AGRI MECH (November 2015)

(YOUR FARM TECHNOLOGY NAVIGATOR)

February 23 – 24, 2016 · Dolpur Kampa – Dhansura, Aravalli, Gujarat, India

www.dlg-international.com/fielddaysindia.html

Agricultural mechanization is an important part in the field of agricultural engineering, which will promote agricultural development and agricultural modernization. On one hand, horizontally, agricultural machineries can be extended to play role in forestry, animal husbandry, fishery and other industries. On the other hand, longitudinally, they are applied before, during and after the agricultural production process, and are further developing towards the aspects of the storage, processing, transportation of agricultural and sideline products, three-dimensional agriculture, water-saving agriculture and precision agriculture.

Along with the development of high and new technology, such as computer technology, sensor and detection technology, information processing technology and control technology, the operating performance of agricultural machinery has been being greatly promoted, which has been improving the labor productivity as well as the working conditions of workers. Especially, nowadays, combined with the rapid development of intelligent technology, various agricultural robots and intelligent system are constantly emerging in the field of agricultural automatic control.

To promote agricultural intensification and agricultural modernization, one of the important measures is to realize the weightage of focused magazines. Therefore, this special issue of AGRIMECH is dedicated to intelligent agricultural machinery technology, which I have experienced during AGRITECHNICA 2015, Germany. This involve, tillage machine, precision seeder, transplanting machine, weeding machine, fertilizing machine, spray machine, irrigation equipment, harvester, picking robot, grafting robot, drying and storage equipment of agricultural products, and other agricultural machinery.

With the best ar cles and photographers AGRIMECH produces a crisp approach to farm publishing; it will be the perfect accomplice for all your machinery needs. If you're into farm mechaniza on business, you should deďŹ nitely be displayed into AGRIMECH. AGRIMECH team is always seeking your guidance and sugges on to improve the quality of this magazine. Hoping for the most proďŹ table business ahead.

Our Team

Editorial policy is independent, Views expressed by authors are not necessarily those held by the editors.

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S K Ali Editor in Chief skali85@gmail.com

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Editorial and adver sements may not be reproduced without the wri en consent of the publishers. Whilst every care is taken to ensure the accuracy of the contents of AGRI MECH. The publishers do not accept any responsibility or liability for the material herein.

Publica on of news, views and informa on is in the interest of posi ve development of Global Farm Mechaniza on. It does not imply publisher’s endorsement.

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Unpublished material of industrial interest, not submi ed elsewhere is invited.

The submi ed material will be published a er going through the relevancy of the magazine subject and may be returned in case of not found appropriate.

Publisher, Printer: S K Ali on behalf of RK Media and Communica ons, Delhi Printed at: Rolleract Press Services, A-83/1, Naraina Industrial Area, Phase-I, New Delhi - 110 028 (INDIA) Editor in Chief: S K Ali All legal matters are subject to Karnal jurisdiction.

Contents 06

Agricultural mechanization: A key for future mankind welfare.

12

Consolidation coming in machinery industry?

16

AGRITECHNICA: A seamless spotlight on Farm Mechanization.

18

Satellite controlled agriculture machines create Environmental Benefits.

22

Factor analysis of agricultural mechanization challenges in Iran.

27

Increased production with Agriculture Machinery for your farm.

28

Is Indian agriculture ready for Gadgetization?

31

Role of Japan in Agriculture Mechanization in India.

33

Understanding profitability in Farming Business.

38

Difference between Rotavator and a Cultivator.

41

NEWS

04 | AGRI MECH | NOVEMBER 2015

Editorial Committee

Editorial Committee Dr Gyanendra Singh M.Tech , Ph.D Member Task Force Committee (Agriculture), Government of Madhya Pradesh Member Academic Council, JNKVV, Jabalpur

Dr. Said Elshahat Abdallah Associate Professor Agricultural Process Engineering Department of Agricultural Engineering, Faculty of Agriculture, Kafrelsheikh Univ.

Kafr Elsheikh 33516, Egypt

Dr Shimon Horovitz Roberto B.Sc. Agronomy Consultant - Open fields and greenhouses Jerusalem, Israel

DOUGLAS AYIREBIDE ALEKIBA Production Supervisor Mim Cashew and Agricultural Products Ltd., Mim – Brong Ahafo, Ghana

Dr. Joginder Singh Malik Professor of Extension Education CCS Haryana Agricultural University Hisar-125 004 (Haryana) INDIA

Yash Agrawal Business Development Associate BIS Research

Dr. Ghanshyam T. Patle Assistant Professor College of Agricultural Engineering & Post Harvest Technology Central Agricultural University, Imphal Manipur (INDIA)

A. S. SUBBARAO Sr.Manager - Agronomy SBU - South Agronomy Department NETAFIM, India

Raghavan Sampathkumar Founder & Principal SMARTAgBiz

05 | AGRI MECH | NOVEMBER 2015

Article

Agricultural mechanization: A key for future mankind welfare Mechanization is even the by far dominating factor. This has resulted in low world market prices for basic agricultural products as compared to the prices of many other goods.

E

very time there is a downturn, we hear rumors of consolidation, both of farms and the industries that serve them.

This cool spell is no different.

Rabobank analysts are the latest to speculate about consolidation in the farm machinery industry.

If they are correct in a recent report, the colors of your favorite farm equipment could soon change.

"Contraction Today, Consolidation Tomorrow?" suggests we are about to see manufacturers merge, buy smaller companies and/or expand their offerings to include product lines not usually found on your local tractor dealer's lot.

"Consolidation in any sector or industry is a logical, natural response to difficult operating conditions or declining growth," said Rabobank's report. The "difficult operation conditions" to which the report refers are a witch's brew of factors. High commodity prices and favorable tax incentives sent farmers on a capital 06 | AGRI MECH | NOVEMBER 2015

expenditure shopping spree; they stocked up with the latest in farm equipment and technology.

Then the commodity markets headed south. With less money to spend and farm machine sheds already full of shiny new equipment, farmers have been visiting dealers less frequently.

Used equipment has piled up in those dealerships because second-tier buyers, who usually buy trade-ins, had bought new instead with money from high

priced commod ities. And third-tier buyers, w h o usually

buy smaller older equipment, don't need the production volume of the large equipment.

In addition to all of this, the North American farm sector is considered "mature." That is, not many new players are entering the market these days.

A mess has ensued for d e a l e r s a n d manufacturers.

Writers of the Rabobank report (Rabobank is a Netherlands-based cooperative bank

Article

specializing in agriculture with a strong North American presence.) conclude that the downturn in equipment sales is both severe and persistent and that it will lead to a reshaping of the industry.

It suggests three scenarios: 1) Mergers among the largest manufacturers 2) Acquisitions by the larger fish of smaller fish 3) Manufacturers branching out into new product lines including grain storage and animal protein production systems.

It seems AGCO, one of the largest manufacturers to which the report refers, already got a jump on the acquisitions and new product line parts of this. The Georgia-based giant bought grain storage system manufacturer GSI in 2011. Of course, AGCO is a company built on acquisitions, so no real surprise there. This time around, AGCO has even launched its own line of UAVs (drones) as a way to capture more farmer dollars.

equipme n t revenue s as, in order of s i z e : Deere, C N H Industrial , AGCO, Kubota, Claas a n d Mahindra & Mahindra.

While short on specific predictions, the report does single out John Deere as unlikely to participate in any mergers. As the most dominant of farm equipment manufacturers in North America, Big Green would have little to gain from a merger. On the other hand, the report said, "A combination of any of these non-Deere tiers 1 O E M S [ C N H , A G C O ] would create a more formidable competitor, with great scale economies and global reach."

Unfortunately political instability hampers the necessary actions in several poor countries.

If a shakeup is to occur, Rabobank said, it has at least a two-year time frame before machinery market conditions improve significantly: "Rabobank expects that, in North America, revenues derived from sales of tractors and combines will likely fall 25% in 2015, 10% in 2016 and 2.5% in 2017."

Whether those declines will be enough to trigger a major

Of the three scenarios, Rabobank said acquisitions will most likely happen quickly. This is no great revelation considering all the major manufacturers routinely buy either shortline manufacturers or the rights to products that complement machinery portfolios. reconfiguration of the iron industry The report classifies the six largest is a question with no easy answer. g l o b a l p l a y e r s b a s e d o n a g My guess: No. 08 | AGRI MECH | NOVEMBER 2015

The Big Four (Big Three if you count Case IH and New Holland as one within CNH Industrial) will likely remain. Deere is untouchable; CNH has strength in its commercial and construction sectors and has never shown a desire to separate Case IH and New Holland; and AGCO isn't big enough to swallow any of its competitors now.

The strategic role This third field of responsibility of agricultural engineering is not so often addressed, as it has nothing to do with feeding, raw material or energy, nor with animals – but it is never-the less also very important.

The key point is, that agricultural mechanization usually can reduce the number of working people in agriculture making possible that they can become productive in

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other areas of the national economy creating additional added value. This results in an increased GDP. Agricultural mechanization is therefore in almost all developing countries the key technology to overcome poverty, suffering, low expectation of life, high illiteracy, high infant mortality, low level of infrastructure etc.

