Agricultural Business Profile on Broccoli

Agdex 888/252 Agricultural Business Profile on Broccoli April 1999 This profile has been compiled as a source of information for those who may be considering the production and/or processing of broccoli as a commercial venture. The reader is cautioned that the information provided should be considered only a starting point. It is not a substitute for a business plan; a business plan incorporates specific information unique to the investor. The preparation and evaluation of a business plan is a critical step that must be taken before any significant investment is made. While every effort has been made to ensure the accuracy of the information provided, the reader is further cautioned that information critical to his or her business plan should be verified. Particular attention should be paid to information that may become dated. Abstract Broccoli is a common cole crop that is well adapted to growth in the Atlantic provinces. It requires high levels of inputs, particularly labour, and has a low margin for profit. Broccoli is primarily marketed fresh or frozen and is an excellent source of Vitamin A, potassium, folacin, iron, phosphorus, calcium and fibre. Broccoli also contains chemicals which can help prevent carcinogens from forming in the body. Currently there appears to be limited potential for increased broccoli production on PEI, especially for the fresh market. Individual farms, however, may be successful in obtaining contracts with a processor, or may be able to develop small, niche markets for specialty or value-added broccoli products. Background Broccoli is a member of the Cruciferae or cole crop family and thus is related to cabbage, cauliflower and brussels sprouts. Cole crops are biennials but are generally grown as annuals. There are two main types of broccoli: sprouting/Italian broccoli (Brassica Oleracea Italica) the most common, and heading broccoli (Brassica Oleracea). The name broccoli comes from the Italian word “brocco,” meaning branch or arm. Broccoli has been around for over 2000 years. It was a favourite food of the ancient Romans and has been grown in France and Italy since the 1500's and in England since the early 1700's. Little was known about this vegetable until the 1920's when it was first grown commercially in New York by immigrants from Italy. Broccoli is rich in vitamins and minerals. It is a good source of Vitamins A and C, potassium, Agricultural B usiness P rofile on Broccoli 1 PEI D epartment of Agriculture and Forestry folacin, iron, phosphorus and fibre. One ounce of broccoli has as much calcium as one ounce of milk. Broccoli also contains important phytochemicals such as beta-carotene, indoles and isothiocyanate that help prevent carcinogens from forming in the body. Broccoli production is well suited to the cool moist climate of the Maritime region. Broccoli and other cole crops are important to vegetable production in the Atlantic area for the fresh market and to some degree for processing. Consumption of both fresh and frozen broccoli is increasing in North America. Approximately 10 to 20 hectares of broccoli are grown in PEI each year1 for the fresh market. In the Maritime provinces, approximately 350 hectares of broccoli are grown each year. Broccoli consumption has increased over 200 percent in Canada in the last 15 years2 and has increased over 900 percent in the US in the last 20 years3. Per capita consumption of broccoli in Canada averaged 3.14 kg in 1996. Production Climatic Requirements: Broccoli is well adapted to cool season production and grows best in areas with a cool, wet climate and moist soils, such as the Atlantic provinces. Broccoli plants are quite cold tolerant, although not to the same extent as cabbage. High summer temperatures delay maturity and increase the vegetative growth (number of leaves), while cool temperatures hasten maturity and may induce bolting. Cultural Practices: Most of the broccoli grown in Atlantic Canada is produced from plants which are started in greenhouses and later transplanted to the field. Five to six weeks are required to produce transplants in the greenhouse. Young plants with four to five leaves are generally superior to older ones for transplanting. Hardened plants from the greenhouse are transplanted in the field, either by hand or by mechanical transplanter, at a row spacing of 60 to 90 cm, with a plant spacing of 30 to 40 cm within rows. At this spacing approximately 120 to 140 grams of seed should produce enough transplants for one acre. Newer compact hybrids may be grown at closer spacings than the older traditional cultivars. Transplants can generally be planted in the field as early as four to six weeks prior to the last spring frost and should not be planted later than the end of July. The actual planting date will depend on the target harvest date. Broccoli plants generally take from 70 to 90 days to reach maturity, depending on variety and the season. Direct seeding has been attempted in the region with relatively good results, particularly for later harvest dates; however, cool temperatures early in the season may cause bolting. Also, germination is often a problem with direct seeding of small seeded crops such