Commodity Costs and Returns Estimation Handbook | Economics NRCS
A Report of the AAEA Task Force on Commodity Costs and Returns
This handbook's purpose is to gather in one place information on estimating costs of and returns to agricultural enterprises. Some of the earliest formal work in agricultural economics related to the analysis and interpretation of cost data (H. C. Taylor). A major task of many individuals over the years has been the preparation and distribution of detailed cost of production estimates and projections. Undergraduate students in farm management classes have spent many hours learning how to prepare a projected corn or rice budget. In many states the extension service routinely prepares representative cost of production projections for use by area producers. And in many areas farm record associations provide annual cost of production summaries based on data collected from members. The United States Department of Agriculture (USDA) has been involved in the estimation of costs and returns (CARS) to agricultural enterprises for many years, the latest effort under the auspices of the Agricultural Resource Management Study (ARMS). This monograph was prepared by a Task Force organized by the American Agricultural Economics Association's Economic Statistics and Information Resources Committee. The mission given to the Task Force by the committee was to recommend standardized practices for generating costs and returns estimates for agricultural commodities after a careful examination of the relevant economic theory and the merits of alternative methods.