If we analyze the situation today, we can conclude that many countries could still improve their

early addressed by members of the Club of Bologna.

While Henry Ford could capture the world market with only one tractor model – that was the famous FORDSON F (1917-28).

Today's situation is completely different.

If worldwide market demands for tractors and farm machinery are analyzed, the come out is an extremely wide span of demanded specifications. It is by

people could be transferred for value adding outside agriculture reducing poverty and increasing national welfare in all areas of the economy. This is still a goal for developing countries and underlines the mission of the Club of Bologna. The 21th century came up with dramatic challenges for agriculture and thus agricultural mechanization.

The era of production surplus

general economic level considerably by improving their agricultural mechanization.

far not possible to cover them neither economically with only one machine nor with one machine family.

Agricultural mechanization has a very long fascinating tradition from the very first simple hand tools to modern high sophisticated machinery, thus being a real driving force and piece of human civilization. The huge reduction of labor costs by mechanization could keep the prices low for staple food such as cereals. In addition, whole economies could benefit from increased labor productivity as

ended – further population increase must be met by agricultural production increase.

This increase must be much higher than the population growth due to expected higher proportions of meet, energy and raw materials and expanded duties of environmental protection. As the variety of required technologies and power levels has dramatically been widened within the past decades, global product planning of machinery has to be structured meeting a wide span of locally oriented, graded technology levels.

Globalization of agricultural machinery development and manufacturing The total turnover of the worldwide agricultural machinery production (including tractors) is estimated to be about 130 Billion US $ in 2014.

Along with the globalization, agricultural machinery has become more and more international. This resulted in new strategies of increased world wide networking and cooperation as – for example –

10 | AGRI MECH | NOVEMBER 2015

Article

C

onsolidation oming in Machinery Industry?

E

very time there is a downturn, we hear rumors of consolidation, both of farms and the industries that serve them.

This cool spell is no different.

Rabobank analysts are the latest to speculate about consolidation in the farm machinery industry.

If they are correct in a recent report, the colors of your favorite farm equipment could soon change.

"Contraction Today, Consolidation Tomorrow?" suggests we are about to see manufacturers merge, buy smaller companies and/or expand their offerings to include product lines not usually found on your local tractor dealer's lot.

response to difficult operating conditions or declining growth," said Rabobank's report. The "difficult operation conditions" to which the report refers are a witch's brew of factors. High commodity prices and favorable tax incentives sent farmers on a capital expenditure shopping spree; they stocked up with the latest in farm equipment and technology.

Then the commodity markets headed south. With less money to spend and farm machine sheds already full of shiny new equipment, farmers have been

t h o s e dealerships b e c a u s e second-tier buyers, who usually buy trade-ins, had

Jim Patrico Progressive Farmer Senior Editor Winner Oscar in Agriculture writing award

bought new instead with money from high priced commodities. And third-tier buyers, who usually buy smaller older equipment, don't need the production volume of the large equipment.

In addition to all of this, the North American farm sector is considered "mature." That is, not many new players are entering the market these days.

A mess has ensued for dealers and manufacturers.

"Consolidation in any sector or industry is a logical, natural 12 | AGRI MECH | NOVEMBER 2015

visiting dealers less frequently.

Used equipment has piled up in

Writers of the Rabobank report (Rabobank is a Netherlandsbased cooperative bank specializing in agriculture with a strong North American presence.) conclude that the downturn in equipment sales is both severe and persistent and that it will lead to a reshaping of the industry.

AN ISO 9001:2008 CERTIFIED CO. 2420 & 2422, DLF city, DLF Phase-IV, Gurgaon - 122002, Haryana (India) Ph: +91 124 2385916, +91 124 6526130 E-mail: info@leiongroup.com

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It suggests three scenarios: 1) Mergers among the largest manufacturers 2) Acquisitions by the larger fish of smaller fish 3) Manufacturers branching out into new product lines including grain storage and animal protein production systems.

It seems AGCO, one of the largest manufacturers to which the report refers, already got a jump on the acquisitions and new product line parts of this. The Georgia-based giant bought grain storage system manufacturer GSI in 2011. Of course, AGCO is a company built on acquisitions, so no real surprise there. This time around, AGCO has even launched its own line of UAVs (drones) as a way to capture more farmer dollars.

Of the three scenarios, Rabobank said acquisitions will most likely happen quickly. This is no great revelation considering all the major manufacturers routinely buy either

The report classifies the six largest global players based on ag equipment revenues as, in order of size: Deere, C N H Industrial, AGCO, Kubota, Claas and Mahindra & Mahindra.

While short on specific predictions, the report does single out John Deere as unlikely to participate in

from a merger. On the other hand, the report said, "A combination of any of these non-Deere tiers 1 O E M S [ C N H , A G C O ] would create a more formidable competitor, with great scale economies and global reach."

If a shakeup is to occur, Rabobank said, it has at least a two-year time frame before machinery market conditions improve significantly: "Rabobank expects that, in North America, revenues derived from sales of tractors and combines will likely fall 25% in 2015, 10% in 2016 and 2.5% in 2017."

Whether those declines will be enough to trigger a major reconfiguration of the iron industry is a question with no easy answer.

My guess: No.

shortline manufacturers or the rights to products that complement machinery portfolios.

14 | AGRI MECH | NOVEMBER 2015

any mergers. As the most dominant of farm equipment manufacturers in North America, Big Green would have little to gain

The Big Four (Big Three if you count Case IH and New Holland as one within CNH Industrial) will likely remain. Deere is untouchable; CNH has strength in its commercial and construction sectors and has never shown a desire to separate Case IH and New Holland; and AGCO isn't big enough to swallow any of its competitors now.

AGRICULTURE TRACTORS

2010

Palm Mach Sdn Bhd

Cover Story

AGRITECHNICA A seamless

sp tlight on Farm Mechanization

“the Smart Farming special feature returns at this year's event. The aim of this feature was to help farmers manage their farming operations in the most efficient way, but the focus has been widened so that it now includes engineering solutions that make farm machinery more effective as well as high-tech monitoring and control systems�...

...Dr Reinhard Grandke (CEO of DLG e.V)

A

GRITECHNICA is the world's major exhibition for innovations in agricultural technology and the latest concepts for the future of plant production. It

9 Kilometers each day.

AGRITECHNICA 2015 showed a record attendance with around 450,000 visitors including more Dr Reinhard Grandke CEO DLG e.V., Germany Kingdom, Turkey, Finland and Italy.

It is by far the largest and most prestigious indoor farm equipment show on the globe and is held every two years in Hannover, Germany.

To d a y , d e v e l o p m e n t s i n electronics, GPS and sensor systems largely determine the degree of innovation of systems and machinery with a view to rendering processes even more efficient, precise, environmentally compatible and cost-efficient.

was an excellent experience, while at the show; I met N-Number of intellectuals and visionary people.

Now my body started recovering from jet lag and my feet started recovering from walking more than 16 | AGRI MECH | NOVEMBER 2015

than 100,000 from outside Germany. As per my observation, the largest contingents made their way from Switzerland, the Netherlands, Austria, France, Ireland, Denmark, the United

AGRITECHNICA exhibitions are known for being a driving force for innovations. The focus is on quality rather than quantity, however big tractors now with over 440 HP are

Cover Story

shown, as well as big planters and drills.

Germany and Western Europe remain a significant centre for innovations and investment. Farmers c a m e t o AGRITECHNICA, similar to other shows, to gather information about hightech answers to the challenges facing the industry, regardless of their farm size.

This proofs the AGRITECHNICA really is the world's most international event. Although it was near to impossible to visit every hall and understand each product closely, I have observed that besides an increase in the number of exhibitors, this year's strong foreign flavor will also be captured in the record number of 23 pavilions, other than International Visitor's Lounges.

On the last day, during a closing press conference to talk about the event, Dr Reinhard Grandke (CEO of DLG e.V) says, “the Smart Farming special feature returns at this year's event. The aim of this feature was to help farmers manage their farming operations in the most efficient way, but the focus has been widened so that it now includes engineering solutions that make farm machinery more effective as well as high-tech monitoring and control systems”.

On response of one senior journalist, he continued, “The attendance this year, was up 7% over the AGRITECHNICA 2013 show, The number of exhibitors, 2,898, was also up by 7%, completely filling the world's largest

exhibition grounds”.

According to a survey, “A good majority (approx. 98%) of the visitors and exhibitors were fully satisfied with their experience”.

We are getting closer to the 9 billion by 2040 estimation. This growth combined with increasing prosperity around the world requires doubling the world's food production by 2050. Meeting such

a huge challenge requires a several measures. Especially in Asian countries, farmers strive for more with less on existing farm land, so it is important to know all attributes of the field i.e. soil, water, nutrients and its overall potential.

Based on positioning, sensors and software, decisions made by farmers will need support provided by the innovative use of actionable data.

