Farm business management: Machinery investment and costs
Farm business management: Machinery investment and costs
Published: 3 Mar 2014
Investment in technology-enhanced machinery has provided significant productivity gains for grain growers over the last 10 years. However, determining the appropriate level of machinery investment for an individual farm business can be a challenge.
Key points
- Investment in better machinery can offset the need for additional labour.
- On average, farming businesses have a 1:1 machinery income efficiency ratio.
- Machinery costs, including the use of contractors, are, on average, one third of farm income and are higher than fertiliser and chemical costs combined.
- Machinery replacement can be delayed until there are sufficient surplus funds in good years. However, the trend towards financing machinery over three to five years results in machinery capital being a fixed overheard cost in all years, and averages 11 per cent of farm income.
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Region South
- 3.09 mbFarm Business Management fact sheet: Machinery investments and costs (High resolution version)Investment in technology-enhanced machinery has provided significant productivity gains for grain growers over the last 10 years. However, determining the appropriate level of machinery investment for an individual farm business can be a challenge.
- 421.30 kbFarm Business Management fact sheet: Machinery investments and costs (Low resolution version)Investment in technology-enhanced machinery has provided significant productivity gains for grain growers over the last 10 years. However, determining the appropriate level of machinery investment for an individual farm business can be a challenge.
Region: South
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