Progress 09/01/10 to 08/31/15
Outputs
Target Audience:Target audiences for this project were farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. Changes/Problems:A one-year no-cost extension made it possible to collect an additional year of farm record data. The greatly strengthened our results. What opportunities for training and professional development has the project provided?Project team members Delbridge, DiGiacomo, and King all attended the Minnesota Organic Conference in 2011, 2012, 2013, 2014, and 2015. Project team member Nordquist attended the conference in 2011, 2012, 2013, and 2014. Project Director King attended at NIFA/OREI Project Directors meeting in 2012 and the annual MOSES conference in 2013. Project team members Delbridge and King attended and made a presentation in an organized symposium on "Expanding the U.S. Organic Sector--Will Recent USDA Initiatives Help?" at the annual meeting of the Agricultural & Applied Economics Association in Minneapolis, MN in July 2014. Attendance at these conferences and workshops gave project team members opportunities to broaden their knowledge of opportunities and challenges related to organic agriculture. How have the results been disseminated to communities of interest?As noted in the discussion of project accomplishments, results from the project have been disseminated to farmers, organic certifiers, lenders, crop insurance agents, and other agricultural professionals who support organic production through presentations at the Minnesota Organic Conference and the MOSES conference, as well as through the project web site. Two key publications from the project, "Organic Transition: A Business Planner for Farmers, Ranchers and Food Entrepreneurs," and "Making the Transition to Organic: Ten Farm Profiles," are available for free download on several web sites. Printed copies of the "Planner" are being mailed by SARE to National Association of State Organic Programs members, all U.S. organic certifying agencies, and select nonprofits. Postings on email list serves have been used to inform Farm Business Management instructors and farm management Extension educators about the availability of these publications. In addition, earlier versions of several of the farmer profiles included in the "Making the Transition to Organic: Ten Farm Profiles" publication were published in the MOSES Organic Broadcaster, which has a combined print and online circulation of 15,000. What do you plan to do during the next reporting period to accomplish the goals?The project has ended, but we have several outreach activities scheduled for 2016. These include a session on business planning for transition at the Minnesota Organic Conference in January 2016 and a webinar on "Transitioning to Organic production" for USDA Natural Resource Conservation Service/NRCS staff in April 2016. In addition we have one journal manuscript under revision and a second manuscript in preparation for submission.
Impacts
What was accomplished under these goals?
This project was among the first, if not the first, to collect enterprise and whole farm financial performance data for farms transitioning to organic production. Data collected over the life of the project, along with findings and insights from surveys and workshops with participating farmers, were the basis for development of data resources and planning tools that will help farmers assess opportunities to transition to organic production. Resources developed through this project also will help lenders evaluate organic transition plans and will provide insights to policy makers on potential barriers to significant increases in organic production. Goal 1: Collect data on farm performance measures during the transition to organic production and develop resources such as an online database and analysis tools to generate benchmark reports for crop and livestock enterprises and whole farm performance during transition. (a) Project team members made adjustments to the FINPACK and FINBIN computer systems and associated data coding and entry procedures to facilitate capture of enterprise and whole farm data for transitioning farms. The 56 FBM instructors all received training on these procedures. A total of 22 instructors worked directly with transitioning or recently certified farms. (b) Over the course of the project team members recruited a total of 47 farms (36 transitioning and 11 recently transitioned) to participate in the FBM program. This was a smaller number than expected, largely due to a dramatic slowdown in the rate of transition to organic production during the project period. Between 2008 and 2014, USDA NASS reports that the number of organic farms in Minnesota declined from 543 to 508, while certified cropland increased slightly, from 122,428 acres to 133,033 acres. During that same period, certified field crop acreage declined from 90,556 acres to 82,549 and the number of dairy farms with certified organic cows increased only from 109 to 115. As noted in earlier annual reports, the farms that participated in this project managed 4,708 acres in transition, 1,761 recently certified acres, 7,418 acres that had been certified for three years or more and an additional 4,995 acres of conventional land. They had a total of 692 dairy cows in transition, 583 recently certified dairy cows, 945 organic dairy cows certified three years or more, and 255 conventional dairy cows. (c) Data collected from the participating farms are stored in the FINBIN data and, when minimum number of observations permits, can be accessed by researchers, agricultural professionals, producers, lenders and policy makers to generate enterprise and whole-farm reports. Even though the project has now ended, farms that identify themselves as