Agriculture and agricultural engineering are the future and play a key role with regard to feeding the increasing world population, but also with regard to producing renewable energies.“75% of the AGRITECHNICA visitors are planning to invest in machines in the course of the next two years and 50% are even planning this investment for next year and prepared it at the AGRITECHNICA 2017.

At last but not the least, AGRITECHNICA is became the must-visit exhibition for big and small businesses looking to succeed in the competitive sector of agriculture. We wish that, in future also, DLG will maintain the same level of Enthusiasm for the brand & Quality of service during the expo, which has been reflected this year. ... S K Ali Chief Editor (AGRI MECH)

www.agrimech.net 17 | AGRI MECH | NOVEMBER 2015

Article

Satellite Controlled AGRICULTURAL MACHINES Create Environmental Benefits GPS satellite navigation G P S (Global Positioning System) is a military navigation satellite system. The satellites transmit radio signals which make it possible for a radio receiver to calculate its location. All around the world, humans are using GPSassisted navigation in cars, airplanes and boats. The system can also be used in trucks, forestry machinery and other vehicles. The equipment is becoming smaller, and G P S can be added to mobile phones and small h a n d h e l d instruments.

T

echnical development in agriculture is moving quickly in other areas as well.

Satellite-controlled agricultural machinery, for example, is the latest innovation in arable farming. The tractor or combine harvester is controlled automatically, and a GPS navi- gation system provides the driver with exact information on the tractor’s position. It reduces fuel consumption and allows ferti- lising and harvesting operations to be carried out with greater pre- cision.

The driver’s working environment is also improved, since he or she does 18 | AGRI MECH | NOVEMBER 2015

Automatic milking using robotics was introduced in the late 1990s, and is now used by just under four percent of Sweden’s milk producers. The cattle roam free and seek out the robot when it is time to be milked. They are also fed at the same time. not have to steer the vehicle. This is how it works:

Computer support for precision farming Sensors and computer screens provide the driver of a modern combine harvester with

Positioning is based on telemetry with triangulation from a number of satellites.

The satellites continuously transmit information on exact time and date, identity, status and where the satellite is located at any given time. The telemetry is carried out by measuring the difference in the time it takes for the signals from the satellites to reach the receiver.

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the overlap as a machine travels up and down a field from 10 percent of the machine width to only a few centi- metres, and this cuts down on both the hours worked and the amount of fuel consumed. Precision growing generates both financial and environmental benefits, but at present, the method only pays dividend on the largest farms. Crop farming may become even more detailed in the future, and some scientists are aiming for treatment of individual plants, a bit like providing potted plants at home with different amounts of water and nutrients. information on, for example, driving distances, harvesting per hour, grain water content and unloading in tons per hectare. The driver can adapt the speed to crop density, and even use the computer to plan farming opera- tions. The aim is to find the best possible combination of different crops on agricultural land, to achieve the best possible results from crop rotation and expected crop prices. Information from laboratory analysis can be entered into the computer, to produce details of when to apply lime and how much fertiliser has to be added to different soil types.

Information on expected sowing, fertilizing and spraying can also be entered, and all this information can be used as a basis for budgeting for the season.

areas where they are needed most.

This reduces the risk of nitrogen and phosphorus leaching into the ground water and watercourses.

For precision growing to work, the farmer must have detailed

The Lukas weed control robot

R

obotics is also entering the field of weed control – something which is of great interest to organic growers who are currently removing weeds manually. Halmstad University is in

The weed robot Lucas can be a cost efficient alternative for farmers

If farmers use a combination of advanced market analysis and precise positioning, crop growing can be planned with much greater precision. The aim of this type of precision growing is to optimize the treatment of each part of a field.

Traditionally, lime, fertilizer and crop sprays have been applied equally to every part of a field, but precision growing means that the resources can be targeted on the 20 | AGRI MECH | NOVEMBER 2015

knowledge of the status of the different areas of a field, and be in complete control of the location of tractors or combine harvesters. For example, information on how much fertiliser needs to be applied to a certain area is stored in the computer. The GPS equipment keeps track of the tractor’s location, and the fertiliser feed is adjusted to the various conditions in a field.

Precision GPS equipment reduces

process of developing the ”Lukas” weed control robot. It can move along the rows of plants and uses a camera to identify plants. A rotating wheel deals with weeds between the rows. A small machine of this kind reduces fuel consumption and earth compacting. The ”Lukas” can be used from most crops grown in rows, and the College estimates that the cost of weed control can be halved if the robot is used.

ROPA Fahrzeug- und Maschinenbau GmbH Sittelsdorf 24 D-84097 Herrngiersdorf Telephon +49–8785–96010 Telefax +49–8785–566 Internet www.ropa-maschinenbau.de E-mail: kundendienst@ropa-maschinenbau.de

Article

Factor analysis of agricultural mechanization challenges in Iran NIKROOZ BAGHERI Agricultural Engineering Research Institute, Karaj, Iran

MARZIYEH BORDBAR Young researchers and elite club, Marvdasht branch, Islamic Azad University, Marvdasht, Iran)

The term mechanization is generally used as an overall description of the application of these inputs. The level,

and drudgery of manual farm labour and increases farmers’ income. Among the recent trends in development of agricultural mechanization, there are an increase in power and energy capacity of agricultural machinery

appropriate choice and subsequent proper use of mechanized inputs into agriculture has a direct and significant effect on achievable levels of land, labour productivity, profitability of farming, s u s t a i n a b i l i t y, environment and quality of people’s life engaged in agriculture (Olaoye and Rotimi, 2010). Agricultural mechanization constitutes the centre stage power source for boasting agricultural production. The application of m a c h i n e s i n agricultural production minimizes the burdens

and equipments, an increase in their reliability and decrease in exploitation expenses and labour consumption (Bagheri and Moazzen, 2009; Yadav et al., 2010). Numerous attempts were carried out by different countries for development of mechanization and determination of its challenges.

Aderoba (1987) investigated major problems of using modern machinery in small farms. The author suggested a model for development of mechanization in small farms. A simple procedure to assist such decision-making is reported in the work. Pawlak et al.

(2002) showed that having an appropriate mechanization is an extremely wide-ranging problem, which requires deep technical

A

griculture continues to play an important role in the economies of most developing countries. A 1% growth in per capita agricultural gross domestic product (GDP) leads to 1.61% increase in per capita income of the bottom quintile of the population, whereas a similar 1% growth in industrial G D P increases the income of the poor by 1.16% (Norton, 2004).

Commercialization is essential for agricultural development, which, amongst other things, entails mechanization of agriculture to reduce the cost of production and to increase the yield of crops. Due to the ever-increasing agricultural labour scarcity in developing countries, an extensive scale agricultural commercialization may not be possible without mechanization (Nepal and Thapa, 2009). Tools, implements, and powered machinery are essential and major inputs to agriculture.

22 | AGRI MECH | NOVEMBER 2015

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analysis and a holistic approach.

To s o l v e t h i s p r o b l e m , mechanization needs to be considered not just in technical terms, but also as a component in a system where development relies upon establishing a series of essential “collateral� activities within various countries. These concern networks of applied research and testing centres, extension services, after-sales services, contracting companies,

appropriate machinery, lack of agricultural mechanization experts, political interference and institutional weaknesses. Singh (2006) estimated mechanization index and investigated its impact on production and economic factors in India. Analysis revealed that the human labour cost was the largest component in the cost of cultivation in the wheat crop in India. Results also revealed that the states having higher mechanization indices

covering 120 farm households, and group discussion and key informant interviews. In both instances of farm mechanization, the degree of commercialization is t h e m o s t i n f l u e n t i a l f a c t o r, indicating the significant role of mechanization in agricultural commercialization. The major policy implications of the findings of the study are outlined (Anonymous, 1995; 2003).

Bagheri and Moazzen (2009)

education and training schools, etc. Fernando et al. (2005) exhibited technology transfer strategies for small size farm mechanization in the Philippines.

incurred a lower cost of cultivation of the wheat crop on quintal basis due to increased yield.

Balasubramanian et al. (2007) described the most important challenges and opportunities for rice production in Sub-Saharan Africa. Nepal and Thapa (2009) analyzed effective factors on agricultural mechanization in Nepal. Information was collected through a questionnaire survey,

investigated agricultural mechanization challenges in Iran.

They found that an important part of challenges belonged to human resources. Therefore, development of human resources is the most effective way to solve many challenges. To improve the situation of agricultural mechanization in Iran, government carries out many attempts.

Nevertheless, current situation of

The results showed that, the most important challenges for agricultural mechanization were: lack of information technology, farmers with limited-resource, small size of farm, lack of

23 | AGRI MECH | NOVEMBER 2015

Article

agricultural mechanization is not acceptable. Previous researches indicated that some challenges hinder the development of mechanization in Iran (Bagheri and Moazzen, 2009) and it is necessary to be known. So, the main objective of this research is to find out and then prioritize agricultural mechanization challenges in national level.

Materials and methods The methodology used in this study involved a combination of descriptive and analytical method.

