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No. 1338
Information Sheet
July 2001

Custom Rates for Mississippi Agriculture, 2000

Printable PDF Version (4 pages)

Steven W. Martin
Delta Research and Extension Center

Fred Cooke, Jr.
Delta Research and Extension Center

David Parvin
Department of Agricultural Economics
Mississippi State University


Sometimes, farmers have opportunities to earn extra income by providing custom services for other farmers. These opportunities can come about because of time constraints or a lack of adequate equipment. For producers with adequate or surplus machinery (the contractor), the idea of spreading fixed costs over additional acres is appealing. However, in order for the custom work to be economically beneficial for the contractor, the custom rate must cover fixed and direct costs and provide some additional return as well. Per acre fixed cost is reduced through additional hours of annual use; direct costs per acre can be expected to increase because of overall annual repairs and maintenance.

As a guideline for custom charges, the following table gives direct and fixed costs for selected pieces of equipment and their appropriate tractors. These costs are based on Mississippi State Planning Budgets (MSPB). Direct costs include repairs and maintenance, labor, fuel, and interest on operating expense. Fixed costs for tractors are based on 600 hours annual use. Implement fixed costs are based on the hours of annual use given in the table.

The table also gives a suggested custom charge per acre for each implement. This charge was obtained by multiplying the total costs per acre by 1.25 or a 25 percent premium. This percent markup is consistent with normal markups in Mississippi (range 20-40 percent) as suggested by county agents, custom operators and farmers. Farmers providing custom work may desire a lower or a higher return depending on the level of management required.

The table also lists custom rates as reported in Doane’s Agricultural Report. These rates are for the entire Southern U.S., so some degree of variance can be expected. However, the reported rates are still a good reference for performing or having custom work performed. As the table shows, most rates are relatively consistent with the calculated and/or reported rates for Mississippi.

Additionally, the tables give a commonly charged custom rate for Mississippi, based on personal communication with county agents, custom operators and farmers. This rate can help producers decide whether to plant additional acreage for which they do not have adequate equipment or to plant crops that they do not normally plant.

Farmers desiring to have custom work performed may benefit in several ways. Benefits may include lower capital and labor costs, tax advantages, and/or economic opportunities through new or additional crops. Also, the ability to complete field operations in a timely manner can have significant benefits.

Farmers desiring to perform or have custom work performed should remember that custom work involves certain risks. Some of these risks are timeliness of the work, quality of the work, and field contamination of weeds or insects.

This information sheet is intended only as a guide. Farmers desiring to perform or have custom work performed should realize that these rates are often negotiable. Also, per acre costs and hours of annual use will likely vary for each producer; therefore producers should use their own costs whenever possible. Additionally, input costs and interest rates are increasing. Producers should consider any needed adjustments accordingly.



Implement*

Hours annual use

Direct costs
per acre

Fixed costs
per acre

Suggested
custom charge
per acre

Doane's estimate**

Reported Mississippi
custom charge

   

$

$

$

$

$

Chisel Plow 12’

200

3.32

3.40

8.50

12.00

15.00/A

Chisel plow 24’

150

2.72

2.02

6.00

n/a

n/a

Cultivate and Apply

  Post-Emergent  Chemicals

  8 Row/40 inch (Early)

 200

3.85

2.66

8.25

n/a

n/a

Cultivate and Apply

  Post–Emergent Chemicals

  8 Row/40 inch  (Late)

200

2.45

1.85

5.50

n/a

n/a

Cultipacker 12’

300

3.11

1.87

6.25

n/a

8.00/A

Cultivate (Early)

  8 Row/40 inch

200

3.28

2.40

7.00

6.00

n/a

Cultivate (Late)

  8 Row/40 inch

 200

2.05

1.61

4.50

6.00

n/a

Cyclone Spin

  Spreader 600 lb

3.92

2.75

8.25

4.00

8.00/A

Disk & Incorporate 24’

200

3.30

2.72

7.50

n/a

n/a

Disk & Incorporate 32’

200

2.72

2.64

6.75

n/a

n/a

Disk Bed (Hipper)

  8 Row/40 inch

160

2.37

1.94

5.50

n/a

10.00/A

Disk Harrow 24’

