An analysis of financial implications of switching between crop production systems in Middle Swartland

[摘要] ENGLISH ABSTRACT: Sustainability issues and the structural over-supply of wheat in the Western Cape since themiddle 1990‟s have caused the introduction of alternative crop rotation systems in the MiddleSwartland, a dry-land winter cereal production area of the Western Cape. Crop rotationsystems typically consist of cereals and oilseed crops and pastures. Alternative crop rotationssystems are currently scientifically evaluated at the Langgewens Experimental farm.Currently more than half the cultivated area in the Swartland is still under wheat production,a third of which is wheat monoculture. An issue regarding the adoption of such a croprotation system is the cash flow and affordability of implementing such an alternative system.The goal of this study is to determine the cash-flow implications of a shift from wheatmonoculture to a crop rotation system. Typical strategies available to producers to supportsuch a shift are investigated. The complexity of farm systems as well as the interrelationshipsbetween crops within such a crop rotation system necessitates the implementation of asystems approach. A multi-period, whole-farm budget model was constructed to capture theinterrelationships of the farm system and to express the financial performance thereof instandard profitability criteria.The farm model is based on a typical farm for the Middle Swartland. The model was used todetermine the expected profitability of various crop rotation systems and to evaluatealternative strategies to accommodate the shift to alternative systems. The Langgewens croprotation trial results are used to determine expected profitability of various crop rotationsystems. A wheat-monoculture system serves as basis for the shift to alternative systems withthe focus on the practical implications of such as shift.The profitability calculations show that various crop rotation systems are expected to be moreprofitable than wheat monoculture. The most profitable system is one year canola followedby three years of wheat, followed by a wheat/medic system with Dohne Merino sheep on themedic pastures. The shift from wheat monoculture is simulated by four scenarios. The firstevaluated the financial implications of a shift form monoculture to the three year wheat andone year canola system. The second simulates a shift from monoculture to a wheat/medicsystem within two years and using own funds. The third scenario simulate the same shift withown funding, but over a ten year period. The fourth is similar to the second, but borrowedmoney is used to fund the shift.Lower input costs and consistently higher yields results in higher expected gross margins forthe crop rotation systems, especially with nitrogen fixing plants. The inclusion of medic andmedic/clover pastures and alternative cash crops such as canola and lupins show a higheryield on investment than wheat monoculture. Insight into the factors that producers shouldconsider was also generated by this study, concerning changes to crop rotation systems.These factors include; time period over which a shift is planned and the availability offinancing options. It seems that a quicker shift, using borrowed funds, is more profitable overthe longer term.

[发布机构] Stellenbosch University