farm planning

• Primary purpose of planning

  To satisfy needs
• Types of needs


  • Personal goals
  • Organisational goals
  • Societal goals
• Effective planning


  Ensures that needs are identified, prioritised and met in a structured and efficient manner
• Resources are in scarce supply
• Resources like money, time, materials and human skills are limited
• Planning


  Helps with efficient allocation of resources
• Planning helps to reduce wastage
• Resources can be used in different and multiple ways
• Planning helps to determine


  The best possible way to use resources while maximising profits and minimising costs
• Committed resources


  Resources that are already allocated for a specific use or purpose
• Uncommitted resources


  Resources which are available for any new projects or needs
• Planning ensures the efficient use of resources


  Committed resources are used efficiently and effectively while uncommitted resources are prepared for future needs and opportunities
• Satisfy Needs


  The primary purpose of planning is to address and satisfy various needs, whether they are personal, organizational, or societal
• Resources are in Scarce Supply


  Resources such as time, money, materials, and human skills are limited
• Resources Have Different Applications


  Different resources can be used in multiple ways
• Committed and Uncommitted Resources


  Resources can be categorized into committed (already allocated for specific purposes) and uncommitted (available for new projects or needs)
• Planning Objectives

  • Short-term Objectives
  • Medium-term Objectives
  • Long-term Objectives
• Short-term Objectives


  Immediate goals that need to be achieved within a short period, often within a year
• Medium-term Objectives

  Goals that are planned for a moderate time frame, typically spanning 1 to 5 years
• Long-term Objectives


  Long-term goals are set for an extended period, usually 5 years or more
• Factors Increasing Complexity of the Planning Task


  • The Dynamic Nature of Production
  • Uncertainty
• The Dynamic Nature of Production


  Production environments are constantly changing due to technological advancements, market trends, regulatory changes, and other external factors
• Uncertainty


  Uncertainty in planning arises from unpredictable elements such as market unpredictability, economic fluctuations, environmental conditions, and other unforeseen events
• Farming vs Other Businesses

  • Farming
  • Other Businesses
• Farming


  Involves the production of agricultural goods, influenced by factors such as weather, soil quality, and biological processes
• Other Businesses

  Non-agricultural businesses may have more control over their production processes and can often respond more quickly to market changes
• Sequence of Decisions in Farm Planning

  • What to Produce?
  • How to Produce?
  • How Much to Produce?
• What to Produce?

  1. Enterprise Selection

  2. Product/Product Relationships
• Enterprise Selection


  Determine which crops or livestock enterprises to engage in based on market demand, climate suitability, soil conditions, and personal expertise
• Product/Product Relationships

  Analyze the potential relationships between different products
• How to Produce?

  1. Resource Combination

  2. Factor/Factor Relationships
• Resource Combination

  Decide how to combine available resources (land, labor, capital, and management) to optimize production
• Factor/Factor Relationships

  Evaluate the relationships between different production factors
• How Much to Produce?

  1. Output Level

  2. Input/Output Ratios
• Output Level

  Determine the optimal level of production based on input/output ratios
• Input/Output Ratios


  Calculate the efficiency of input use to achieve the desired level of output
• Planning and Budgeting

  1. Which Crop or Livestock to Produce

  2. What Area Should be Used

  3. Evaluate Different Farming Practices

  4. Estimate Costs

  5. Estimate Yields

  6. Estimate Income and Net Farm Profit (NFP)
• Which Crop or Livestock to Produce

  Determine the most suitable crops or livestock based on factors such as market demand, climate, soil conditions, and personal expertise
• What Area Should be Used

  Decide on the size of the area to be allocated for each crop or livestock enterprise
• Evaluate Different Farming Practices

  Assess various farming practices and techniques to determine the most efficient and sustainable methods