Profitability of Cultivation of Sweet Lupineand Fodder Pea in Comparisonto Selected Winter Cereals

Irena Augustyńska and Arkadiusz Bębenista

No 311230, Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej from Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI)

Abstract: The subsidies for legumes introduced in 2010 resulted in an increase in their cultivation area, including the area of sweet lupine and fodder pea. The cultivation of lupine is usually carried out on soils of the rye complex, similarly to winter rye, while the cultivation of peas – on soils of the wheat complex, like winter wheat. Due to similar soil requirements, legumes compete with cereals for the arable land. However, the cultivation of the former is not considered to be very profitable, even after including direct subsidies for cultivation. The purpose of the paper was to determine the production and economic results from the cultivation of the abovementioned legumes and cereals and to compare the profitability of cultivation of sweet lupine in relation to winter rye and fodder pea in relation to winter wheat on selected individual farms in Poland in the years 2015-2017. Profitability of cultivation of the plants was determined primarily using the profitability index of production, which is a percentage relation of the total value of production (excluding direct subsidies) to the total costs. The measure of profitability was also the income from activity without subsidies and income from activity after including subsidies. In the research, we used data from the AGROKOSZTY system, the Polish FADN system and the Central Statistical Office. Vertical and horizontal analysis of the results was used. It was shown that on average in the years 2015-2017, on farms participating in the study of considered plants, the profitability of lupine cultivation, expressed by profitability index, was lower than that of rye, and pea cultivation was slightly higher than that of wheat. In addition, the first income category, which is the gross margin (difference in total production value and direct costs), and one of the last – income from activity without subsidies (difference in total production value and total costs) proved to be in the case of lupine and peas cultivation relatively low compared to cereals competing with them for the same arable land. However, after taking into account the subsidies, cultivation of legumes was more profitable than cultivation of cereals. Therefore, the incentive for cultivation of legumes certainly provides a possibility for receiving subsidies for the area of their cultivation, and also a possibility for receiving subsidies for greening.

Keywords: Agricultural; and; Food; Policy (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iafepa:311230

DOI: 10.22004/ag.econ.311230

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