In order to achieve information, interviews were conducted with agricultural mechanization specialists. Information collected from different points of view; studies which applied in other countries, papers presented in international congresses, and so on. The research population included agricultural mechanization experts, managers and specialists of agricultural engineering in private and

24 | AGRI MECH | NOVEMBER 2015

governmental sections and farmers with different farm holdings (mostly small farms). Using proportional stratified sampling, a sample of 119 was constituted out of a total population of 809 by using Cochran formula. A questionnaire was developed based on relevant literature to be the main and basic method of information gathering to achieve goals. The questionnaire included fixed choice questions on which the statements were

collected after literature review of researches and interviews with s p e c i a l i s t s . To p r i o r i t i z e challenges, 24 statements were used and asked from respondents to determine their opinions about them.

A five-point Likert scale was used to measure the perception of respondents. The respondents were asked to indicate their agreements with statements by marking their response on a five point Likert-type

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scale. Content and face validity were established by a panel of experts consisting of faculty members at universities. Minor wording and structuring of the instrument were carried out based on recommendation of the expert panel. A pilot study was conducted with 30 persons (not included in the sample population), to determine the reliability of the questionnaire.

Computed Cronbach’s alpha score were 75%, which indicated that the questionnaire was highly reliable.

All survey data were analyzed using the Statistical Package for Social Sciences (SPSS 16.0).

According to diversity of challenges, factor analysis was used to prioritize and reduce number of variables to fewer factors and determine the portion of each factor in the experts view about challenges of mechanization in Iran. Regarding the Kaiser criterion, seven factors with more than one eigenvalue were extracted. So, studied variables were divided into seven factors after factor rotation by the Varimax method.

Results Prioritized challenges of agricultural mechanization in Iran are shown in Table 1. As shown in this table, among challenges, the highest priorities refer to small size of farms and traditional forms of gardens, severe and long process to pay credit loans, financial weakness of agricultural beneficiaries, weakness of agricultural mechanization programs because of their low feasibility and adaptability and slow trend of beneficiaries in accepting new technologies. While the least important challenges were low quality of country-made agricultural machinery, inefficiency of subside payment methods for buying agricultural machinery, large number of time-worn agricultural machinery, and lack of

suitable services for agricultural machinery.

According to diversity of challenges, factor analysis was used to prioritize and reduce number of variables to fewer factors and determine portion of each factor in the experts view about challenges of mechanization development in Iran. Calculations indicated that the internal consistency of data was suitable (KMO=0.70) and Bartlett statistic was significant at 1% level.

Regarding the Kaiser criterion, seven factors with more than one eigenvalue were extracted (Table 2 and Table 3). Studied variables were divided seven factors after factor rotation by the Varimax method, namely, programming, technical, infrastructural, managerial, research and extension, economical and content factors.

In this research, seven factors were extracted and named based on the nature of agricultural mechanization challenges. The

first factor was programming factor. In regarding the highest eigenvalue of this factor (Eigenvalue 2.89 and variance % 11.13), challenges related to programming factor are the most important challenges for agricultural mechanization development. These challenges include: inefficiency of subside payment methods for buying agricultural machinery, lack of effective supervision and delay in application of suitable, feedback to agricultural mechanization evolutions, inattention of agricultural mechanization managers to rural development and environmental considerations, lack of necessary law in agricultural mechanization area, and weakness of agricultural mechanization programs because of their low feasibility and adaptability. Because of the nature of constituting variables of the second factor, this factor is named as a technical factor. This factor explained 11.08% of the challenges (eigenvalue 2.88).

Te c h n i c a l m e c h a n i z a t i o n 25 | AGRI MECH | NOVEMBER 2015

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challenges are: large number of time-worn agricultural machinery, low quality of domestically produced agricultural machinery, lack of suitable services for a g r i c u l t u r a l m a c h i n e r y, o l d technology of domestically produced agricultural machinery, and low skill and technical information of graduate students in agricultural machinery majors.

According to the constituting variables of third factor, it named as infra-structural factor that explained 10.23% of the challenges. Infra-structural challenges include: incomplete collection of agricultural equipments for power generator machinery (tractor), low social position of agricultural and rural jobs, and slowness of agricultural machinery test centre in testing machinery. So, the fourth factor, named managerial factor determined 9.88% of the challenges. Agricultural mechanization challenges in managerial fields were slow trend of beneficiaries in accepting new technologies, and lack of consensus about definition and 26 | AGRI MECH | NOVEMBER 2015

domain of agricultural mechanization. Also, the fifth factor was economical factor that explained 9.48% of the challenges include: financial weakness of agricultural beneficiaries, financial weakness of agricultural machinery producers, financial weakness of mechanized services companies,

and small size of farms and traditional forms of gardens. The sixth factor was named research and extension that explained 9.02% of the challenges. These challenges are: inefficiency of agricultural extension and education methods, weakness of information technology in agricultural sector and mechanization area, and deficiency of applied research in agricultural mechanization field.

Finally, regarding to the nature of variables, the seventh factor named content factor that covers 8.24% of the mechanization challenges include; weakness of agricultural machinery producers and operators in protecting their guild benefits, non observance of financial considerations in establishment of mechanized services companies, and severe and long process to pay credit loans. Totally, as it is illustrated in Table 2, the seven mentioned factors explained about 69.1% of challenges and the other was related to factors which were not predicted in this study.

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Discussion and conclusions The results of this study indicated that the small size of farms and traditional forms of gardens, severe and long process for paying credit loans, financial weakness of agricultural beneficiaries, weakness of agricultural mechanization programs because of their low feasibility and adaptability and slow trend of beneficiaries in accepting new technologies were determined as the most important challenges facing agricultural mechanization development in Iran. The results of

factor analysis indicated that 69.1 % of the variances in the challenges of agricultural mechanization could be classified in seven groups of programming, technical, infrastructural, managerial, economical, research and extension, and content area. It is necessary to mention that the most important challenges include: inefficiency of subside payment methods for buying agricultural machinery, large number of time-worn agricultural machinery, incomplete collection of agricultural equipments for power

generator machinery (tractor), slow trend of beneficiaries in accepting new technologies, financial weakness of agricultural b e n e f i c i a r i e s , i n e ff i c i e n c y o f agricultural extension and education methods, and weakness of agricultural machinery producers and operators in protecting their guild benefits. It is believed that these findings are partially consistent with studies by Aderoba (1987); Asoegwu and Asoegwu (2007).

Increased Production With

Agriculture Machinery for Your Farm

A

griculture machinery is a term used to refer to all equipments, tools and machines that are used to aide production on the farm. It is amazing that in the whole of the United States, a mere 2% of the total population is able to feed the rest of the 98% population!

This has been so because of the agricultural machinery in place.

The technological advancement in the manufacture of the machinery is on the upward trend. Tractors have had major advancements; computer monitoring systems, GPS locators, and self-steer programs. It is possible that in the near future, little human intervention will be needed to work on the firm given advancements such as nanotechnology and genetic engineering where submicroscopic devices and biological processes respectively are being used to perform tasks on the farm. These are tools which have made it possible for almost accurate precision in carrying out functions thus optimum efficiency is achieved on the farm. Less fuel and fertilizer among other inputs in the course of production are used thus increasing returns on investments.

So what are key points to keep in mind to achieve leverage with agriculture machinery?

Take a thorough look at your farm, your assets versus your liabilities, and opportunities versus your threats. If necessary, get the help from experts so that you come up with a good strategic plan. Let everyone on the farm get involved in the whole process.

Get to determine what machinery is necessary to achieve the targets and smart goals that are laid down in the strategic

plan. There are those immediate ones while other machinery may follow later at other stages of the agriculture process on the farm.

Once the machinery is determined, search around the market to determine which would be the best J. R. Singal machine at the best price. This Managing Director Eastman Auto & should also be checked against the Power Ltd., INDIA return on investment for each of the machines. Be careful with cheap machines, they may not last. At the same time, good machines can be gotten at pretty cheap prices if care is taken to research for prices.

Once the machines are purchased, proper care should be taken while the machines are in use. This will ensure maximization of the machines utility period. In some cases, farmers have been able to use the machines beyond its life period.

Keep checking on popular web sites and online agricultural magazines for any new technologies in the industry as this will continue to ensure high levels of productivity at a cheaper price.

Agriculture machinery has been a source of economic leverage for investors in the agriculture sector. Continuous research on internet sites, together with other resources and development of the agriculture machinery, will increase profits for the investor.

Proper planning is needed to guide one into procuring the best machinery for the specific farm.

27 | AGRI MECH | NOVEMBER 2015

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?

Is Indian agriculture ready

There is nothing that we don't know about Indian agriculture and farmers” attitude pervasive at least among the earlier generation of leaders but it is heartening to see that changing, albeit slowly.

for “Gadgetization” (Part-02 of 02) Continuing on the prospects and challenges of Agtech in India, which we discussed in last edition of AGRI MECH, this concluding part discusses some of the realistic scenarios, key factors necessary for success, and possible recommendations including policy measures required.

Challenges for Agtech revolution in India All the obvious issues that are discussed in the last part affect directly or indirectly the farming industry, farmers' profitability, rural & agrarian prosperity and prospects of possible solutions to these problems. Though not directly relevant to the technological innovations that aim to help agriculture, following challenges also ultimately impact how farming is practiced in the country and its future prospects.

