Depreciation
Depreciation is calculated using the “Activity Method” for every operation that uses a capex.
The activity method calculation requires 3 equations: depreciable base, depreciation per unit, and depreciation for a period.
Let’s walk through an example: Calculating the depreciation cost of a tractor for the below operation titled Block Installation.
1. Depreciable Base = Unit Cost - Salvage Value
In OY, the salvage value is assumed to be zero, so the calculation would follow:
DB = $10,000 - 0 = $10,000
2. Depreciation per hour = Depreciable Base / Expected lifespan
DPH = $10,000 / 22,000 hours = $0.45/ hour
Depreciation for an Operation = Depreciation per hour x Duration of an Operation
Depreciation = $0.45/hour x 48 hours = $21.6 ~ rounded up to $22
This aligns with the depreciation listed in your Operations dashboard (see below).
Yield
Your Yield calculation is based on your stem/tree count (defined during the design process), as well as your target yield, 30 year yield model, mortality rate, and loss events (all defined in your crop template).
The yield for any given year will be calculated as follows:
# Survived trees × Target yield × % Target yield achieved (expressed as a decimal)* × Loss event 1 adjustment (expressed as a decimal) × Loss event 2 adjustment, etc.
* Note: % Target yield achieved will depend on the age of the tree, meaning calculating final yield involves calculating survived trees and replanted trees separately (replanted trees will always be 1 year younger).
For example, say you:
Planted 2739 trees in 2023
Expect 10% mortality for the original planting, which you will replant in 2024
Expect the following loss events:
5% shrinkage annually
20% disease loss every four years starting in year 7
And plan for a target yield of 3 lbs per tree, achieved in year 7, with the following yield curve.
How would Overyield calculate yield in year 7, for example?
The calculation would follow:
2739 trees total x .9 survival = 2465.1 survived trees
2465.1 survivors x 3 lbs per tree (target yield) x 1 (100% target yield achieved)
= 7395.3 lbs before losses
- yield loss from shrinkage (5%)
- yield loss from diseases/pests (20%)
= 7395.3 lbs * .95 (shrinkage) * .8 (diseases/pests) = 5620.4 lbs
2739 trees total x .1 replanted = 273.9 replanted trees
273.9 replanted trees x 3 lbs per tree (target yield) x .7 (70% yield achieved)
= 575.19 lbs
- yield loss from shrinkage (5%) = 546.43 lbs
5620 lbs from survied trees + 546 lbs from replanted trees
= 6166 lbs yield in year 7 (2029)
This aligns with the yield displayed in the Yield dashboard (see below).
A few notes to consider during these calculations:
Loss events are factored in cumulatively based on the order the loss event was added to a template.
Loss events occur based on the age of the tree. In the above example, the pest and disease loss event (programmed to begin in year 7) only affected the survived trees but did not affect the replanted trees. This is because the survivors reached their 7th year, while the replanted trees were a year behind in growth and had not reached the loss year threshold.
Area
Within every design, users can view surface area calculations for every crop measured in acreage or hectarage, broken down across the whole farm and individual sections. Crop area is calculated differently depending on the Section type created.
Lines
Crop area for Line sections is based on several factors: number of rows, between-row spacing, and row length.
For example, the line section pictured is planted out in apples and bananas.
If we zoom in on its individual rows via our Inspect/Design panels, we can see that the banana and apple row are both 59 ft long, with a between-row spacing of 12 ft.
The calculation for the area of apples or bananas would follow:
59 ft x 12 ft = 708 sq ft
708 sq ft / 43560 sq ft (one square acre)
= .016 acres
This aligns with the area calculated by Overyield, pictured below, which is rounded to two decimal points for clarity.
Grids and Keylines
Area for crops in Grid and Keyline Sections is based on the polygon’s overall area, row count, and the relative proportion of each crop planted in the section.
For example, in the pictured Grid, we can see 3 rows of apples and 1 row of bananas represented.
Using the Line as a measuring tool, we can glean that Section length and width are 116 ft and 52 ft respectively, equaling a total section area of 6032 sq ft or .14 acres.
The calculation for each crop’s area would follow:
Apples:
.14 acres / 4 total rows x 1 row apples =
.035 x 1 = .035 ~ .04
Bananas:
.14 acres / 4 total rows x 3 rows bananas =
.035 x 3 = .105 ~ .11
These figures align with the areas calculated by Overyield, pictured below.
