Pena, Jose G.

Taylor, Merritt J.

Teague, Paul

English

Texas A&M University

l-2327
Texas Agricultural Extension Service
Texas Citrus
Orchard Establishment Costs
Merritt J. Taylor, Jose G. Pena and Paul Teague*
Prior to the 1983 freeze, the citrus industry in
the Lower Rio Grande Valley was tied to large
investments in groves that were not providing
returns comparable to alternative agricultural
investments. Growers recognized that there were
new varieties, ownership arrangements, planting
schemes and production systems that would
increase profit potential of the land resource but
were unable to make the costly changes.
The devastating freeze in December 1983 resulted
in a loss of about 70 percent of the citrus trees-
from approximately 69,000 acres to 22,000 acres.
In addition, those trees that remained alive required
extensive rehabilitation. Production was virtually
zero in the 1984-85 season. In the ensuing three
years production reached about 2 to 3, 18 to 20 and
35 to 40 percent of pre-freeze levels, respectively,
on rehabilitated trees.
Some of the land previously planted in citrus
was only marginally suited because of poor drainage
and land quality. However, many of the fields
were excellent for citrus production. The re-
establishment of the better lands into citrus groves
provides an opportunity for the Texas citrus
industry to develop more modern production
systems and more productive orchards. The
availability of comparatively inexpensive suitable
land, water resources and other economic factors
have attracted an increasing number of investors
interested in reestablishing a major part of the
Texas citrus industry.
Citrus orchard production is a capital and labor
intensive, longterm enterprise. Citrus orchard
establishment often requires 3 to 4 years and it
*Extension economists-management, The Texas A&M Univer-
sity System, and former citrus economist, Texas A&I University
Citrus Center, Weslaco, Texas.
takes 8 to 9 years to recapture the accumulated
expenses. Costs of entry, however, are highly
variable and depend on orchard size, land quality,
equipment available and the owner's management
capabilities.
The objective of this paper is to outline the
economic factors that affect the establishment and
operation of a citrus orchard. This will include the
equipment required and expected costs and returns
for the specific case of a small-acreage, high-
technology operation. The case of a large com-
mercial scale farm will not be addressed in this
paper. Establishment and development costs will
be converted to a 15 -year cash flow projection and
the investment will be analyzed using the net
present value system.
Assumptions
The data used to support this publication were
collected from orchard managers, research
scientists, agribusinessmen, Texas A&I Citrus
Center personnel and Texas A&M University
Extension and Research specialists.
Land Tenure
The three most common types of citrus
operations in the Lower Rio Grande area are:
1) complete management services for investor-
owned orchards; 2) owner managed with major
equipment operations performed by use of custom
services and 3) complete owner/operator-managed
orchards. This paper will concentrate on the
second category where some equipment and
services are provided by the manager, but the
major spray operations are conducted by custom
operators.
Returns
Returns are to management and risk because an
imputed charge is not calculated for the owner's
management.
Texas Agricultural Extension Service. Zerle L. Carpenter, Director. The Texas A&M University System • College Station, Texas
~----------------------------------
Table 1. Land preparation custom hire costs, (Fall
1987).
Table 2. Basic machinery required for citrus
orchard maintenance, Lower Rio Grande Valley,
Texas.
Orchard Establishment Costs
Table 3 provides an estimate of the costs in the
initial establishment year that includes land leveling
and tree purchasing and planting. The orchard
Although the expenditures to purchase
equipment and establish the orchard are substantial,
they are not considered a cost, but rather an
investment. Investments, however, generate costs
to the business. These costs are represented as
ownership costs of operating the "manufacturing
plant". Ownership costs or fixed costs, as they are
normally called, include depreciation, interest on
the investment, taxes and insurance. These costs
occur annually and are unrelated to the amount of
production from the orchard.
Capital investments in machinery, excluding
land and orchard establishment, during the first
year total $24,200 for the orchard or $1,210 per
acre, as shown in Table 2. The investment shown
in this table is the minimum amount required to
operate an intensive, well-managed citrus orchard.