as broccoli. Plants for later crops may also be started in module trays or field seed beds. Broccoli seed can be sized or pelleted for precision seeding of module trays or for direct seeding. When direct seeding is used, 220 to 340 grams of seed per acre are required since seed is generally planted at half the desired plant spacing to ensure adequate plant numbers. Seed should be planted 0.6 to 1.2 cm deep. Direct seeding should be done two to three weeks earlier than transplanting for the same Agricultural B usiness P rofile on Broccoli 2 PEI D epartment of Agriculture and Forestry harvest date. Generally, broccoli should not be direct seeded after mid- to late June. For broccoli crops which will be ready for harvest during hot, humid weather, plant spacings should be at the wider end of the range to help reduce head rot. For bed culture of broccoli, rows may be spaced closer together and plants spaced further apart, as risk of disease is lower. The actual spacing depends on the cultivar, fertility program, size of the crop desired for market, and the target maturity date. Broccoli is susceptible to several physiological disorders which can reduce yields and affect quality of the product. Broccoli buttoning is the premature formation of a head which results in leaves which are not large enough to nourish the head to a marketable size. Buttoning is influenced by a number of factors, including: cultivar; under- or over-hardening of greenhouse plants; low soil nitrogen; low soil moisture; extended cold weather; disease; insects; or micronutrient deficiencies. Hollow stem, another physiological disorder, starts with gaps that develop in the stem tissues and gradually enlarge to create a hollow stem. Hollow stem incidence is influenced by plant spacing and soil nitrogen level. Steady, even growth of the broccoli crop is necessary for high quality and yields. The availability of water can be critical to successful production. Irrigation may help provide a constant, steady water supply, particularly during dry years. Fertilizers can also be applied through the irrigation system. Good management of a broccoli crop involves crop rotation. The frequency of production of cole crops, turnips, rutabagas or radish in a particular field should be restricted to one year out of every four to seven. This rotation is very important for the prevention of an infestation of insects and diseases, especially clubroot, a soil borne disease which affects all cruciferous crops. Control of cruciferous weeds4 is also important to reduce risk of clubroot infestation. Cultivar selection is very important, as different varieties are often preferred for the fresh or frozen markets. In addition to market demand, producers should consider disease resistance, resistance to bolting and the length of growing season. Land Suitability: Broccoli requires soils that can provide a continuous source of water throughout the season. Soil organic matter of three percent or higher is preferable. Well drained, sandy loam soils are well suited to early varieties while loam and clay-loam soils are better suited to later cultivars, which are somewhat tolerant to poorer drainage. Well-drained soils can have shorter rotations than heavier soils, as clubroot thrives in wetter soils. Fertility: Broccoli, along with other cole crops, is considered a high fertility crop. Good management practices are essential if optimum fertilizer responses are to be achieved. These practices include: the use of recommended varieties; selection of adapted soils; good weed, disease and insect control; good seedbed preparation; proper seeding methods; and timely harvest. Because of the influence of soil type, climatic conditions, and other cultural practices, 3 Agricultural B usiness P rofile on Broccoli PEI D epartment of Agriculture and Forestry crop responses from fertilizer may be difficult to predict. Soil test results, field experience, and knowledge of specific crop requirements can help determine the nutrients needed and the rate of application. Producers should be aware of the potential for runoff after heavy applications of fertilizers. Soil pH should be maintained in the range 5.8 to 6.5 through applications of lime. Fertilizer application should insure adequate levels of all nutrients and starter fertilizers high in phosphorus are recommended. Cole crops are not as responsive to potash as to nitrogen, and on soils high in potassium, no additional potassium may be needed. Usually nitrogen, phosphorus, and potassium are broadcast and incorporated into the soil before planting; however, potassium can be harrowed into the soil before planting and the nitrogen and phosphorus may be banded at planting. A side dressing of nitrogen is usually applied during the growing season. Broccoli also requires sufficient levels of micronutrients, particularly Boron, to produce good yields and a high quality product. Micronutrient deficiencies can result in physiological disorders, discoloration of heads, poor growth and reduced yields. Pest Control: Weed control is important for production of quality broccoli. Proper identification of problem weed species should be made prior to deciding on a control measure. Any cultivation and hoeing