University Of California Cooperative Extension
Production Practices and Sample Costs to Produce
Etaferahu Takele, Area Farm Advisor, Farm Management Economics, Southern Region
Jose Aguiar, Farm Advisor, Vegetable Crops and Small Farms, Riverside County
Delos Walton, Staff Research Associate, Farm Management Economics, Southern Region
Detailed costs to produce eggplant in Coachella Valley, Riverside County, California are presented in this study. The hypothetical farm used in this report consists of 60 acres of which 9 acres are in eggplant production.
We base this study on assumption of production practices and costs that are considered typical for eggplant production in the Coachella Valley of Riverside County. These production practices and costs do not reflect the exact values or practices of any grower or shipper, but are rather an amalgamation of costs and practices in the region. Sample costs given for labor, materials, equipment and contract services are based on 1997 prices. This study is intended as a guide. It can be used in making production decisions, determining potential returns, preparing budgets and evaluating production loans.
Costs are presented in six tables:
Table 1. Costs Per Acre To Produce Eggplant
Table 6. Ranging Analysis To Produce Eggplant
For an explanation of calculations used in the study refer to the attached General Assumptions, call Etaferahu Takele, Area Farm Management Economics Advisor, Cooperative Extension, (909) 683-6491 ext. 243 or call Jose Aguiar, Vegetable Crops Farm Advisor in the Coachella Valley of Riverside County, (760) 863-7949.
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University of California and the United States Department of Agriculture cooperating.
Jump down to:
- Land Rent
- Cultural Practices and Production Inputs
- Harvesting and Postharvesting
- Yields & Returns
- Cash Overhead
- Non-Cash Overhead
- Equipment Cash Costs
The following is a description of the assumptions used in this study to develop costs for production of winter planted eggplant in the Coachella Valley of Riverside County in 1997/1998. There are three major types of eggplant grown in Riverside County, American, Italian, and Japanese. Of these, the American variety constitutes the majority of production.
- LAND RENT
This report is based on a 60 acre farm, of which 100% is double cropped. This practice results in 120 farmed acres per year with 9 acres of eggplant production. Rental contracts and charges for land suitable for eggplant production can range widely. Land in this study is leased on a cash rent basis at $225 per acre per year for the entire 60 acres. As all of the 60 acres is double cropped, the amount of the annual rent per planted acre allocated to the eggplant operation is $112.50.
- CULTURAL PRACTICES AND PRODUCTION INPUTS
Land Preparation: Primary tillage and planting groundwork operations which include plowing, discing, leveling, and the listing and cultivation of beds are performed from October through December. Most operations requiring equipment are performed with a 80 or 90 hp 2-wheel drive tractor.
Beginning in October the acreage intended for eggplant production is disced. This operation is followed by plowing the soil profile 2 to 3 feet, breaking up any underlying soil compaction for improved root and water penetration. Then leveling is done using a landplane to improve irrigation efficiency of the soil.
Following leveling of the field, chicken manure is spread on the soil. Chicken manure is custom applied a week or more prior to the eggplant bed formation. The manure is broadcasted, and then incorporated by discing the soil twice to break up any remaining clods and to smooth and firm the soil. After discing, the soil is ready for bed preparation and it is then listed into eggplant beds.
Stand Establishment: Prior to planting eggplant, drip tape for the irrigation system is installed and black plastic mulch is applied to the beds. Next, the soil is fumigated with methyl bromide via the “hot gas method,” applied through the drip irrigation system. Prior to planting the plastic mulch is punctured in preparation for transplanting of the eggplant.
Planting for the eggplant crop in the Coachella Valley is done in February. Growers in the Coachella Valley transplant eggplant plants to field beds after the eggplant seedlings have already been established in local nurseries. Transplants are usually spaced 24” apart within rows and 80” between rows for American eggplant, and 16’’ apart within rows and 80” between rows for Italian and Japanese eggplants. The large spacing between rows is used to aid in the picking and packing of the crop. In general, approximately 2,000 eggplants are planted per acre in the Coachella Valley.
