The ultimate goal of farming operation is to make a profit. Therefore, it is critical that producers understand and effectively manage the costs associated with producing a crop. This will allow managers to make informed managerial decisions, and minimize the risk of failure. Knowing the costs associated with producing a product is also a key component of pricing the product. An effective way of understanding and managing product costs is developing crop budgets. Budgets are an essential part of planning and risk analysis for agricultural production systems. Crop budgets allow producers to estimate on paper, costs and potential income, before allocating funds and other resources. According to Ahearn and Newton (2009), new and beginning farmers face two primary obstacles: high startup costs and a lack of available land for purchase or rent (an even more intense problem in the state of New Jersey). Because of the limited resources that these farmers must work with, it is important to manage resources efficiently from the get go. Creating crop budgets is one way of helping new and beginning farmers allocate their resources wisely.
Although budgets exist in different states for some crops production costs vary considerable between regions, farms, and seasons. These budgets seeks to fill the gap of lack of, or outdated budgets for the farming community of the state of New Jersey.
|Conference||2017 Extension Risk Management Education National Conference|