Items shown are assumed to be new. Good used
equipment is available and could be used to reduce
initial investment requirements. Note that only
one-fourth of the pickup value is allocated to the
orchard.
$100.00/acre
$1.00/tree
$0.60/tree
Cost
per
acre
$162.50
637.50
30.00
40.00
160.00
80.00
100.00
$1,210.00$24,200
$ 3,250
12,750
600
800
3,200
1,600
2,000
Estimated cost
for 20-acre
orchard
Overhead Costs
Operation
Land preparation and leveling
Custom layout! plant orchard
Tree wrap
Equipment
Pickup truck $13,000/4
Tractor (30-45 PTa hp)
Blade (5 ft)
Shredder (5 ft)
Disk (offset 8 ft)
Disk (border)
Herbicide rig
Land Preparation
Land preparation is the first consideration after
site selection and orchard planning. Table 1
provides an estimate of land preparation costs. It
is suggested that custom-hire operators be used
because heavy equipment is required and equipment
purchase or lease considerations appear too
expensive for a 20-acre tract. Custom-hire costs
are highly variable and depend on the availability
of custom-hire operators to provide required
services in a particular area. The costs for the
various required activities varied 20 percent to 30
percent in the survey group. The costs shown in
Table 1 represent the middle of the range.
Orchard Size
A hypothetical 20-acre orchard model is used
throughout this study, but the costs are discussed
on a cost-per-acre basis. It was necessary to select
an historically economic unit because high manage-
ment and equipment requirements and the op-
eration size form a substantial influence on
establishment costs. It is understood that a larger
tract of land probably would reduce the cost-per-
acre charges for equipment.
Soil and Irrigation
It is assumed that the orchard will be established
on alluvial soil in an area previously occupied by a
producing orchard and needing no drainage system.
Rio Grande water supplied through existing water
districts will be used as a primary water source,
applied through a permanent valve system.
Orchard Characteristics
The management unit is a 20-acre orchard with
a tree density of 145 trees/acre.
Prices
The establishment costs are based on Fall, 1987
costs. Citrus fruit sales are estimated to average
$135 per ton.
Miscellaneous
The study assumes that the equipment, labor
and other supplies will be obtained specifically for
the orchard establishment and operation. Har-
vesting will be conducted and paid for by the
buyer.
Tax Issues
This study does not address income tax issues as
these implications should be addressed in the
context of the total business and with specialized
professional assistance.
-----~
will require approximately.51 ,331/acre in variable
costs and S:,73/acre in overhead costs for a total of
about 31 ,704/acre.
The values provided in these budgets represent
an average of the costs and returns that were
obtained from growers. They do not represent the
costs and returns of any particular orchard.
Potential investors should modify these estimates
and adapt them to more accurately describe a
specific operation.
Orchard Development
and Operational Costs
Table 4 provides an estimate of the costs and
returns to develop and operate the orchard during
the second and third years after establishment. A
small amount of production should begin in the
third year. During the first year of economic
production (year:'), variable production costs will
average about 3484/acre with overhead costs
averaging about 5291/ acre for a total projected
cost of about $775/ acre.
Table 3. Citrus orchard establishment (year 1) Lower Rio Grande Valley,
1988 projected costs and returns per acre
Category
Projected
yield unit
Projected
$/unit value
1. Gross receipts
Total projected returns
2. Variable costs
Preharvest costs
Land prep. and level
Trees
Custom layout! plant
Tree wrap
Nitrogen
Fertilizer appl.
Miticide
Insecticide
Insecticide appl.
Spot herbicide
Preemergence herbicide
Irrig water (strips)
Fuel and lube
Repairs
Labors-mach inery
irrigation
herb and other
Tree insurance (LVL-2)
Operating capital int.
Total variable costs
3. Income above variable costs
4. Fixed costs
Cash Costs
Taxes
Misc. admin. o/h
Interest on equipment
Interest on irr. syst.
