Vegetable crops Production Cost and Return Analysis: What is new Ventura County, 2012

Transcription

1 Vegetable crops Production Cost and Return Analysis: What is new Ventura County, 2012 Eta Takele UCCE Area Farm Management Economist Southern California

2 The value of Ventura County vegetable crops industry is $554,078 million in 2013/14; The three crops we conducted cost studies for: Crop Value $million Rank in the county Rank in California Celery 180, ; Monterey (1) Peppers 52, ; Bell peppers; Riverside (1) Cabbage 26, ; Monterey (1) and Kern (2)

3 Survey ; Data collected from farmers; pest control advisors and commodity farm advisors; Information collected inputs, time of operation, equipment used; leases and food safety regulations.

4 From the data we saw that: Production practices among growers vary a lot for a cop; except in the amount of N and water. Even for N; the source or type of materials used vary. Farms have multiple crops (a minimum of 4 veg. crops farms).

5 What is the same or at least common to growers are: land lease: ~$2800/year; Assessment fees/rates differ by crop but ~ same rate for growers within crop; Pest Control advisor fees same: $45/acre; Food safety cost are same per farm regardless of the size of farm; therefore the bigger the farms; the smaller the cost gets; Conditional waiver program fees are same per acre.

6 Costs of Production, $ Per Acre, Crops Bell Pepper Bell Pepper Cost Category Celery Fresh Processed Cabbage difference explanations (partial) Land Prep broadcast fertilizer- cabbage more Planting 1,502 1, processed BP do not use stakes Growing 1,428 2, Growing period-shortest for cabbage Harvesting and marketing 6,750 5, Disposal removal of stakes-fresh BP cash overhead 1,728 2, major cost, land lease Non-cash overhead Total

7 Costs of Production Per Acre Crops Cost Category Celery Celery BP BP incr/yr; major differences Land Prep % -12% Planting , % Growing 884 1, %-5%; mainly water Harvest & market , %-6% --labor cost Disposal 442 7%-11% ; mainly land lease (>100% increase) cash overhead 898 1, Non-cash overhead Total %-6.5% Percent Change-overall Percent Change/year % for Celery and 7% for BP

8 Costs of Production Per Acre Crops Bell Pepper Bell Pepper Cost Category Celery Fresh Processed Cabbage Land Prep Planting 1,502 1, Growing 1,428 2, Harvesting and marketing 6,750 5, Disposal cash overhead 1,728 2, Non-cash overhead Total Price survey (growers) ($/unit) ctn ctn ton ctn Break-even yield/a 1, Survey yield/a 1, Bread even yield % 80% 66% 77% 97% Yield for all crops above break-even for total cost

9 What is this information telling us? Costs of production have increased more than 6%- 7%/year at least in the two crops (celery and BP) that we had data to compare from 1999 to We also looked at price trends: Price fluctuates but on average showed positive change of 4%-5% /year for celery and BP;

10 What is this information telling us? Even though, all the four crops/enterprises are profitable for the data represented; highest for fresh BP; followed by celery; 3 rd processed BP and last cabbage.

11 Looking into food Safety program costs: Program began~ late 198os but real enforcement came about much later. Programs include evaluating potential contamination risk by looking at: Traceability record; Adjacent Land Use; Fertilizer/Crop nutrition; Irrigation/water use; Crop protection; Employee Hygiene.

12 Costs: Good Agricultural Production (GAP); ~$550/farm; Harvest crew audits (2x/year):~$390/crop season Conditional Waiver Program (CWP) the Federal Clean Water Act (began in 2005): $23/acre Per acre food safety costs depend on farm sizes (except the CWP which is /A; therefore for our study the overall cost ranged from $9.46/A-$13.65/A.

13 What are the factors that influence future costs: Land lease will continue to be high; maybe increasing especially in light of the drought; demand and lease for land with well water will increase; wells cost any where from $½ million to $1 million; Harvesting costs being major in the production of these crops (>40% in the fresh crops) and being labor intensive; labor availability & management will continue to play a major role in production costs.

14 Risk Management Strategies: Operations are diversified; our interview showed at least 4 different crops grown by each farm; Some are combining organic and conventional crops. Farmers have options to switch crops; to alternate to manage pest and diseases. Health trend encouraging demand increase.

15 100 Years of Cooperative Extension