630.7 K6b no.602 cop.2> NOTICE: Return or renew all Library Materials! The Minimum Fee (or each Lost Book is $50.00. The person charging this material is responsible for its return to the library from which it was withdrawn on or before the Latest Date stamped below. Theft, mutilation, and underlining of books are reasons for discipli- nary action and may result in dismissal from the University. To renew call Telephone Center, 333-8400 UNIVERSITY OF ILLINOIS LIBRARY AT URBANA-CHAMPAIGN L161 O-1096 6 OA. HIGHEST RETURN FARMING SYSTEMS for Tama and Muscatine soils An application of linear programming to 240- and 480-acre farms operated by two men By G. A. Peterson and Earl R. Swanson AGRICULTURE LIBRARY SEP ? 6 1990 UNIVERSITY OF ! BULLETIN 602 UNIVERSITY OF ILLINOIS AGRICULTURAL EXPERIMENT STATION ASSUMPTIONS 3 Crop Enterprises 3 Livestock Enterprises 4 Prices and Costs 10 HIGHEST RETURN FARMING SYSTEMS 12 Comparison of Highest Return Farming Systems on 240-Acre Farms Under Average Level of Livestock Management 12 Comparison of Highest Return Farming Systems on 240-Acre Farms Under Varying Levels of Livestock Management 14 Comparison of Highest Return Farming Systems on 480-Acre Farms Under Varying Levels of Livestock Management 16 Comparison of Highest Return Farming Systems That Include Livestock With Highest Return Cash-Grain Systems That Ex- clude Livestock on 240- and 480-Acre Farms 17 SUMMARY . .20 The computations on which this bulletin is based were performed by the University of Illinois high-speed digital computer (I Iliac). Urbana, Illinois October, 1956 Publications in the Bulletin series report the results of investigations made or sponsored by the Experiment Station ' Co c HIGHEST RETURN FARMING SYSTEMS T For TAMA and MUSCATINE Soils By G. A. PETERSON and EARL R. SwANSON 1 .HE PURPOSE OF THIS BULLETIN IS TO PRESENT THE HIGHEST RETURN farming systems (combinations of crop and livestock enterprises) for 240- and 480-acre farms on Tama and Muscatine soils. In determining the highest return farming systems for these farms, all possible com- binations of eight crop rotations and eleven livestock enterprises were considered under varying levels of livestock management. These farm- ing systems were determined by the method of linear programming. 2 ASSUMPTIONS Assumptions made in this study involve those relating to crop and livestock enterprises and to prices and costs. The assumptions con- cerning crop enterprises include yields and fertilizer and labor required; those concerning livestock enterprises include feed and labor required; those concerning prices and costs are based on past price and cost relationships among agricultural products. Crop Enterprises Muscatine silt loam and Tama silt loam are highly productive, dark- colored prairie soils. 3 For grain production under a moderately high level of management, Muscatine has a productivity index of 125; Tama, of 115. Muscatine has imperfect natural drainage, but tiles well and occurs on slopes of 0.5 to 3.5 percent. Tama is well drained and has a slope range of 3.5 to 7.0 percent. Tables 1, 2, and 3 present the estimated annual yields and fertilizer required for eight crop rotations for Muscatine with 2-percent slope and for Tama with 3.5- and 7-percent slope respectively. These esti- mates were made by the Department of Agronomy, University of Illinois, and were based, wherever possible, on experimental data. 1 G. A. PETERSON, formerly Assistant Professor of Agricultural Economics ; EARL R. SWANSON, Associate Professor of Agricultural Economics. 2 This is a mathematical procedure which insures that, given the conditions and assumptions, the highest return farming system for a farm can be derived. For an explanation of this method, see An Introduction to Linear Programming, by A. Charnes, W. W. Cooper and A. Henderson (New York, John Wiley and Sons, 1953). 3 Illinois Soil Type Descriptions, by H. L. Wascher, J. B. Fehrenbacher, R. T. Odell, and P. T. Veale (111. Agr. Exp. Sta. AG-1443, 1950), pp. 73 and 78. 4 BULLETIN No. 602 [October, These estimates involve four assumptions, that soil fertility is at such a level at the outset that soil tests show no deficiencies in avail- able phosphorus and potassium; that later some commercial fertilizer is used to supply nutrients removed by the crops; that weather and growing conditions are normal; and that no hay is removed. In determining how much commercial fertilizer is required an- nually for each crop rotation, credit is given for the nitrogen returned to the soil by the clover crop. 1 For this reason, the amount of commer- cial fertilizer required per rotation acre decreases as the percentage of land in clover increases. Credit is also given for the nitrogen, phos- phoric acid, and potash returned to the soil by livestock. 