Food production and manufacturing has been at an all-time high. In the year 2021, the global agricultural market amounted to 11,287.56 billion dollars and is expected to grow to 18,814.21 billion by 2026 at a CAGR of 10.7%. India is ranked 2nd in terms of volumes of production with a 54.6% of workforce engaged in agriculture and a whooping 90 million plus farmers across the country. How do you manage such large group of farmers and how decisions are taken collectively?
With global trade expanding at a rapid pace, the need for optimization and efficiency has become a fundamental aspect without sacrificing on product quality. Agriculture involves lots of critical information and decisions to be made, from how farm life is to be managed, to decisions relating to production, resource allocation, sustainability and many more, a farm manager has to understand, implement and act to find the best method in which a particular farm should operate.
Let’s understand, what a farm management is and what its functions are.
Farm management is the process of analyzing, making, implementing decisions relating to farm operation and organizing to achieve maximum production and profits. It involves decisions relating to crops, livestock, aquaculture, agroforestry, resource allocation, strategies and planning.
It is defined as, “a branch of agricultural economics, which deals with wealth earning and wealth spending activities of the farmer in relation to the organization and operation of the individual farm unit for securing the maximum possible net income”.
A farm manager oversees all farming activities involving the management of produce and livestock, in addition to how, what, when, and how much to produce.
- They are in charge of deciding what, how, when, and where to manufacture while adjusting to shifting economic and technological conditions and using their technical expertise to deliver products on schedule.
- They get involved in acquiring inputs for produce, machinery procurements, storage, marketing and where to sell. This also includes forecasting and adapting to changes in the market.
- They keep a track of business-related activities like capital acquisition, financial resource allocation, tax records, filing and regulatory compliances.
Scope of Farm Management
In farm management, differences in availability of resources, problems and potentialities treats every farm as a separate unit. Farm management deals with allocating inputs at individual farm levels. The objective is to maximize returns from the farm as a whole. Along with profitability, practicability should also be considered. The scope of farm management encompasses what crops, livestock or their combination that can be grown, what number of resources to use and how the various farm activities are going to be performed.
Livestock and crop management are both a part of farm management. Data collection is the first step, followed by study, analysis, and implementation to help farm managers make better decisions. The primary objective of a farm management system is to increase profits and reduce costs.
The subject of farm management includes farm research, farm education and farm extensions
A farm manager gathers data by examining each aspect of farming activities and focusing on each one independently for improved outcomes. To increase productivity, they investigate farming practices, new technology, customer behavior, and market trends.
- Soil testing, weather, consumer demand, the availability of resources, and a number of other factors influence the sorts of crops that must be grown as well as the methods used to produce them.
- Details about inputs and fertilizers are allocated based on research, crop type, water required, chemicals required, etc.
- A variety of cropping patterns, techniques, and the crop itself are developed to preserve input-output efficiency.
- Modern farming methods along with technological updates are to be implemented along with farming research.
Students need to be equipped with knowledge and skills required for being an efficient farm manager. Preparation of farm resource inventory, farm layout, market needs, farm planning and budgeting, monitoring and control are a few aspects that needs to be analyzed
Technology transfer is the main focus of farming extension. Emphasis on market oriented agriculture, post-harvest management, farm level processing, food quality and safety standards, organic farming are the present trends.
In today’s agricultural market, both consumers and regulatory bodies are concerned about the ecological impact that the industry is causing. More and more care is given to sustainability and regenerative agricultural practice and its methods. A shift in mindset has made the entire supply chain to become sustainable and efficient. Crop management and agricultural practices have expanded their range adhering to the current needs.
The scope of farm management covers aspects of farm business which has a bearing on the economic efficiency of the farm. The type of enterprises to be combined, the kind and variety of crops to be grown, dosage of fertilizers to be applied and the way farms function fall within the purview.
Evaluation of existing farm systems
Farming is an integrated set of activities that farmers perform with the available resources to maximize productivity and net farm income on a sustainable basis. The farming system considers soil factors, water, crops, livestock, labor, and other resources. At the center is the farmer exercising control regarding various interactions. The income from small and marginal farms is insufficient to sustain the farmer’s family.