Non cash costs
Land
Equipment depreciation
In. syst. depreciation
Total fixed costs
5. Total projected costs
6. Net projected returns
to risk and management
0.00
Input use
1.00 acre
145.00 tree
145.00 tree
145.00 tree
19.00 lb.
4.00 appl
0.60 qt.
0.60 qt.
2.00 appl.
1.00 acre
1.40 qt.
12.00 appl.
1.00 acre
1.00 acre
1.09 hour
12.00 hour
12.00 hour
1 acre
631.01 sum/2
acre
acre
1.00 acre
1.00 acre
11.005 year
11.005 year
$2,000.00 acre
15.00 years
20.00 years
acre
acre
acre
0.00
100.00
4.50
1.00
0.60
0.26
3.00
8.28
9.70
8.00
17.00
15.00
4.00
2.26
0.47
6.13
4.70
4.70
25.58
0.11
20.00
7.50
1210.00
300.00
5%
1210.00
300.00
$0.00
$0.00
$100.00
652.50
145.00
87.00
4.94
12.00
4.97
5.82
16.00
17.00
21.00
48.00
2.26
0.47
6.68
56.40
56.40
25.58
69.41
$1,331.43
($1,331.43)
$20.00
7.50
133.10
33.00
100.00
64.53
15.0
$373.13
$1,704.56
($1,704.56)
Note: Projections for planning purposes only. Should not be used without updating.
@l-----
Table 4. Citrus orchard establishment budget estimates for Years 2 and 3, Lower Rio Grande Valley,
1988 projected costs and returns per acre
Phase of Development
Establishment Establishment
(year 2) (year 3)
Projected ..................... Projected ............................ _ .. -.
Category Yield (unit) $/Unit Value Yield (unit) $/Unit Value
1. Total projected receipts 0.00 ton $0.00 $0.00 2.00 ton $135.00 $270.00
----- .... -...................... -.- .....................
2. Variable costs Input Use Input Use
Preharvest costs
Nitrogen 37.00 lb. $0.26 $9.62 74.00 lb. $0.26 $19.24
Fertilizer appl. 4.00 appl. 3.00 12.00 3.00 appl. 3.00 9.00
Tree replacement 3.00 tree 8.00 24.00 0.00 tree 8.00 0.00
Tree hedging 0.00 acre 60.00 0.00 0.00 acre 60.00 0.00
Miticide 1.00 qt. 8.28 8.28 2.00 qt. 8.28 16.56
Citrus oil 0.00 gal. 4.60 0.00 5.00 gal 4.60 23.00
Insecticide #1 1.20 qt. 9.68 11.62 2.00 qt. 9.68 19.36
Insecticide #2 0.00 qt. 38.76 0.00 0.50 qt. 38.76 19.38
Insecticide appl. #1 2.00 appl. 8.00 16.00 0.00 appl. 8.00 0.00
Insecticide appl.#2 0.00 appl. 21.75 0.00 3.00 appl. 21.75 65.25
Fungicide 0.00 lb. 2.30 0.00 6.00 lb. 2.30 13.80
Contact herbicide 1.00 appl. 17.50 17.50 1.00 appl. 17.50 17.50
Contact herb. appl. 1.00 appl. 8.00 8.00 1.00 appl. 8.00 8.00
Selective herb. #1 0.00 qt. 3.60 0.00 5.00 qt. 3.60 18.00
Selective herb #2 0.00 lb. 3.20 0.00 5.00 lb. 3.20 16.00
Preemergence herb 1.33 qt. 15.00 19.95 qt. 15.00 0.00
Irriga.tion water 6.00 appl. 8.00 48.00 6.00 appl. 8.00 48.00
Fuel & lube 1.00 acre 1.69 1.69 1.00 acre 1.13 1.13
Repairs 1.00 acre 0.35 0.35 1.00 acre 0.24 0.24
Labor-machinery 3.00 hour 6.13 18.39 0.55 hour 6.13 3.37
irrigation 12.00 hour 4.70 56.40 9.00 hour 4.70 42.30
other 14.00 hour 4.70 65.80 12.00 hour 4.70 56.40
Tree insurance LVL-2 1.00 acre 46.50 46.50 1.00 acre 62.00 62.00
Operating capital int. $182.05 sum/2 11% 20.02 229.27 sum/2 0.11 25.22
Total variable costs per acre $384.12 per acre $483.75
Break-even price/ton to cover variable costs N/A to cover variable costs $241.88
3. Income above
variable cost per acre ($384.12) per acre ($213.75)
4. Fixed costs
Cash costs
Taxes 1.00 acre 20.00 $20.00 1.00 acre $20.00 $20.00
Misc. admin. o/h 1.00 acre 7.50 7.50 1.00 acre 7.50 7.50
Int. on equip. $1,210.00 5 yrs 11% 85.18 $1,210.00 5 yrs 11% 63.89
Int. on irr. sys. $300.00 5 yrs 11% 26.40 $300.005 yrs 11% 19.80
Non-cash
Land $2,OOO.00/acre 5% 100.00 $2,000.00/acre 5% 100.00
Equip. deprec. $1,210.00 15 yr Str. Ln. 64.53 $1,210.00 15 yr Str. Ln. 64.53
Irr. sys. depr. $300.00 20 yr Str. Ln. 15.00 $300.00 20 yr Str. Ln. 15.00
