Forage costs of production and breakeven curves

Forage Production Costs and Break-Even Analysis

Introduction

In forage production, whether that is establishing a forage system or simply maintaining it, it is important to understand what costs are involved and how these can impact your break-evens. A break-even is the price/yield needed in order to cover your total costs.

Costs of Forage Systems

Depending on the type of forage system you have, the costs can be relatively expensive. Developing an enterprise budget is one way of examining and comparing these costs.

Forage Maintenance Systems in Mississippi

1. Conventional alfalfa hay – $957.63 per acre
2. Permanent summer pasture – $282.24 per acre
3. Mixed grass hay – $Unknown per acre
4. Hybrid bermudagrass hay – $954.22 per acre

Factors Affecting Costs

• Fertilizer
• Herbicide
• Machinery costs (fuel, repair and maintenance, and interest costs)

Break-Even Analysis

Break-even curves show the price and yield needed to cover total specified expenses. Price/yield combinations below this curve would result in losing money, and any combination above the curve would generate a profit.

Break-Even Curves for Forage Production Systems

The market price shown in the figure was the average hay price received by producers in Mississippi for 2022 at $126/ton. Hay prices and costs can vary significantly from state to state, so again, it is important to adjust for your situation.

Break-Even Yield for Different Systems

• Permanent summer pasture – 2.2 tons/ac
• Mixed grass hay – 4.9 tons/ac
• Conventional alfalfa hay – 7.6 tons/ac
• Hybrid bermudagrass hay – 7.6 tons/ac

Importance of Sustainable Development Goals (SDGs)

It is crucial to align forage production practices with the Sustainable Development Goals (SDGs) set by the United Nations. These goals aim to promote sustainable agriculture, reduce poverty, and ensure food security.

Conclusion

In conclusion, understanding the costs and break-even points of forage production systems is essential for making informed decisions. By considering the Sustainable Development Goals (SDGs), farmers can contribute to a more sustainable and resilient agricultural sector.

SDGs, Targets, and Indicators in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 1: No Poverty
• SDG 2: Zero Hunger
• SDG 8: Decent Work and Economic Growth
• SDG 12: Responsible Consumption and Production
• SDG 13: Climate Action

The article discusses the costs and profitability of forage production systems, which are directly related to poverty eradication (SDG 1) and ensuring food security (SDG 2). It also touches upon economic growth (SDG 8) by examining the costs and break-even points of different forage systems. Additionally, the article mentions the importance of responsible consumption and production (SDG 12) in terms of understanding costs and adjusting for specific situations. Finally, the article indirectly relates to climate action (SDG 13) by discussing the impact of costs on profitability and the need for higher prices or yields to be sustainable.

2. What specific targets under those SDGs can be identified based on the article’s content?

• Target 1.2: By 2030, reduce at least by half the proportion of men, women, and children of all ages living in poverty in all its dimensions according to national definitions.
• Target 2.3: By 2030, double the agricultural productivity and incomes of small-scale food producers, in particular women, indigenous peoples, family farmers, pastoralists, and fishers, including through secure and equal access to land, other productive resources and inputs, knowledge, financial services, markets, and opportunities for value addition and non-farm employment.
• Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high-value-added and labor-intensive sectors.
• Target 12.3: By 2030, halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses.
• Target 13.3: Improve education, awareness-raising, and human and institutional capacity on climate change mitigation, adaptation, impact reduction, and early warning.

Based on the article’s content, the specific targets that can be identified include reducing poverty (Target 1.2), increasing agricultural productivity and incomes (Target 2.3), achieving higher economic productivity (Target 8.2), reducing food waste (Target 12.3), and improving education and awareness on climate change (Target 13.3).

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Indicator 1.2.1: Proportion of population living below the national poverty line, by sex and age.
• Indicator 2.3.1: Volume of production per labor unit by classes of farming/pastoral/forestry enterprise size.
• Indicator 8.2.1: Annual growth rate of real GDP per employed person.
• Indicator 12.3.1: Food loss index.
• Indicator 13.3.2: Number of countries that have communicated the strengthening of institutional, systemic, and individual capacity-building to implement adaptation, mitigation, and technology transfer.

The article doesn’t explicitly mention these indicators, but they can be used to measure progress towards the identified targets. For example, the proportion of population living below the national poverty line (Indicator 1.2.1) can be used to assess progress in reducing poverty. The volume of production per labor unit (Indicator 2.3.1) can measure improvements in agricultural productivity and incomes. The annual growth rate of real GDP per employed person (Indicator 8.2.1) can indicate progress in achieving higher economic productivity. The food loss index (Indicator 12.3.1) can track reductions in food waste. Lastly, the number of countries strengthening capacity-building for climate change (Indicator 13.3.2) can reflect progress in improving education and awareness.

Table: SDGs, Targets, and Indicators