SGM – Standard gross margins


The Standard Gross Margin (SGM) is a standardized quantity, which is used for grouping agricultural enterprises according to their type of production and for determining the economic size of a farm.

However, if no farm-specific figures are available, the figures can be used as a substitute for the output and input of agricultural production, e.g. within the framework of appraisal reports. But notice that with switching to the EU−typology from the economic year 2001/02 variable machine costs are not an item within variable costs of the SGM′s.

The SGM is calculated per area unit of a crop, respectively per livestock unit of a livestock category, as the value of output consisting of the amount produced times the respective price minus the variable costs needed for producing this output. Here average standardized yields, prices and input quantities are assumed, resulting from statistical surveys, farm accountancy data network and further information. The SGM′s are ascertained annually for 23 categories of crop production and for 16 categories of animal production in 38 regions in Germany (administrative districts or states). For the classification of farms 3−year averages are being applied in farm structure surveys and in farm accountancy data network. For classification in the national farm accountancy data network it was switched to 5−year averages, starting with the economic year 2004/05.