Organic Broadcaster

Study examines how sharing equipment can help farmers scale up

By Laura Miller, Georgeanne Artz, and Linda Naeve

Scenario:

Last year you planted three acres of aronia berry shrubs, which are starting to bear fruit. In five years, each bush could produce 15-20 pounds of berries (about 7 tons an acre), and harvesting the crop by hand will take nearly 35 people work­ing a total of two weeks.

Should you invest in the additional labor or the specialized equipment? And how does this decision impact your bottom line?

Growers in an equipment-sharing group take advantage of a shared plastic mulch layer to save labor and greatly increase the amount of plastic mulch they are able to put in their fields.
Photo by ISU Value Added Extension

Fruit and vegetable growers throughout the Midwest are familiar with the labor vs. machin­ery trade-off. More interest and demand for local food are causing growers to consider expand­ing their operations by increasing the number of acres in production, but this requires either more labor or the use of labor-saving equipment. Complicating the issue is the greater diversity of equipment required for fruit and vegetable crops, limited access to the equipment as well as experience in its operation.

Exactly how Midwestern fruit and veg­etable producers are scaling up—what works, what doesn’t work, and the array of available options—has been the focus of Georgeanne Artz’ research at Iowa State University (ISU) the past several years. An assistant professor in the Department of Economics, Artz has led two proj­ects funded by research grants from the Leopold Center for Sustainable Agriculture.

A 2012 project looked at how six Iowa fruit and vegetable farms expanded their operations. Artz and a graduate student, Nicholas Pates, interviewed growers to understand how size, diversification, marketing strategies, and production methods impact machin­ery adoption, and how they viewed the inevitable trade-offs that come with these decisions. All growers had at least eight years of experience in fruit and vegetable produc­tion and their operations had undergone some expansion.

In 2013, Artz launched a second project, just completed, that looked at machinery-sharing agreements. She worked with Linda Naeve from ISU Value Added Agri­culture Extension to inter­view five groups of farmers who had entered into trial sharing agreements, includ­ing aronia berry growers in southwest Iowa. Other groups shared an ECO weeder, a mulch layer, a garlic separa­tor, and a multipurpose toolbar attachment for the back of a tractor.

“There is no ‘one-size-fits-all’ strategy when it comes to sharing equipment,“ Artz said. “We want to give people the idea that there’s not a ‘right way,’ but a lot of different ways to share equipment. You have to figure out what works for you.”

Example: Berry Harvester

Farmers who shared in the purchase of an aronia berry harvester use it to save time picking berries.
Photo by ISU Value Added Extension

“Anyone who has har­vested berry bushes quickly realizes that hand-picking is time-consuming and costly,” said Henry, who had been growing aronia ber­ries since 2005.

With seven acres of aronia berries to harvest, Henry was motivated to find a harvesting alterna­tive to hand-picking on his farm. He approached three growers initially about the possibility of collectively purchasing an aronia berry harvester to machine-harvest their crop. Soon the group grew to eight growers with a total of 40 acres of aronia berry bushes planted. Of the eight, only three had plants of bearing age in 2013.

Artz and Naeve documented their journey as a case study for their 2013 Leopold Center proj­ect (individual identities and organizations were changed to protect privacy). They were able to follow them as they formalized their group (as a limited liability corporation) and rules of opera­tion (called an operating agreement), explored equipment options (their $33,000 harvester is from a company in Poland), and completed their first harvest (about 10 acres on three farms).

“I think they resolved a lot of issues during their first year,” Artz said. “It helped that not all growers were in full production, so they could watch the process and learn from it.”

Since some of the farms are certified organic, the group purchased a high-pressure washer to help with cleanout after each use. They also purchased a portable scale that travels with the harvester since members pay a fee based on the number of pounds of harvested berries.

Three people were needed to operate the harvester in the field—a tractor driver and two on the harvest platform working with the picked berries. Each grower provided two laborers and the LLC hired the tractor driver. Each farm was required to have its own farm liability insurance in place at the time of harvest.

Artz and Naeve also were able to collect details on how labor, time and expenditure are influenced by the sharing scheme. Group members logged more than 100 hours of time related to the shared use of their harvester, including nearly 30 hours to transport the machine between farms. Nearly 40 hours involved training, set-up, adjustment and clean­ing of the machine, while only about 20 hours were spent actually operating the harvester during the first year.

The group’s dynamics helped in the decision-making process. Three growers work off-farm, bringing individual skills that were complemen­tary to others in the group. Adding to the suc­cess was participation from all members.

“We are fortunate that everyone is willing to get their hands dirty and are able to bring their variety of different individual skills and inter­ests to the table,” Henry said.

In the future, the group may buy supplies together, such as harvest totes, and possibly use the machine for custom-harvesting.

Lessons learned

Three growers share this labor-saving mechanical weeder.
Photo by Leopold Center

Artz offered this advice about successful equipment-sharing arrangements, based on her five case studies:

• Trust and communication are important. Transparency about what type of equipment is being purchased to share, who will store it, and what the costs are to operate and main­tain the equipment are critical to build trust and a good business relationship. Plant and row-spacing to allow room for the equipment may need to be communicated early in the process.

• Compatibility matters when it comes to both the farms and the people involved. One part­nership worked because all were beginning growers with skills and interests that comple­ment one another. Another partnership never materialized because farm and off-farm job schedules prevented adequate communication.

• Consider the complexity of the equipment, especially as it relates to adjustments for dif­ferent field and farm conditions.

• Distance matters. Long-distance sharing could work if there is enough variation in the growing seasons of participating farms and the equipment is used only once each season.

• Not everything is worth sharing. Mileage and time spent in transport could exceed the labor required to do the task by hand.

• Sharing equipment could lead to greater partnerships, such as buying inputs together or marketing produce together in cooperatives.

In addition to lessons learned from her 2013 study, Artz saw several themes emerge from the 2012 case studies of six Iowa growers who had recently scaled up their operations:

• Farms producing large quantities of similar crops tended to use more and larger pieces of equipment.

• Farms that grew a more diverse set of crops tended to use more labor.

• Mechanization can help to offset labor costs, but it does not eliminate the need for labor entirely. In general, harvesting remains a particularly labor-intensive task.

• How farmers choose to sell and market their crops has an impact on the purchase of machinery.

• Before planning expansions, farmers should talk with other growers to understand what their expansion entails, consider their goals and account for their own farm’s unique features.

Laura Miller works for the Leopold Center for Sustain­able Agriculture. Georgeanne Artz is an assistant pro­fessor in the Department of Economics at Iowa State University. Linda Naeve works for Iowa State University Value Added Extension.

From the September | October 2014 Issue

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