transitioning to organic production will continue to be coded as such and will add to the available data resources. (d) All farms participating in the project were invited to participate in workshops at the annual Minnesota Organic Conference. This offered opportunities to communicate and explain project findings and to build a sense of community among the transitioning farmers. (e) Sessions on transition to organic production were presented at the MOSES annual conference in February 2013 and at the Minnesota Organic Conference in January 2015. Both were open to the broader community of producers. (f) Confidentiality restrictions for the use of farm record data in the FINBIN database and smaller than expected numbers of participating farms made it impossible to release annual summaries of farm financial performance results. An analysis of yield gaps between conventional and organic farms was prepared in 2014 (Delbridge and King 2014), and a comprehensive summary of enterprise and whole farm performance that uses a novel form of ratio analysis to combine data from different years and locations was prepared in 2015 (Delbridge et al. 2015) Goal2: Develop web-based and print materials to address the informational needs of farmers transitioning to organic production and the educational needs of agricultural professionals who advise them. (a) Results from intake surveys and four annual surveys of participating farms have been reported at organic conferences and published on the project's eOrganic web site. Business plan examples for three transitioning farmers are available in the business planning publication (DiGiacomo, King, and Nordquist 2015) that is available online and in print. (b) In addition to having posted educational materials on the project's eOrganic web site, their availability has been announced on email lists of extension educators and organic interest groups. (c) Project team members have conducted breakout sessions on transition to organic production at the MOSES annual conference (2013, approximately 20 attendees), Agricultural and Applied Economics Association Annual Meeting (2014, approximately 20 attendees), and the Minnesota Organic Conference (2015, approximately 30 attendees). (d) The business planning publication, "Organic Transition: A Business Planner for Farmers, Ranchers and Food Entrepreneurs," was published online in September 2015 and in print in October 2015. This publication is accompanied by online access to a complete set of planning worksheets, financial worksheets for projecting cash flows and key finaincial ratios, and an "Organic Transition" business planning template in the AgPlan software that was developed under this project. Copies of the "Planner" will be distributed at the 2016 Minnesota Organic Conference. In addition, "Making the Transition to Organic: Ten Farm Profiles" (GiGiacomo and King 2015) is a collection of profiles that provide insights on the challenges and rewards of transition to organic production. (e) Copies of "Organic Transition: A Business Planner for Farmers, Ranchers and Food Entrepreneurs" are being distributed by SARE to all U.S. organic certifying agencies.
Publications
- Type:
Books
Status:
Published
Year Published:
2015
Citation:
DiGiacomo, G; King, R.P.; Nordquist, D. 2015. Organic transition: a business planner for farmers, ranchers and food entrepreneurs. SARE Handbook Series 12, Sustainable Agriculture Research and Education Program. (http://purl.umn.edu/211871)
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Progress 09/01/14 to 08/31/15
Outputs
Target Audience:Target audiences for this project are farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. Changes/Problems:Work during the past year was conducted under a no-cost extension. What opportunities for training and professional development has the project provided?Project team members Tim Delbridge, Gigi DiGiacomo, and Robert King all attended the 2015 Minnesota Organic Conference. In addition to meeting with project farmers and and presenting a workshop on transition, we each had opportunities to attend breakout and plenary sessions on a variety of topics related to organic agriculture. How have the results been disseminated to communities of interest?Results from the project were disseminated to farmers, organic certifiers, lenders, crop insurance agents, and other agricultural professionals who support organic production through a workshop presentation at the Minnesota Organic Conference in January 2015 as well as through the project web site. Two key publications from the project were released during this reporting period: "Organic Transition: A Business Planner for Farmers, Ranchers and Food Entrepreneurs," and "Making the Transition to Organic: Ten Farm Profiles." These are available in print and for free download on several web sites. Printed copies of the "Planmner" are being distributed by SARE, the report publisher, to national Association of State Organic Programs members, to all U.S. organic certifying agencies, and to select nonprofits. Postings on email list serves have been used to inform Farm Business Management instructors and farm management Extension educators about the availability of these publications. What do you plan to do during the next reporting period to accomplish the goals?This is the final reporting period for the project, but we have several outreach activities scheduled for 2016. These include a session on business planning for transition at the Minnesota Organic Conference in January 2016 and a webinar on "Transitioning to Organic production" for USDA Natural Resource Conservation Service/NRCS staff in April 2016. In addition we have one journal manuscript under revision and a second manuscript in preparation for submission.
