URBANA, IL – Every other year, University of Illinois ag economists update their projected costs of machinery, and for 2021 the costs would have been much higher had interest rates not been so low.
According to Dr. Gary Schnitkey in the Department of Agricultural and Consumer Economics, these costs are often used in setting custom rates and can be useful in determining options for maintaining or purchasing new equipment.
For the most recent year, the cost of owning and operating a 310 horsepower tractor is estimated at $189 per hour, a 4 percent increase since 2019 though Schnitkey reminds users that an “additional amount for profit should be added to our cost estimates, as we have not added an amount for returns”.
The tractor wasn’t the only piece of machinery that costs more to operate. According to the FarmDoc article, costs for several sizes of tractors, combines, a chisel plow, and a conventional planter all increased between 2 and 19 percent.
Overall, the bottom line expense to the machinery costs was fueled by, increasing fuel costs, labor costs, and actual sales price of the new equipment.
<Learn more here: https://farmdocdaily.illinois.edu/2021/10/machinery-cost-estimates-for-2021.html>
(SOURCE: All Ag News)
