor. 25' length, with optional extension to
pump the deepest pits. Loading pipes and
hydraulics included.
Tank Models S-3250, S-4500;
injectors available.
contrary! What it does mean is
that you may want to change how
you interpret your figures.
Correct your return over feed
cost figures by the break-even
figure, which you have calculated
from your tax return for your
farm. Then, you can compare UQ
true profitability of one cow with
another.
We discovered, in our example,
that the $1,155 retum-over-feed
cost cow only made $lB5 profit.
That means a $1,340 “return” cow
would be twice as profitable ($1,155
+ $lB5 = $1,340), but you probably
would not have concluded that
from your first glance at your
return over feed cost figures.
So, don’t let Uncle Sam be the
only one who benefits from all the
time you spend on your tax return;
you may as well benefit, too. Use it
in conjunction with your DHIA
reports as a gmdleine for more
profitable culling and farm
management decisions.
$1,48/
1,28 d
631
LANCASTER
FARMING
CLASSIFIED
d,/l/
b. 882
241
Open Pit Pump
USED EQUIPMENT
12’ Better Bilt Auger Pump
10’ Badger Pump
1500 Badger Spreader Tank
2250 Calumet Spreader
3250 Calumet Spreader
10 Ton N.l. Manure Spreader
287 Hawk Bill
SELL
IT
WITH
A