1. 2014 Purdue Crop Cost and Return Guide (August 2013) Craig Dobbins Michael Langemeier Alan Miller

2. Outline of Presentation Trends in Revenue, Variable Cost, and Contribution Margin 2013 and 2014 Comparisons – Market Revenue – Variable Cost – Contribution Margin – Earnings Earnings per Acre, 2005 to 2014

3. Trends in Market Revenue, Variable Cost, and Contribution Margin

7. Ten-Year Averages (2005 to 2014) CropMRVCCM Continuous Corn Rotation Corn Rotation Soybeans Wheat Double-Crop Soybeans 638 683 497 404 314 376 354 186 162 156 263 328 311 241 158

8. 2013 and 2014 Comparisons

9. Market Revenue per Acre (Average Productivity Soil) Crop20132014% Change Continuous Corn Rotation Corn Rotation Soybeans Wheat Double-Crop Soybeans 887 945 670 574 471 719 766 626 441 -18.9 -6.5 -23.2 -6.5

10. Variable Cost per Acre (Average Productivity Soil) Crop20132014% Change Continuous Corn Rotation Corn Rotation Soybeans Wheat Double-Crop Soybeans 486 462 239 204 205 451 431 229 186 197 -7.2 -6.7 -4.2 -8.8 -3.9

11. Variable Cost per Acre (Average Productivity Soil) Rotation Corn20132014% Change Fertilizer Seed Pesticides Fuel Other 176 115 38 49 84 138 122 38 50 83 -21.6 6.1 0.0 2.0 -1.2

12. Variable Cost per Acre (Average Productivity Soil) Rotation Soybeans20132014% Change Fertilizer Seed Pesticides Fuel Other 77 69 24 16 53 62 73 25 16 53 -19.5 5.8 4.2 0.0

13. Contribution Margin per Acre (Average Productivity Soil) Crop20132014% Change Continuous Corn Rotation Corn Rotation Soybeans Wheat Double-Crop Soybeans 401 483 431 370 266 268 335 397 255 244 -33.2 -30.6 -7.9 -31.1 -8.3

14. 2014 Contribution Margin per Acre by Soil Productivity Level CropLowAverageHigh Continuous Corn Rotation Corn Rotation Soybeans Wheat Double-Crop Soybeans 164 221 283 189 161 269 335 397 255 244 403 477 512 323 327

15. Land Rent in Dollars per Bushel of Corn Yield Land Quality20132014 Low Yield1.251.37 Average Yield1.301.43 High Yield1.371.52 Note: Based on 2013 Purdue Land Value Survey. These are not forecasted amounts.

16. Rotations Continuous Corn Corn/Soybean Corn/Soybean/Corn/Wheat – 50.0% corn – 33.3% soybeans – 16.7% wheat; double-crop soybeans

17. 2013 and 2014 Earnings per Acre (Average Productivity Soil) Rotation20132014 Continuous Corn Corn/Soybean Corn/Soybean/Corn/ Wheat; DC Soybeans 50 120 154 -105 7 24

18. 2013 and 2014 Total Costs Per Bushel (Corn/Soybean Rotation; 3000 acres) Crop Low YieldAverage YieldHigh Yield $/Bushel 201320142013201420132014 Rotation Corn 5.455.344.904.854.444.43 Rotation Beans 11.8812.0910.6710.899.9810.25

19. Earnings per Acre, 2005 to 2014

20. Ten-Year Earnings per Acre (Average Productivity Soil) RotationAverage Standard Deviation CV Continuous Corn Corn/Soybean Corn/Soybean/Corn/ Wheat; DC Soybeans -7.45 61.03 79.52 107.55 107.00 111.15 175.32 139.77

21. Questions, Comments