2 Tables 1, 2, and 3 also show that as the percentage of land in forage increases, the need for conservation practices (terracing, strip cropping, and contouring) decreases. Only a competitive relationship between grain and forage appears in the rotations considered. 3 The lack of a complementary relationship between grain and forage in the rotations considered is due to the high level of nitrogen assumed to be applied. The man-hours required per rotation acre on each of the soils and slopes considered are also shown in Tables 1, 2, and 3. Because these requirements do not include labor involved in harvesting forage, man- hours per rotation acre decrease as the percent of land in forage increases. Livestock Enterprises A large number of livestock enterprises can be considered by the method of linear programming. In this study, however, only livestock enterprises commonly found on farms on Muscatine and Tama are included. The following livestock enterprises, which involve certain assump- tions, were selected and should be considered in relation to Table 4. 1 In the tables, rotations having a catch crop of clover have clover desig- nated as (Cl). Those having a standover crop of clover have clover designated as Cl. ' Credits for manure are based on the table appearing in Planning the Farm Business (College of Agriculture, University of Illinois, Oct. 1947), p. 23. Hogs and cattle the only livestock included in the livestock enterprises differ in the amount of plant nutrients they restore to the soil. 3 Production relationships between two crops may be complementary, com- petitive, or supplementary. If, on a given acreage, two crops are grown in the rotation and an increase in the production (yields times acreage) of the first crop augments the production of the second crop, the relationship is comple- mentary. If the production of the second crop decreases, the relationship is competitive. If the production of the second crop remains unchanged, the rela- tionship is supplementary. 1956] HIGHEST RETURN FARMING SYSTEMS ^s 10 S^M"*t-t--W^-0 (S^-OOTJ. a| 6 o \O ^ m > orca OO l/11/> *^ c 8 ~z a Rotations Si u u-jr fSOf^ro O vo o it ^t t~t^-< So t J2 rt ex o E O 00 u O UH ractice 6^ u5 iOO"1 1> o> \o o i w es Ot^-f5 Ov \O o ? (S ^"^H Tf H IN H IfllO t~- ts = 1 bushel corn Iture, Universit s - ij = 1 O in 3 fSOs ^ tS^H gg O H O fS fO--lt^ : 2 bushels oats College of Agricu Is of hay. ;3 c I's Si l^5 tSO OOr^>O 00 4 o *V3rO ^H tscs g O t- OOOO le following basis Farm Business (< days= 100 poun< *3 y JJH 3 | S .2 6* oOtoS 5 ^c J Ot~- ts W(N ts 8 O H6 pasture Estimated > P 3 *l ~l n OvxOt^ fl CS ^H jj 8 O H^-< M 00 OOOO J3 V . erted to corn e e Supplement hay at this ra m 1 *H JJ tion acre, Ib otation acre, I Mi; g ::::::::::::: . : : : : |ijNiHjijjj|INj| ns were conv able 17 in th converted to H 0) f IN 1 .9 1 j j j I j j j j j j j i j 1 I j j j 111 Yields per acre Corn, bu. . . . Soybeans, bu. Oats, bu Clover, ton. . Corn equivalent 1 W Percent of land Grain Clover !l|!||||||i|^ j||| j iiiiiiitiisifl |<^< H 111 BULLETIN No. 602 [October, 3i m o2 6 u-^ 00 O ^ t^. i Of. O* oo o 1O1O ** icl corn. Rotations S| t^ O f5 f*3 -^ 00 vO O S5 N o 100 -< o o Tf ^ 11 2 o 00 hi o <-w .a 1 1 SI Ov O ^ fi 00 00 O O CN o O-H I^PO o csS S "~ *O s.s 00 "^ ->. TJ V u V * e _o la i> TO a 8 6s oo r^i 00 o Or3 -H CSl 1/51/5 o t- cs cs Tf oo oo oo t~- es r- -H -o i * ooiot-iio = 1 bushel corn llture, Universit T3 w rt i - O. s -A Rotation an tfl d u"5 0051O ID ooor^ CN-H OO O 00 (N : 1 bushels oats College of Agrici is of hay. 1 B r_ rt J2 cd "33 *O c OOOOO * ootrno co o^ *tr>^ ^H (N04 o o rt _ _ t~. OOOO e following basis Farm Business (( days= 100 poun 3 C *f ^^ o-s u" OOOOO N t^ f3 1/5 fO "1 "i t^.lO O IN CNCS oo o ,H,H_ , oo OCt^t^ equivalent on tl to Planning the te: 3% pasture Estimated J U'C O O 00 O 00 1^. l/> 00 * n . . . . J3 ' ' " ' a tfl^i\O fO IM -H ^ D S : : : oo o J3 ' . . . 8 rtrt 00 OOOO converted to corn n the Supplement d to hay at this n CM 3 CJ Yields per acre Corn, bu Soybeans, bu Oats, bu Clover, ton Corn equivalent per rotation acr a . . . o . . . o . . . VI ... 1 .H 1 tt 8 Percent of land in: Grain Clover Man-hours required per rotatioi Jan. 15-Feb. 14... ~* ^ H M* ^4 ' ' ^* _ll ^ *4H ^ -J ' ^ H 2 "^ ** ^ 1 ^ ^ * ^ ill- l<^< Oats and soybeans were >' Adapted from Table 17 i " Pasture may be converte 7956] HIGHEST RETURN FARMING SYSTEMS v? r^ SI OOO<5 00 >O r^ Q ^ u~. O oo oo W) IO O f*5 Ot^ooio lei corn. ) Rotations Oft u'5 'a O 2 00 OO"> t^ 10 00 N O 2 C " 3O * O if) tsr-i (Noo A 7g- rt |S o O 00 fa .2 ractice u'5 n^ t^ in 00 t^ o-tc t^ f5 O -H 10 0.58 bushel so y of Illinois, S< 'O U fa 1 1 conservation p US U 61 oooOtN t>. I/) 00 ~^ in : -f m\n t^ cs = 1 bushel corn llture, Universit rt -Ji 1 S 1 N rv. Rotation an 6"" ^ y "looots t^ tSlfl N 0> ** M r^oo-o OO 00 CN O vo OO 2 bushels oats College of Agrici ,s of hay. ? o - fjj O c ? to rt 'O c f?s, U tnoooo t^ (Nlfl 1^ t^- 00 8 oooo 1OU5 e following basis Farm Business (( days= 100 pounc ^5 C .SJ , rt c CA S3 U O *$ (Sf)O ts cs CN 8 O ^H oo OOrt~ OO equivalent on tl to Planning the te: 3*4 pasture 1 '1 us "! O OO t> 1/3 9 m Otsul w; e-4 .0 8 O ..