Impacts
What was accomplished under these goals?
This project is among the first, if not the first, to collect enterprise and whole farm financial performance data for farms transitioning to organic production. In this final year of the project, data collected over the life of the project and lessons for surveys and workshops with participating farmers were the basis for development of data resources and planning tools that, in years to come, will help farmers assess opportunities to transition to organic production. Resources developed through this project will also help lenders evaluate organic transition plans and will provide insights to policy makers on potential barriers to significant increases in organic production. Goal 1: Collect data on farm performance measures during the transition to organic production and develop resources such as an online database and analysis tools to generate benchmark reports for crop and livestock enterprises and whole farm performance during transition. Project team members have made adjustments to the FINPACK and FINBIN computer systems and associated data coding and entry procedures to facilitate capture of enterprise and whole farm data for transitioning farms. Farm Business Management instructors have been trained to use the new coding systems. It is now possible to generate enterprise reports for major field crops and dairy and whole farm reports for transitioning crop and dairy farms. This data resource will continue to grow in the future. Project team members presented a workshop on "Who Is Transitioning and How?' at the same Minnesota Organic Conference. Confidentiality restrictions for the use of farm record data in the FINBIN database and smaller than expected numbers of participating farms made it impossible to release annual summaries of farm financial performance results. A comprehensive summary of enterprise and whole farm performance that uses a novel form of ratio analysis to combine data from different years and locations was prepared and published in 2015 (Delbridge et al. 2015). In addition, a manuscript is currently under revision that presents a dynamic programming model of the transition process. This model uses yield, return, and cost data from long-term experiments at the Southwest Research and Outreach Center in Lamberton, MN as well as data from the farm records of project participants. It provides insights on the economic forces that shape the timing of the transition decision and conditions under which transitioning or certified farms might shift back to conventional production methods. Goal2: Develop web-based and print materials to address the informational needs of farmers transitioning to organic production and the educational needs of agricultural professionals who advise them. Project team members developed two new publications that are available in print and online. "Organic Transition: A Business Planner for Farmers, Ranchers and Food Entrepreneurs" (DiGiacomo, King and Nordquist 2015) is a comprehensive guide to business planning for transitioning farmers. Supplementary online resources for the Planner include a complete set of electronic worksheets and an "Organic Transition" business plan template in the AgPlan software. "Making the Transition to Organic: Ten Farm Profiles" (DiGiacomo and King 2015) is a collection of farm profiles that provide insigths on the challenges and rewards associated with the transition to organic production.
