Price per Bale of Hay..

Has anyone ever figured out what it REALLY cost to make one bale of hay..There seems to be to many varibles that can change to actually get it exact..

I tried and came to about .50-1.00 per bale?? BUT this depends on how many I can get off each field I do.
Drought, Rain, fertilizer, etc...
I based it on. Twine costs, gas, yearly oil change, yearly Hyd. oil filter change. I know there are other variables such as time per hour..etc.

Any thoughts on this??

You would probably want to figure depreciation of eqt. In other words the cost of wear and tear. That is what will surprise you. You might be a little bit low, but it probably depends on location as well. Bob

And to get really depressed (depending on where you live) you really should factor in property taxes - assuming if you weren't haying it you'd sell it off.

What does the ground cost you? Do you rent or own? How much did it cost to plant the hay? Gotta take all that into consideration. My alfalfa which is on ground I own, I pay "rent" to myself. I take the cost of planting the crop and divide out by 5 years. Road ditches and meadows that I don't have to pay for planting or rent are the biggest money makers, but they are generally harder on equipment so my repair expense goes up. There is no magic number as every operation has large variables. I like to keep my cost less than 50% of if I had to buy it. I generally run between 25-35%.

I figure bottom line, all expenses included, $2.00. That would include property tax.

Labor costs? Gotta figure for handling the stuff 2-3 times as well.

If you're honest about your equipment and depreciation costs... it's going to cost you 1.25-1.50 just to drop the bales on the field. That doesn't include growing the crop. That can easily be another 1.00 per bale. That's also dependant on the size bale you're dealing with. Obviously a 35 pound bale will have different costs than a 65 pound bale...

Rod

Up here in MA, grass hay with a fertilizer application, lease payment or r/e taxes, fuel, depreciation, etc. is around $2.25 and that is based on state avereage of 1.9 tons per acre and 2 cuttings. Add in some labor and equipment payments and you can get over $3. That being said my buddy said his wife paid $9 a bale the other day for "crappy" horse hay.

Mow : 1655 + m/c @ $63.00 x 10 hr $ 630.00
ted : 770 + tedd @ $39.00 x 6 hr $ 234.00
rake : 77 + rake @ $39.00 x 10 hr $ 468.00
bale :1655 + baler@ $61.50 x 10 hr $ 615.00
: 77 + 2 wag@ $37.00 x 10 hr $ 370.00
: skid steer @ $60.00 x 10 hr $ 600.00
TOTAL $2917.00
X 2 cuttings $5834.00
divide by 27 acres per acre $ 216.07
fertilizer $ 87.00
GRAND TOTAL -RENT per acre $ 303.07
divide by avg. yeild 127 bales/acre
for two cuttings = $2.39/bale

If you facture all your costs in you would be shocked..probably really sell hay at a "loss" if you figure taxes,land cost, equipment, fuel, insurance...
I know I make more money brokering hay than I ever can selling mine...

This subject can be one of the trickiest and widest cost discussions you can get into. The difference in operations, crop, equipment, age and condition and cost, cost of ground, and market all figure into it. A guy farming a neighbors ground for nothing with his grndfathers old baler and equipment who 'mines' the ground can do it for fuel, twine and labor. A real farmer cannot work with junk equipment, and will upgrade the ground for a maximum yield, and make a cost plus profit. Those costs, of course, are also variable. The ground cost and cost of establishing a preferred crop, plus fertilizer changes from year to year. Machinery can be very costly to harvest a premium product, as well as storage for maybe a year to keep it in top quality until sale. And most folks don't have the money just to go out and start from scratch, so interest and depreciation have to be figured in. It's not hard to tie up over $100,000 in hay enterprises, and profits can be trashed with one storm or a drought. And, by the time you pretty much get it paid for, the equipment is getting worn and has to be replaced. So, what it really comes down to, is you reall have to sit down with a pencil and try to figure all of this in. You can be a great neighbor, and feed the area horses for little to nothing if you have a bunch of junk machinery and are desperate for some thing to do on Saturday and Sunday afternoon. But, after you are established, and need to expand the operation into the business it really is and that you really enjoy doing, you find that you can't afford to give hay away and eat at the same time. So, it can be complicated, and costly. I really can't make hay for less than $150 a ton and survive. And I don't try to sell junk full of weeds and thistle and claim it to be good hay. If that's what a customer wants, they'll have to find it somewhere else.

You left out land and equipment depreciation and labor, 3 of the biggest costs, so doubt your 50 cents is close to reality.

Many agricultural activities are based on 10 year averages, you lose money 3-4 of the 10, break even 2-3 years, and hope to make a good income on the remaining 3-5 years.

Of course, your customers will laugh as you lose money 1/2 the time, and will scream bloody robbery the few years you are able to make something to put away for the next bad cycle.

As these cycles involve the economy, weather, and local demand, I could be in a good cycle and a person 100 miles from me could be in a bad cycle.

Just comes with the territory.

Paul

thanks for all the comments.. as i figured you'll brought up a lot of things to take in to consideration in "trying" to figure it out that I never thought of.

In looking at the comments..it would appear that there could be a huge diff. in the cost from one operation to the other too. I do about 40 acres a year. I have updated over the years but always figured that the updating allowed me to cut some of my time, in some cases in half of what it originally took. like raking. Which saves alittle in cost.. Again thanks for the comments.. very interesting..my wife says i think to much!!!

I've done this a few times and it varies year to year. Per bale it was really good when producing a couple of thousand bales per year, sharing equipment, and delivering wagons to locals had almost no investment. It has been much worse now we are doing 5-6000 and have to have all our own gear, and have to handle multiple times to get it stored and delivered. I sat down and showed my wife what we had invested in equipment and she was shocked. It adds up quickly.

There isn't really a huge difference in costs from one operation to another... there's just a HUGE difference in what's accounted for in that 'cost' from one operation to another.
The farm with junk mentaility works OK until something breaks down and you lose a big portion of your crop. If you account for THAT loss then all of a sudden working with junk doesn't look so cheap. If you keep multiples of junk equipment to offset that possibility... you have a cost there...
On the other side of the fence... the nutrient miners that don't plant/grow crops and don't add anything in terms of fertility... might get along fine until you get that hot dry year that nothing grows... then that lack of fertility and soil structure whacks you up the side of the head pretty good. So the field that used to make 100 bales per acre that now made 40 bales... just changed your costs a LOT. Fuel is another big variable...
When I look around this area at the people that bale hay and sell it for 2 bucks off the field... I wonder what their motive is. Making money certainly isn't it.

It also costs me 50 cents a bale to move hay every time I touch it...

Rod

That's about what I come up with on my operation. I figure it costs about .30 per bale to get it off the field in a stack.

Profitability from a per unit basis though.
If I'm shooting for a 30% return plus hourly for my time. I can make about 200 bales an hour on a large field, less on a small field, plus all the cutting, raking, moving equipment, stacking/hauling I estimate that when I'm done I have about 10 minutes a bale into them.
A 60 lb bale at $4 per bale (133 per ton)shows a per unit profit of around $1 per bale. This means that I'm making %25 profit and getting nothing for my time. When you factor in the equipment replacement I suspect that until I can do around 10,000 bales a year I'm probably really breaking even in the long run.

The most profitable part of haying for me is custom cutting and baling for people with 10 acres and a horse, but no equipment.