-H-H -. Ov J . oooo srted to corn Supplement hay at this ra W 1 en & 5 v B : : : 8 ' 8 :::::...::::: jjl^t; u 2 1 5 ... Ill; 1 ::::::::::::: *. = S"S 8 H V Yields per acre Corn, bu Soybeans, bu Oats, bu Clover, ton Corn equivalent per rot Fertilizer required per N P^Os KjO Percent of land in: Grain Clover 8, :;::::::::::: ISfiiiS iiijsasiasis^ s s^ i?<< 0. a Oats and soybea >' Adapted from T c Pasture may be 8 BULLETIN No. 602 [October, Hogs Two-litter system (spring and fall). Gilts farrow in March and September; there are 6 pigs per litter; hogs are marketed at 225 pounds in September and March. One-litter system (spring). Gilts farrow in March; there are 6 pigs per litter; hogs are marketed at 225 pounds in September. One-litter system (fall). Gilts farrow in September; there are 6 pigs per litter; hogs are marketed at 225 pounds in March. One-litter system (summer). Gilts farrow in June; there are 6 pigs per litter; hogs are marketed at 225 pounds in December. Choice feeding cattle Steer calves weighing 400 pounds are bought in October, roughed through winter, full-fed grain on pasture, and sold the following October at 950 pounds. Steer calves weighing 400 pounds are bought in October, roughed through winter, full-fed grain in drylot, and sold in September at 900 pounds. Yearling steers weighing 650 pounds are bought in November, roughed through winter, full-fed grain on pasture, and sold in Sep- tember at 1,050 pounds. Yearling steers weighing 650 pounds are bought in November, roughed through winter, full-fed grain in drylot, and sold in Sep- tember at 1,050 pounds. Yearling heifers weighing 600 pounds are bought in November, full-fed grain in drylot, and sold in March at 900 pounds. Beef cow herd The calf is sold in October at 400 pounds or transferred to one of the two feeding systems for steer calves described above; cows are replaced after they have produced 8 calves. Dairy cow herd Seven thousand pounds of 4-percent milk is produced annually; cows are replaced after 5 lactation periods; and the calf is vealed at 200 pounds. Labor Table 4 shows the estimated number of man-hours required per unit of production as well as the distribution of man-hours for the 12 1956] HIGHEST RETURN FARMING SYSTEMS 1, i "8|s? =i Q s- [ I S g ^ rNrsr-jcooooooocooOOfSO JJ 1/5 '"'*' tj York, 1953); J 51; Fourteenth )f Illinois, Sept 1,000 pounds ( la V n a, I? i ) O 3 f 8 S"g eses gOO-* ott Co., New ois, June, 19 University ( rement is for ii c 41 J3 5 -o 5 B 'o 1 5J1IIZ |ir e-- *> '5 *fl ! _> ding cattl V tj i o i|l | "0 3CJ Z t-H hi a ^ J> C Choice fee n O b Sfoo-^es -,.., -1 ^1^ v 3 bo g OH - _. C 1 1 rn o .S V "8 6-S ,a " 15 *> H-c f gl a u g }g||, __* Ul5^ -g Labor verage system g 3 j3 S o 65- Srt^Ji IBil a < TO N^X 3 i O a One-littei M fl wo-J) :"?... .9 _J .3 fjes^-^^^-^-^'^tf^escsf^eN W MOOO O^ -5 (*5 00 O Estimated I 0. 5 3 "S S Q AS in Principles * Illinois, 194$ eding Years H description o requirement i 1 V S - ~ spring M es III and IV n and Westeri During the Ft for a detailec erd, the feed H 1 i Z iSiii 41 m Based on Appendic Coil Report for Northwester Report of Feeder Cattle Fed See page 4 of this bulletin b For the beef -cow h 10 BULLETIN No. 602 [October, labor periods of the year. These estimates are based on detailed cost records and surveys of livestock enterprises. Feed Table 4 shows the estimated amounts of feed required annually per unit of production under an average level of management by these livestock enterprises. These estimates are based on Illinois farm records and feeding experiments. Prices and Costs To arrive at prices and costs that would be reliable in planning highest return farming systems, past relationships among agricultural products were investigated. On the basis of these relationships, the following price and cost structure was devised, which should be con- sidered in relation to Table 5. Crop production costs (corn, oats, soybeans, hay) : Based on 1949 detailed cost records for northwestern Illinois. 