The Profitability of Organic Agriculture

This is Tim Hammerich of the Ag Information Network with your Farm of the Future Report.

Demand for organic products has been on the rise for decades. But many farmers still remain skeptical that it can work for their local context. Andrew Smith with the Rodale Institute says they have the data to support that overall, organic farming can be more profitable.

Smith… “ The first thing I'd probably say is that, we have decades now of economic data, especially from our long-term farming systems trial, and I've looked at the economic data, just about every economic study that's compared to organic and conventional. And they all show that organic farming is more profitable. In many cases it's more profitable because of the price premium in organic. So some people say, well, you know, if that price premium went away then it wouldn't give me that improved profit. However, we see that the demand side in organic is remaining much stronger than the supply side. But basically we have a much greater demand for organic products than the supply. So we believe that the price premium is gonna stay strong. But our most recent analysis of the farming systems trial found that our diversified organic system, because it had lower costs and had similar yields as the conventional, was more profitable, even if you take away price premiums.”

Learn more about the Rodale Institute at rodaleinstitute.org.