Performing Department
OARDC
Non Technical Summary
Large specialized farms that achieve economies of scale are common in US agriculture. Small and mid-sized farms, however, need a different kind of economy, an economy of scope. Diversified production systems have demonstrated ecological and economic benefits that could apply to small and medium-sized farms, but needed research on these benefits is lacking for US agriculture. We propose research to develop a decision-making framework for the transition from specialized commodity production systems to diversified crop and livestock production. Diversified production systems are likely to target differentiated local and regional markets where small and mid-sized farms compete more effectively, taking advantage of economies of scope. Our education component will integrate land grant and liberal arts college undergraduate students with research by graduate students and faculty, in both independent study and formal classroom teaching. The results will improve economic decision-making with respect to diversification on small and medium sized farms and contribute to their success and the health of rural communities. Results of both the on-farm experiments and surveys of diversified farmers, also will contribute to: evaluating and implementing strategies to enhance access to markets by small and mid-sized farms, strategies that will increase supply into local and regional food systems, and improved planning for new input costs, capital needs, and markets for diversifying small and medium-sized farms.
Animal Health Component
70%
Research Effort Categories
Basic
10%
Applied
70%
Developmental
20%
Goals / Objectives
Our overall goals are to develop a decision-making framework for the transition from specializedcommodity production systems to diversified crop and livestock production. The productionsystem targets differentiated local and regional markets where small and mid-sized farmscompete more effectively, taking advantage of economies of scope. We expect the advantages of diversification to include: 1.) greater output in new value chains; 2.) entry into new markets that bring new revenues; 3.) lower costs of production due to ecosystem services that derive from synergies between crop, animal, and farm energy enterprises; 4.) lower cost of capital because human, social, built, and natural capitals can be used as substitutes for more expensive financial capital in diversifying small and medium sized farms; and 5.) greater net revenue and return on investment for the farm.To address these goals we propose the following research objectives: Objective 1 - Establish controlled field experiments with early stage diversification on a mid sized farm and measure associated costs and returns.Objective 2 - Estimate the thresholds for entry into new markets for whicha diversified production portfolio offers potential foreventual penetration and expansion. Objective 3 - Examine the decision making, mindset and influences on diversification decisions for recently diversifying farmers using survey techniques. Objective 4. Integrate the research in each of the phases of the project described above into a decision making framework for small to medium sized farmers. Objective 5. Incorporate the research activities and results into coursework and student experience at both a public land grant university and a private liberal arts college.
Project Methods
We propose a two-pronged approach to the research needed to improve decision models for diversification on small and medium sized farms, both thoroughly integrated with undergraduate and graduate education. Using the earliest stages of diversification on a new research farm, we will develop metrics, a monitoring framework, and data needed for a decision model for farmers who are considering diversification of their production systems. Ecological and economic complementarities in the transitioning production system, i.e. ecosystem services, will be quantified according to metrics developed specifically for the decisions farmers will face. In complementary community level research, diversification alternatives and associated decisions made by farmers will be measured in a survey of small and medium sized farms that have recently diversified in the region.For new value chains created by the diversified production, we will conduct market research on entry thresholds into new local and regional markets; and explore the capital that the farmer would need for each diversification option. The influence of landscape characteristics will be quantified so that the results can be scaled and extended to new farm settings based on soil type, topography, land use and management histories. Analysis of the data will be based on variance and probability of receiving higher returns, rather than average point estimates. Education components of the project will be designed to educate future and existing producers interested in diversified production, educate those who could find careers throughout the food value chain including the many supporting industries, and develop awareness among new consumers regarding their potential roles as investors in and supporters of diversified production on small and medium sized farms.