1 Hay-harvesting costs: A crew of four men with a one-man baler is assumed to do the harvesting. Since two full-time men are available for any one of the farming systems considered, two additional men have to be hired when and if hay is harvested. The cost of harvesting hay, including this additional labor, is $7.86 a ton. Fertilizer costs (nitrogen, phosphorus, potassium) : Based on 1948- 1952 average Illinois prices for straight materials. Soybean meal costs: Based on 1948-1952 average Illinois prices. Grain prices (corn, oats, soybeans) : Based on 1948-1952 average Illinois prices. Hog prices, butcher, Chicago: Based on a 12 to 1 instead of a 13 to 1 hog-corn ratio, which was the average hog-corn ratio for the United States for 1943-1952. There are two reasons for this: in planning, farmers may view the hog-corn ratio as the ratio of hog prices to government-supported corn prices rather than to the open- market corn prices; second, farmers may also consider that returns from hogs are more uncertain when they feed their corn to hogs than when corn is sold at government-supported prices. 1 Detailed Cost Report for Northwestern and Western Illinois, 1949, by R. H. Wilcox and A. C. Ruwe (College of Agriculture, University of Illinois, June, 1951). Crop production costs are restricted to those which vary with the rotation. All costs which remain constant, whatever rotation is adopted taxes, labor, and interest, for example are excluded. HIGHEST RETURN FARMING SYSTEMS 11 Cattle prices, slaughter, choice, Chicago (steer calves, yearling steers, yearling heifers, commercial cows, vealers) : During 1944- 1952, the average price per pound of 1,000-pound choice slaughter steers was 33 percent higher than the average price per pound of 225- pound butcher hogs. This relationship was used to develop the cattle prices. These prices are 76.9 percent of their average 1948-1952 level. Feeder-cattle prices, choice, Kansas City (steer calves, yearling steers, yearling heifers) : Price margins on feeding operations were based on studies of feeder cattle conducted at the University of Illinois. Feed margins were checked by valuing hay at $20 a ton. Butterfat prices: Based on 1948-1952 average Illinois prices. Table 5. Prices of Products and Costs of Inputs" Item Weight (Ib.) Date bought or sold Unit Price per unit Crop production costs Corn Oats Soybeans Hay: growing cost harvesting cost Fertilizer costs Nitrogen (33-0-0) Phosphorus (0-20-0) Potassium (0-0-50) Soybean meal Grain prices Corn Oats Soybeans Hog prices, butcher, Chicago 225 225 225 Cattle prices, slaughter, choice, Chicago Steer calves 950 Steer calves 1 ,000 Yearling steers 1 ,050 Yearling heifers 900 Commercial cows 1 , 100 Vealers 200 Feeder-cattle prices, choice, Kansas City Steer calves 400 Yearling steers 650 Yearling heifers 600 Butterfat... Bought at average annual price Bought at average annual price Sold at average annual price Sold Sept. 1 Sold March 1 Sold Dec. 1 Sold Oct. 1 Sold Sept. 1 Sold Sept. 1 Sold March 15 Sold at average annual price Sold May 1 Bought Oct. 1 Bought Nov. 1 Bought Sept. 15 Sold at average annual price Acre Acre Acre Acre Acre Ton Ton Ton Cwt. Bu. Bu. Bu. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Cwt. Lb. 831.59 13.23 1 8 . ()> 8.88 13.74 87.12 38.40 55.00 4.58 1.48-1 .77 2.53 18.50 16.88 15.85 24.43 24.64 24.64 21.00 16.20 24.69 22.00 21.00 18.00 .65 8 For the bases of these prices and costs, see page 10 and above. '' Does not include costs that remain constant whatever rotation is adopted taxes, labor, and interest, for example but does include the cost of terracing on those rotations requiring terracing. c The cost of harvesting hay was included in the calculation of returns only when hay was har- vested. This cost was set at #7.86 a ton, which includes the cost of hired labor other than that provided by the two men assumed to be available. d Instead of feeding only home-grown corn to livestock, corn could be bought at a slightly higher price. 12 BULLETIN No. 602 [October, HIGHEST RETURN FARMING SYSTEMS With these eight crop rotations and eleven livestock enterprises set forth, and the assumptions and conditions they involve made explicit, those combinations or systems that yield the highest returns to labor, capital, and management can now be presented. Two basic situations are considered: first, 240- acre farms; second, 480-acre farms. Each of these farms is assumed to have two full-time men who furnish 480 man-hours in each of the twelve labor periods of the year. These two situations are assumed to exist first under an average level of livestock management, then under varying levels of livestock management. 