Dear readers, in order to produce food, land is needed, and this land is managed by man, whom we can call a manager, since he is the one who must organize and plan the activities related to agricultural production. To get the most out of an agricultural enterprise, the manager must understand some aspects of the economy, goods and services.
Apart from the aforementioned, for a farm to generate adequate production, it must establish crops that are adapted to the climatic conditions of the geographical area where it is located. It is also important to consider that to facilitate the management of crops, sometimes equipment and machinery such as tractors, tillage tools, irrigation systems, mechanical milking, artificial insemination of livestock among other elements are acquired, to acquire these goods the agricultural entrepreneur must make an investment after a market study that will show which are the products of greatest demand in the market, with this information you could project the income that will be obtained by the sale of the items established on their land.
Therefore, it can be said that the economic value of the farm is not only based on the infrastructure that can be found on it, but also on the production of food, with the production of which the necessary labor can be hired, such as tractor drivers, maintenance personnel and agronomic management.
On the other hand, the producer must also consider the expenses generated for the acquisition of inputs in order to obtain a profitable production. Aldana (2001) pointed out that there are fixed and variable inputs, defining fixed inputs as those whose quantity cannot vary in the short term because the cost would be too high, such as construction and large machinery, while variable costs are those that are susceptible to immediate changes, such as unskilled labor and raw materials, among others.
Taking into account the above, the agricultural entrepreneur seeks to produce more at a lower cost, i.e., for example, if corn is planted, the production of this crop generates more income than the costs of agronomic management, therefore, currently a wide variety of more profitable agronomic alternatives have been implemented.
Dear readers, in conclusion, agricultural production consists of transforming goods and services into other kinds of goods, therefore, the intention of any agricultural entrepreneur is to generate value to the entire production process, i.e. he seeks that the agricultural products he produces acquire greater value than the inputs used throughout the process.
| Bibliographic references |
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Aldana, H. (2001). Agricultural Economics, Administration and Marketing. Editorial Terranova: Bogota, Colombia.
Hi @amestyj, as a grower you are looking to get the best crops from the land and to do that you have to make a good investment in land preparation and have excellent equipment to get the best out of the land. Greetings friend and thanks for sharing this valuable information.
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I think the danger of just treating agriculture like a business is that farmers take options like tiling, pesticides and fertilisers as away of keeping profits up. However they are all bad for the environment. Ultimately bad for the very economy the farmers are enjoying. How should we deal with these economic externalities?
Great article btw 👏
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Greetings dear @awah, you are very right, the problem is that producers have adapted to mechanical management without considering that they are in a natural ecosystem, there are no unique solutions, everything depends on the soil, climate, vegetation and many other elements that make up the agricultural system.
See you later brother, have a great week
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