4.6. Comparison with Agricultural Sectors
To compare the horticultural enterprises studied with the agricultural enterprises, calculations of the yield change, required revenue premium and expenditure were made and tabulated.
The "bottom-up" focus-group method used to construct organic models means the organic models were not all directly comparable, so some reworking was done to ensure the valid comparisons. Table 4.6.1 provides a summary of the comparisons generated.
Table 4.6.1: Comparison of horticultural and agricultural sectors, organic models versus MAF monitoring models
|
Sector | ||||||
Kiwifruit |
Apples |
Dairy |
Sheep & Beef |
Deer |
Arable | |
Estimated yield change under organic production (%) |
-23 |
-22 |
-8 |
-25 |
-25 venison |
-30 cropping |
Revenue premium required for organic model cash farm/orchard surplus to equal MAF models (%) |
23 |
16 |
2 |
29 |
30 |
44 |
Estimated change in organic model cash farm/orchard expenditure compared with the MAF model (%) |
+1 |
-9 |
-9 |
-8 |
-2 |
-22 |
Notes:
A "no premium" organic model was used to calculate the revenue premium required. The revenue premium required was calculated by taking the difference in cash surplus as a percent of MAF model revenue. If any costs are based on a percent of revenue, then these figures would understate the revenue premium required.
Kiwifruit
Uses an "all-green" variety MAF model for valid comparison.
Apples
Adjusted to exclude organic premium, applies to Hawkes Bay MAF model.
Dairy
Revenue premium and yield change are based on milk solids.
Sheep and Beef
Organic model accounts for lower stocking rate and reduced growth rates.
Deer
Excludes grazing income.
Arable
Adjustment for different areas of cropping/livestock in organic model. All non-cropping area was calculated as livestock area.
The table shows all sectors expect a lower yield under organic production. Kiwifruit and apples are broadly similar to sheep and beef and deer at around 20-25 percent yield drop. Dairy is lower at 8 percent lower yield and arable highest at 30-47 percent yield reduction. Required revenue premiums follow a similar pattern. They are lowest for dairy at 2 percent and highest for arable at 44 percent. Kiwifruit, apples, deer and sheep and beef all fall between 16 percent and 30 percent required organic revenue premium.
The organic models cash farm or orchard expenditure changes are more modest. Kiwifruit is the only increase, at a modest 1 percent. All other sectors expect lower expenditure, ranging from 2 percent less for deer to 22 percent less for arable and 8-9 percent for apples, dairy, and sheep and beef.
Other comparisons between the horticultural and agricultural sectors studies are:
Yield drop/conversion period
For all sectors, the conversion period where a yield drop occurs but no organic premium is received is a big issue constraining conversion to organic production. For kiwifruit and apples, historical circumstances and policies helped encourage conversions as growers did receive revenue premiums during conversion.
Limited organic pest and disease control options
This is an issue for all sectors. In kiwifruit and apples, conversion of mature orchards has helped with weed issues, perhaps analogous to starting conversion with a weed-free farm. Kiwifruit and apple diseases are often climate-influenced, more like facial eczema, rather than the internal parasites affecting stock. There is no direct comparison in kiwifruit and apples of reducing stocking intensity to reduce pest and disease problems.
Processors
The main value in kiwifruit and apples is for export of the fresh fruit. Processing required for this is packing and coolstorage that maintains organic integrity. There are registered organic packhouses and obtaining registration of a packhouse is not problematic. Processing of kiwifruit and apples into other food products does occur, but is not a significant contribution to orchard revenue. This contrasts to most of the agricultural sectors where lack of organic processing facilities is a key constraint.
Soil fertility
For apples and kiwifruit, phosphorus is a less important nutrient than it is for the pastoral sectors. The major nutrients nitrogen, potassium and magnesium are most important for apples and kiwifruit, and difficult to apply at the times and in the quantities required. The per hectare requirements for these nutrients are probably several orders greater than for the pastoral sectors, and more like arable requirements.
The perennial nature of kiwifruit and apple trees increases "conservation" of nutrients between seasons compared with arable cropping but annual application of nutrients is restricted to surface application as cultivation disturbs roots.
BioGro registration
Kiwifruit and apple growers all use BioGro or Demeter registration. This is either required by the marketers, or due to historical acceptance of BioGro in the key markets. The pastoral sectors appeared to have more choice with respect to organic certification. Certenz certification was a viable option for organic farmers and comment was made that a higher proportion of livestock could meet Certenz standards.
Limited buffer
The limited range of management tools to adapt to seasonal conditions is probably more pronounced for apples, kiwifruit and arable cropping than the pastoral sectors because there is no analogy to buying in or storing feed as hay or silage. Without this buffer, greater season-to-season variation in performance could be expected for the horticultural sectors.
Contact for Enquiries
Kay Brown
Sector Performance Policy
MAF Policy
Ministry of Agriculture and Forestry
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0695
Fax: +64 4 4 894 0746
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