1 Comparison of Highest Return Farming Systems on 240-Acre Farms Under Average Level of Livestock Management Table 6 compares the highest return farming systems for each of the soils and slopes under consideration. On less productive soils, 2 highest return farming systems require more acreage in standover clover, more cattle, and slightly fewer hogs. This, of course, decreases the annual expenditure for fertilizer. The highest return farming system for Tama, 7-percent slope, for example, requires no expendi- tures for nitrogen. If the number of unused man-hours in each labor period is sub- tracted from the 480 man-hours assumed to be available each month, the monthly distribution of labor required by each system can be determined. The lower the productivity of the soil, the higher is the number of man-hours required. For even though soils with lower productivity have smaller acreages in grain, they have larger cattle enterprises. Under all three systems, most of the hay is harvested in the first (May 15-June 14) and third (August 15-September 14) periods, be- cause labor requirements for the other crops are lower during these periods than during the second period (June 15-July 14). Returns to labor, capital, and management on Muscatine are roughly $1,000 higher than on Tama soil, 3.5-percent slope. Returns to labor, capital, and management on Tama soil, with 3.5-percent slope are about 'Average requirements per unit of production (feed-to-gain ratio) are used to indicate the level of livestock management, and are based on Illinois farm records. 2 Muscatine, 2-percent slope, is most productive ; Tama, 7-percent slope, is least productive. HIGHEST RETURX FARMING SYSTEMS 13 $2,000 higher than on Tama soil with 7-percent slope. These differ- ences in returns are not wholly due to differences in productivity of the soil. They are also due to the fact that each system involves a somewhat different combination of capital investment. Only if capital investment is assumed to be fixed, and adequate for operating any of these systems, can the differences in returns be attributed in the main to differences in productivity of the soil. Table 6. Highest Return Farming Systems Under Average Level of Management" for Muscatine and Tama Silt Loam (240-acre farms, 2 full-time men) Item Muscatine, 2 -percent slope Tama, 3.5-percent slope Tama, 7-percent slope Hogs (litters) Two-litter system (spring and fall) 50 43 41 Cattle (head) Steer calves fed on pasture Yearling steers fed on pasture 28 48 60 Yearling heifers 12 23 25 Crop rotations (acres) C-C-O (Cl) 68 C-C-O-C1 172 228 198 C-C-O-C1-C1 12 42 Hay harvested (tons) May 15-June 14 15.8 28.6 30.1 June 15-July 14 8.8 10.1 Aug. 15-Sept. 14 27.1 31.9 34.5 Fertilizer expenditure (annual) N... 1,453 $ 578 $ PsOs... 1.596 1,545 1,338 KzO 548 517 398 Unused man-hours (monthly) Jan. 15-Feb. 14 139 106 103 Feb. 15-March 14 28 15 15 March 15-April 14 3 April 15-May 14 May 15-June 14 100 June 15-July 14 24 29 33 July 15-Aug. 14 19 32 36 Aug. 15-Sept. 14 90 100 104 Sept. 15-Oct. 14 98 117 124 Oct. 15-Nov. 14 1 Nov. 15-Dec. 14 42 15 Dec. 15-Jan. 14 154 143 107 Used man-hours (annual total) 5,284 5,407 5,444 Unused pasture days April 15-June 14 000 June 15-Aug. 14 Aug. 15-Oct. 14 Supplement bought (cwt.) 721 713 700 Corn equivalent bought (cwt.) 659 Corn equivalent sold (cwt.) 1,150 90 Returns to labor, capital, and management (annual) 323.090 $22,240 $20.123 Feed-to-gain ratio is used as an index of livestock management. 14 BULLETIN No. 602 [October, Table 7. Highest Return Farming Systems for Five Levels of Livestock Management* (240-acre farm, 2 full-time men, Muscatine silt loam, 2-percent slope) Level of livestock management Item 20 percent above average 10 percent above average Average 1 ' 10 percent below average 20 percent below average Hogs (litters) Two-litter system (spring and fall) 44 44 SO 53 52 One-litter system (fall) 5 7 Cattle (head) Steer calves fed on pasture 12 29 35 54 Yearling steers fed on pasture. 65 60 28 13 Yearling heifers 22 22 12 8 Crop rotations (acres) C-C-O (Cl) 83 50 68 65 37 C-C-O-CI 157 190 172 175 203 Hay harvested (tons) May 15-June 14 12.8 17.8 15.8 12.4 13.7 June 15-July 14 2.2 4.5 Aug. 15-Sept. 14 33.4 32.6 27.1 24.6 23.2 Fertilizer expenditure (annual) N 1.790 $1.414 1.453 1.348 1,009 PjOs 1.646 1.625 1.596 1.567 1.546 K-O ... 575 562 548 531 519 Unused man-hours (monthly) Jan. 15-Feb. 14 110 102 139 147 162 Feb. 15-March 14 12 7 28 30 43 March 15-April 14 11000 April 15-May 14 10000 May 15-June 14 17 10 1 00 June 15-July 14 27 27 24 20 21 July 15-Aug. 14 1 19 18 23 Aug. 15-Sept. 14 91 81 90 81 77 Sept. 15-Oct. 14 115 108 98 85 82 Oct. 15-Nov. 14 1 8 Nov. 15-Dec. 14 42 Dec. 15- Jan. 14 115 107 154 167 184 Used man-hours (annual total) .... 