Cornhusker Economics June 29, 2022
2022 Nebraska Agricultural Custom Rates with Statewide Survey Summary

With rising operational costs for agricultural machine hire and services, rates reported on the 2022 University of Nebraska-Lincoln Custom Rates Survey were mostly higher than rates reported on the 2020 survey, ranging from 6% to nearly 20% greater on some common custom services. For example, state average custom rates for harvesting corn and soybeans per acre increased to $41.63 and $40.18 from $39.34 and $37.29, respectively, two years ago.  Planting row crop average rates across Nebraska range from $20.17 per acre (no coulters, without band applicator) to $23.50 per acre for ridge planting with band applicator, up 6% to 8% from 2020. Table 1 provides a summary of popular machinery operations for hire, or the rates most reported on from the Nebraska survey, and includes rate averages, the ‘most common’ reported rate per operation, and the range of custom rates charged per operation in Nebraska.   

Agricultural custom rate charges can vary across the state; therefore, the Nebraska Custom Rates Report provides rate details from survey responses grouped by Nebraska Agricultural Statistics Districts.  

Several factors contribute to rate differences reported by survey participants, including field and job sizes, soil conditions, and the number of responses for the various operations. Some operators may charge lower than market rate prices to neighbors or relatives. Rates may change from year to year due to expense differences and local market forces. Determining appropriate charges for custom machine hire and agricultural services may include consideration of various elements including current market rates as reported in the custom rates survey report, market demand in the area for specific types of custom work, and availability of services. In addition, machine owners and custom operators should consider their own machine ownership and operating costs to adequately price custom rate services.

The UNL Center for Agricultural Profitability has developed the Agricultural Budget Calculator (ABC) program to assist producers in tracking their enterprise costs including machinery and equipment used in their agricultural operations.  Custom operators can utilize the online program, agbudget.unl.edu to enter their machinery and equipment information such as purchase value, length of anticipated ownership and other key information, along with their actual fuel prices, labor costs and estimated annual repair expense for each machine to determine operation costs per acre.  Fuel, repair, and salvage value cost factors and calculations from the American Society of Agricultural and Biological Engineers (ASABE) are utilized in the ABC program. The ABC machinery cost calculations for machinery and equipment ownership and operation costs, combined with the Nebraska Custom Rates Report data, should assist custom operators in setting charges that are comparable in the marketplace while covering all costs. 

With the growing investment cost of agricultural machinery and equipment, and often with the uncertainty in labor availability, many Nebraska farms and ranches utilize and pay for custom services. The biennial University of Nebraska-Lincoln Custom Rates Survey report has wide utilization by those who perform custom hire services and by producers who pay for services. The survey is distributed both by mail and electronically to Nebraska farm and ranch managers and agricultural service companies that have indicated that they have provided some type of custom machine, equipment rental, or service in the state and have charged for such services.

There were 193 survey responses received and tabulated in the 2022 report. Rates are included in the full report when at least three or more survey respondents provide their current rates charged for machine hire operations or services. Rates reported from the survey should reflect the cost of the machine, power unit, fuel, and labor unless otherwise stated. Custom contract farming, planting, fertilizer, and chemical application rates do not include material or input expenses. For baling, however, supplies such as wire, twine, or net wrap are included in the rates charged. Refer to the custom rate description in the report to understand cases where the operation does include additional inputs.

Full summaries from the survey, including regional rates for the eight Nebraska Statistics Districts and the overall state, are published as a University of Nebraska-Lincoln Extension Circular (EC) 823 and available online at: cap.unl.edu/customrates. The information presented in the state summary and full report should be used only as a guide when determining what to charge or pay for custom operations.

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Glennis McClure

Associate Extension Educator
Farm & Ranch Management Analyst
Department of Agricultural Economics
University of Nebraska-Lincoln
gmcclure3@unl.edu
402-472-0661