180

2.86

2.58

6.75

n/a

9.00-20.00/A

Disk Harrow 32’

180

2.42

2.54

6.25

n/a

n/a

Apply Liquid Fertilizer

  8 Row/40 inch

150

2.66

2.22

6.00

5.00

n/a

Field Cultivate &

  Incorporate   24’

100

2.79

2.50

6.50

n/a

n/a

Field Cultivate &

  Incorporate   32’

100

2.07

2.14

5.50

n/a

n/a

Field Cultivate &

  Incorporate   42’

100

1.72

2.01

4.75

n/a

n/a

Field Cultivate  24’

100

2.35

2.19

5.75

6.50

n/a

Field Cultivate  32’

100

1.87

1.83

4.75

6.50

n/a

Field Cultivate  42’

100

1.54

1.72

4.00

6.50

n/a

Grain Drill 20’     

100

4.93

4.51

11.75

10.00

12.00/A

Hay Baler  Square

200

4.99

4.46

11.75

.58/bale

12.00-50.00/A

Hay Baler  Lg Round

200

5.37

5.95

14.00

7.50/bale

12.00/bale

Hay Cut–Cond  9’ 

200

5.41

5.18

13.25

10.00

4.00-8.00/bale

Hay Disc Mower  8’

200

4.54

3.18

9.75

8.00

8.00-10.00/A

Hay Rake-Double 17’  

200

2.25

1.37

4.50

5.00

4.00-5.00/bale

Heavy Disk 21’

180

4.34

3.60

10.00

10.00

Land Plane

Hours

n/a

n/a

n/a

n/a

4.50-9.25/A

Land Form (per  Yard)

n/a

n/a

n/a

n/a

1-1.50/yard

Manure Spreader

200

4.10

2.02

7.75

20.00/hr

No-Till Grain Drill 20’

150

6.81

7.96

18.50

10.00

12.00-20.00/A

No-Till  Plant

  6 Row/30 inch

 150

6.74

5.90

15.75

12.00

n/a

No-Till Plant

  6 Row/40 inch

150

5.12

4.58

12.25

12.00

n/a

No-Till Plant & Pre

  8 row/30 inch

 150

5.98

6.06

15.00

n/a

n/a

No-Till Plant & Pre

  8 Row/40 inch

 150

4.52

4.64

11.50

n/a

n/a

Paratill & Bed

  4 Row/40 inch

150

5.08

4.26

11.75

n/a

n/a

Plant 8 Row/30 inch 

150

4.08

3.48

9.50

10.00

8.00/A

Plant 8 Row/40 inch

150

3.10

2.74

7.25

10.00

8.00-9.00/A

Plant & Pre 8 Row/30 inch

150

4.38

3.91

10.25

n/a

n/a

Plant & Pre 8 row/40 inch

150

3.37

3.11

8.00

n/a

n/a

Rotary Mower  8’

200

3.49

2.14

7.00

10.00

5.00-10.00/A

Row Condition &

  Incorporate    27’

100

2.52

2.22

6.00

n/a

n/a

Row Condition (Harrow)   27’

100

1.92

1.76

4.50

5.75

n/a

Row Condition (Plant)   27’

100

2.65

2.42

6.25

n/a

n/a

Spray (Broadcast)  27’

100

1.99

1.15

4.00

4.50

3.00/A

Spray (Broadcast) 42’

100

1.32

.79

2.75

4.50

3.00-4.50/A

Spray (Layby) 8-Row

100

2.09

1.18

4.00

4.50

n/a

Spray (Spot)  27’

100

1.99

1.15

4.00

4.50

n/a

Hi-Clear Sprayer 60’

1.13

0.96

2.75

5.00

n/a

Sprigger  60 bu***

100

13.56

7.63

26.50

n/a

65.00-75.00/A

Stalk Shredder 12’ 

185

4.06

3.18

9.00

6.50

8.00/A

Subsoiler 3 shank

100

5.64

3.88

12.00

12.00

n/a

Subsoiler 4 shank 

100

4.65

3.36

10.00

12.00

n/a

Subsoiler  low–till 4 shank

100

4.45

3.88

10.50

n/a

n/a

Subsoiler  low-till 6 shank

100

3.13

2.89

7.50

n/a

n/a

Apply Fert by Air

n/a

n/a

n/a

n/a

4.10-5.00/cwt

Custom Spread Fert (Truck)

n/a

n/a

n/a

4.00

3.00-5.00/A

Combine Rice (cl) 25’