Publications
- Type:
Books
Status:
Published
Year Published:
2015
Citation:
DiGiacomo, G.;King, R.P.;Nordquist, D.W. 2015. Organic transition: a business planner for farmers, ranchers and food entrepreneurs. SARE Handbook Series 12, Sustainable Agriculture Research and Education Program. (http://purl.umn.edu/211871)
- Type:
Other
Status:
Published
Year Published:
2015
Citation:
DiGiacomo, G.;King, R.P. 2015. Making the transition to organic: ten farm profiles. Department of Applied Economics, University of Minnesota. (http://purl.umn.edu/207981)
- Type:
Other
Status:
Published
Year Published:
2015
Citation:
Delbridge, T.A.; King, R.P.; Nordquist D.W.; DiGiacomo, G.; and Moynihan, M. 2015. "Farm performance during the transition to organic production: Analysis and planning tools based on Minnesota farm record data." Staff Paper P15-6, Department of Applied Economics, University of Minnesota. (http://purl.umn.edu/212429)
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Progress 09/01/13 to 08/31/14
Outputs
Target Audience: Target audiences for this project are farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. Changes/Problems: We requested and were granted a one-year no-cost extension for the project. This is making it possible to collect data for an additional year. What opportunities for training and professional development has the project provided? This project has provided graduate research assistant funding for Timothy Delbridge, who has been a key member of the project team. He completed his Ph.D. in July 2014 and will continue to work on the project as a post-doctoral researcher. How have the results been disseminated to communities of interest? The project team has undertaken a number of educational activities during the past year. In January 2014 we conducted a workshop for participating farmers that included a presentation on annual survey results, an overview of organic farm performance in Minnesota, preliminary findings on transitioning farm performance, and a panel discussion with two experienced farmers and a certifier. Work on a draft business planning manuscript, called the Transition Business Planner, continued in 2014. Project team members have worked with three farms to develop complete business plans that will be used as examples in the “Planner.” As noted in last year’s progress report, USDA’s Sustainable Agriculture Research and Education (SARE) Program has agreed to co-publish the manuscript. Project team members also prepared three new profiles of transitioning farm operations that have been published in the project newsletter and posted on the project web site. Finally, project team members made a presentation on barriers to organic transition at the annual meeting of the Agricultural and Applied Economics Association. What do you plan to do during the next reporting period to accomplish the goals? 1. We will hold another farmer workshop at the Minnesota Organic Conference in January 2015. This session will be open to all conference attendees. 2. The "Transition Business Planner" was sent out for review in late October 2014. We expect it to be published during the first several months of 2015. 3. Data collection for the project will end in the spring of 2015. When all data are in, we will prepare reports and articles presenting the findings with regard to both enterprise and whole farm profitability of farms transitioning to organic production systems.
Impacts
What was accomplished under these goals?
With the end of the project approaching, we are no longer recruiting new farmer participants to the study. During the first three years of the project, team members recruited 47 transitioning and recently certified farmers to participate in the project by enrolling in the state’s Farm Business Management (FBM) program. Collectively, at the start of project participation, these 47 farms managed 4,708 acres in transition and 1,761 recently certified acres. They cultivated 7,418 acres that had been certified for three years or more and an additional 4,995 acres of conventional land. They had a total of 692 dairy cows in transition, 583 recently certified dairy cows, 945 organic dairy cows certified three years or more, and 255 conventional dairy cows. A total of 22 farm business management instructors are working with these farms. Project team members have made adjustments to the FINPACK and FINBIN computer systems and the procedures used by instructors in order to facilitate capture of enterprise-level data on transitioning and recently certified farms. Project team members have analyzed all available financial and production records for participating farms. In some cases, these records are for years prior to the start of the project, since some participating farms were already enrolled in the Farm Business Management program when they were recruited. Confidentiality restrictions continue to limit our ability to release financial performance results until more data have been collected. This past year we were able to report findings from an analysis of crop yields for “split operation” farms that simultaneously grew the same crop under both organic and conventional management practices. We found that these farms have significantly lower conventional corn and soybean yields than the average farm in their county, which implies that there is a selection effect in the decision to transition to organic production. Our analysis also showed that there is a statistically significant, positive relationship between conventional yields and organic yields on the same farm. Together, these findings imply that data derived from farms that have chosen to adopt organic management likely understate the organic yield potential for the full population of conventional crop producers. This has important ramifications both for business planning and for the design and implementation of organic crop insurance products. A manuscript is currently under review that presents a dynamic programming model of the transition process. This model uses yield, return, and cost data from long-term experiments at the Southwest Research and Outreach Center in Lamberton, MN as well as data from the farm records of project participants. It provides insights on the economic forces that shape the timing of the transition decision and conditions under which transitioning or certified farms might shift back to conventional production methods. The annual survey of TFT farmers identifies key management, regulatory, production and marketing issues. Results from the most recent survey, conducted in November and December 2013, identify significant problems facing transitioning and recently certified farmers. Overall time requirements, access to capital, current profitability, and cash flow challenges were identified as medium or big management problems by 10 or more survey respondents. Cost and availability of inputs, yields, weed management, and access to land were identified as medium or big problems by 10 or more survey respondents. No regulatory or marketing issues are identified as medium or big problems by 10 or more survey respondents. Complete survey results are posted on the project’s eOrganic web site (http://eorganic.info/toolsfortransition/reports).
