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Economic Considerations Related to Alternative Agricultural Enterprises

Roger Sahs

Summary

Agricultural producers must make financial plans and management decisions aimed at profitability and sustainability in an increasing risky environment. Alternative agricultural enterprises such as specialty crops are being added to operations by producers in hopes of increasing farm profit. Producers need assistance in realistically evaluating financial prospects of alternative enterprises and in identifying cost effective ways of producing specialty commodities. Many horticultural crops are not insurable or may be underserved with available coverage.

A lack of time and knowledge are common reasons given by producers for not using recommended practices. Limited discretionary time and the need for adopting best management practices make it imperative that timely, unbiased information be accessible to interested or existing producers involving alternative enterprises. Economic considerations and keys to success are required information. Marketing, land and labor resources, financing, and management skills are critical components. Enterprise budgets also provide a firm foundation for risk-management decisions. Knowledge of budgeting and the ability to use them assist producers to focus on financial management as well as production performance.

Details

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