Issue 6
March 1997

Financial performance of varieties

By Jochum Wiersma
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Prairie Grains is the
official publication of
the Minnesota
Association of
Wheat Growers,
North Dakota Grain
Growers Association,
South Dakota Wheat,
Inc., and the
Minnesota Barley
Growers Association.


 Variety selection is an important first step towards profitable production. Consideration must be given to a balance of key characteristics that make up a variety, including yield potential, grain quality, disease responses, input costs.

Minimizing cost per bushel produced is critical. An extra pass with a swather or the need to use a fungicide to control leaf diseases increases the total amount of inputs, which may not be offset by a yield increase in comparison with other varieties.

Quality of each bushel produced also is a determinant of your income per acre. To illustrate, I have done some varietal-based calculations on financial return per acre, using a concept developed by former AgriPro wheat breeder Blake Cooper, and market data provided by Ed Usset, University of Minnesota grain marketing specialist.

Premiums and discounts used in the calculations are presented in Table 1: the numbers are 3-year averages and the classes are chosen somewhat arbitrarily, and so there may be variations from your local area. However, using these numbers one can calculate a return per acre, and subsequently, you can compare varieties’ financial performance.

In Table 2, the average yield, test weight, protein content, and financial return were calculated for 12 varieties included in on-farm yield trials conducted in the Red River Valley last year.

What I want you to remember from Table 2 is this:

1) The percent dockage (including percent scabby kernels) in the trials was negligible and were not included in the calculations.

2) These numbers do not include differences in production cost per acre.

3) Ranking amongst varieties changes when comparing grain yield to financial return.

Table 1: Three year average discount and premiums received for HRSW.

  Class
(%)		 Premium
($)
Protein >14.5
>13.5
<13.5 		0.61
0.00
-0.31
Dockage >15
>7
>4
>2
>1.5
<1.5 		-1.35
-0.65
-0.25
-0.15
-0.05
0.00
Test Weight >60
>58.5
>57.5
>56
>55
>54
<54 		0.04
0.02
0.00
-0.04
-0.08
-0.13
-0.19

Table 2: Performance of released varieties in the 1996 Red River Valley On Farm Yield Trials averaged across all fourteen locations.

Variety Grain Yield
(bu/acre)		 Test Weight
(lbs/bu)		 Protein
(%)		 Financial Return
($/acre)
Russ
Lars
Verde
Marshall
2375
Oxen
Hamer
Sharp
Grandin
Gunner
Kulm
Bacup
LSD		 68.2
66.8
66.3
64.7
63.8
63.7
62.9
61.1
60.7
57.1
56.2
46.7
(5%)		 59.6
58.4
59.0
58.5
59.9
59.7
58.7
61.1
59.7
59.7
60.0
60.6
4.6 0.		 14.2
13.8
13.9
13.9
14.6
15.0
14.4
14.7
14.9
15.6
15.5
17.0
7 0.3		 140.87
119.24
120.99
115.28
131.22
137.35
123.50
123.76
120.48
114.19
110.73
70.98
22.57

Base price: $4.00/bu
Production cost: $140/acre

Copyright Prairie
Grains Magazine
March 1997