Publications
- Type:
Conference Papers and Presentations
Status:
Published
Year Published:
2014
Citation:
Delbridge, T.A and King, R.P. 2014. The Conventional-Organic Yield Gap: Evidence from Farm-Level Data. Selected paper presented at the Annual Meeting of the Agricultural and Applied Economics Association, Minneapolis, MN, July 2014. (http://purl.umn.edu/170561)
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Progress 09/01/12 to 08/31/13
Outputs
Target Audience: Target audiences for this project are farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. Changes/Problems: We are preparing a request for a no-cost extension for the project. This will make it possible to collect an additional year of farm record data, which will greatly strengthen our results. What opportunities for training and professional development has the project provided? During the first three years of the project, team members have recruited 47 transitioning and recently certified farmers to participate in the project by enrolling in the state’s Farm Business Management (FBM) program. Collectively, at the start of project participation, these 47 farms managed 4,708 acres in transition and 1,761 recently certified acres. They cultivated 7,418 acres that had been certified for three years or more and an additional 4,995 acres of conventional land. They had a total of 692 dairy cows in transition, 583 recently certified dairy cows, 945 organic dairy cows certified three years or more, and 255 conventional dairy cows. A total of 22 farm business management instructors are working with these farms. Project team members continue to make adjustments to the FINPACK and FINBIN computer systems and the procedures used by instructors in order to facilitate capture of enterprise-level data on transitioning and recently certified farms. How have the results been disseminated to communities of interest? The project team has undertaken a number of educational activities during the past year. In January 2013 we conducted a workshop for participating farmers that included presentations on survey results and on preliminary research observations. The workshop included a farmer panel focusing on transition challenges and solutions. The panel - represented by three farmers of varying levels of organic management experience - was well received by workshop participants. Two of the panel members participated in a subsequent educational session moderated by project team members at the Midwest Organic and Sustainable Education Service (MOSES) conference in February 2013. A draft business planning manuscript, called the Transition Business Planner, was developed in 2013. Project team members tested the draft manuscript through a series of four business planning workshops with managers from four transitioning farms. The manuscript has since undergone subsequent revisions. USDA’s Sustainable Agriculture Research and Education (SARE) Program has agreed to co-publish the manuscript pending further review and the inclusion of regionally-sensitive examples. Finally, project team members prepared four new profiles of transitioning farm operations that have been published in the project newsletter and posted on the project web site. One of these profiles also was published in Organic Broadcaster, the bi-monthly periodical of the Midwest Organic and Sustainable Education Service. What do you plan to do during the next reporting period to accomplish the goals? We will continue to collect and analyze data from the transitioning and recently certified farms that are enrolled through the project in the Farm Business Management program. In the coming year we expect to have results on crop yields, dairy production, and financial performance during transition that can be shared with the public and incorporated into publications. The annual survey of project participants is being conducted in November 2013. Summary results will be published on the project web site (http://eorganic.info/toolsfortransition/about) and will be shared with project participants. We will conduct an annual educational workshop for project participants at the Minnesota Organic Conference in January 2014. We will refine the dynamic programming model of transition and will prepare a manuscript on the model structure and results for publication in a refereed journal. We will do further testing of the Transition Business Planner, make final revisions in the manuscript, and publish it in cooperation with USDA's SARE program.
Impacts
What was accomplished under these goals?
