With organic farm products commanding a higher price and with large agricultural enterprises increasingly dominating the non-organic segment, many established small farmers are considering switching to fully organic operations. However, significant time, investment and new expertise is required to go organic; leading many farmers to wonder if it is too late to convert their operations.
In Canada, transitioning from a conventional farm to a certified-organic one requires significant investment and a minimum of three years for conversion. During this period, you cannot market produce as organic; and, thus, are unable to take advantage of the price premium.
To minimize disruption of income, the Saskatchewan government encourages farmers to transition to organic production incrementally. You can convert portions of your farm to organic production while leaving other parts in conventional production. This will give you time to learn new organic farming skills while the income earned from conventional crops will provide you with a financial buffer during the three-year transition period. When determining how much of a buffer will be needed, keep in mind that farms generally experience a significant drop in yields during the transition.
As well as having a cash buffer for the transition period, up-front investment will be needed. Things you will need include potentially more expensive organic inputs, such as seeds and naturally derived pesticides, as well as additional labor.
Beyond cash factors, the biggest barriers to going organic can be a lack of technical, financial and marketing information, according to a University of Saskatchewan study. Research and advice from industry associations and local organic marketing organizations may be able to help you decide if going organic is right for you.
Once you do decide if going fully or partially organic is a good value proposition for your farm, you can consult with your bank or an agricultural banking specialist to help you secure financing and develop a business plan for the transition. Scotiabank’s Plan Writer for business and our recent Get Growing for Business video on farm financing may be able to help.
Have you had any experience with conversion to an organic business? Share your experience.