A financial analysis of different livestock management approaches within different crop rotation systems in the middle Swartland

Basson, Coenraad Hendrik (2017-03)

Thesis (MScAgric)--Stellenbosch University, 2017.

Thesis

ENGLISH SUMMARY : The need for sustainable agricultural production systems is emphasised by the increasing pressure on natural resources. Conservation agriculture (CA) is a holistic approach to sustainable agriculture, encompassing three basic principles: (1) minimal soil disturbance, (2) maximum or permanent levels of soil cover and (3) crop diversification through crop rotation systems. The Swartland grain production area of the Western Cape has seen an increased adoption of CA practices over the last two decades. The reasons for and extent of CA uptake amongst Swartland producers vary significantly. The Swartland has a typical Mediterranean climate with hot, dry summers and cold, wet winters. Grain production in the Swartland is predominantly based on dry-land production systems, while wheat has traditionally been produced in monoculture systems. As a result of various driving forces, the attractiveness of crop rotation as an alternative to monoculture has increased significantly since the late 1990’s. Alternative crops such as canola, lupins, and annual legume pastures have gained popularity in the area and are commonly incorporated into Swartland crop rotation systems. The addition of annual legume pastures into crop rotation systems with wheat has provided Swartland producers the opportunity to also diversify in terms of farming enterprise by adding a livestock component to their farming operation. The additional incorporation of a livestock component may provide many benefits, including increased diversification, increased financial and income stability and even increased profits. However, despite the fact that livestock fit perfectly in crop rotation systems, there is concern about the impacts of livestock on soil compaction and cover, posing various threats to the successful implementation of CA. This is mainly due to possible soil compaction caused by livestock trampling and soil cover serving as livestock feed. To achieve successful integration of a livestock component into a mixed farming system without mitigating CA outcomes, therefore, requires livestock approaches based on lower stocking rates or alternative feeding systems. This study aims to assess the financial implications of different approaches that could be followed to achieve successful crop-livestock integration. Technical data from the Langgewens experimental farm served as basis for developing the livestock approaches and strategies. To capture the interrelatedness of variables and complexity of the farming system, this study is based on a systems approach. To assess the financial performance of the different livestock management approaches on whole-farm level, a typical farm model was developed. A multi-disciplinary expert group discussion was used to obtain valuable information necessary for developing the typical farm model. The financial performance of the different strategies on whole-farm level was measured in terms of the Internal Rate of Return on Capital (IRR) and the Net Present Value (NPV). Wheat-medic crop rotation systems with additional saltbush pastures proved to be the most profitable. Of the three livestock management approaches modelled, a grazing approach is least profitable. While an intensive speculation approach is the most profitable for integrating livestock on a particular farm, treating medics as a cash crop by selling medic hay to neighbouring producers is a valuable alternative.

AFRIKAANSE OPSOMMING : Die behoefte aan volhoubare produksiestelsels in landbou word beklemtoon deur die toenemende druk waaronder natuurlike hulpbronne gebuk gaan. Bewaringslandbou is ‘n holistiese benadering tot volhoubare landbou. Bewaringslandbou word onderle deur drie kernbeginsels: (1) Minimum grondversteuring, (2) maksimum of permanente grondbedekking en (3) gewasdiversifikasie deur middel van wisselboustelsels. Oor die afgelope twee dekades is bewaringslandboupraktyke toenemend toegepas deur boere in die Swartland graanproduksiearea van die Wes-Kaap. Die redes vir en die omvang van die implementering van bewaringslandbou onder boere in die Swartland verskil noemenswaardig. Die Swartland het ‘n tipiese Mediterreense klimaat met warm, droe somers en koue, nat winters. Graanproduksie in die Swartland is oorwegend op droeland produksie sisteme gebaseer, terwyl koring tradisioneel in monokultuur verbou is. Verskeie dryfvere het daartoe gelei dat wisselbou as alternatief tot monokultuur al hoe aantrekliker geword het sedert die laat 1990’s. Alternatiewe gewasse soos kanola, lupiene en eenjarige peulgewasse het toenemend gewild geword in die area en word vandag algemeen ingesluit by wisselboustelsels. Die insluiting van weidingsgewasse in wisselboustelsels het vir Swartlandboere die geleentheid verskaf om ook in terme van bedryfsvertakkings te diversifiseer, deur ‘n veekomponent tot die boerdery toe te voeg. Die toevoeging van ‘n veekomponent hou vele moontlike voordele in, insluitend verhoogde diversifikasie, toenemende finansiele- en inkomste stabiliteit, asook verhoogde winsgewendheid. Ten spyte daarvan dat vee goed in die wisselboukomponent van bewaringslandbou pas, bestaan daar egter kommer oor die impak wat vee op grondkompaksie- en bedekking kan he. Die kommer word oorgewend toegeskryf aan moontlike grondkompaksie wat veroorsaak word deur vertrapping, asook die feit dat die deklaag as voer dien. Om suksesvolle integrasie van ‘n veekomponent in ‘n gemengde boerderysisteem te bewerkstellig sonder om inbreuk op die uitkomste van bewaringslandbou te maak, vereis dus veebenaderings wat geskoei is op verlaagde veeladings of alternatiewe voersisteme. Hierdie studie poog om die finansiele implikasies van verskillende benaderings wat gevolg kan word om suksesvolle gewas-vee integrasie te bewerkstellig, te evalueer. Tegniese data van die Langgewens proefplaas het as basis vir die ontwikkeling van die veebenaderings en integrasie-strategiee gedien. Om die interafhanklikeid van verandelikes en die kompleksiteit van die boerderysisteem vas te vang, is hierdie studie geskoei op ‘n stelselsbenadering. Ten einde die finansiele prestasie van die verskillende veebestuursbenaderings op plaasvlak te evalueer, is daar van ‘n tipiese plaasmodel gebruik gemaak. ‘n Multi-dissiplinere groepsbespreking is gebruik om belangrike inligting relevant tot die ontwikkeling van die tipiese plaasmodel in te win. finansiele prestasie van die verskillende strategiee op plaasvlak is gemeet in terme van die Interne Opbrenskoers van Kapitaal (IOK) en die Netto Huidige Waarde (NHW). Koring-medic wisselboustelsels met addisionele soutboskampe het die hoogste winsgewendheid getoon. Van die drie veebestuursbenaderings wat gemodelleer is, vaar ‘n weidingsbenadering die swakste in terme van winsgewendheid. Alhoewel ‘n intensiewe spekulasiebenadering die hoogste winsgewendheid toon vir integrasiebenaderings op ‘n gegewe plaas, is die hantering van medics as kontantgewas deur dit as hooi te verkoop ‘n geldige alternatief.

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