Weed Management: Weeds common in this area include the various summer grasses and broad weeds common to the Coachella Valley, such as Bermuda grass, nut grass, and purple and yellow nut sedge. Weeding for eggplant is done by hand using custom labor crew.
Fertilization: In this study, chicken manure, as previously indicated, is applied prior to bed formation during land preparation. The manure is broadcasted, then disced and floated for incorporation. The soil is then listed into the eggplant beds.
During the course of the cultural period, fertilizer is applied regularly via the irrigation system. Calcium Nitrate is applied at a rate between 20 to 30 units of nitrogen (N) per acre per year. Initial applications are light, and increase gradually as the plant enters into the harvest period.
A custom blend fertilizer, common to the Coachella Valley, is also used as part of the fertilization practices for eggplant. A small amount of 10-0-5 with 3% sulfur, is applied at the beginning of the cultural period. Then, as with the Calcium Nitrate, its application rate increases through the harvesting period to maximize the amounts of nutrients supplied to the plant. Additionally, a phosphate fertilizer is applied throughout the cultural and harvesting periods at a constant rate.
Irrigation: In the Coachella Valley, approximately 72 acre inches of water is used in the production of eggplant. One acre foot of water is applied to the eggplant field as part of the stand establishment using sprinklers. In this study, the sprinkler irrigation equipment and pumps to pre-irrigate the field are rented. The remaining five acre feet of water is applied to the eggplant crop via a drip irrigation system using drip tape that was installed during bed shaping.
Water is supplied by the Coachella Valley Water District (CVWD) at about $14 per acre foot. Therefore, the total cost of irrigation water for eggplant throughout the production period is $84 per acre.
The CVWD charges its agricultural customers a $10 gate charge for each delivery of water. In our study, a single crop of eggplant with six months of an actual growing period, receives 162 deliveries, i.e. six deliveries before planting and 156 during the growing period. Based on the 9 acres of eggplant farmed, this results in a $180 per acre charge for delivery.
The energy costs for irrigating eggplant vary by type of irrigation. For the first acre-foot of water, the crop is irrigated via the sprinkler system. The cost is approximately $45 per acre. The remaining five acre-feet of water is irrigated by drip irrigation at a cost of about $20 per acre foot. This results in energy costs of approximately $145 per acre. Therefore the total cost of water, deliveries and energy approximates to $409 per acre. The cost of irrigation shown in Table 1, Table 2 and Table 3 are for the cost of the water (including delivery and energy) and labor to apply it.
Pest Management: Major pests of eggplant include spider mites, aphids, lygus, flea beetles, rootknot nematodes and wireworms. In this study, aphids and beetles are treated using Lannate and Ambush twice during the cultural period. Mites are treated with an application of Vendex mid-way through the growing period. Additionally, some pests, such as worms and loopers, are treated at the larval stage with an application of a biological insecticide, Bacillus thuringiensis (Bt), such as Dipel 2x ® or Agree TM as they become detected during the season.
If you have a specific pest problem, consult a licensed pest control advisor (PCA). Chemicals which may be legally used to control these pests are subject to change frequently. Current information is imperative before treating a field.
Disease Management: Depending on the region, a number of diseases may infect eggplant during any phase of growth. In the Coachella Valley, common diseases affecting eggplant are Fruit Rot, and wilts caused by various fungi. Additionally, Tobacco Ring Spot Virus can also be a problem in the Coachella Valley. Treatments can vary for each disease. Consult your PCA before commencing a treatment regime.
The pesticides and rates mentioned in this cost study are a few of those that are listed in Pest of the Garden and Small Farm: A Growers Guide to Using Less Pesticide and University of California Pest Management Guidelines. In this study, no disease treatment was included. Written recommendations, made by State of California licensed pest control advisors, are required for pesticides. For information and pesticide use permits, contact the local county Agricultural Commissioner's office. Contact the Riverside County farm advisor for additional production information. Pest management information can also be found on the University of California Integrated Pest Management web site: http://www.ipm.ucdavis.edu.