250

14.83

20.87

44.75

n/a

60.00/A

Combine Rice (sl) 25’

250

13.22

18.61

40.00

n/a

50.00/A

Combine Soybeans 25’

250

8.67

11.90

25.75

25.00

20.00-30.00/A

Combine Sorghum 25’

250

7.94

10.84

24.00

25.00

22.00-28.00/A

Combine Wheat 25’

250

6.88

9.40

20.50

25.00

24.00-28.00/A

Combine Corn 8- Row

250

9.24

13.03

28.00

25.00

25.00-28.00/A

Pick Cotton 4-Row

200

20.76

26.31

59.00

50.00

.08/lb

Pick Cotton 4-Row BB MB

200

33.00

39.00

93.50

n/a

120.00/A

Pick Cotton 6-Row

200

11.79

15.82

38.00

50.00

.085/lb

Pick Cotton 6-Row BB MB

200

23.00

28.00

55.00

n/a

n/a

Strip Cotton

n/a

n/a

n/a

35.00

.08/lb

Haul Corn

n/a

n/a

n/a

.12/bu

.16/bu

Haul Cotton

n/a

n/a

n/a

n/a

.02/lb

Haul Rice

n/a

n/a

n/a

.12/bu

.10/bu

Haul Sorghum

n/a

n/a

n/a

.12/bu

.16/bu

Haul Soybeans

n/a

n/a

n/a

.12/bu

.16/bu

Haul Wheat

n/a

n/a

n/a

.12/bu

.14/bu

Custom Spread & Seed

n/a

n/a

n/a

n/a

5.25/A

Plant by Air

n/a

n/a

n/a

n/a

4.00/cwt

Custom spray by Helicopter

n/a

n/a

n/a

n/a

12.50/A

Custom spray by Air (1 gal)

n/a

n/a

n/a

n/a

2.00/A

Custom spray by Air (2 gal)

n/a

n/a

n/a

n/a

2.20/A

Custom spray by Air (3 gal)

n/a

n/a

n/a

n/a

2.60/A

Custom spray by Air (5 gal)

n/a

n/a

n/a

n/a

3.25/A

Custom spray by Air (10 gal)

n/a

n/a

n/a

n/a

5.10/A

Custom Terragator

n/a

n/a

n/a

n/a

2.75-4.00/A

Spray levees, 4-wheeler

100

.90

.46

1.75

n/a

2.50/A

* Rates and costs are for service performed only and do not include cost of chemicals, seed or fertilizer.
** All material within Doanes’ Agricultural Report is copyrighted. These rates are reprinted with Doane’s permission.
*** Custom sprigging includes cost for transportation, etc.; calculated sprigging costs assume tractor sitting in the field, ready to go.


References

Benson, Fred J., M. N. Mawampanga, and Larry D. Swetnam. 1996 Kentucky Custom Rates for Farm Machinery. University of Kentucky Cooperative Extension Service. Publication AEC-81.

Edwards, William, Darnell Smith, Beth McLees and Joe Baitinger. 2000 Iowa Farm Custom Rate Survey. Iowa State University Extension. Publication FM 1698.

1999 SMART PROGRAM ANNUAL REPORT. Alan Blaine and Jim Thomas, Coordinators. Mississippi State University, Mississippi State, Mississippi.

2000 Planning Budgets. Agricultural Economics Report 110. Mississippi State University. December 1999.

Doane’s Agricultural Report. 2000 Machinery Custom Rates Guide. May 19, 2000.

Farm Custom Rates In Mississippi. Mississippi State University Extension Service Publication 969. 1982.

Forage 1999 Planning Budgets. Agricultural Economics Report 105. Mississippi State University. July 1999.

Mississippi State University Extension Service County Agricultural Agents and Crop Specialists.


Mention of a trademark or proprietary product does not constitute a guarantee or warranty of the product by the Mississippi Agricultural and Forestry Experiment Station and does not imply its approval to the exclusion of other products that also may be suitable.

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