New report forecasts rising profits for UK organic arable
Sustainable cereals are profitable cereals.
The production of organic combinable crops, such as wheat and barley, is set to generate greater margins compared to non-organic as the price of oil increases to US $200 a barrel – predicted by a recent Chatham House report to happen in 5 to 10 years – reveals a new study carried out for the Soil Association.
The study by Andersons, the farm business consultants, is titled ‘The impact of rising oil prices on organic and non-organic farm profitability’. It shows that with oil at US $200 a barrel, the profit margins of non-organic combinable crop systems range from £296 to £348 per hectare, per year whilst the organic margins range from £371 to £411. This is mainly due to the high cost of oil- based artificial fertilisers that are extensively used in non-organic systems which could soon rise to £550 a tonne.
At such prices, the fabled efficiency of fossil-fuel and fertiliser dependent industrial farming begins to crash. Organic farming does not use artificial chemical fertilisers, instead building soil fertility through crop rotations and particularly the use of clover that fixes nitrogen naturally from the atmosphere using the sun’s energy and photosynthesis. Typically, clover can fix 200kg of nitrogen per hectare over a year