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Purdue ag economist on organic vs. conventional crop rotations
Farmers who transition from conventional to certified organic grains report higher net returns, but certified land accounts for less than two percent of U.S. farmland.
Purdue Ag Economics Professor Michael Langemeier says there is a lot to organic production that discourages people from becoming an organic producer.
“One of the big hurdles that everybody that goes into organic faces, is there is at least a two-year transition period from convention to organic,” he says. “What I mean by that is essentially you have to use organic practices for two years— and that would mean no use of herbicide, insecticide, and use of manure rather than synthetic fertilizer – but you only receive conventional prices.”
A paper released Friday by Langemeier and Xiaoyi Fang with the Purdue Center for Commercial Agriculture compares long-run net returns of conventional corn/soybean and corn/soybean/wheat crop rotations to organic corn/soybean/wheat rotation. Ten-year enterprise budgets for each crop rotation were developed.
Over a ten-year period, Langemeier says…”organic had higher net returns to land- close to $100 per acre,” he says.
But, he says operating costs for organic production are also higher.
“You have higher machinery costs and it’s also very evident labor costs are quite a bit higher under an organic system,” he says.
From 2014 to 2018, total expenses for organic production compared to conventional production were slightly higher for corn, and 30-40 percent higher for soybeans and wheat.
Langemeier says farmers considering organic should talk to other producers who have transitioned to organic production.
“There’s much more variability for organic producers in terms of rotations they pick, how they handle weeds, and the labor they use,” he says. “Visit with these people but also start crunching the numbers.”
He suggests that interested growers to put different prices and yields in their budgets to see what some break-even prices might be.
Audio: Michael Langemeier
