An Economic Analysis Of The Grass Seed Industry PDF Download

Grass seed producers in Oregon's Willamette Valley have employed the cultural practice of post-harvest open field burning since the mid-1940's for purposes of field sanitation and crop residue disposal This practice creates environmental quality problems of air pollution during the late summer Recent public concern over the valley's environmental quality has focused attention on the grass seed industry, resulting in measures passed by the 1971 state legislature to ban open field burning in Oregon by January 1, 1975. Several economic issues are raised by the prospect of field burning curtailment. These include identification of: (1) alternatives to open burning, and their associated costs; (2) income effects resulting from possible increases in production costs, reduction in seed yields and changes in seed quality; (3) possible loss of comparative advantage now enjoyed by Willamette Valley farmers; and, (4) possible organizational adjustments by farm operators including prospects for increased farm size and reduced farm numbers. This thesis is designed as a base study to provide descriptive information and an economic rationale as necessary precursors for evaluating possible and probable' economic consequences of a burning ban to the grass seed industry. The Willamette Valley was separated into five seed-production regions, based on soil characteristics and urban.influences. A ten percent random sample was drawn from the population of farm operators raising grass seed. Major grass seed types studied include Highland bentgrass, Kentucky bluegrass, fine fescue, tall fescue, orchard grass, annual ryegrass, and perennial ryegrass. Descriptive data includes farm family characteristics, income sources, age, family labor, farm organization, and resource returns. Analysis of data identified wide variability in resource use. A significant component involved large differences in operating costs for machinery, labor, fertilizer, and chemicals within each seed type. This suggests internal adjustments in resource use efficiency and cost management are necessary for high-cost farms to survive in the short run regardless of whether or not a burning ban threat exists. Some farms are successfully competing now and will continue to do so with limited operating resource adjustments. Orchardgrass and Kentucky bluegrass generally provided highest net returns, while ryegrasses earned lowest returns of the seven seed types, suggesting some adjustment opportunities for substitution between seed types. Inter-enterprise adjustments will be determined by the number of grass seed crops, other non-grass crops, and livestock choices available. Cost advantages of complementary enterprises were evident, with adjustments in this direction determined by market accessibility, soil limitations, and managerial constraints. These limitations suggest limited adjustment, in general, toward non-grass and livestock enterprise choices. Pronounced cost advantages occurred to farms over 300 acres in size, suggesting that long run adjustments will likely include farm enlargement and reduction of farm numbers. Farm location, topography, -, and proximity to urban areas are also expected to affect direction and magnitude of adjustments. Farms in Region 1, Clackamas and Multnomah counties, faced with topography limitations and urban pressures, will likely shift resources to more intensive . farm and non-farm uses. Linn, Benton, and Lane county grass seed producers are expected to intensify specialization in grass seed production with an increase in average farm size. In Washington and Yamhill counties where grass seed production serves primarily as complementary and/or supplementary enterprises, the trend toward production of proprietary grass seed varieties is expected. In Polk and Marion counties where soil and topographical characteristics dominate resource use and enterprise choices, probable adjustment impacts are less obvious and are expected to vary widely from farm to farm. Imposition of a burning ban, felt primarily in the form of increased production costs, will undoubtedly hasten the farm organizational adjustments specified above.