August 22, 2013
Todd Jeffries urges farmers to compare their soybean prices for 2014 vs. competitor's prices on the basis of cost per amount of seed, or overall cost per acre. Jeffries is the rep for Seed Consultants, Inc., in southeast Indiana.
The reason he urges companies to make that comparison is because they are the only company he's aware of that are packing or selling soybeans in units of 150,000 seeds per unit. Most are selling either 140,000 seeds per unit. Some competitors sell at 130,000 seeds per unit, and at the same time, recommend lower seeding rates.
Apples and oranges: Make sure you're making cost comparisons on like items. Some seed may be treated like in this plot, others may not. Some may have more seeds per pound than others.
The end result, Jeffries says, is that their price per unit for soybean seed may not always be the cheapest. But he believes they offer value if you consider how many seeds per unit you're getting, and plant by number of seeds per acre instead of pounds of seed per acre.
Here's an example. The prices used here are arbitrary and do not reflect actual prices set for 2014 by any company. Some companies have not yet set prices. The seed count per pound is also arbitrary. Actual seed count will vary by variety. In addition, Jeffries believes seed will likely be smaller in size than a year ago, when late rains pumped up seed size, even though yields were still below normal. This year yields may be normal or above, but with adequate rain all year, seed size may not be as big as last year for any given variety.
Suppose company A sells 130,000 seeds for $37. Company B sells 130,000 seeds for $40. Company C sells 150,000 seeds at $42. These are all priced before discount. You intend to seed 150,000 seed per acre.
If you buy from company A, your cost per acre will be $42.55. If you buy from company B, it will be $42.80. If you buy from company C, it's $42 per acre, the lowest of all by less than $1 per acre, even though their unit price was highest.
The bottom line is that it pays to calculate based on seeding rate before making buying decisions.
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