Data? What is it?

Having worked in market research roles in the Agbiz industry in India, I have personally experienced several frustrating instances with data availability and reliability on any industry indicators. One of the possible reasons could be “lack of demand” from those who can and must use solid data to take decisions, be it the corporate world and/or Government. There is an inexplicable “Well! There is nothing that we don't know about Indian agriculture and farmers” attitude pervasive at least among the earlier generation of leaders but it is heartening to see that changing, albeit slowly.

While the discussions in the 28 | AGRI MECH | NOVEMBER 2015

developed countries are moving towards ownership of data, and privacy issues, the situation here is quite opposite. Those who understand the value of data would be terrified to find out about the reliability of even basic agricultural statistics available such as acres planted, production or yield, and farmers demographic profiles etc.

Insiders will know these are best “guestimates” of the officials at the village level, which eventually get aggregated at the State levels and then at the country level and reported to the public.

Obviously, all these limit the possibility to take decisions based on solid data. Although the country features one among the pioneers in space science, mobile connectivity, and Information Technology, its agriculture sector still remains disconnected from these.

Leveraging those advancements in agriculture for example, satellitebased technologies seems to be a

distant dream. For example, the data collected to improve accuracy of the field l e v e l production data or RAGHAVAN SAMPATHKUMAR Founder & Parincipal

SMARTAgBiz, Singapore

using the information collected for offering customized crop insurance plans. Similarly, the numbers from the household consumption surveys are to be taken with caution and there are hundreds of private firms selling demographic profiles based on geographical area (e.g. Metros, Tier1 and Tier 2 cities), socioeconomic class (e.g. SEC – A

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segment in all metros) and the like.

At a time when food production is increasingly getting synced to consumption trends across the world, reliable retail and household consumption data is absolutely critical for a demand-driven, market-oriented agriculture sector.

Policy hijack: Vested interests driven by Votebank concerns In India, policy hijack is quite pervasive by many groups with vested interests. There is an inexplicable fervor for traditional or conventional farming partly perpetrated by some who possibly have no knowledge of agriculture.

Any technology including mechanization is vehemently opposed without any rationale particularly, when there is highlevel political support. Longpending reforms in Agricultural Produce Marketing Committee Act (APMC) and vehement opposition to contract farming in some States are obvious examples of greater lobbying power of the marketing intermediaries or the middlemen community that hardly add any value but costs at multiple levels as the produce move towards consumers in the food chain.

Similarly, cap on Foreign Direct Investments in certain sectors including modern food retail and restrictions on local procurement, storage and movement of commodities particularly, under the Essential Commodities Act are other examples of how policies are influenced by different groups that have greater lobbying powers and specific interests.

Policy Placebo: Really effective or not This happens when the beneficiaries and other stakeholders are made to believe the policies are working. For example, several schemes

announced at various times are shown to be effective particularly, when a debate arises on its effectiveness in the highest policymaking circles but the truth on the ground may be quite different.

There are several examples for 'Policy Placebo� such as the MSP (Minimum Support Prices), produce marketing, and many farmers' welfare schemes.

It is rather an open warning that any new innovative technology if it does seem to potentially disrupt or impact the status quo of any group (having strong political influence and greater lobbying power) may face huge resistance and may not even see the light of day. Disruptive innovations such as Uber and the strong opposition it is facing in the country particularly from the political circles stand as a testimony of vested interests hijacking otherwise good policies.

When it comes to agriculture, the likelihood is clearly very high.

Intellectual Property Rights (IPR) regime: Time to plug the holes Although being a signatory to the global IPR treaties, India needs to enhance and streamline its policy and legislative frameworks on protecting IP rights. Learning from the experiences in Bt Cotton, the only commercialized Genetically Modified (GM) crop in the country, there were several instances of infringements of the IP rights to the extent that the spurious and unapproved hybrids could possibly have been sold in the market at least a year ahead of its formal approval in 2002 according to industry observers.

However, the causes or sources of such infringements still remain at large and there is probably no way to pursue a legal course particularly if it involves farmers unlike the western countries. It would simply be suicidal for any company and also time-taking and cumbersome

in many ways. Issues like these are going to be very important in future and will impact the emergence of technological innovations that may cost billions to develop. Lack of sufficient and strong protection of the Intellectual Property may thwart further investments into any innovative technologies into the sector in future.

Scale & Potential users Individual farmers vs Collective farms / Cooperatives One of the key determinants of propensity to use technology in agriculture is per-capita land holdings. Average land-holding in India more than halved over the last four decades to little over a hectare (1.16 ha to be precise) currently and these small and marginal holdings (1 to 2 ha) constitute about 85 percent of the total agricultural land in the country. This means a really huge number of fragmented small farms living mostly on a hand-to-mouth subsistence agrarian situation.

There is vast difference between States as average holdings in Punjab (3.77 ha) are nearly ten times as that of Bihar (0.39 ha), one of the least developed States.

It is not an exaggeration to say some areas in the country are much worse than Somalia when it comes to food security.

From a techpreneur's point of view, it may be difficult to consider these small & marginal farmers as potential users of innovative technologies when they do not even have access to most fundamental pre-requisites for successful farming such as quality seeds, fertilizers, chemicals, finance, infrastructure and marketing opportunities.

However, the solution to this issue lies in collective or cooperative farming. Adoption of any new technology is possible when 29 | AGRI MECH | NOVEMBER 2015

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farmers get aggregated as producer groups and the Government seem to have realised this in recent years. There are several initiatives that are supported mainly N A B A R D (National Bank for Agriculture and Rural Development) that encourage farmers to form FPOs (Farmer Producer Organizations) and the idea seems to be gaining steam in the recent years. Delta Mart, an initiative by the farmers of the Cauvery delta area in Tamil Nadu is one such example. One may logically think it is only a matter of time for the farmers to realize the importance of economies of scale

30 | AGRI MECH | NOVEMBER 2015

(Integrated Farming by Delta Mart) and mechanization in primary production and that can open up huge prospects for use of technologies that aim to enhance efficiency in primary production.

Critical Success Factors Novelty, relevance and value under realistic on-ground conditions A simple Google search brings up hundreds of different technologies currently being pursued in India in the agriculture sector. But, the key to succeed in the long term would be a unique and novel offering (product or service) something that the farmers can use without much

complicated technology, gadgets or investments.

There are a huge number of innovative technologies focusing on improving efficiency such as saving labor, time and costs of doing cultural operations, fertilization, water use etc. While these are very important and useful from the perspective of resource use efficiency and sustainability, one needs to consider ground reality and ask whether these offer real value to the users.

On relevance, I wonder how many farmers would really be interested in for example, a gadget that senses soil moisture levels and alert the farmer to irrigate (or not) his crops. If water is completely free for the farmers, now where is the incentive to save water?

Unless there is potential scarcity or drought-like condition prevailing, no farmer would take pain to use this technology. Similar would be the case for a technology that can detect fertilizer deficiencies and recommend soil nutrient management unless the farmer is really caring about environment, pollution, soil health or undertaking any certification schemes. Urea is the cheapest available fertilizer and a vast majority of the farmers simply dump Urea and do not care about balanced nutrition simply because the prices of Phosphates

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and Potash has risen more than three times.

K n o w Yo u r ( P o t e n t i a l ) Customers India is a vast and perhaps one of the most diverse country with 8 Agro climatic zones, a vast number of different crops grown from rice, wheat, soybean to vegetables and fruits, at least 6 different major soil types, 23 languages and 30 States with different administrative ideologies and political affiliations.

Hence, the most critical factor for success here would be not falling for the “one-size fits all� strategy to targeting and segmenting potential users based on their demographic, land-holding, crops grown, inclination to use new technologies and socio-economic status for developing solutions that add value on the ground. Another critical factor for maximizing adoption of technologies in agriculture would be to focus on user-friendliness and customization according to the local conditions. Language is another issue as India has more

than 300 dialects and when considering this along with low literacy rates, the problem compounds. However, the situation is changing as literacy rates have improved significantly in the last few decades.

Let the innovations trickle-down Referring again to the Bt Cotton example, adoption of new technologies can vary depending upon the products or services offered. For example, a simple Whatsapp group created for marketing in some States such as Gujarat and Maharashtra has become an overnight hit among farmers while some online webbased marketing platforms are taking their time to reach many users. However, in all the cases, the natural trickle-down phenomenon must be taken into account as each technology will take its own course and time to get adopted. The innovators and early adopters must be treated differently when it comes to testing new

technologies on the ground and they serve as key informants and source of knowledge for neighboring farmers in the area.

In summary, given the country's current agrarian situation, there is virtually unlimited potential for utilizing Agtech advancements.

However, there are significant hurdles to overcome. Also a conducive policy environment is the need of the hour to encourage the start-up ecosystem particularly the one that is focusing on the a g r i b u s i n e s s s e c t o r. I t i s heartening that there is no dearth of availability of creative engineering minds in the country with better ICT knowledge, skills and capabilities.