Total fixed costs per acre $318.62 per acre $290.72
5. Total projected costs per acre $702.74 per acre $774.57
Break-even price N/A $387.24
6. Net projected returns
to risk and management per acre ($702.74) per acre ($504.47)
Note: Projections for planning purposes only. Should not be used without updating
Educational programs conducted by the Texas Agricultural Extension Service serve people of all ages regardless of socioeconomic
level, race, color, sex, religion, handicap or national origin.
Issued in furtherance of Cooperative Extension Work in Agriculture and Home Economics, Acts of Congress of May 8, 1914. as
amended, and June 30,1914, in cooperation with the United States Department of Agriculture. Zerle L. Carpenter, Director, Texas
Agricultural Extension Service, The Texas A&M University System.
1.5M-9-88, New HaRT 2-2, ECO 7-1


Texas Citrus Orchard Establishment Costs.

Texas A&amp;M Repository

l-2327Texas Agricultural Extension ServiceTexas CitrusOrchard Establishment CostsMerritt J. Taylor, Jose G. Pena and Paul Teague*Prior to the 1983 freeze, the citrus industry inthe Lower Rio Grande Valley was tied to largeinvestments in groves that were not providingreturns comparable to alternative agriculturalinvestments. Growers recognized that there werenew varieties, ownership arrangements, plantingschemes and production systems that wouldincrease profit potential of the land resource butwere unable to make the costly changes.The devastating freeze in December 1983 resultedin a loss of about 70 percent of the citrus trees-from approximately 69,000 acres to 22,000 acres.In addition, those trees that remained alive requiredextensive rehabilitation. Production was virtuallyzero in the 1984-85 season. In the ensuing threeyears production reached about 2 to 3, 18 to 20 and35 to 40 percent of pre-freeze levels, respectively,on rehabilitated trees.Some of the land previously planted in citruswas only marginally suited because of poor drainageand land quality. However, many of the fieldswere excellent for citrus production. The re-establishment of the better lands into citrus grovesprovides an opportunity for the Texas citrusindustry to develop more modern productionsystems and more productive orchards. Theavailability of comparatively inexpensive suitableland, water resources and other economic factorshave attracted an increasing number of investorsinterested in reestablishing a major part of theTexas citrus industry.Citrus orchard production is a capital and laborintensive, longterm enterprise. Citrus orchardestablishment often requires 3 to 4 years and it*Extension economists-management, The Texas A&M Univer-sity System, and former citrus economist, Texas A&I UniversityCitrus Center, Weslaco, Texas.takes 8 to 9 years to recapture the accumulatedexpenses. Costs of entry, however, are highlyvariable and depend on orchard size, land quality,equipment available and the owner's managementcapabilities.The objective of this paper is to outline theeconomic factors that affect the establishment andoperation of a citrus orchard. This will include theequipment required and expected costs and returnsfor the specific case of a small-acreage, high-technology operation. The case of a large com-mercial scale farm will not be addressed in thispaper. Establishment and development costs willbe converted to a 15 -year cash flow projection andthe investment will be analyzed using the netpresent value system.AssumptionsThe data used to support