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For a detailed reporting of this work please see the teamrsquos website nwnyteamccecornelledu click ldquoBusinessrdquo click ldquoEconomic Analysisrdquo Also see Cornell Universityrsquos website focusing on in-dustrial hemp production in New York httpshempcalscornelledu Industrial Hemp Production Budgets New York 2019 To make decisions regarding industrial hemprsquos place in their cropping systems farm business owners can use information from 2019 industrial hemp budgets (Table 1) Please note that budgets are projections esti-mates of expected future revenues costs and returns Presently considerable uncertainty characterizes projected values of production and revenues Farm business owners may not ob-tain projected prices and quantities due to un-certainties in evolving markets for industrial hemp end uses Farm business owners should thoroughly investigate markets for their poten-tial to sustain favorable economic performance at the farm level by working closely with poten-tial buyers to best understand expected prices quantities and marketing costs Marketing con-siderations suggest that industrial hemp enter-prises perhaps require relatively greater man-agement input versus other crops
AG FOCUS MARCH 2 019
Economics of Producing Industrial Hemp in NYS
Projected Costs and Returns 2019 Budgets by John Hanchar
Page 6
Notes
Reported totals may not equal the sum of individual items due to rounding
Expected value of hemp fiber production $010 per pound expected value of hemp seed (grain) production $110 per pound
Expected yield hemp fiber production fiber production and harvest only scenario 397 tons per acre expected yield hemp fiber production dual purpose fiber and seed (grain) production and harvest scenario 124 tons per acre expected yield hemp seed (grain) production 1000 pounds per acre
Revenues costs and returns reflect expected 2019 price levels
Fertilizers amp Lime costs reflect Cornell University agron-
omistsrsquo recommendations regarding N and Purdue University regarding phosphorus and potash
Seeds amp Plants costs vary by scenario with respect to
seeding rates but are constant with respect to seed price per pound
Sprays amp Other Crop Inputs include crop professional fees machinery hire rent amp lease and others Estimates reflect no spray inputs since no pesticides are
registered for use on industrial hemp in the United States
Labor costs reflect labor from hired and or family andor owneroperator sources
Machinery related variable and fixed costs per Lazarus 2018 ltzumnedumachdatagt
This analysis excludes a charge for management inputs
Questions Comments Contact John Hanchar jjh6cornelledu
Budget Item Hemp Fiber Production amp Harvest
Hemp Seed (Grain) Production amp Harvest
Hemp Fiber amp Seed (Grain) Production amp Harvest
--- $ per Acre ---
Value of Production
Fiber 79400 24800
Seed (Grain) 111000 111000
Total Value 79400 111000 135800
Costs of Production
Variable Inputs
Fertilizers amp Lime 8160 8160 8160
Seeds amp Plants 20943 10472 4848
Sprays amp Other Crop Inputs
1767 6235 3961
Labor 3741 1523 4605
Repair amp Maintenance
Tractors 360 1873 2066
Equipment 1363 1324 2335
Fuel amp Lube 1717 1741 2876
Interest on Operating Capital
951 783 721
Variable Costs Total 39004 32112 29572
Fixed Inputs
Tractors 2316 4018 5284
Equipment 3067 2240 4088
Land Charge 10188 10188 10188
Value of Operator amp Fam-ily Management
Fixed Costs Total 15571 16446 19559
Total Costs 54574 48558 49131
Returns
Return above Variable Costs
40396 78888 106228
Return above Total Costs 24826 62442 86669
Table 1 Projected values of production costs and returns by industrial hemp production scenario
dollars per acre conventional tillage system New York 2019 budgets