Project team members have analyzed all available financial and production records for participating farms. In some cases, these records are for years prior to the start of the project, since some participating farms were enrolled in the Farm Business Management program when they were recruited. Confidentiality restrictions continue to limit our ability to release financial performance results until more data have been collected, but we are able to report some preliminary enterprise analysis results. In order to combine data from multiple years, we have normalized crop yields by dividing them by the county average yield for the county in which each Tools for Transition (TFT) farm is located. Prior to transition, TFT farms had conventional alfalfa yields slightly above the county average. This slight yield advantage continues during transition and after certification. Prior to transition, conventional corn yields on TFT farms averaged 86 percent of their county average. During transition, that ratio drops to 76 percent of county average and after transition it falls to 72 percent of county average yield. Prior to transition, conventional soybean yields on TFT farms averaged 97 percent of their county average. During transition, that ratio drops to 76 percent of county average and after transition it falls to only 57 percent of county average yield. For dairy, pre-transition milk production, feed cost and net return per cow are all well below regional averages. During transition, milk production falls, feed costs rise, and net return falls relative to regional averages. After certification, production per cow and feed costs are below regional averages, and net return per cow is well above the regional average. The annual survey of TFT farmers identifies key management, regulatory, production and marketing issues. Results from the most recent survey, conducted in November and December 2012, identify significant problems facing transitioning and recently certified farmers. At least 40 percent of TFT farmers identify overall time requirements and cash flow challenges as medium or big management problems. Cost and availability of inputs, yields, and weed management are identified as medium or big problems by at least 40 percent of TFT farmers. No regulatory or marketing issues are identified as medium or big problems by at least 40 percent of TFT farmers. Analysis of farm record data and survey responses is being complemented by the development of the dynamic programming model of the transition process. This model currently uses yield, return, and cost data from long-term experiments at the Southwest Research and Outreach Center in Lamberton, MN, but data from the farm records of project participants also are being integrated into the analysis. This model can provide insights on the economic forces that shape the timing of the transition decision and conditions under which transitioning or certified farms might shift back to conventional production methods.
Publications
- Type:
Journal Articles
Status:
Published
Year Published:
2013
Citation:
Delbridge, T.A.; Fernholz, C.; King, R.P. and Lazarus, W. 2013. A whole-farm profitability analysis of organic and conventional cropping systems. Agricultural Systems 122:1-10.
- Type:
Other
Status:
Published
Year Published:
2013
Citation:
DiGiacomo, G. 2013. Couples Determination Yields 1,300 Acres of Organic Cropland. Organic Broadcaster 21(3):4,13.
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Progress 09/01/11 to 08/31/12
Outputs
OUTPUTS: During the first two years of the project, team members have recruited 37 transitioning and recently certified farmers to participate in the project by enrolling in the state's Farm Business Management (FBM) program. Collectively, at the start of project participation, these 37 farms managed 3,815 acres in transition and 990 recently certified acres. They cultivated 5,868 acres that had been certified for three years or more and an additional 4,850 acres of conventional land. They had a total of 507 dairy cows in transition, 583 recently certified dairy cows, 455 certified organic dairy cows, and 90 conventional dairy cows. A total of 17 farm business management instructors are working with these farms. Project team members continue to make adjustments to the FINPACK and FINBIN computer systems and the procedures used by instructors in order to facilitate capture of enterprise-level data on transitioning and recently certified farms. Project team members have analyzed 2011 financial and production records for participating farms. We also have administered two surveys - and intake survey and an annual survey - to all project participants. Analysis of farm record data and survey responses is being complemented by the development of the dynamic programming model of the transition process. This model currently uses yield, return, and cost data from long-term experiments at the Southwest Research and Outreach Center in Lamberton, MN, but data from the farm records of project participants will be integrated into the model in the future. At present, the model focuses on cropping operations, but it will be adapted to model transition decisions for dairy operations. This model can provide insights on the economic forces that shape the transition decision and on the effects alternative conservation and risk management