- HARVESTING AND POSTHARVEST HANDLING
Eggplant is ready for harvesting approximately 3 months after transplanting to the field. Harvesting of fall planted eggplant begins in May and will continue through to the first week of July, beyond which the temperatures of the Coachella Valley will become too hot for eggplant harvesting.
Eggplant is mature, and ready for harvest when the fruit has achieved a shiny, glossy appearance and its stem has hardened. Harvesting is done by hand, using a sharp knife to remove the fruit from the plant by cutting its stem, approximately ¼ inch from the eggplant.
Eggplant is packed in 10 and 20 pound boxes. The American variety is packed in 20 pound boxes with either 18 or 24 eggplant per box, depending on size of fruit. The Japanese and Italian varieties are packed in both 10 and 20 pound boxes, again depending on size of fruit. In our study we used a standardized packing of 20 lb. box for all varieties. After packing, the eggplant is transported to a local storage facility where it is chilled quickly and palletized before being shipped directly to market.
Eggplant is subject to chilling injury at temperatures below 50( F (10(C). It will also deteriorate quickly when exposed to, or placed in, warm temperature.
In general, eggplant has the same storage requirements as green beans, cucumber, chilies, and squash. These products may be stored together without deleterious effect. Costs for harvest operations are shown in Table 1 and Table 3.
After the eggplant is harvested, the field is cleaned up by removing the drip tapes and plastic mulch from the soil.
- YIELDS & RETURNS
Yields: In any given year yields vary considerably. Average crop yields in Coachella Valley from 1990 to 1996 are shown to range from 565 to 1314 boxes per acre (Table A.). In this study, we used a yield of 1300 boxes per acre, the most common yield level obtained from participant growers as the basis of our analysis.
Returns: The market for eggplant is very volatile and prices per 20 pound box can vary greatly during the season. Growers market their crop through the local or Los Angeles brokers where they pay a percentage fee based on the FOB price per box. Brokers fees are usually 10% of the wholesale prices in the local market and 20% of the wholesale prices in the Los Angeles Market. In this study, marketing of eggplant is through a local broker. We used a price of $7.75/box as the basis for our analysis. This price approximates the average price for the (1990 - 1996) period in Riverside County. However, to cover a broader scenario of productivity and prices, we analyzed returns at various yield and prices (Table 6).
Table A. Acres Planted, Average Yield, and Average Prices for Eggplant
Riverside County, 1990 - 19961
Year Acres Planted Boxes Per Acre Price/Box 1990 151 708 $7.34 1991 323 765 $9.39 1992 94 565 $6.76 1993 253 1107 $9.02 1994 115 1314 $6.99 1995 231 1260 $8.19 1996 519 1011 $6.82 AVERAGE 241 961 $7.79
1 Riverside County Agricultural Production Reports, 1990-1996.
1997 Coachella Valley Eggplant Cost Study, UC Cooperative Extension
The risks associated with fresh market eggplant production should be noted. While this study makes every effort to model a production system based on typical, real world practices, it cannot fully represent financial, agronomic, and market risks which affect the profitability and economic viability of fresh market eggplant production. Risk is caused by various sources of uncertainty which include production, price, and financing. Examples of these risks are insect damage, a decrease in price, and increase in interest rates. Because of the risk involved, access to information on production practices, prices, and markets is crucial.
Hourly wage for workers is $5.25 per hour for both machine and non-machine workers. This is based on wages paid by growers that participated in this study. Growers also pay for benefits including, Workers Compensation, Social Security, Medicare, insurance, and other possible benefits. In this study, growers surveyed showed that benefits increased labor wages by 34%. This brings the labor rate to $7.04 per hour for both machine and non-machine workers. The labor for operations involving machinery are 20% higher than the operation time to account for the extra labor involved in equipment set up, moving, maintenance and repair.