this publication werecollected from orchard managers, researchscientists, agribusinessmen, Texas A&I CitrusCenter personnel and Texas A&M UniversityExtension and Research specialists.Land TenureThe three most common types of citrusoperations in the Lower Rio Grande area are:1) complete management services for investor-owned orchards; 2) owner managed with majorequipment operations performed by use of customservices and 3) complete owner/operator-managedorchards. This paper will concentrate on thesecond category where some equipment andservices are provided by the manager, but themajor spray operations are conducted by customoperators.ReturnsReturns are to management and risk because animputed charge is not calculated for the owner'smanagement.Texas Agricultural Extension Service. Zerle L. Carpenter, Director. The Texas A&M University System • College Station, Texas~----------------------------------Table 1. Land preparation custom hire costs, (Fall1987).Table 2. Basic machinery required for citrusorchard maintenance, Lower Rio Grande Valley,Texas.Orchard Establishment CostsTable 3 provides an estimate of the costs in theinitial establishment year that includes land levelingand tree purchasing and planting. The orchardAlthough the expenditures to purchaseequipment and establish the orchard are substantial,they are not considered a cost, but rather aninvestment. Investments, however, generate coststo the business. These costs are represented asownership costs of operating the "manufacturingplant". Ownership costs or fixed costs, as they arenormally called, include depreciation, interest onthe investment, taxes and insurance. These costsoccur annually and are unrelated to the amount ofproduction from the orchard.Capital investments in machinery, excludingland and orchard establishment, during the firstyear total $24,200 for the orchard or $1,210 peracre, as shown in Table 2. The investment shownin this table is the minimum amount required tooperate an intensive, well-managed citrus orchard.Items shown are assumed to be new. Good usedequipment is available and could be used to reduceinitial investment requirements. Note that onlyone-fourth of the pickup value is allocated to theorchard.$100.00/acre$1.00/tree$0.60/treeCostperacre$162.50637.5030.0040.00160.0080.00100.00$1,210.00$24,200$ 3,25012,7506008003,2001,6002,000Estimated costfor 20-acreorchardOverhead CostsOperationLand preparation and levelingCustom layout! plant orchardTree wrapEquipmentPickup truck $13,000/4Tractor (30-45 PTa hp)Blade (5 ft)Shredder (5 ft)Disk (offset 8 ft)Disk (border)Herbicide rigLand PreparationLand preparation is the first consideration aftersite selection and orchard planning. Table 1provides an estimate of land preparation costs. Itis suggested that custom-hire operators be usedbecause heavy equipment is required and equipmentpurchase or lease considerations appear tooexpensive for a 20-acre tract. Custom-hire costsare highly variable and depend on the availabilityof custom-hire operators to provide requiredservices in a particular area. The costs for thevarious required activities varied 20 percent to 30percent in the survey group. The costs shown inTable 1 represent the middle of the range.Orchard SizeA hypothetical 20-acre orchard model is usedthroughout this study, but the costs are discussedon a cost-per-acre basis. It was necessary to selectan historically economic unit because high manage-ment and equipment requirements and the op-eration size form a substantial