policies may have on farmers' decisions to transition. The project team has undertaken a number of educational activities during the past year. In January 2012 we conducted a workshop for participating farmers that included presentations on survey results and on financial performance results for certified organic producers who participate in the FBM program. Time was also set aside for small group discussion among project participants with a focus on transition challenges. Project team members also conducted a series of four business planning workshops with managers from two participating farms. These workshops were the first step in developing business planning materials for transitioning farmers that will complement general purpose farm business planning materials. Finally, project team members prepared two profiles of transitioning farm operations that have been published in the project newsletter and posted on the project web site. These profiles also were published in Organic Broadcaster, the bi-monthly periodical of the Midwest Organic and Sustainable Education Service. PARTICIPANTS: Project team members include: Robert Craven (U of M), Tim Delbridge (U of M), Gigi DiGiacomo (U of M), Robert King (U of M), Rann Loppnow (U of M), Meg Moynihan (Minnesota Department of Agriculture), Helene Murray (U of M), Dale Nordquist (U of M), and Jim Riddle (U of M). Project advisory committee members include: Ira Beckman (MnSCU), Ron Dvergsten (MNScu), Carmen Fernholz (farmer), Kent Hoehne (farmer), Loretta Jaus (farmer), Michelle Menken (Minnesota Crop Improvement Association), Carolyn Olson (farmer), and Carissa Spencer (USDA/NRCS). TARGET AUDIENCES: Target audiences for this project are farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
Confidentiality restrictions limit our ability to release financial performance results until more data have been collected, but we can report some preliminary results. Prior to initiating organic transition, compared to Minnesota state average dairy farmers, Tools for Transition (TFT) project participants: (i) had smaller dairy operations (TFT farms milked an average of 94 cows before transition compared to the state average of 120 cows.), (ii) had lower production per cow (Annual conventional dairy production for TFT farms averaged 17,300 lbs/cow compared to nearly 21,000 lbs/cow for dairy producers statewide. TFT farms with certified herds average 13,300 lbs/cow of organic milk.), and (iii) were equally profitable. (Despite lower per cow production, TFT farms were able to achieve nearly equal rates of return on assets as the state conventional dairy average.) We also can make some qualitative observations about transition strategies. Transitioning TFT farmers generally fall into four groups: (i) conventional dairy farmers, most with relatively small farms and a median herd size of 80, (ii) conventional crop farmers using a diversified three- or four-year rotation prior to beginning transition, (iii) certified organic crop farmers expanding by transitioning newly purchased or rented land or by transitioning additional acreage from conventionally managed cropland, and (iv) absentee landowners and part time farmers transitioning land that was previously fallow or enrolled in the Conservation Reserve Program. We observe the following transition strategies. (i) Dairy farmers almost always transition land first before transitioning the herd. The majority of dairy farmers keep land in alfalfa or other forage crops throughout transition. (ii) Crop farmers transition land gradually, many with two or three distinct transition periods for different fields. This gradual transition allows experimentation with management alternatives. (iii) Most livestock and crop producers plant land to alfalfa throughout the transition period and establish a rotation of row crops and small grains once land is certified. This facilitates weed control throughout transition, and a high-value crop can be planted in the first year that the land is certified. (iv) Landowners with acreage in long-term pasture or coming out of the Conservation Reserve Program can certify land immediately without an actively managed transition period. These farms have often changed ownership or are undertaking a significant shift in overall farm strategy. According to the survey results, a large percentage of TFT farmers purchased equipment, animals, or land and/or increased their use of hired labor and consultants when beginning to transition land. Some transitioning farmers increased the amount of rental land. Cash flow management and access to capital are the most important management challenges for TFT farmers. Cost and availability of inputs and weed management are the most important production problems. Finding buyers, proximity to markets, organic price volatility and high prices for conventional crops are the most important marketing challenges.
Publications
- Delbridge, T.A. and King, R.P. 2012. Conversion to organic farm management: a dynamic programming approach. Poster presented at the annual meeting of the Agricultural & Applied Economics Association, Seattle, WA. (http://purl.umn.edu/124928)
- DiGiacomo, G. 2012. Profile: Rory Beyer, Recently Certified Organic Dairy. Organic Broadcaster 20(4):1,10.
- DiGiacomo, G. 2012. Walters Transition Dairy to Increase Profits. Organic Broadcaster 20(6):1,8.