However, in my opinion, it might still take a few decades to see an average Indian farmer with a gadget in his hand and managing operations in his tech-enabled farm. But signs of progress are encouraging and it all depends on the quality and pace of reforms that are due since long.

Role of Japan in Agricultural Mechanization in India

T

he Government of both the countries should support the institutions/industry for joint projects for development of customized farm machinery technologies suitable to Indian condition. Policy support should be provided to tractor and implement manufacturers of India to enter into joint ventures with Japanese industry for design, development, up-gradation and testing of farm machinery. Human resource development of Indian researchers, designers and manufacturers of farm machinery may be done in Japan to share advanced knowhow in the area of design, development and manufacturing of sophisticated farm machinery.

Dr. Champat Raj Mehta Project Coordinator

Japanese industry has played a key role in the progress of farm mechanization by providing high ICAR, INDIA quality and user friendly machines with efficient after-sales service. This has helped the farmers to use the machines during critical periods of production and processing with minimum failure rate. The Japanese model of quality control and efficient after-sales service can be adopted in India to produce high quality durable machines at affordable price by small and large scale agricultural machinery manufacturing industry. Japanese industry may be encouraged to establish farm machinery manufacturing hub in India to reduce the cost of production of farm machinery. The Government of Japan may assist India by providing modern agricultural equipment to farm machinery bank, and train entrepreneurs to use them to ensure timely land tilling, planting, weeding, chemical spraying, harvesting and threshing for increased crop production and productivity.

31 | AGRI MECH | NOVEMBER 2015

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Perfecting performance and comfort”

...

M

acDon Industries Ltd.'s M205 Windrowers and R85 Rotary Disc Header are loaded with performance enhancements, and they feature significant upgrades from their predecessors, the M200 and the R80.

The M205 Windrower A high-powered Cummins turbo diesel engine (220 hp. at a rated 2,220 rpm) that can automatically power boost to 230 hp. when in extreme, heavy crop conditions is one of many upgrades on the M205. Powerful enough to run

reduction in fuel consumption.

Supporting the larger engine are improvements to the machine's air intake and exhaust system, which meant reworking the windrower's body and hood to allow for greater a i r f l o w i n t o t h e e n g i n e . To accommodate the increased airflow, the M205's air filter has also been enlarged, which has an added bonus — longer periods between service intervals.

The R85 Rotary Disc Header The new R85 Rotary Disc Header matches the M205 for

unit.

In terms of the large changes, the multipledrum crop conveying system on the R85's 16-foot model (also available in Laurie Bedord a 1 3 - f o o t Advanced technology editor v e r s i o n ) Successful Farming h a s b e e n Meredith Corporation eliminated. In its place is an overshot auger that delivers more positive feeding — and less backfeeding — of crop at the ends of the header when you are cutting heavier material.

To help in lighter downed or lighter crop, the cutterbar assembly now sports a lower profile with full-width wear protection. This enables lower, faster cutting.

Not all the improvements to the M205 Windrower and the R85 Rotary Disc Header are about performance.

draper headers up to 40 feet, this Tier 3 engine is fuel efficient and environmentally friendly, thanks to MacDon's Intermediate Speed Control (ISC).

With ISC engaged, you can select one of three engine speeds to optimally match the engine to harvesting conditions. This may result in an ability to run the engine quieter in most situations and to also experience a significant 32 | AGRI MECH | NOVEMBER 2015

performance upgrades. The focus has been to take the rotary disc concept to the next level by not only increasing productivity, especially in heavier material, but also by ensuring a cleaner, closer cut in those extreme conditions.

To achieve this goal, MacDon examined every aspect of the R80 for possible improvements. That analysis resulted in changes — large and small — throughout the

Operator comfort was also taken into consideration. Look for a smoother ride thanks to MacDon's new Ultra Glide Cab (UGC) suspension system. This fourcorner, custom-tuned, independent-suspension system features suspension stabilization to prevent cab roll.

The M205 has enhanced instrumentation that provides accurate readouts of hydraulic oil temperature, along with the reporting of more information on other critical systems.

For pricing information or to learn more about other pieces of equipment in the MacDon lineup, contact a dealer in your area.

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Understanding Protability in FARMING

BUSINESS...

Protability is the primary goal of all business ventures. Without protability the business will not survive in the long run. So measuring current and past protability and projecting future protability is very important.

Protability is measured with income and expenses. Income is money generated from the activities of the business. For example, if crops and livestock are produced and sold income is generated. However, money coming into the business from activities like borrowing money do not create income. This is simply a cash transaction between the business and the lender to generate cash for operating the business or buying assets.

Expenses are the cost of resources used up or consumed by the activities of the business. For example, seed corn is an expense of a farm business because it is used up in the production process. Resources such as a machine whose useful life is more than one year is used up over a period of years. Repayment of a loan is not an expense, it is merely a cash transfer between the business and the lender.

P

rofitability is measured with an income statement. This is essentially a listing of income and expenses during a period of time (usually a year) for the entire business. Decision Tool Income Statement, is used to do a simple income statement analysis. An I n c o m e Statement is traditionally u s e d t o m e a s u r e profitability of the business for the past accounting p e r i o d .

H o w e v e r, a proforma i n c o m e statement measures projected profitability of the business for the upcoming accounting period. A budget may be used when you want to project profitability for a particular project or a portion of a business.

Increasing profitability is one of the most important tasks of the business managers.

Managers constantly look for ways to change the business to improve profitability. These potential changes can be analyzed with a proforma income statement or a Partial Budget. Partial budgeting allows you to assess the impact on profitability of a small or incremental change in the business before it is Don Hofstrand Co-director implemented.

Ag Marketing Resource Centre

A variety of Profitability Ratios (Decision Tool) can be used to assess the financial health of a business.

Cash accounting formula + Income (when farm products are sold) - Expenses (when production inputs are purchased) = Net Income (difference between sales of products and purchases of inputs) These ratios, created from the income statement, can be compared with industry benchmarks. Also, Income Statement Trends (Decision Tool) can be tracked over a period of years to identify emerging problems.

Accounting Methods Reasons for Computing Profitability Whether you are recording profitability for the past period or projecting profitability for the coming period, measuring profitability is the most important measure of the success of the business. A business that is not profitable cannot survive. Conversely, a business that is highly profitable has the ability to reward its owners with a large return on their investment.

Cash method of accounting Traditionally farmers have used the cash method of accounting where income and expenses are reported on the income statement when products are sold or inputs are paid for. The cash method of accounting, used by most farmers, counts an item as an expense when it is purchased, not when it is used in the business. This has been used as a method of managing tax liability from year to year. However, 33 | AGRI MECH | NOVEMBER 2015

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many non-farm business accounting systems count an item as an expense only when it is actually used in the business activities.

However, net income can be distorted with the cash method of accounting by selling more than two years crops in one year, selling feeder livestock purchased in

on hand at the beginning and ending of the year.

Defining Profitability Profitability can be defined as either accounting profits or economic profits.

Accounting profits (net income) Accrual accounting formula + Cash Income (when farm products are sold) Beginning value of inventory of farm products (farm products sold this year but produced last yea – products not produced in the current year). + Ending inventory (farm products produced this year but sold next year)

Traditionally, farm profits have been computed by using accounting profits. To understand accounting profits, think of your income tax return. These are the same items used in calculating accounting profits.

However, your tax statement may not give you an accurate picture of profitability due to IRS rapid depreciation and other factors. To compute an accurate picture of profitability you may want to use a

= Accrual Income (when farm products are produced) + Cash Expenses (when production inputs are purchased) + Beginning inventory (production inputs used this year but purchased last year) - Ending inventory (production inputs purchased this year but used next year) + Ending accounts payable (production inputs used this year but paid for next year).

- Beginning accounts payable (production inputs paid for this year but used last year). = Accrual Expenses (when production inputs are used).

= Accrual Net Income (difference between the value of products produced (accrual income) and cost of input used (accrual expenses) a previous year, and purchasing production inputs in the year before they are needed.

Accrual method of accounting To provide a more accurate picture of profitability, the accrual method of accounting can be used. With this method, income is reported when products are produced (not when they are sold) and expenses are reported when inputs are used (not when they are purchased). Accrual accounting uses the traditional cash method of accounting during the year but adds or subtracts inventories of farm products and production inputs 34| AGRI MECH | NOVEMBER 2015

more accurate measure of depreciation.

Accounting profits provide you with an intermediate view of the viability of your business. Although one year of losses may not permanently harm your business, consecutive years of losses (or net income insuffi cient to cover living expenditures) may jeopardize the viability of your business.

Economic profits In addition to deducting business expenses, opportunity costs are also deducted when computing economic profits. Opportunity costs relate to your money (net worth), your labor and your management ability. If you were not farming, you would have your money invested elsewhere and be employed in a different career. Opportunity cost is the investment returns given up by not having your money invested elsewhere and wages given up by not working elsewhere. These are deduced, along with ordinary business expenses, in calculating economic profit.

