Perennial peanut hay producers should be able to provide the market with a good quality hay
and maintain profits in the future.

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Economics of Perennial Peanut Hay Production

Marianna NFREC Research Report 97-5

Timothy D. Hewitt, Extension Economist, UF, North Florida Research and Education Center, Marianna, Florida
Clay B. Olson, County Extension Director and Extension Agent III, Taylor County, Perry, Florida

The information presented below was taken from "Economics of Perennial Peanut Hay Production" (Marianna NFREC Research Report 97-5). To order this complete printed report contact your local extension office.

Perennial Peanut hay is a quality, high value hay that can be successfully grown in Florida.The quality and palatability of the hay make it desirable for many segments of the Florida livestock industry. Much hay is annually imported into Florida to meet the needs of a high quality hay. Perennial peanut hay has the potential to substitute for some of the imported hay. This high value forage crop can be grown at production costs comparable to or lower than costs incurred by growers nationwide who supply most of the hay to Florida markets. Establishing stands requires intensive management and production knowledge. Investment costs are high for haying equipment. Establishing, growing and harvesting perennial peanut hay can be costly. The economic analysis indicates that the investment costs can be recovered by hay producers at a level of production of three tons per acre. The information in this study indicates that the perennial peanut hay business may be profitable in Florida. At the low end prices of $100 per ton make hay more profitable than many North Florida agronomic crops. Markets do exist for good quality hay. Producers must establish a good stand, maintain yields and quality, and provide a good product to the users. Weather patterns will always be a factor in hay production in Florida. However, most hay producers learn to work around the rains to produce and harvest high quality hay. Perennial peanut hay producers should be able to provide the market with a good quality hay and maintain profits in the future. As the crop and markets develop, profit levels should increase and provide a good source of income to Florida hay producers.


Estimated Establishment Costs Per Acre for Perennial Peanut
North Florida, 1997


Variable Expenses

bd14693_.gif (837 bytes) Fertilizer
K Mag: 1.0 cwt, unit cost of   $14.00, total cost of $14.00
Potash (K2O): 140 lbs., unit cost off 14, total cost of $19.60
Sulfur: 20 lbs, unit cost of 18,
total cost of $3.60

bd14693_.gif (837 bytes) Lime
1.0 ton, unit cost of $24.00, total cost of $24.00

bd14693_.gif (837 bytes) Rhizomes
80 bushels, unit cost of $2.20, total cost of $176.00

bd14693_.gif (837 bytes) Custom spraying
1.0 acre, unit cost of $90.00, total cost of $90.00

bd14693_.gif (837 bytes) Herbicide
1.0 acre, unit cost of $40.00, total cost of $40.00

bd14693_.gif (837 bytes) Land Preparation
1.0 acre, unit cost of $30.00, total cost of $30.00

bd14693_.gif (837 bytes) Machinery
Fuel: 8.0 gallons, unit cost of 90, total cost of $7.20
Repairs and maintenance: 1.0 acre, unit cost of $12.00, total cost of $12.00
Hired labor: 5.0 hours, unit cost of $6.00, total cost of $30.00
Interest on cash expenses: $446.40, unit cost of 10, total cost of $44.64


Total Cash Expenses: $491.04

Fixed Costs

bd14693_.gif (837 bytes) Tractor and equipment: 1.0 acre, unit cost of $30.00, total cost of $30.00

bd14693_.gif (837 bytes) 
General overhead: $491.04, unit cost of 3, total cost of $14.73

bd14693_.gif (837 bytes)
Total fixed costs: $44.73

Total Costs: $535.77


Estimated Costs of Producing One Acre of Perennial Peanut
North Florida, 1997


Variable Expenses

bd14693_.gif (837 bytes) Fertilizer
K Mag: 1.0 cwt, unit cost of   $14.00, total cost of $14.00
Potash (K2O): 120 lbs., unit cost off 14, total cost of $16.80
Sulfur: 20 lbs, unit cost of 18,
total cost of $3.60

bd14693_.gif (837 bytes) Lime
.25 ton, unit cost of $24.00, total cost of $6.00

bd14693_.gif (837 bytes) Herbicide
1.0 acre, unit cost of $17.00, total cost of $17.00

bd14693_.gif (837 bytes) Machinery
Fuel: 14.0 gallons, unit cost of 90, total cost of $12.60
Repairs and maintenance: 1.0 acre, unit cost of $32.00, total cost of $32.00
Twine: 1.0 acre, unit cost of $7.50, total cost of $7.50
Hired labor: 8.0 hours, unit cost of $6.00, total cost of $48.00
Interest on cash expenses: $157.50, unit cost of 5, total cost of $7.88


Total Cash Expenses: $165.38

Fixed Costs


bd14693_.gif (837 bytes) Tractor and equipment: 1.0 acre, unit cost of $48.00, total cost of $48.00

bd14693_.gif (837 bytes) Establishment (prorated over 10 years): 1.0 acre, unit cost of $53.58, total cost of $53.58

bd14693_.gif (837 bytes) 
Overhead (3% of cash expenses): 165.38, unit cost of 3, total cost of $4.96

bd14693_.gif (837 bytes)
Total fixed costs: $106.54

Total Costs (10% for 6 months): $271.92


Break-even Prices at Various Yields

Yield Price Per Ton
2.5 108.77
3.0 90.64
3.5 77.69
4.0 67.98
4.5 60.43
5.0 54.38
5.5 49.44
6.0 45.32



Net Returns Per Acre with Varying Yields and Prices

Yield Per Acre
Price 3 4 5 6
100 28 128 228 328
125 103 228 353 478
150 178 328 478 628
175 253 428 603 778