5,402 5,471 5.284 5.316 5.258 Unused pasture days April 15-June 14 286 587 June 15-Aug. 14 00000 Aug. 15-Oct. 14 Supplement bought (cwt.) 582 673 721 807 867 Corn equivalent bought (cwt.) 460 Corn equivalent sold (cwt.) 2.585 1,532 1.150 395 Returns to labor, capital, and management (annual) 27.240 25.580 23.090 20.975 18.890 Variations in the level of feed-to-gain ratio are used to show differences in livestock manage- ment. When the same gains are achieved by using smaller quantities of grain, supplement, and pasture days, a higher level of livestock management is indicated. For example, the average level of feed-to- gain ratio shown in Table 4 is 371 pounds of grain. 44 pounds of supplement, and 2.2 pasture days. A decrease in this level to 297 pounds of grain, 35 pounds of supplement, and 1.8 pasture days represents a level of livestock management 20 percent above average. b Average level of management is the same as that shown in Table 6. Comparison of Highest Return Farming Systems on 240-Acre Farms Under Varying Levels of Livestock Management Analysis of Illinois farm records indicates a wide variation in live- stock management. 1 This variation is due to many factors such as sani- 1 For a study of this point, see "Variability of Returns From the Hog Enterprise," by Earl R. Swanson, Journal of Farm Economics, 37: 736-739 (Nov. 1955). 1956] HIGHEST RETURN FARMING SYSTEMS 15 Table 8. Highest Return Farming Systems for Five Levels of Livestock Management* (240-acre farm, 2 full-time men, Tama silt loam, 3.5-percent slope) Level of livestock management Item 20 percent 10 percent 10 percent 20 percent above above Average 1 " below below average average average average Hogs (liners) Two-litter system (spring and fall) 40 Cattle (head) Steer calves fed on pasture 35 39 40 Yearling steers fed on pasture. 57 58 48 Yearling heifers 26 26 23 Crop rotations (acres) C-C-O (Cl) C-C-O-C1 240 240 228 C-C-O-C1-C1 12 Hay harvested (tons) May 15-June 14 30.4 28.5 28.6 June 15-July 14 8.9 8.8 Aug. 15-Sept. 14 29.0 32.2 31.9 Fertilizer expenditure (annual) N $ 813 % 749 $ 578 PiOs 1.601 1.576 1,545 KjO 550 534 517 Unused man-hours (monthly) Jan. 15-Feb. 14 96 100 106 Feb. 15-March 14 8 14 15 March 15-April 14 3 April 15-May 14 000 May 15-June 14 5 June 15-July 14 43 31 29 July 15-Aug. 14 29 32 32 Aug. 15-Sept. 14 109 109 100 Sept. 15-Oct. 14 121 124 117 Oct. 15-Nov. 14 Nov. 15-Dec. 14 15 Dec. 15-Jan. 14 102 104 143 Used man-hours (annual total) 5,417 5.434 5,407 Unused pasture days April 15-June 14 128 June 15-Aug. 14 1.O49 00 Aug. 15-Oct. 14 342 Supplement bought (cwt.) 571 628 713 Corn equivalent bought (cwt.) Corn equivalent sold (cwt.) 1,473 884 90 Returns to labor, capital, and management (annual) $26.410 $24.390 $22.240 21 148 12 116 112 43.7 1.0 48.9 $ 403 1.535 514 186 112 78 2 2 53 71 92 115 2 75 179 5.055 588 $20.274 20 152 32 35 173 45.3 59.6 $ 323 1.503 496 180 108 75 77 56 71 73 115 2 73 174 5,051 636 814 $17.949 m See footnote a to Table 7. b See footnote b to Table 7. tation practices, skill in feeding livestock, and the breed and quality of the livestock fed. To examine the effects of livestock management upon highest return farming systems, only Muscatine, 2-percent slope, and Tama, 3.5-percent slope, are considered. To vary levels of live- stock management, a percentage increase and decrease was made for all feeds. 1 The two higher levels of livestock management shown in 1 The feed-to-gain ratio may be affected by the substitution of one feed for another. For example, the grain required per 100 pounds of beef produced will be affected by the roughage in the ration. In this study, livestock-management levels were specified by taking a given percentage of all feeds. 16 BULLETIN No. 602 [October, Tables 7 and 8 represent a 10- and 20-percent decrease in the average feed requirements. The two lower levels represent a 10- and 20- percent increase in the average feed requirements. The average level is also shown in Table 6. The range from 20 percent above to 20 percent below average includes the management levels of most farmers. In order to maintain the highest return farming system, whatever the level of livestock management, the crop and livestock enterprises had to be modified somewhat. In these situations, the modifications are of far less consequence in their effect 'on returns to capital, labor, and management than changes in the level of livestock management. Table 7 presents the highest return farming systems for each of five levels of livestock management on 240-acre farms on Muscatine. The differences in returns range as high as $8,350. Table 8 presents the highest return farming systems for each of five levels of livestock management on 240-acre farms on Tama. The differences in returns range as high as $8,461. On both Muscatine and Tama, the highest return farming systems for the levels of livestock management considered are principally live- stock systems. There are