Economic profits provide you with a long-term

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perspective of your business. If you can consistently generate a higher level of personal income by using your money and labor elsewhere, you may want to examine whether you want to continue farming.

Profitability is not Cash Flow People often mistakenly believe that a profitable business will not encounter cash flow problems.

Although closely related, profitability and cash flow are different. An income statement lists income and expenses while the cash flow statement lists cash inflows and cash outflows. An income statement shows profitability while a cash flow statement shows liquidity.

Other Financial Statements An income statement is only one of several financial statements that can be used to measure the financial strength of a business. Other common statements include the balance sheet or net worth statement and the cash flow statement, although there are several other statements that may be included.

These statements fit together to form a comprehensive financial picture of the business. The balance sheet or Net Worth Statement shows the solvency of the business at a specific point in time. Statements are often prepared at the beginning and ending of the

Many income items are also cash inflows. The sale of crops and livestock are usually both income and cash inflows. The timing is also usually the same (cash method of accounting) as long as a check is received and deposited in your account at the time of the sale.

Many expense items are also cash outflow items. The purchase of livestock feed is both an expense and a cash outflow item. The timing is also the same (cash method of accounting) if a check is written at the time of purchase.

However, there are many cash items that are not income and expense items and vice versa. For example, the purchase of a tractor is a cash outflow if you pay cash at the time of purchase. If money is borrowed for the purchase using a term loan, the down payment is a cash outfl ow at the time of purchase and the annual principal and interest payments are cash outfl ows each year.

The tractor is a capital asset and has a life of more than one year. It is included as an expense item in an income statement by the amount it declines in value due to wear and obsolescence. This is called depreciation. The depreciation expense is listed every year.

Depreciation calculated for income tax purposes can be used. However, to accurately calculate net income, a more realistic depreciation amount should be used to approximate the actual decline in the value of the machine during the year.

36 | AGRI MECH | NOVEMBER 2015

accounting period (i.e. March 31). The statement records the assets of the business and their value and the liabilities or financial claims against the business (i.e. debts). The amount by which assets exceed liabilities is the net worth of the business. The net worth reflects the a m o u n t o f ownership of the business by the owners.

The Cash Flow Statement is a dynamic statement that records the flow of cash into and out of the business during the accounting period. A positive (negative) cash flow will increase (decrease) the working capital of the business. Working capital is defined as the amount of money used to facilitate business operations. It is calculated as current assets (cash or near cash assets) less current liabilities (liabilities due during the upcoming accounting period).

EVENT CALENDAR DECEMBER 2015 EIMA 03-05 December 2015 Delhi,India

Event Calendar

SEPTEMBER 2016 INTL AGRICULTURAL AND FORESTRY Machinery Export Fair 18-20 March 2016 Guangzhou, China

SIMA ASEAN 08-10 September, 2016 Bangkok,Thailand

APRIL 2016 KISAN 16-20 December 2015 Pune,India

FEBRUARY 2016

TECHAGRO 03-07 April 2016 Brno-Czech republic

SAHARA INTERNATIONAL AGRICULTURAL EXHIBITION 24-27 September 2016 Cairo - Egypt

OCTOBER 2016 AGROEXPO EURASIA 11 – 14 February 2016 Izmir,Turky

AGRITALK INDIA 21- 24 February 2016 Gujarat,India

Field Days India 23 - 24 February 2016 Gujarat, India

MARCH 2016

RUSSIA Nokka

AGRITEX 11-13 April 2016 Hyderabad,India

AGROSALON 03-07 October 2016 Moscow Russia

AGRARIA 21–24 April 2016 Cluj-Napoca, Romania

AGRI WORLD 12-14 October, 2016 Makuhari Messe, Japan

JUNE 2016

NOVEMBER 2016

AGRITEC AFRICA 15-17June, 2016 Nairobi, Kenya

EIMA INTERNATIONAL 09-13 November 2016 BOLOGNA,Italy

AGRI ASIA 03 - 05 March 2016 Mumbai, India

JULY 2016

EXPOAGRO 08 - 11 March 2016 Argentina

AGRO-TECH MINIKOWO 02–03 July 2016 Minikowo, Poland

INTERNATIONAL IRRIGATION SHOW 09-11 March 2016 Shanghai, China

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Difference between R tavat r and a Cu tivator...

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hen trying to find the correct tool for preparing and cultivating the soil in a garden, choosing the right machine for the job can be a bit confusing. This article hopes to help clear up some of the confusion between two similar garden tools designed for this work, rotavators and cultivators. In order to prepare the soil for successful planting, leveling, turfing, or seeding, it needs to be prepared and maintained. Garden soil should be churned and broken up as part of that process, and both a rotavator and cultivator can be used to perform the task. This process aerates the soil, which enables it to gain warmth quicker so plants can grow. This also makes weeding easier, exposes insects to birds, and helps improve soil drainage. Often the only real difference between the two is the name given to it by the manufacturer. The names are frequently interchangeable. Essentially, rotavators and cultivators do the same job, although there are subtle differences between the two, and it can be difficult to decide which is the best to use. They are both mechanised diggers, designed to make the work easier and quicker for a gardener.

Rotavators There are different types of rotavator, also known as a ‘power digger’, that can be powered by gas, petrol, or electric, and the required power of the machine will influence the type of connection it requires. As a general rule, when trying to decide what type of digging machine a tool is, bear in mind if it has wheels that drive the machine along with the blades at the back of it, then it is a rotavator. However, do not be fooled – some larger rotavators have their blades, also known as ‘tines’, at the front. Generally, rotavators tend to be bigger than cultivators, although again, this is not always the case. Since they are usually more powerful, 38 | AGRI MECH | NOVEMBER 2015

rotavator blades are able to dig deeper into the ground, normally about 9” compared to a cultivator’s 2”-3”. For a mid-sized plot of land, a rotavator is a good choice for

preparing the soil, especially in comparison with hand held tools such as spades or trowels. Some of the larger, more powerful rotavators are suitable for use on commercial plots of land.

Cultivators In comparison to a rotavator, a cultivator is generally more hand driven. Usually cultivators have no wheels and are driven along the blades of the machine, although this is not always the case. Because cultivators tend to be smaller and lighter, they are usually cheaper and more financially attractive to a small plot holder or for only occasional use. Like

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rotavators, cultivators can be powered by petrol or by electric. The latter is usually cheaper and quieter, but not as powerful, and the blades tend to be lighter than those of a rotavator. Most small-sized cultivators look very similar and share the same size tilling width (the digging ability), even when produced by different manufacturers. The only real difference between them is the engine type and the quality of the manufacture.

Own brand engine types tend to be cheaper than

more famous brands, but quality should be studied very carefully before making any purchase, as the cheap est deal may not necessarily be the best for the p u r c h a s e r. A n y product that comes with a warranty is especially desirable. If the product is new, most warranties will last 1 year, but some carry a 5 year guarantee, which may be subject to the company’s servicing requirements; this will probably be optional for the purchaser. Since cultivators turn the ground over at less of a depth than a rotavator, they are better for removing weeds. Of course, soil that is too greatly infested with weeds (particularly Japanese knotweed or bindweed) will need to have some initial weeding done by hand, as the machine will not be able to cope and will just choke.

Differences Between a Rotavator and Cultivator

ROTAVATOR

CULTIVATOR

Larger, heavier, more powerful

Smaller, lighter, less powerful

Blades at back

Blades at front

Deep digging

Light digging

More expensive

Cheaper

Professional/experienced user

Beginner/occasional user

Which to Use for the Job - Rotavator or Cultivator?

Firstly, before making a decision, consider the land on which either machine would have to be worked. Larger gardens, or small fields, where the soil is relatively free of weeds, are best suited to a rotavator. However, since they can be expensive, it is always worth considering hiring one or buying second hand. See the notes below on safe purchase of a second hand machine. For smaller areas or lighter digging, a cultivator may be better suited, as well as being more suited to removing weeds. Both rotavators and cultivators will have difficulty on soil that has never been managed before (‘virgin’ land). The soil will need to be broken up using a fork tool beforehand, as the blades of the machine will not be able to grip into the soil properly and will just ‘skip’ across the surface, which is both dangerous and counterproductive. When

using either a rotavator or cultivator, proper personal protective equipment should be used. Both machines are noisy (a rotavator more so), so ear defenders are recommended. Gloves, safety boots, or rather steel toe-capped boots if using a machine with rear facing blades, should be worn when operating one or the other of these machines. As mentioned above, smaller hand-held cultivators are ideal for breaking up a certain amount of weeds on a plot. Rotavators, particularly larger ones, are more powerful and used for deeper digging. They are not as appropriate for a smaller space in the garden, as due to the expense and power, they can give the impression of ‘using a hammer to crack a nut’. Rotavator blades will also simply shred weed roots and send them spraying outwards, which can only increase the problem once these roots have taken into the ground. Cultivators are more ideal for light digging around plants (particularly trees and shrubs) that are well established, since the blades do 39 | AGRI MECH | NOVEMBER 2015

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not go so deeply into the ground and cannot damage the root systems of existing plants. Due to this light blade work, cultivators are also better at producing furrows in the ground for planting vegetables, such as onions or carrots. Some gardeners use them as makeshift hedge trimmers, and due to their relative lightness, they are excellent for those with bad backs who want to do some light gardening work but are unable to use labour-intensive hand tools.

