Final Report on Investment, Cost of Production and Productivity of Medium & Large Grain Operations in Alberta

 
 
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  Economics and Competitiveness
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Success in commodity grain production requires business owners to strive for efficiency. This efficiency applies to all areas of their operation including the use of their Management, Labour, Assets, Capital and all other resources employed in their grain enterprise, as well as excellence in the production of each crop they grow. In most businesses, including agriculture, one of the primary tools that managers use to become more efficient is through increase in size, i.e. farming more acres. This study tests some of the more commonly accepted efficiency gains by analyzing 58 medium and large scale grain operations of over 2,000 acres in Alberta for the 2008 crop production year. The focus of this study is on cost of production, investment levels, equipment and labour use for “traditional” grain farms. “Traditional” is taken to mean farms growing the typical commodity crops found in Alberta, such as Wheat, Durum, Barley, Canola, and Peas.
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A key part of this report is the determination of what some of the profit drivers are in Grain farms of over 2,000 acres. Do the larger farms make productivity gains (higher yields) when compared to the smaller farms and what are their cost savings when compared with those smaller farms? Do the large farms achieve lower per-unit investment levels, and costs than smaller farms? Do large farms make more money per bushel or less? Do they generate more profit in for every unit produced, or is their success mainly through thin margins and high output levels. Other farm attributes were explored, such as the use of rented land and machinery investment practices.

For a copy of the report, please download the attached .pdf file.
 
 
 
 
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For more information about the content of this document, contact Rawlin Thangaraj.
This document is maintained by Shukun Guan.
This information published to the web on July 29, 2010.
Last Reviewed/Revised on January 13, 2016.