influence onestablishment costs. It is understood that a largertract of land probably would reduce the cost-per-acre charges for equipment.Soil and IrrigationIt is assumed that the orchard will be establishedon alluvial soil in an area previously occupied by aproducing orchard and needing no drainage system.Rio Grande water supplied through existing waterdistricts will be used as a primary water source,applied through a permanent valve system.Orchard CharacteristicsThe management unit is a 20-acre orchard witha tree density of 145 trees/acre.PricesThe establishment costs are based on Fall, 1987costs. Citrus fruit sales are estimated to average$135 per ton.MiscellaneousThe study assumes that the equipment, laborand other supplies will be obtained specifically forthe orchard establishment and operation. Har-vesting will be conducted and paid for by thebuyer.Tax IssuesThis study does not address income tax issues asthese implications should be addressed in thecontext of the total business and with specializedprofessional assistance.-----~will require approximately.51 ,331/acre in variablecosts and S:,73/acre in overhead costs for a total ofabout 31 ,704/acre.The values provided in these budgets representan average of the costs and returns that wereobtained from growers. They do not represent thecosts and returns of any particular orchard.Potential investors should modify these estimatesand adapt them to more accurately describe aspecific operation.Orchard Developmentand Operational CostsTable 4 provides an estimate of the costs andreturns to develop and operate the orchard duringthe second and third years after establishment. Asmall amount of production should begin in thethird year. During the first year of economicproduction (year:'), variable production costs willaverage about 3484/acre with overhead costsaveraging about 5291/ acre for a total projectedcost of about $775/ acre.Table 3. Citrus orchard establishment (year 1) Lower Rio Grande Valley,1988 projected costs and returns per acreCategoryProjectedyield unitProjected$/unit value1. Gross receiptsTotal projected returns2. Variable costsPreharvest costsLand prep. and levelTreesCustom layout! plantTree wrapNitrogenFertilizer appl.MiticideInsecticideInsecticide appl.Spot herbicidePreemergence herbicideIrrig water (strips)Fuel and lubeRepairsLabors-mach ineryirrigationherb and otherTree insurance (LVL-2)Operating capital int.Total variable costs3. Income above variable costs4. Fixed costsCash CostsTaxesMisc. admin. o/hInterest on equipmentInterest on irr. syst.Non cash costsLandEquipment depreciationIn. syst. depreciationTotal fixed costs5. Total projected costs6. Net projected returnsto risk and management0.00Input use1.00 acre145.00 tree145.00 tree145.00 tree19.00 lb.4.00 appl0.60 qt.0.60 qt.2.00 appl.1.00 acre1.40 qt.12.00 appl.1.00 acre1.00 acre1.09 hour12.00 hour12.00 hour1 acre631.01 sum/2acreacre1.00 acre1.00 acre11.005 year11.005 year$2,000.00 acre15.00 years20.00 yearsacreacreacre0.00100.004.501.000.600.263.008.289.708.0017.0015.004.002.260.476.134.704.7025.580.1120.007.501210.00300.005%1210.00300.00$0.00$0.00$100.00652.50145.0087.004.9412.004.975.8216.0017.0021.0048.002.260.476.6856.4056.4025.5869.41$1,331.43($1,331.43)$20.007.50133.1033.00100.0064.5315.0$373.13$1,704.56($1,704.56)Note: Projections for planning purposes only. Should not be used without updating.