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Progress 09/01/10 to 08/31/11
Outputs
OUTPUTS: Much of the project team's time during this first year has been devoted to recruiting transitioning and recently certified farmers to participate in the project by enrolling in the Farm Business Management program. To date, we have enrolled 30 farmers in the project: 26 with at least some land and/or dairy cattle in transition and four with recently certified land and/or dairy cattle. Many of the transitioning farms already have some certified organic land or cows. Of these farms: 18 raise only crops, pasture, and hay; one has only dairy cows, and 11 raise crops, pasture, hay, and dairy cows. Collectively, these farms have 2,724 acres in transition and 400 recently certified acres. These farms cultivate 4,762 acres that have been certified for three years or more, and they cultivate an additional 3,754 acres of conventional land. These farms have a total of 422 dairy cows in transition, 433 certified organic dairy cows, and 90 conventional dairy cows. A total of 18 farm business management instructors are working with these farms. Project team members have made adjustments to the FINPACK and FINBIN computer systems to facilitate capture of enterprise-level data on transitioning and recently certified farms. Project team members also have begun preliminary analysis of financial and production records for farms that were enrolled in the Farm Business Management program prior to the start of this project. Project team members have used long-term experimental trial data from the Variable Input Crop Management Study (VICMS) at the Southwest Research and Outreach Center in Lamberton, MN in an analysis of whole farm profitability and risk under conventional and organic practices. This work will provide insights on differences in optimal farm sizes under these two systems. This is important because organic cropping operations may be smaller, though not necessarily less profitable, than conventional cropping operations. Finally, we have established an eOrganic web site that is currently used only for communication within the project team. In the future it will be used to communicate research results with other researchers and the public. PARTICIPANTS: Project team members include: Robert Craven (U of M), Tim Delbridge (U of M), Gigi DiGiacomo (U of M), Richard Joerger (MnSCU), Robert King (U of M), Rann Loppnow (U of M), Meg Moynihan (Minnesota Department of Agriculture), Helene Murray (U of M), Dale Nordquist (U of M), Jim Riddle (U of M). Project advisory committee members include: Ira Beckman (MnSCU), Ron Dvergsten (MNScu), Carmen Fernholz (farmer), Loretta Jaus (farmer), Robin Martinek (USDA/NRCS), and Michelle Menken (Minnesota Crop Improvement Association). TARGET AUDIENCES: Target audiences for this project are farmers, farm business management instructors, organic certifiers, agricultural professionals who support organic production, lenders, crop insurance agents, and policy makers. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
At this early point in the project, we do not have significant outcomes or impacts for external audiences based on the farm record data we are collecting. Members of our project team have learned that there is much greater diversity than expected in the range of strategies farmers are using to transition to organic production. As financial and demographic data from the first year of the project starts to come in through FINPACK and farmer surveys during the winter of 2012, we will be better able to describe and quantify this diversity for audiences outside of our project. The Minnesota Guide to Organic Certification (originally published in 1998) has been updated as part of this project and has been made available to all participating farmers. Finally, the whole farm analysis of the VICMS trial data has yielded some interesting results. Starting with a fixed machinery set for tillage and grain harvesting, we find that the number of acres that can be farmed organically is considerably less than that for a conventional operation. From a profitability and risk management standpoint, however, the smaller organic operations would be preferred by all decision makers who are risk neutral or risk averse. This has important implications for farms in transition, since it suggests that they may downsize as part of the transition process. In many cases, this could mean terminating leases on some or all rented land. These results were distributed to team members via the eOrganic website and to broader audiences at an organic field day held in Lamberton, MN and at the annual meeting of the Agricultural & Applied Economics Association in Pittsburgh, PA.
Publications
- Delbridge, T.A., Fernholz, C., Lazarus, W.F., and King, R.P. 2011. A whole farm analysis of organic and conventional cropping systems. Paper presented at the annual meeting of the Agricultural & Applied Economics Association, Pittsburgh. PA. (http://purl.umn.edu/103790)
- Riddle, J. and Gulbranson, L. 2011. Minnesota Guide to Organic Certification. University of Minnesota, Minnesota Institute for Sustainable Agriculture. (http://www.misa.umn.edu/prod/groups/cfans/@pub/@cfans/@misa/document s/asset/cfans_asset_335916.pdf)
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