1. Sprayer Economics Gary Schnitkey schnitke@uiuc.edu University of Illinois

2. www.farmdoc.uiuc.edu Outline Estimate costs of per acre sprayer operations for inclusion on farmdoc Evaluate for four situations

3. www.farmdoc.uiuc.edu

6. Custom Rate Surveys Type Avg. Range Iowa, 2005 Tractor 4.95 (3.50 – 8.50) Self propelled 5.05 (3.50 – 8.00) Airplane 5.80 (5.00 – 6.75) Purdue, 2004 Tractor 4.81 (3.32 – 6.29) Highboy 5.44 (3.77 – 7.12) Airplane 6.22 (4.30 – 8.14)

7. www.farmdoc.uiuc.edu Situations Evaluated 1.Pull-type, well-equipped, 90 ft boom 2.Pull-type, economical, 40 ft boom 3.Self-propelled, High boy, 90 ft boom 4.Self-propelled, Coupe, 60 ft boom

8. www.farmdoc.uiuc.edu Tendering Costs $50 per hour for truck and labor Acre/hr Cost/acre 1.Pull-type, well equip 50$1.00 2.Pull-type, economical 23 2.17 3.Self-prop, high crop 50 1.00 4.Self-Prop, coupe 41 1.21

9. www.farmdoc.uiuc.edu Pull-Type Sprayer Well Equipped $25,000 purchase price 90 ft boom Hold 10 years (sell for $5,200) $1.50 fuel price, 7% interest rate, $13.50 labor price Covers about 50 acres per hour

10. www.farmdoc.uiuc.edu Acres per Hour Speed 8 miles per hr. x feet per mile 5,280 feet x boom width 90 feet ÷ area per acre 43,560 square feet The. capacity 87 acres x field efficiency 60% Acres covered 52

11. www.farmdoc.uiuc.edu Tractors Charges (155 HP) Based on Per Hour Costs Per YearPer Hour Depreciation $4,867 $16.22 Interest 3,714 12.38 Housing 531 1.77 Repair 627 2.09 Fuel and Lub 3,362 11.20 Labor 4,455 14.85 Total 17,555 $58.51 From Machinery Cost Estimates on farmdoc

12. www.farmdoc.uiuc.edu Per Hour Tractor Cost by HP

13. www.farmdoc.uiuc.edu Pull Type Sprayer (4,000 acres) Costs per Acre Sprayer Tractor Total Depreciation.50.31.81 Interest.21.24.45 Repairs.21.04.25 Ins + House.04.03.07 Fuel.21.21 Labor.28.28 Total.96 1.11 2.07

14. www.farmdoc.uiuc.edu Per Acre Costs for Different Acres AcresCost 1,000$4.23 2,000 2.77 3,000 2.30 4,000 2.07 5,000 1.94 Holds tractor hour costs constant **No tendering costs ($1.00 per acre)

15. www.farmdoc.uiuc.edu Pull Type Sprayer Economical $14,000 purchase price 40 foot boom Hold 10 years ($0 salvage value) 105 HP tractor 23 acres per hour (60% field efficiency)

16. www.farmdoc.uiuc.edu Per Acre Costs for Different Acres AcresCost 1,000$4.19 2,000 3.22 3,000 2.90 4,000 2.76 5,000 2.69 Holds tractor hour costs constant Do not include tendering costs ($2.17)

17. www.farmdoc.uiuc.edu Pull Type Sprayers, Per Acre Costs Acres90 ft. 40 ft. 1,000$4.23 4.19 2,000 2.77 3.22 3,000 2.30 2.90 4,000 2.07 2.76 5,000 1.94 2.69

18. www.farmdoc.uiuc.edu Why not much difference? Tractor cost spread over fewer acre 90 foot boom (155 HP) –$58.51/ 50 acres = $1.17 per acre 40 foot boom (105 HP) –$44.13 / 23 acres = $1.92 per acre

19. www.farmdoc.uiuc.edu Self Propelled Sprayer High Crop $192,000 purchase price 90 foot boom High boy Hold for 10 years ($40,000 value) 50 acres per hour (60% field efficiency)

20. www.farmdoc.uiuc.edu Salvage Value Work from Kansas State http://www.agmanager.info/ Kastens and Dhuyvetter Developed OwnSpray.xls to estimate costs of self-propelled machines Salvage values: –Drop 15% for each year –Drop 1% for each 100 hours

21. www.farmdoc.uiuc.edu Self Propelled, High Boy (10,000 acres) Costs per Acre Total Per Acre Depreciation 15,213 1.52 Interest 6,511.65 Repairs 4,000.40 Ins + House 1,160.12 Fuel 2,484.23 Labor 2,224.24 Total 31,920 3.16

22. www.farmdoc.uiuc.edu Per Acre Costs for Different Acres High Boy ** AcresCost 5,000$5.45 7,500 3.92 10,000 3.16 12,500 2.70 15,000 2.39 ** No tendering costs ($1.00)

23. www.farmdoc.uiuc.edu Self Propelled Sprayer Spray Coupe $91,000 purchase price 60 foot boom No tall crop ability Hold for 10 years ($19,000 value) 41 acres per hour (60% field efficiency)

24. www.farmdoc.uiuc.edu Self Propelled (10,000 acres) Costs per Acre Total Per Acre Depreciation 7,207.72 Interest 3,084.31 Repairs 4,000.40 Ins + House 550.06 Fuel 1,743.17 Labor 3,582.36 Total 20,166 2.02

25. www.farmdoc.uiuc.edu Per Acre Costs for Different Acres Spray Coupe AcresCost 5,000$3.10 7,500 2.37 10,000 2.02 12,500 1.80 15,000 1.66 ** No tendering costs ($1.21)

26. www.farmdoc.uiuc.edu Self Propelled Sprayers, Per Acre Costs Acres High crop Coupe 5,000$5.42 $3.10 7,500 3.92 2.37 10,000 3.16 2.02 12,500 2.70 1.80 15,000 2.39 1.66

27. www.farmdoc.uiuc.edu Why difference? Difference due to initial costs of machine

28. www.farmdoc.uiuc.edu Summary Must run over sufficient acres to get costs approaching custom rates. Some instances of cost savings. Additional reasons justifying ownership from other than cost savings perspective