@l-----Table 4. Citrus orchard establishment budget estimates for Years 2 and 3, Lower Rio Grande Valley,1988 projected costs and returns per acrePhase of DevelopmentEstablishment Establishment(year 2) (year 3)Projected ..................... Projected ............................ _ .. -.Category Yield (unit) $/Unit Value Yield (unit) $/Unit Value1. Total projected receipts 0.00 ton $0.00 $0.00 2.00 ton $135.00 $270.00----- .... -...................... -.- .....................2. Variable costs Input Use Input UsePreharvest costsNitrogen 37.00 lb. $0.26 $9.62 74.00 lb. $0.26 $19.24Fertilizer appl. 4.00 appl. 3.00 12.00 3.00 appl. 3.00 9.00Tree replacement 3.00 tree 8.00 24.00 0.00 tree 8.00 0.00Tree hedging 0.00 acre 60.00 0.00 0.00 acre 60.00 0.00Miticide 1.00 qt. 8.28 8.28 2.00 qt. 8.28 16.56Citrus oil 0.00 gal. 4.60 0.00 5.00 gal 4.60 23.00Insecticide #1 1.20 qt. 9.68 11.62 2.00 qt. 9.68 19.36Insecticide #2 0.00 qt. 38.76 0.00 0.50 qt. 38.76 19.38Insecticide appl. #1 2.00 appl. 8.00 16.00 0.00 appl. 8.00 0.00Insecticide appl.#2 0.00 appl. 21.75 0.00 3.00 appl. 21.75 65.25Fungicide 0.00 lb. 2.30 0.00 6.00 lb. 2.30 13.80Contact herbicide 1.00 appl. 17.50 17.50 1.00 appl. 17.50 17.50Contact herb. appl. 1.00 appl. 8.00 8.00 1.00 appl. 8.00 8.00Selective herb. #1 0.00 qt. 3.60 0.00 5.00 qt. 3.60 18.00Selective herb #2 0.00 lb. 3.20 0.00 5.00 lb. 3.20 16.00Preemergence herb 1.33 qt. 15.00 19.95 qt. 15.00 0.00Irriga.tion water 6.00 appl. 8.00 48.00 6.00 appl. 8.00 48.00Fuel & lube 1.00 acre 1.69 1.69 1.00 acre 1.13 1.13Repairs 1.00 acre 0.35 0.35 1.00 acre 0.24 0.24Labor-machinery 3.00 hour 6.13 18.39 0.55 hour 6.13 3.37irrigation 12.00 hour 4.70 56.40 9.00 hour 4.70 42.30other 14.00 hour 4.70 65.80 12.00 hour 4.70 56.40Tree insurance LVL-2 1.00 acre 46.50 46.50 1.00 acre 62.00 62.00Operating capital int. $182.05 sum/2 11% 20.02 229.27 sum/2 0.11 25.22Total variable costs per acre $384.12 per acre $483.75Break-even price/ton to cover variable costs N/A to cover variable costs $241.883. Income abovevariable cost per acre ($384.12) per acre ($213.75)4. Fixed costsCash costsTaxes 1.00 acre 20.00 $20.00 1.00 acre $20.00 $20.00Misc. admin. o/h 1.00 acre 7.50 7.50 1.00 acre 7.50 7.50Int. on equip. $1,210.00 5 yrs 11% 85.18 $1,210.00 5 yrs 11% 63.89Int. on irr. sys. $300.00 5 yrs 11% 26.40 $300.005 yrs 11% 19.80Non-cashLand $2,OOO.00/acre 5% 100.00 $2,000.00/acre 5% 100.00Equip. deprec. $1,210.00 15 yr Str. Ln. 64.53 $1,210.00 15 yr Str. Ln. 64.53Irr. sys. depr. $300.00 20 yr Str. Ln. 15.00 $300.00 20 yr Str. Ln. 15.00Total fixed costs per acre $318.62 per acre $290.725. Total projected costs per acre $702.74 per acre $774.57Break-even price N/A $387.246. Net projected returnsto risk and management per acre ($702.74) per acre ($504.47)Note: Projections for planning purposes only. Should not be used without updatingEducational programs conducted by the Texas Agricultural Extension Service serve people of all ages regardless of socioeconomiclevel, race, color, sex, religion, handicap or national origin.Issued in furtherance of Cooperative Extension Work in Agriculture and Home Economics, Acts of Congress of May 8, 1914. asamended, and June 30,1914, in cooperation with the United States Department of Agriculture. Zerle L. Carpenter, Director, TexasAgricultural Extension Service, The Texas A&M University System.1.5M-9-88, New HaRT 2-2, ECO 7-1

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Texas Citrus Orchard Establishment Costs.

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Texas Citrus Orchard Establishment Costs.

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