How Costs of Production Vary

Excerpts from the report: Costs of producing crops per unit of output vary considerably across farms. The major factors affecting cost levels are yields, input use, and size of farm. Major differences also exist by production region. The 25 percent of farms with the lowest costs account for as much as 50 percent of U.S. production. This report describes the cost of producing corn in 1987, soybeans in 1986, wheat in 1986, cotton in 1987, sorghum in 1986, and rice in 1984. For each of these commodities, we have analyzed the 25 percent of producers with the lowest costs of production ("low-cost producers"), the 25 percent with the highest costs ("high-cost producers"), and the 50 percent in the midrange of costs ("mid-cost producers”)