| Updated March, 2008 |  |
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File A3-10 |
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Iowa Farm Custom Rate Survey
| For more explanation of the 2008 Custom Rate Survey, listen to the presentation available here. |
Many Iowa farmers hire some custom machine work in their farm business, or perform custom work for others. Others rent machinery or perform other services. The information below is based on a survey of 185 Iowa farmers, custom operators, and farm managers. For each operation, the average rate from the survey and the range are shown. Thirty-four percent of the respondents perform custom work, 17 percent hire work done, and 49 percent indicated doing both.
Values below are rates expected to be charged or paid, including fuel and labor. The average price for diesel fuel was assumed to be $2.75 per gallon. This rate schedule is intended only as a guide. Actual custom rates may vary according to availability of machinery in a given area, timeliness, operator skill, field size and shape, crop onditions, and the performance characteristics of the machine being used. Machinery rental rates can be estimated on the back.
The Iowa Farm Custom Rate Survey is presented in the accompanying "pdf" file that you can access by clicking here or on the icon above.
Note: Higher Fuel Prices Boost Custom Farming Costs, Updated June 2008
Adjusting custom machinery rates for increasing fuel prices has been a difficult problem this year. In the 2008 Iowa Farm Custom Rate Survey, Iowa State University Extension Economists suggested that respondents assume that diesel fuel would cost an average of $2.75 per gallon delivered to the farm. However, fuel prices have increased considerably since then.
If diesel fuel is assumed to cost $4.00 per gallon today instead of $2.75, the total cost of performing tillage operations will increase by 10 to 15 percent, depending on the depth at which soil is tilled. Costs for less power intensive operations such as planting, spraying and harvesting will increase by 7 to 10 percent.
Another way to adjust custom rates is to use Information File A3-27, “Fuel Required for Field Operations,” which contains estimated fuel consumption values per acre for many common operations. Multiplying the fuel used per acre by the change in the price of fuel since the survey was conducted can provide an estimate of the most recent cost increases per acre.
Alternatively, custom operators can keep a record of the actual fuel they use for specific operations, or the person hiring the work done can provide the necessary fuel.