MU Extension urges enterprise budgeting
The University of Missouri Extension is urging farmers to use its enterprise budgets to prepare their farms for financial success this year.
Ryan Milhollin, ag economics professor, says they have 30 enterprise budgets for everything from crops and forages to livestock and dairy.
“You take our MU budgets, you customize them for your own situation. Spend some time beating on our budgets, looking at them, figure out, is that my cost structure or not. How do I deviate from that MU budget? Really customize it for your situation.”
Farmers are able to adjust things like higher fertilizer prices and see how things might play out.
“If I increase costs 10 to 30% on my budget, what’s it do to my bottom line? Also, on the optimistic side, you know, when things are better, prices are better, what’s it do if corn price is up 20% better than what the budget is. What’s it in line for me?
Milhollin says customized enterprise budgets provide basic information to do a cash flow statement and can be taken to bankers when applying for operating loans.