August 15, 2013

If current drought and dry conditions persist into early fall, winter wheat may be a viable option for many producers, especially those in western Nebraska, due to its low water requirement.

The 2013 Nebraska Crop Budgets estimate per-bushel costs for both dryland and irrigated winter wheat production for various regions across the state. These budgets are based on UNL production recommendations and expectations. Cost projections are based on assumptions thought to be valid for many Nebraska producers; however, costs for individual producers may vary depending on agronomic and financial needs.

Dryland Production

Two dryland budgets (Budgets 48 and 52) provide cost estimates for production in the southwest region. No-till wheat after a row crop has a projected yield of 40 bushels per acre and an estimated cost per bushel of $7.35. With lower cost field operations and less expensive materials, no-till wheat before corn, two crops in three years, has a cost of $5.95 per bushel and a higher projected yield of 60 bushels per acre .

In the Panhandle dryland wheat production is the most common practice. Three budgets (Budgets 49, 50, and 51) outline different fallow options for this region, with actual yield of 45-55 bushels per acre. No-till fallow, one crop in two years, has the lowest estimated dryland cost at $5.86 per bushel. Clean-till fallow, one crop in two years, has the highest production cost at $7.09 per bushel. The production cost for stubble-mulch fallow, one crop in two years, falls in the middle at $6.47 per bushel.

In dryland production systems, wheat could have an economic advantage over corn or grain sorghum. Estimated statewide production costs for dryland corn are $6.34 per bushel with a yield of 85 bushels per acre (Budget 8). For western Nebraska and the Panhandle, a more realistic yield goal for dryland corn production is 55-60 bushels per acre. The grain sorghum budget (24) has an estimated statewide production cost of $3.89 per bushel with a yield of 95 bushels per acre.

Irrigated Production

Approximately 10% of winter wheat in the Panhandle is irrigated. It is estimated that with 8 acre-inches of water and a 90 bushels per acre yield, production costs would be approximately $5.90 per bushel. By comparison, the statewide pivot-irrigated corn budget (18) estimates that corn will use 13 acre-inches of water, produce 225 bushels, and cost approximately $5.66 per bushel. Realistic yield goals for irrigated corn in the Panhandle are around 180 bushels per acre.

When making planting decisions, it is important to consider all costs associated with production, including labor, scouting for pests, insurance, overhead, and land taxes. The budgets include these as well as non-cash expenses such as machinery depreciation, lost interest on operating capital, and real estate opportunity cost. Cash costs that only account for monetary spending are available within the Nebraska Crop Budgets Excel spreadsheet.

Crop Production Budgets in PDF and Excel Formats

The crop production budgets cited and many more are available online in PDF and Excel formats. The Excel format allows modifications so you can estimate costs for your production system and compare commodities based on your practices. Download these at economics/budgets.

Jessica Johnson
Extension Educator – Ag Economics