Date of this Version
Cornhusker Economics, November 15, 2000, agecon.unl.edu/cornhuskereconomics
Some producers suggest they prepare a cash flow if needed for their lender, but otherwise find the projection too dependent upon unknowns to be useful. Earlier newsletters have suggested using projected cash flow commitments to determine the level of crop insurance coverage. Much of the information required to prepare a cash flow projection can also be used to prepare a projected return over variable costs (gross margin) for individual enterprises. Gross margins can be used to project, for example, which crops will be most profitable.