MACHINERY INVESTMENT

Figure 1 shows an estimated 2005 fair market value machinery investment function by size of farm based on information from Illinois FBFM cash grain farms. The upward sloping line indicates the estimated total machinery investment by tillable acre. For example, the average machinery investment for a 1,500 acre grain farm is approximately $405,541.

The downward sloping line indicates the machinery investment per acre function (vertical axis on the right). As shown in figure 1, machinery investment per acre declines as farm size increases. The average investment per acre for a 1,000 acre farm is $283, while the investment per acre for a 2,000 acre grain farm is $261. In summary, Figure 1 shows some general guidelines to follow when analyzing the amount of farm machinery investment.