The impact of farm direction on the cost and quantity of used fertilizer

Abstract

Objective: The level of costs and the volume of fertilizers used are largely determined by the situation in world markets and the decisions of state authorities. Moreover, individual farms have different characteristics. Therefore, the objective of the article is to investigate the relationship between the production direction of the European Union farms, the level of fertilizer purchase costs and the amount of P2O5, K2O, and N applied in mineral fertilizers.

Research Design & Methods: The research focused on the purchase cost of fertilizers (€) and the amount of P2O5, K2O, and N applied in mineral fertilizers (q). To illustrate the direction of farm production, I used data relating to the eight agricultural types distinguished in the Farm Accountancy Data Network (FADN) database. I applied one-way ANOVA variance to achieve the research objective. However, as all the assumptions of the ANOVA model were not met, I used the non-parametric Kruskal-Wallis test.

Findings: The most frequent differences in the case of fertilizer costs are found between crop and livestock-oriented farm types. Fewer differences can be observed for farms that are oriented at the same food source. For the amount of compounds used in mineral fertilizers, identical differences are found for P2O5 and K2O. In the case of N, the main differences are linked to farms of the following types: field crops, milk, and granivores.

Implications & Recommendations: The conducted research clearly indicates that the production direction of farms in the European Union countries significantly influences the variation in both the costs incurred for the purchase of fertilizers and the amount of individual chemical compounds used in mineral fertilizers. Individual production specializations are therefore differently exposed to possible adverse political and economic developments. An analysis of the opportunities and threats to the use of mineral fertilizers by individual farm specializations is recommended. At the same time, it is justified to indicate the main determinants causing the existing differentiation.

Contribution & Value Added: The added value of the study is to determine how the production direction of the EU farms influences the costs incurred for the purchase of fertilizers and the quantity of the various types of chemical compounds used in mineral fertilizers.

Keywords

agriculture, FADN, analysis of variance, crop production, livestock production

Author Biography

Sebastian Kubala

Assistant Professor at the Department of Organization Development at the Krakow University of Economics (Poland). His research interests include agribusiness, in particular research related to land economy, prices on food markets and agricultural policy of the European Union.

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