more cattle on Tama than on Muscatine, because grain yields relative to forage yields are higher on Muscatine. Even though returns from livestock decrease with a decrease in the level of livestock management, returns from the entire farming system are higher when there are livestock than when there are none, because labor is more fully utilized. Comparison of Highest Return Farming Systems on 480-Acre Farms Under Varying Levels of Livestock Management Tables 9 and 10 present the highest return farming systems for three levels of livestock management on 480-acre farms on Muscatine and Tama. Again, the crop and livestock enterprises had to be modified somewhat in order to maintain the highest return farming system. This time, changes in the level of livestock management, and the re- sulting modifications of the systems, had little effect upon returns to labor, capital, and management, because the value of livestock produc- tion is minor compared with the value of cash-grain production. No hogs appear in these systems and cattle numbers change little with changes in the level of livestock management. Not only does the value of livestock production decrease in relation to the value of cash-grain production, but actual cattle numbers are smaller on 480-acre farms than on 240-acre farms. The differences in returns to labor, capital, and management on Muscatine and Tama indicate differences in soil productivity. 1956] HIGHEST RETURN FARMING SYSTEMS 17 More labor is used by any of the highest return farming systems on Tama than by any of those on Muscatine, because the systems on Tama include more cattle. The reason that the systems on Tama in- clude more cattle is that grain yields relative to forage yields are higher on Muscatine than on Tama. Comparison of Highest Return Farming Systems That Include Livestock With Highest Return Cash-Grain Systems That Exclude Livestock on 240- and 4 80- Acre Farms The highest return farming systems that include livestock can now be compared with the highest return cash-grain systems that exclude Table 9. Highest Return Farming Systems for Three Levels of Livestock Management" (480-acre farm, 2 full-time men, Muscatine silt loam, 2-percent slope) Item Level of livestock management 10 percent 20 percent Average below below average average Cattle (head) Steer calves fed on pasture Yearling steers fed on pasture 52 47 49 Yearling heifers 20 18 19 Crop rotations (acres) C-C-O (Cl) 240 246 243 C-C-Sb-O (Cl) 82 83 82 C-Sb-O (Cl) 38 59 50 C-C-O-C1 120 92 105 Hay harvested (tons) May 15-June 14 June 15-July 14 Aug. 15-Sept. 14 47 47 54 Fertilizer expenditure (annual) N . 35,940 $5,983 35,949 Pi-Os 3,811 3,817 3,801 KzO 1,539 1,555 1,542 Unused man-hours (monthly) Jan. 15-Feb. 14 363 375 370 Feb. 15-March 14 243 251 247 March 15-April 14 156 159 157 April 15-May 14 May 15-June 14 June 15-July 14 25 23 24 July 15-Aug. 14 Aug. 15-Sept. 14 239 242 229 Sept. 15-Oct. 14 88 86 87 Oct. 15- Nov. 14 Nov. 15-Dec. 14 11 6 Dec. 15-Jan. 14 289 301 296 Used man-hours (annual total) 4,744 4,687 4,725 Unused pasture days April 15-June 14 868 426 486 June 15-Aug. 14 472 Aug. 15-Oct. 14 1.810 1,682 1,287 Supplement bought (cwt.) 126 126 144 Corn equivalent bought (cwt.) Corn equivalent sold (cwt.) 154 155 152 Returns to labor, capital, and management (annual) 331,870 331,420 331.000 See footnote a to Table 7. 18 BULLETIN No. 602 [October, livestock. The two basic situations still remain 240- and 480-acre farms, each with two full-time men, on Muscatine and Tama. Table 11 pre- sents the systems without livestock; Tables 7, 8, and 9 present the systems with livestock. 240-acre farms on Muscatine The returns from the system without livestock on the 240-acre farm on Muscatine are $15,440 (Table 11); the returns from the sys- tem with livestock on the same soil and size of farm are $23,090 (Table 7). This difference is largely due to the fact that labor is better Table 10. Highest Return Farming Systems for Three Levels of Livestock Management" (480-acre farm, 2 full-time men, Tama silt loam, 3.5-percent slope) Level of livestock management Item 10 percent 20 percent Average below below average average Cattle (head) Steer calves fed on pasture 59 Yearling steers fed on pasture 19 60 60 Yearling heifers 15 15 15 Crop rotations (acres) C-C-O (Cl) 172 228 228 C-C-Sb-O (Cl) 81 81 C-C-O-C1 308 171 171 Hay harvested (tons) May 15-June 14 1 June 15-July 14 12 15 Aug. 15-Sept. 14 44 41 61 Fertilizer expenditure (annual) N . 