A mix of enterprises with cropping should complement the farmer’s income and help in recycling their farm wastes. The existing approach is integrated farm management with the use of improved varieties to maximize productivity. The commodity approach of growing crops to increase yields does not alleviate rural poverty. Farmers are not drawing benefits from technology as it implies changes in their allocated resources that conflict with their existing activities. A multitude of different aspects of research is necessary.
Farm business planning
Even though there has been a drastic increase in demand for food, there can’t be an increase in the availability of limited resources. Hence farm planning becomes vital. It not only helps in allocation of resources but helps in decisions relating to production and financial aspects as well.
As farm management involves various decisions to be made under various sectors, a farm manager requires data, analytics and hands on information to precisely predict and plan the farm system. It acts as a scheduled of farm activities that is created in advance. The best farm plan will maximize profits while addressing all resource limitations at the farm level.
The scope of planning can help reach farm’s immediate and long term goals and objectives. In involves resource analysis and production practice based on previous experience and current advancements in the technology, helps cater demand smoothly, all financial aspects of cash inflow, meeting expenses, marketing and production are charted out before hand to estimate income and expense and further work on expansion, development and any credit needs.
Farm systems analysis
Farm system analysis deals with understanding the structures and functions of farming systems, the constraints faced on agriculture production and implementation of research programs. Farm system analysis does not focus on raising yields of one crop but increase the long-term stability of yields and reduce risks through crop diversification. It has drawn attention to multi-cropping and the importance it has to the environment.
There has been an emphasis on crops and livestock species like cassava, yam, millet, sweet potato, goats and buffalo, The farm system analysis promotes careful planning to include a diagnostic phase prior to actual design and testing. The improvements in input/output ratios should not be confined to theory but should be tried out on farms. Interdisciplinary approach is another significant factor. A well knitted strategy with ecological and socio-economic aspects is required. The physical, biological and socio-economic aspects of the farm are inter-linked while processing inputs to outputs. Disciplined research is a must though it may have an impact on planning.
Farmers face ecological as well as socioeconomic issues, thus research cannot afford to focus on a single topic alone; it must combine the findings from many disciplines. In fact, a farm’s physical, biological, and socioeconomic components are so intricately interwoven that it can be viewed as a system. Therefore a farm system concentrates on all aspects of cropping and livestock in creating advancements and diversity in the long run.
Operating objectives of the farm
Apart from the general objectives of farm management, farm managers have to work between economic, environmental and operational objectives of a farm
Resource analysis: Data about land, water, labor, plants, animals, and renewable resources are gathered to plan their exploitation in an efficient way that will produce the optimum result.
Protect diversity: through soil management, pollution control, energy efficiency, crop protection, water management, nature conservation and livestock management, integrity and safety are maintained.
Vary proportions: one of the best ways to analyze profits over production is to determine the relative efficiency between agricultural input and output. It can also be used to understand different input levels in comparison to the effect of change in output.
Cost profit analysis: Effective farm management practices can show cost and profit per hectare of land, providing opportunity for analysis and better decision-making.
The objective of farm management is to maximize returns from the farm
Identifying factors responsible for the present production pattern and the optimal use of resources and analyze the extent of optimality in its usage are several factors that are considered.
Farm Management has been in tremendous limelight in the present world. The scope seems to be getting wider every year. Digitization in agriculture has spurned the advent of farm management and the associated tools. The allocation of resources along with farming aspects have a tremendous bearing on farm efficiency.
The farmers of modern age have to embrace technology and innovation to meet the challenges imposed by climate changes and consumer demands for food safety. The application of technology at all stages in the agriculture supply chains should see improved efficiency at reduced times and costs. Farm Management software helps in enhancing farm productivity with optimal usage of inputs and streamlined process management to increase operational efficiency. It also helps in maintaining records and accounts.
TraceX’s Farm management software builds an end to end robust, resilient and transparent system powered by blockchain technology. It gives businesses the required competitive edge to stay ahead of the curve. It enables farmers to plan and forecast accurately, manage inventory efficiently, evaluate activities and prepare analytical reports.