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  • Author or Editor: Hector German Rodriguez x
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Numerous apple (Malus ×domestica) research experiments have shown that organic apples can be both profitable and sustainable, especially in the Pacific northwestern United States. However, there is limited published research on the profitability of organic apple orchards in the southern U.S. region. Surveys of southern U.S. stakeholders have indicated that great opportunities exist for markets of both fresh and processed fruit, but significant challenges still exist. These challenges include a lack of information available on the economic impacts of different organic production practices and the potential returns available from organic production. In response to these challenges, we developed a user-friendly interactive economic decision support tool using spreadsheet software to simulate organic apple production in Arkansas and across the southern United States. The purpose of this interactive economic decision support tool is 2-fold: 1) to assist producers in the evaluation of costs, returns, and risks associated with their organic apple orchard and 2) to assess changes to cost, return, and risk as expected costs, prices, and/or yields change. The production budget components of the interactive economic decision support tool estimate variable and fixed costs, gross revenues, and net returns for 18 years of production. In addition, this interactive economic decision support tool provides economic analyses regarding: 1) the operation’s breakeven (price and yield) points, 2) sensitivity analyses or “what if” scenarios related to changes in costs and returns, and 3) risk assessment by calculating the probability of obtaining a positive net present value (NPV) over the life of the organic apple orchard. This manuscript describes the development of this interactive economic decision support tool and provides an example of how it works.

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Extending the production season of blackberry (Rubus subgenus Rubus) cultivars allows producers the opportunity to potentially receive better prices. Producers could benefit from out-of-season production by sustaining cash flow during more of the year and thereby expanding their market. The objective of this study was to compare the present value (PV) probabilities of being able to cover the total cost (TC) of production (break-even) for open-field and high tunnel production systems for the primocane-fruiting blackberry cultivar Prime-Jan® in northwestern Arkansas. (PVs) of gross revenues (GRs) of each production system were simulated 500 times. Total yields were higher in the open-field system in the first 2 years of production and consistently higher in weeks 33 to 34 and 36 to 37 than high tunnel production. It seems that there are no yield benefits from the high tunnel system early in the harvest season, except in the first year of primocane-fruiting production. The break-even probability was sensitive to the different percentage of yield sold, the percentage of the retail price received by the producer, and the production system analyzed. Even though the potential gross returns obtained with the high tunnel system are high (when compared with open-field production), the PV distributions of the gross returns do not offset the high tunnel TC in half of the simulations. Conversely, open-field production proves to be more profitable both in magnitude and in terms of the likelihood of exceeding the break-even threshold over the productive life of the enterprise.

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