- CASH OVERHEAD
Cash overhead consists of various cash expenses paid out during the year that are assigned to the whole farm. These costs include property taxes, interest on operating capital, office expense, liability and property insurance, and equipment repairs.
Property Taxes: Counties charge a base property tax rate of 1% on the assessed value of the property. In some counties special assessment districts exist and charge additional taxes on property including equipment, buildings, and improvements. For this study, county taxes are calculated as 1% of the average value of the property. Average value equals new cost plus salvage value divided by 2 on a per acre basis.
Interest On Operating Capital: Interest on operating capital is based on cash operating costs and is calculated monthly until harvest at a nominal rate of 11.61% per year. A nominal interest rate is the going market cost of borrowed funds.
Insurance: Insurance for farm investments vary depending on the assets included and the amount of coverage. Property insurance provides coverage for property loss and is charged at 0.713% of the average value of the assets over their useful life. Liability insurance covers accidents on the farm and costs $469 for the whole farm per year.
Management Fee: This study assumes that the farm is operated and managed by the same person(s). No management fee was included in this study. Any returns above total costs are considered returns to management and risk.
Office Expenses: Office and business expenses are estimated at $30 per acre. These expenses include office supplies, telephone, bookkeeping, accounting, legal fees, road maintenance, etc.
- NON-CASH OVERHEAD
Non-cash overhead is comprised of depreciation and interest charged on equipment and other investments. Typically, farm equipment in the Coachella Valley is mostly old. In this study, the current purchase price for new equipment is reduced by 40% to indicate a mix of new and used equipment. Annual equipment and investment costs are shown in Table 1, Table 2, Table 3, and Table 5. They represent the per acre depreciation and interest costs for each investment on an annual basis.
Depreciation: Depreciation is a reduction in market value of investments due to wear, obsolescence, and age, and is on a straight line basis. Annual depreciation is calculated as purchase price minus salvage value divided by years of ownership of the investment. The purchase price and years of life are shown in Table 4.
Interest On Investment: The interest cost is a charge for the use of capital in eggplant production. It is calculated by multiplying the value of land and the average investment in equipment, buildings, trees, etc. (described in Table 5) by the real cost of capital in current dollars. The real cost of capital used in this study is the long run average of 4%. Average investment equals the new cost plus salvage value divided by 2.
Average value for equipment and buildings equals new cost plus salvage value divided by 2. The interest rate used to calculate opportunity cost is the average of the agricultural sector long-run rate of return to production assets.
- EQUIPMENT CASH COSTS
Equipment costs are composed of three parts; non-cash overhead, cash overhead, and operating costs. Both of the overhead factors have been discussed in previous sections. The operating costs consist of fuel, lubrication, and repairs.
In allocating the equipment costs on a per acre basis, hourly charges are calculated first and shown in Table 5. Repair costs are based on purchase price, annual hours of use, total hours of life, and repair coefficients formulated by the American Society of Agricultural Engineers (ASAE). Fuel and lubrication costs are also determined by ASAE equations based on maximum PTO hp, and type of fuel used. The fuel and repair cost per acre for each operation in Table 1 is determined by multiplying the total hourly operating cost in Table 5 for each piece of equipment by the number of hours per acre for that operation. Tractor time is 10% higher than implement time for a given operation to account for setup time. Prices for on-farm delivery of diesel is $1.10 (off-road, no tax) and gasoline is $1.25 per gallon.
- Due to rounding, totals may be slightly different from the sum of components.
- The per acre equipment costs in Table 1 reflect both the value and the level of use (hours and years of use) of the machinery complement. Therefore this cost could be different from the per acre value of the machinery complement in Table 4.
We express our appreciation to those growers and other cooperators who provided data for the development of this cost study.
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