Date of Award

7-2008

Document Type

Thesis

Degree Name

Master of Science (MS)

Legacy Department

Applied Economics and Statistics

Advisor

Hammig, Michael

Committee Member

Carpio , Carlos

Committee Member

Isengildina-Massa , Olga

Abstract

Integrated Pest Management (IPM) has been very successful in directing farming to a more environment-friendly production. However, the extent of its economic impact is an equally-important question. This study looks at the amounts of savings and potential market profitability of using IPM in South Carolina collard production considering alternative scouting methods. Conventional sampling (CS) and binomial sequential scouting method (SSM), a recently developed scouting system for traditionally operated collard farms are compared. SSM is geared towards a more economical execution of scouting without forfeiting the effectiveness of the process. Financial analysis specifically costs and returns methods and sensitivity analysis on prices were utilized to determine the economic advantages or disadvantages of the two methods.

The outcome of the study showed that both scouting methods would result in cost savings if used on traditionally operated farms. Particularly, the cost savings generated from IPM with SSM (3.62 percent of total cost and 3.91 percent of total variable cost) is higher than the cost savings from IPM with CS (2.91 percent of total cost and 3.15 percent of total variable cost). The difference in cost savings between IPM with CS and IPM with SSM basically came from the less scouting time of SSM thus lower labor cost for the farm. Therefore, to attain maximum profitability potential, using IPM with the sequential scouting method is a better option. Some may conjecture that the cost savings were insignificant because the percentages are low. However, the importance of these cost savings grows after taking account of the potential savings per farm and at the aggregate state level.

Implementing IPM on the farm not only offers cost savings but opens the possibility of higher sales price. IPM products can be sold at 5 to 10 percent price premiums over regular or uncertified products. There is a fee for certification but the benefits overshadow the costs.

In summary, findings show that IPM with conventional sampling and IPM with sequential sampling are both cost-effective and profitable, thus having positive impacts not only environmentally but also economically. Both methods are great tools in a transition program to organic farming. Clearly when considering the potential for maximum profits, IPM with SSM is the preferred choice.

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