Narcissus and Daffodil

5 Economics of Narcissus bulb production
James B. Briggs
INTRODUCTION
A variety of influences determines the crops produced on any farm, and physical
factors such as poor soil or difficult drainage exclude growing Narcissus on many
farms. However, where soils and rotational requirements are favourable, the potential
financial returns from narcissus bulb production can be evaluated to see
whether it could be a feasible and economic enterprise. It is necessary to examine
the profitability of bulb growing relative to other typical enterprises on similar
land types. A farmer is only likely to enter into a contract for growing a particular
crop where there is a financial incentive, or if there are perceived to be other
advantages such as benefit to the rotation or spread of workload.
The expression of crop profitability in terms of ‘gross margin per hectare’ is
widespread, and is effectively an indication of the output less the cost of variable
inputs. As a rough guide, fixed costs on a typical UK arable farm split to one-third
labour, one-third machinery and one-third other costs. The allocation of fixed costs
to specific enterprises is more difficult, and is not widely adopted. If done at all, it
will normally cover the two major elements of labour and machinery costs. Where
specialist equipment is required, as for bulbs, it is not likely that this crop will be
included in the rotation, as it will increase overhead costs significantly. If the equipment
can be utilised for other crops, or if contractors can be used to carry out the
work, or if equipment can be leased, then the bulb crop may be a realistic option.
TYPICAL GROSS MARGINS FOR NARCISSUS BULB PRODUCTION
Gross margins for narcissus growing are shown in Table 5.1, based on 1996 and
1999 costings for a typical ‘two-year-down’ narcissus enterprise in England (for
background information see, for example, ADAS (1985a)). These examples refer
to growing bulbs for the ornamentals industry and, in growing bulbs for processing,
some circumstances may be different. This evaluation gives gross margins of
£1922 and £1554 per hectare per annum for 1996 and 1999, respectively (in this
narrative, the years quoted refer to the years crops were lifted). The following
assumptions were made in these calculations:
1 15 t planting stock (bulbs of grade 16 cm) per hectare at £400/
tonne. Output = 13.5 t/ha saleable bulb stock at £450/tonne. Initial stock