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Review AccountWhere to Start with 2025 Farm Budgeting
Jan 15, 2025
The higher costs for production ag going into 2025, according to Mike Slater, Federated agronomist at the Isanti location, can be attributed to a few factors:
1) Grain prices are at their lowest levels since pre-COVID and the trade war.
2) Input prices, though higher a few years back, have remained relatively steady.
3) Production levels in 2024 were all over the board with widely ranging rain and drought conditions alongside record yields in some medium-textured soils.
And thus, Slater said, “having a good and accurate crop budget is more important than ever.”
A discussion with your Federated Agronomist can help you determine costs per acre and create a plan for fertilizer, chemicals, seed, and service. Having a good handle on your situation as you go into that discussion is extremely helpful.
Start with your soil test results (nothing older than 2022). Knowing what’s in the soils on your farm is the “most important starting point for a crop budget,” said Slater.
Slater suggested asking questions such as: “Is it lighter sand that we really should only be pushing to 125-150 bushel per acre, or is it a heavier silt loam that is capable of 200 plus in a good year?”
The easiest way to save is to apply the right amount of the right products on each crop and each field. “The wrong amount of the wrong product leads to excess costs without an increase in yield or [merely] saving on the wrong product at the cost of yield,” said Slater.
The biggest consideration on the chemical and seed side – with so many different product options – is to not sacrifice yield and weed control over price considerations.
“The ‘easiest way’ to make a budget look nicer,” said Slater, is to start slashing inputs. However, that can come at a price: fewer bushels and less profit. The answer lies in “smart cuts,” he said – cuts based on what your farm needs.
For example, said Slater:
“If there’s a waterhemp or giant ragweed problem out in the field, we want to make sure those weeds don’t escape our chemical plan.
“If we have sandy soils we want to make sure we’re not putting an “expensive racehorse” hybrid out there.
“And if we have heavier soils, we don’t want to be putting out a less expensive ‘discount’ hybrid that lacks top end yield potential.”
And so, the challenge of effective budgeting isn’t addressed in one fell swoop. It will require assessing individual fields, crops, management practices, and – of course – the season itself (moisture, temperature, etc.). (See related article.)
Talk to your Federated Agronomist to help with budgeting for the highest yields and ROI.
1) Grain prices are at their lowest levels since pre-COVID and the trade war.
2) Input prices, though higher a few years back, have remained relatively steady.
3) Production levels in 2024 were all over the board with widely ranging rain and drought conditions alongside record yields in some medium-textured soils.
And thus, Slater said, “having a good and accurate crop budget is more important than ever.”
A discussion with your Federated Agronomist can help you determine costs per acre and create a plan for fertilizer, chemicals, seed, and service. Having a good handle on your situation as you go into that discussion is extremely helpful.
Start with your soil test results (nothing older than 2022). Knowing what’s in the soils on your farm is the “most important starting point for a crop budget,” said Slater.
Slater suggested asking questions such as: “Is it lighter sand that we really should only be pushing to 125-150 bushel per acre, or is it a heavier silt loam that is capable of 200 plus in a good year?”
The easiest way to save is to apply the right amount of the right products on each crop and each field. “The wrong amount of the wrong product leads to excess costs without an increase in yield or [merely] saving on the wrong product at the cost of yield,” said Slater.
The biggest consideration on the chemical and seed side – with so many different product options – is to not sacrifice yield and weed control over price considerations.
“The ‘easiest way’ to make a budget look nicer,” said Slater, is to start slashing inputs. However, that can come at a price: fewer bushels and less profit. The answer lies in “smart cuts,” he said – cuts based on what your farm needs.
For example, said Slater:
“If there’s a waterhemp or giant ragweed problem out in the field, we want to make sure those weeds don’t escape our chemical plan.
“If we have sandy soils we want to make sure we’re not putting an “expensive racehorse” hybrid out there.
“And if we have heavier soils, we don’t want to be putting out a less expensive ‘discount’ hybrid that lacks top end yield potential.”
And so, the challenge of effective budgeting isn’t addressed in one fell swoop. It will require assessing individual fields, crops, management practices, and – of course – the season itself (moisture, temperature, etc.). (See related article.)
Talk to your Federated Agronomist to help with budgeting for the highest yields and ROI.