Working under the Vermont Biofuels Initiative of the Vermont Sustainable Jobs Fund and with UVM Extension, Callahan Engineering developed an Excel® based oilseed cost and profit calculator to assist farmers in forecasting the economics of this nascent segment.
Screen shot of the VT Oilseed Profit and Cost Calculator
The Vermont Biofuels Initiative of the Vermont Sustainable Jobs Fund is working to replace a portion of the fossil fuel energy consumed in-state with homegrown alternatives from oilseed crops, perennial grasses and algae. Our grant making and technical assistance are aimed at addressing the most critical issues of our time — peak oil, energy price volatility, and climate change – using an innovative ‘local production for local use’ market development model. One key component of this effort is an understanding of the economics associated with production of feedstocks, byproducts and biofuels. The Vermont Oilseed Crop Production Cost and Profit Calculator is intended to allow farmers to assess potential costs and profits associated with oilseed production. The tool is based in a Microsoft Excel® spreadsheet and uses a simple, easy to use interface to collect cost factors. The calculation of incremental and total costs as well as projected profit (or loss) is done “behind the scenes” and the results are summarized instantly for the farmer. A complete, detailed report is also available at the click of a button for the interested user.
The tool can be used to review many different scenarios and “what-if” cases. Any of the variables in the white boxes (see screen shot above) can be adjusted. For example, the table below shows actual results for a fictitious farm assuming different Sunflower yields, planted acreage, production costs, and market prices.
An example of several cases run using the cost and profit calculator.
As shown above, the calculator can at least reduce the burden of calculation, but the nature of oilseed production involves variability and uncertainty. Several farmers experienced extremely low yields (<500 lbs/acre) in 2009, for example, which prevent profitable operation at nearly any scale. As Vermont farmers develop more experience with these new crops and techniques to process them, the calculator will be refined and new releases will be made available.
The tool can be downloaded from the VSJF site.