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Enterprise Budgets and Production Costs for Organic Production
Business and Marketing Resource List
|
Holly Born
NCAT Agriculture Specialist May 2004 ATTRA Publication #RL041 |
 A printable PDF version of this entire document is available at:http://attra.ncat.org/attra-pub/PDF/enterprisebudgets.pdf 4 pages — 844K Download Acrobat Reader |
Abstract
This resource list contains Internet-based sources of enterprise budgets and production cost information for organic production of horticultural and agronomic crops and for organic livestock enterprises.
Table of Contents
- Introduction
- Transition to Certfied Organic Budgets
- Horticultural Crops: Vegetables
- Horticultural Crops: Fruits and Nuts
- Herbs
- Agronomic Crops
- Livestock
Introduction
Enterprise budgets are an important tool for planning and for ongoing farm financial management. While many producers develop their own budgets, some producers choose to start with existing budgets and adjust them for their own enterprises. These budgets represent only one set of many possible cultural and management practices, and they do not account for geographic differences. They serve as a starting point for individual producers to adapt to their own specific enterprises and situations.
Budgets generally include variable operating costs, fixed costs, and expected production returns. Labor is under the operating costs in the two-part system. If costs are divided into three parts, the third part is labor. Labor is sometimes treated separately to show a return to labor and management, in addition to a return over operating costs. This is especially important for enterprises in which all the labor is supplied by the enterprise's owner and the owner's family, since the owner needs to understand what his or her labor is being "paid" in terms of returns. Returns on an enterprise often look attractive, but when calculated as returns on your labor, may well be below minimum wage. When returns are not specified as "return to labor and management", you should calculate your per-hour returns for your labor and management. Simply divide returns after costs by the number of hours of labor that you put into the enterprise. This can clarify whether the enterprise is worthwhile for you or whether your labor can be put to more lucrative uses elsewhere.
The budgets and production costs listed below represent many different enterprises in different parts of North America ; some are quite recent while others are quite old, but still useful. If you don't have access to the Internet, contact Cooperative Extension for the state listed, or call ATTRA for paper copies of the budgets you would like to have. In many instances, your local Cooperative Extension Service specialist for farm management (typically located in the Agricultural Economics department of your local land-grant university) should be able to assist or recommend someone to assist in adapting enterprise budgets to reflect your individual enterprises, and show you how to use the budgets to improve your farm financial management. Since resources vary widely from state to state, no single route exists for local assistance.
For conventional production, the Agricultural Risk Budget Library at www.agrisk.umn.edu contains budgets for a very wide range of crops and livestock. In developing a budget for organic production, in many cases, a budget for conventional cropping or livestock may be the best starting point. The budget can then be tailored to specific individual situations, including organic production.
Transition to Certfied Organic Budgets
British Columbia (2002)
Available
budgets: dairy (fluid milKB], spelt, potatoes, oat, apple, sweet
corn, carrots, winter squash, spinach, salad greens, and cauliflower. www.agf.gov.bc.ca/busmgmt/budgets/specialty_organic.htm
Horticultural Crops: Vegetables
British Columbia (1992-1996)
Available
budgets: garlic, carrots, celery, corn for processing, peas for
processing, whole beans for processing.
www.agf.gov.bc.ca/busmgmt/budgets/specialty_organic.htm
California (1996)
Available budgets: processing tomatoes, mixed vegetables. www.agecon.ucdavis.edu/outreach/cost_and_return.php
California, Central Coast (1994)
Available budgets: cabbage, cauliflower, cucumbers, garlic, leaf lettuce,
romaine lettuce, red onions, yellow onions, non-staked snap peas,
non-staked snow peas, green bell peppers, red bell peppers, sweet
corn, large variety winter squash, small variety winter squash,
barley cover crop, vetch cover crop.
Included are yield and return
ranges for selected central coast organic vegetable crops, whole
farm annual equipment, investment, and business overhead costs
for a diversified organic vegetable operation, and hourly equipment
costs for a diversified organic vegetable operation. http://vric.ucdavis.edu/veginfo/topics/prodcosts/organiccosts.html
New Jersey (1996)
Available
budgets: bell pepper, cabbage, cauliflower, cucumber, leaf lettuce,
yellow onions, pumpkins, sweet corn, fresh market tomato, and
processing tomato. http://aesop.rutgers.edu/~farmmgmt/ne-budgets/organic.html
North Carolina (2002)
Available
budgets: fresh market broccoli, kale, tomatoes, sweet corn, salad
mix, leaf lettuce, peppers, and summer squash.
www.ag-econ.ncsu.edu/AgBudgets/vegetable.htm
Wisconsin (1990)
Potatoes:
brief comparison of costs and returns of organic and conventional
potatoes.
http://www.cias.wisc.edu/archives/1992/10/01/
organic_potatoes_they_can_be_grown_but_can_they_be_profitable/index.php
Horticultural Crops: Fruits and Nuts
California (2003)
Available
budgets: strawberries.