53,639 35,207 ?5,195 P 2 5 3,445 3,590 3,583 KzO 1,274 1,455 1,401 Unused man-hours (monthly) Jan. 15-Feb. 14 342 363 362 Feb. 15-March 14 227 241 241 March 15-April 14 155 155 155 April 15-May 14 May 15-June 14 June 15-July 14 4 29 July 15-Aug. 14 Aug. 15-Sept. 14 200 243 210 Sept. 15-Oct. 14 69 99 99 Oct. 15-Nov. 14 17 17 Nov. 15-Dec. 14 Dec. 15-Jan. 14 270 288 288 Used man-hours (annual total) 4,942 4,825 4,838 Unused pasture days April 15-June 14 3,882 1.396 1,276 June 15-Aug. 14 2,120 727 Aug. 15-Oct. 14 2,477 2,461 1,224 Supplement bought (cwt.) 174 146 159 Corn equivalent bought (cwt.) Corn equivalent sold (cwt.) 126 139 137 Returns to labor, capital, and management (annual) 29,440 $28,900 528,460 ' See footnote a to Table 7. 1956} HIGHEST RETURN FARMING SYSTEMS 19 Table 11. Returns to Labor, Capital, and Management and Labor Required for Highest Return Cash-Grain Systems (240- and 480-acre farms on Muscatine silt loam, 2-percent slope, and Tama silt loam, 3.5-percent slope) Muscatine, 2-percent slope Tama, 3.5-percent #lope 240 acres 480 acres 240 acres 480 acres Crop rotation (acres) C-C-O(Cl) 240 480 C-C-Sb-O (Cl) 240 480 Corn equivalent sold (cwt.) 87 174 84 168 Man-hours used 1,894 3 788 2,040 4.080 Returns to labor, capital, and management 15,440 330.880 J514.100 $28.200 utilized by the system with livestock than by the system without live- stock. Even under a livestock management 20 percent below average, returns are $3,450 more on a system with livestock than on one without livestock. In considering these comparisons, it should be recognized that the cost of buildings and equipment required in livestock production and not present in cash-grain production has not been deducted. However, for cattle and hogs the only livestock included in the livestock enterprises this cost is not substantial. The annual cost for the added buildings and equipment is about 5 percent of the feed cost. 1 240-acre farms on Tama Similar differences may be observed in comparing these two kinds of systems on 240-acre farms on Tama (Tables 8 and 11). Irrespec- tive of the level of livestock management, returns are higher from the system with livestock than from the system without livestock. 480-acre farms on Muscatine and Tama Similarities rather than differences in returns from the systems with livestock (Tables 9 and 10) and those without livestock (Table 11) appear when 480-acre farms are compared. This is to be expected, as the two systems are similar. Since crops on a 480-acre farm almost completely utilize the labor of the two men available, there are no hogs and only few cattle. Because the returns from these two systems are almost equal, farmers need to consider whether adding livestock to the cash-grain system is worthwhile. They may find the added labor required by the livestock to be disproportionate to the added returns. 1 Detailed Cost Report for Northwestern and Western Illinois, by R. H. Wilcox and A. C. Ruwe (College of Agriculture, University of Illinois, Tune, 1951), Tables 20 and 22. UNIVERSITY OF ILLINOIS-URBANA SUMMARY 30112018403490 The purpose of this bulletin was to present the highest return farming systems for 240- and 480-acre farms on Tama and Muscatine soils under average and varying levels of livestock management ( feed- to-gain ratio) and with two full-time men available for each farm. By the method of linear programming, the following conclusions were derived: On 240-acre farms under average level of livestock management. The highest return farming systems are essentially livestock systems. On less productive soils, more acreage is devoted to standover clover and there are more cattle and fewer hogs. Returns are higher on Mus- catine than those on Tama. On 240-acre farms under varying levels of livestock management. To vary the level of livestock management, a 10- and 20-percent in- crease and decrease in the average level was made. Then, in order to maintain the highest return farming system for each of these levels of livestock management, the basic systems were slightly modified. The level of livestock management proved to have far more effect on returns than the modifications of the systems. On 480-acre farms under varying levels of livestock management. Compared with the highest return farming systems on 240-acre farms, those on 480-acre farms have fewer cattle and no hogs. As a conse- quence, changes in the level of livestock management proved to have less effect on returns than changes in the level of livestock manage- ment on 240-acre farms. Again, returns are higher on Muscatine than on Tama. On 240-acre farms with and without livestock. Highest return farming systems that include livestock have higher returns than those that exclude livestock, regardless of the level of livestock management. On 480-acre farms with and without livestock. Highest return farming systems that include livestock have returns only slightly higher than those that exclude livestock. 5M 10-56 60767