And of course, there will always be occasions when hand-held tools

will need to be used for smaller jobs.

Purchasing a Second Hand Rotavator or Cultivator Always do lots of research when considering the purchase of a used rotavator or cultivator, particularly if the machine can’t be viewed in person before purchase. Ask the eBay seller about any details, and check that the machine is in excellent condition and be cautious. This will ensure that a safe product is being used. Ensure

that the manual for the machine comes with it, and before operation, read the manual carefully. Make sure the correct fuel is in use, as the wrong kind could break the machine and cost a lot of money to repair. Perform regular maintenance, ideally both before and after the machine is used. Small problems with either a rotavator or cultivator can cause serious injury, so the operator must always fix any underlying issues before using.

5 Mistakes To Avoid When Choosing A Garden Rotavator

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f your looking to buy a garden rotavator this article may be the most important article you have read. When buying garden rotavators there are some very common mistakes that people make, in this article we are going to discuss these and I will show you exactly how to avoid these painful mistakes yourself.

1. Buying A Cheap Badly Made Rotavator Quality is key when looking for a rotavator. Most rotavators that are used in the garden do get a lot of use, your rotavator will get muddy, stones will fly at the plastics when in use and it is very likely that the rotavator will be exposed to damp conditions. All of this means that it’s essential that you buy a garden rotavator that is of a good quality.

The common misconception is that a quality garden rotavator can cost much more than a cheap one. That isn’t the case. Consider this, you can spend some money on a cheap tiller and it may last you five years, however if you spend an extra 10% and buy a garden rotavator that it is probable that it will last you twice as long. Investing in a good quality rotavator is a very good idea.

5 year warranty.

3. Choosing A Rotavator That is the WRONG Size This is a silly mistake that so many people make and it can seriously limit the usage that your rotavator gets. Most people either buy a rotavator that is to big for their garden, or to small. If you have a medium sized garden then I suggest a small rotavator, this will also allow you to cultivate easily around your garden.

If you have a large allotment or garden then a medium sized rotavator would be best, especially if you have big areas that need to be rotavated every year. The large rotavators should only be bought by people who are real professionals or if you have several acres that you would like to cultivate.

4. Choosing A Rotavator With No Additional Attachments With the additional attachments that you can buy for garden rotavators you can turn a basic cultivator into an amazing machine. Before you spend your money on any rotavator for your garden make sure that it does have additional attachments that you can buy.

2. Choosing A Second Hand Garden Rotavator This can be a great idea, saving some money on a rotavator.

It can, however, be a bad idea. If you are even thinking about buying a rotavator that has been previously used you really do need to know what your doing, there are many used rotavators that are very old, havent been looked after, don’t start or are even dangerous to use. If you know exactly what to look for in a rotavator, understand how to check that it’s working and can see that it’s been cared for then it may be worth considering a used rotavator. I would tell the average person to avoid buying a used rotavator.

When buying a second hand rotavator you also have no guarantees of just how long it will last for. If you buy a new rotavator from a supplier such as Honda you actually have a 40 | AGRI MECH | NOVEMBER 2015

Even if you have no plans to buy these attachments right now – as they can cost quite a lot sometimes – you may wish to buy these in the future and will add value onto your rotavator should you ever think of selling this.

5. Choosing A Garden Rotavator Without Reading Reviews BIG MISTAKE Picking up just any rotavator that looks good in the photos will not result in a good purchase, instead it’s highly recommended that you look into the exact specification of your rotavator and read a few reviews just to see what others are saying about the garden rotavator your considering.

NEWS

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eere & Co., the world’s largest farm equipment manufacturer, forecast fiscal 2016 profit that beat analysts’ estimates even as lower crop prices reduce the money that farmers have to buy tractors and combines.

Net income for the year through October will be about $1.4 billion, the Moline, Illinois-based company said Wednesday in a statement.

That was better than the $1.39 billion average of 18 estimates compiled by Bloomberg.

Equipment sales will be down for a third year, falling about 7 percent, the company said.

The decline in prices for corn to soybeans has spurred farmers to cut back on purchases. The U.S. Department of Agriculture forecasts farm net income will drop 21 percent this year. Sales of large, expensive

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eaving Machinery are to launch a Short Disc 8000T, to complement the existing and hugely successful Short Disc range. The company say they have recognised the need for a higher output model to maximise efficiency with their new 8 Metre model.

Currently in use across the UK, this well recognised shallow cultivator is fast and economical to use, perfect for chitting weedseeds and volunteers producing a level and uniformed finish.

Built for reliability and endurance, the Weaving Short Disc cultivators have a 12 month guarantee on nonwearing parts. The low maintenance requirement is a key feature with boron steel notched discs mounted on maintenance free fully sealed bearing hubs. The powder coating surface treatment inhibits corrosion and extends working life on all metal components.

agricultural machinery are down and inventory remains above historical averages, portending more production cuts in 2016, according to Karen Ubelhart, a Bloomberg Intelligence analyst.

“The outlook for 2016 U.S. farmequipment demand is dimming as financial conditions continue deteriorating,” Ubelhart said in a report last week.

Net income in the fiscal fourth quarter fell to $1.08 a share from $1.83 a year earlier, the company said. That’s more than the 75-cent average estimate. Equipment sales fell 26 percent to $5.93 billion, missing the $6.13 billion average estimate.

Shares were up 5.9 percent to $80.88 before the start of regular trading in New York.

Standard equipment for the Short Disc 8000T includes 64 scalloped boron discs followed by a full width ‘V’ ring roller. Transport lights, hydraulic brakes and BKT flotation tyres coupled with a compact 3 Metre transport width make this machine fully road compatible.

A modest power requirement of 250HP enables operators to match productivity against efficiency. High work rates are achievable whilst maintaining working depths between 1.2cm (1/2″) to 7.6cm (3″).

T h e h e a v y d u t y, horizontally folding universal Tool Carrier allows operators to interchange implements to utilise the machine to its full capacity throughout the year.

The Short Disc 8000T will be available from January 2016 priced at £28,600 ex VAT. 41 | AGRI MECH | NOVEMBER 2015

NEWS

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ustomer and dealer reaction from the latest Kubota Insight Programme (KIP) has shown a clear desire from customers for closer links and more dialogue between the manufacturer, dealer and end user customer.

Now in its fifth year and ninth cycle, Kubota’s KIP is a European-wide, service-focused initiative where a team of Japanese service engineers fly to the UK (and five other European sales territories) for a week’s tour of selected dealerships and customers; giving the Kubota Japan staff the opportunity to gain first hand feedback from customers on the product range.

This the second visit in the 2015 programme drew to a close in late October, with the KIP team visiting dealers in Bedfordshire, Norfolk, Lincolnshire, Nottinghamshire and Staffordshire for a combination of ‘tractor clinics’ and on farm customer visits.

At each location, and for each individual tractor, the Kubota KIP team were tasked with carrying out an ‘overall’ product assessment, looking at important service related components, operations and adjustments to ensure the tractor was 100% functional and mechanically sound. If any issues were found present during the inspection the KIP team would then diagnose and correct the fault with help from the Kubota UK and dealer’s staff.

Upon completion of the KIP assessment, each tractor was power checked using a dynamometer and the outcome and conclusion of the KIP assessment explained to the owner/operator. Before concluding, an invitation to contribute personal experiences, preferences and to offer any desired improvements to the product was made to the owner/operator and their comments carefully recorded in order to provide guidance and inspiration for Kubota’s programme of continuous improvement and future design requirements.

The hands-on approach of Kubota UK staff and the willingness of the Japanese Service Engineers to travel to the UK was praised by dealers and customers alike. Tom Lockwood, Service Manager at Farmstar’s Newark depot commented: “We have a saying in our industry: sales sells the first tractor, service sells the second, and it’s true. I’ve got an eleven-year history with the Kubota brand through working here at Farmstar and service has always been key to customer satisfaction.

“The KIP visits that we’ve taken part in this week have been very well received by our customers. People appreciate some care and support from the manufacturer as well as the dealer, and it goes a very long way on Kubota’s part. People like to discuss their issues but also highlight the aspects of the product that they like as well. As a wider customer relations exercise, it’s a very good thing for the business, both from a dealer perspective and for the manufacturer.”

Keith Miller, Kubota UK’s Service & Training Manager added: “KIP is a really worthwhile exercise because it presents an invaluable opportunity for Kubota Japan to meet those working at the coalface in the industry. The end user customer works with our machines day-to-day, so they are best placed to feedback on usability.

He continued: “The tractor clinics and customer visits also present a great opportunity for Kubota Japan to gain insight and a better understanding of how UK dealers approach the service and the diagnostic process, which all contributes towards a better service offering for our customers.

“Service excellence and a commitment to unrivalled customer service is key to what Kubota stands for, and we’re delighted that we’ve received such positive praise from dealers, customers and from head office in Japan.”

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