Organic Broadcaster

 

Benchmarking project offers organic farmers reduced tuition for state farm business management programs

By Joleen Hadrich & Pauline Van Nurden

The number of certified organic farms has increased by 55 percent from 2011 to 2016 in the U.S. (USDA-NASS, 2012; 2017). This statistic includes all organic production—vegetables, fruit, row crops, and livestock. In the Upper Midwest, organic production of row crops, forages, and dairy has experienced even greater growth. For example, certified organic corn production has increased by 165% in Minnesota. Similarly, certified organic alfalfa production has increased by 184% in Minnesota, 156% in North Dakota, and 336% in Wisconsin (USDA-NASS, 2012; 2017). Soybeans, wheat, and dairy production continue to increase in the Upper Midwest over the same time period.

Despite this large growth, organic producers have had few economic resources available to assist with enterprise analysis, cash flow planning, projected profitability statements, and farm management decisions. To meet those needs, the University of Minnesota is leading a multi-year, multi-state organic benchmarking effort in partnership with state-level farm business management (FBM) programs to collect and analyze organic financial data. Through this multi-state effort, organic farmers in Minnesota, Wisconsin, and North Dakota can receive a 25-50% cost-share for farm business management participation. Funding for this benchmarking effort is provided through the USDA-Organic Research and Extension Initiative Program (2019-51300-30484) for 2019-2022.

The organic benchmarking cost-share program creates the opportunity for certified organic producers to participate in an FBM program at a reduced tuition rate now through 2022. Organic producers are eligible if they have an organic dairy farm or raise any of the following organic crops: alfalfa, corn grain, corn silage, hay/haylage, soybeans, or wheat.

Farmers enrolled in an FBM program reap a number of benefits, including:

  • Working one-on-one with a financial expert to enhance management and financial capacity on their organic farm;
  • Individualized organic benchmarking reports for their farm;
  • Improved communication with lenders and other agricultural professionals that support their operation;
  • 50% cost-share for new FBM farms and 25% cost-share for existing FBM

Minnesota, North Dakota, and Wisconsin FBM programs contribute data to FINBIN, the national database for farm financial data. All organic data submitted through this cost-share effort will be included in FINBIN and used in an aggregate form to provide regional benchmark reports and build Extension programming and curriculum regarding the financial stability of organic dairy and crop production.

Right now, the benchmarking program needs additional farms to meet the minimum number needed for an aggregate benchmark to be generated and reported on FINBIN. Each participating farm will receive individualized benchmark reports, financial analysis, and cash flow reports working with their FBM instructor.

An example of an organic dairy farm FINBIN benchmark report is available at finbin.umn.edu/Output/724665.pdf.

Learn more about the organic benchmarking cost share program at agcentric.org/organic-farming-resources. To learn more about the FBM program in Minnesota, contact Bethany Halverson; in Wisconsin, contact Brad Sirianni; in North Dakota, contact Jason Fewell.

For questions about the USDA-OREI grant (2019- 51300-30484) or contributing data to FINBIN, contact: Joleen Hadrich or Pauline Van Nurden.

 

From the July| August 2020 Issue

 

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