www.agecon.ucdavis.edu/uploads/cost_return_articles/strawborgcc03.pdf [PDF/64KB]
Download
Acrobat Reader
California (2002)
Available
budgets: almonds.
www.agecon.ucdavis.edu/uploads/cost_return_articles/almondorgvn02.pdf [PDF/3.3MB] Download Acrobat Reader
California (1996)
Available budgets: almonds, apples, wine grapes, raisins, lemons, oranges,
walnuts.
http://www.agecon.ucdavis.edu/outreach/cost_study.php?archive=1&subject=
New Jersey (1996)
Availablebudgets: fresh market apples, mature trees.
http://aesop.rutgers.edu/~farmmgmt/ne-budgets/organic.html
New York (no date)
Available
budgets: strawberries (greenhouse production).
http://www.hort.cornell.edu/department/faculty/pritts/straw.html
Herbs
Washington State (2003)
Available
budgets: goldenseal.
http://smallfarms.wsu.edu/crops/organicGoldenseal.html
British Columbia (2002)
Available
budgets: calendula, American skullcap, catnip, dandelion root,
lavender, lemon balm, licorice root, nettle, passion flower,
marshmallow root, chamomile, red clover, shepherd's purse, and
yarrow.
www.agf.gov.bc.ca/busmgmt/budgets/budget_pdf/small_scale/small_scale_Mixed_herb_Win.pdf
[PDF/120KB] Download
Acrobat Reader
Available budgets: echinacea.
http://www.cias.wisc.edu/archives/2000/01/02/echineacea_as_a_tobacco_crop_alternative/index.php
Agronomic crops
California (1996)
Available
budgets: cotton, rice.
www.agecon.ucdavis.edu/outreach/crop/cost.htm
Illinois (2003)
Available
budgets: food-grade soybeans, food-grade corn.
http://web.aces.uiuc.edu/value/
Illinois (2001)
Available
budgets: pasture (red clover, red mammoth clover, alfalfa, timothy),
cereal rye grain, blue corn, soft red winter wheat, soybean.
www.aces.uiuc.edu/~asap/research/stew_farm/Appendix-rep-02.html#Production%20Buds,%20Conv
Kansas (2003)
Available budgets:
corn, blue corn, sweet corn, wheat, Austrian winter peas, alfalfa,
clover seed. www.kansasruralcenter.org/publications/Organic%20cropping.pdf [PDF/36KB]
Download Acrobat Reader
Michigan (2001)
Available
budgets: grain corn, soybeans, and oats.
Includes downloads
of Excel budgets so you can do your own calculations.
www.aec.msu.edu/agecon/aecreports/budgets01.htm
New Jersey (1996)
Available
production costs: grain corn, silage corn, soybeans, alfalfa
(new seeding), alfalfa (established stand).
http://aesop.rutgers.edu/~farmmgmt/ne-budgets/organic.html
North Dakota (2003)
Available
budgets: spring wheat, durum, feed barley, corn grain, oil sunflower,
confectionery sunflower, soybeans, oats, flax, field peas, millet,
buckwheat, rye, and rotational green manure fallow.
Has an
excellent overview of organic production, crop rotation, and
machinery used in organic production. There are also organic
crop budgets from 2000 available.
www.ext.nodak.edu/extpubs/agecon/ecguides/2003org.pdf [PDF/156KB]
Download
Acrobat Reader
Livestock
British Columbia (2002)
Available
budgets: free-range laying hens.
www.agf.gov.bc.ca/busmgmt/budgets/budget_pdf/poultry/organic_eggs_2002.pdf
[PDF/44KB] Download
Acrobat Reader
California (2002)
Production
costs for organic and conventional milk.
http://californiaagriculture.ucop.edu/0205SO/pdfs/orgmilk.pdf [PDF/120KB]
Download
Acrobat Reader
Iowa (2003)
Available budgets: pork (two-litter
pasture farrow-to-finish).
www.ipic.iastate.edu/reports/99swinereports/asl-1679.pdf [PDF/28KB]
Download
Acrobat Reader
Iowa (2003)
Available cost
information: pork.
www.extension.iastate.edu/agdm/livestock/html/b1-80.html
New Jersey (1996)
Available
budgets: dairy goat, spring lamb.
Budgets for dairy goat include
scenarios of production levels of 1500, 1800 or 2100 pounds of
milk per doe.
http://aesop.rutgers.edu/~farmmgmt/ne-budgets/organic/DAIRY-GOAT-1500LB-MILK.HTML
Pennsylvania (1999)
Available
budgets: egg production (small-scale).
http://agalternatives.aers.psu.edu/livestock/small_scale_egg/small_scale_egg.pdf
[PDF/44KB]
Enterprise Budgets and Production Costs for Organic Production
By Holly Born
NCAT Agriculture Specialist
August 2004
© NCAT 2004
Edited by Paul Williams
This page was last updated on: June 23, 2010
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