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Ariel Singerman* is an Assistant Professor in Food and Resource Economics Department at the University of Florida and is based at the Citrus Research and Education Center in Lake Alfred. Dr. Singerman holds a Ph.D. in economics from Iowa State University. His fields of interest are Agricultural Economics and Applied Econometrics. Dr. Singerman research interests are currently focused on examining the different economic aspects related to production of specialty crops, particularly citrus, and the adoption of new technologies and strategies that deal with pests and disease.
*Ariel Singerman is our guest in the Special Citrus 2018 (May issue). The issue brings an economic analysis of two orange production Projects recommended by a group of consultants in the area. The essence of the Projects is to form and manage new citrus orchards, aiming the lowest level of greening and, consequently, achieving high productivity. Access the May issue HERE and learn all the details of the Projects.
Hortifruti Brasil: What is the current cost of production in Florida?
Ariel Singerman: The current average cultural cost of production for processed oranges is $ 4,804 per hectare. When adding taxes, opportunity and management costs, the production cost increases to $ 5,872 per hectare. The average harvesting cost per box is $ 3.16. Taking into account that the average yield of early and late oranges in 2016/17 was 462 boxes per hectare, the average total cost (including harvesting) is $ 7,332 per hectare.
HF Brasil: What percentage of the cost is related to the management of HLB?
Singerman: HLB has impacted growers’ spraying, fertilization and resetting practices. The difference between the current and pre-HLB cultural cost of production per acre (in real terms) is about 40%. However, HLB has also impacted the cost of harvesting. Since there is less fruit to be picked, it requires more time to fill a box. However, at the same time, the cost of harvesting per hectare has decreased because there are fewer boxes per hectare to be picked.
HF Brasil: What are the characteristics of a grove (size, density, number of treatments, cultivars etc.) that is economically viable?
Singerman: Having a larger grove has several advantages. First, from an economic perspective, the grower can achieve economies of scale, which includes having more bargaining power when purchasing inputs. A larger grove may also justify owning some machinery, which in some cases may result in lower costs compared to contracting the service. In regard of HLB, controlling psyllids is more effective when managing larger areas. As for the number of treatments, a recent trend has emerged by which growers “spoon-feed” the trees; in other words, growers make small weekly (liquid) applications of fertilizer. Given the decrease in yield per tree, the current average tree density of about 400 trees per hectare is no longer economically viable; the grower would need to obtain above average yields to make a profit with that density. Thus, tree density needs to increase for growers to be able to make a profit.
HF Brasil: What are the current challenges of managing citrus groves in Florida?
Singerman: Prices are currently at a relatively high level because of the decrease in supply, due to HLB plus the combined effect of hurricane Irma that hit Florida in September 2017. The number one challenge for growers is to have enough yield to make a profit. The stress that HLB has imposed on trees has caused roughly a 40% decrease in production compared to pre-HLB levels. This aspect and the increase in cost of production per hectare have resulted in an increase in total production cost per box of approximately 300% compared to pre-HLB levels.
Source: hfbrasil.org.br