should be shallow to minimize damage to the roots. For the latest herbicide recommendations, consult the current Guide to Weed Control (Publication 75)5. Producers should also be aware of the potential for crop damage due to residues of herbicides applied for other crops in the previous season. The most troublesome insects on broccoli in PEI include tarnished plant bugs, thrips, cabbage loopers, cabbage root maggots (especially with early season plantings) and imported cabbage worms. Flea beetles and aphids can also be a concern. Fields should be scouted on a regular basis to identify and locate insect outbreaks in the crop. The use of recommended insecticides will help reduce insect damage. Formulations of Bacillus thurengiensis are effective against Cabbage Loopers, the Imported Cabbage Worm and Diamondback Moths, particularly at the young caterpillar stage. For specific information on insecticides, see Publication 1400A, Guide to Cultivar Selection and Chemical Pest Control6. Clubroot, the main disease affecting broccoli, is a soil-borne disease that can infect all cruciferous crops and weed species. The organism responsible for clubroot can cause severe swelling or deformity of the roots which will result in wilting and death of the plant. This disease is a major problem in cases where poor crop management practices, especially poor crop rotations, are followed. The potential for clubroot infestation is greater in moist, acid soil conditions. The clubroot organism, once present, can remain in soils for up to seven years. Practices to control clubroot include: the use of good crop rotations; the control of cruciferous weeds; restricting broccoli production to well-drained soils with a pH as near neutral as possible; and the use clubroot-free transplants. Agricultural B usiness P rofile on Broccoli 4 PEI D epartment of Agriculture and Forestry The main foliar diseases of broccoli include downy mildew and Alternaria leaf spot. Often fungicides are added to the transplant water to help prevent downy mildew. Otherwise control methods usually are not warranted. Head rot, another disease that affects broccoli, can be minimized through variety selection and the utilization of wider plant spacings, particularly for varieties that will be maturing for harvest during hot, humid weather. For specific information on fungicides, see Publication 1400A, Guide to Cultivar Selection and Chemical Pest Control. Harvest, Storage and Handling: The marketable portion of the broccoli plant consists of the upper stem and the clusters of unopened flower buds or florets. It is vital that broccoli be harvested at the correct stage of maturity. The heads must be picked before the buds open and when the bud-clusters are still compact. Yellow buds and loose clusters decrease the quality of the product. Over maturity is indicated by woodiness in the outer stem tissue, loosening and separation of the flower clusters, and partial opening of the flowers, showing a yellow colour. Such heads are not marketable. The central or terminal heads of the broccoli plant mature first. When mature, the central heads can measure 5 to 25 cm across and may weigh 300 to 600 grams each, depending on variety. For fresh markets, the heads are usually harvested with about 15 cm of the stem attached. The foliage is removed prior to packing. Variability within a variety in a field can result in central heads that mature over a two-week period. Thus, several passes through a field are required to obtain all of the marketable heads. Good management and good growing conditions should result in average yields of between 6500 to 9000 kg per hectare. Once the central head is removed, the growth of the lateral is promoted. The laterals, also known as spears, develop unevenly and cannot all be harvested at one time. Maintaining good growing conditions beyond the harvest of the central head can result in the continued development of the lateral until frost. Second and third commercial harvests of the laterals is sometimes possible, although generally not feasible due to high labour costs for a relatively small yield. Because broccoli is very perishable, it should be transported to the packing shed and immediately cooled. Heads can be bunched and tied, and if required, can be done either prior to cooling, after cooling or prior to shipping. Since the quality of harvested heads quickly declines (heads wilt rapidly and turn yellow), broccoli should be marketed as soon as possible after harvest. Rapid cooling to near 0/C and refrigeration is essential for broccoli being held for shipment. Broccoli held with adequate air circulation and spacing between containers should keep satisfactorily for 10 to14 days if held at 0/C and between 90% to 95% humidity. In less than optimum conditions broccoli heads may wither after one day. Broccoli can be hydrocooled (immersed in cold water) or packed in ice to lower its temperature and preserve the quality. Broccoli should not be stored with fruits such as apples or pears which produce large quantities of ethylene gas, which accelerates yellowing of the heads. 5 Agricultural B usiness P rofile on Broccoli PEI D epartment of Agriculture and Forestry Specialized Equipment Needs: There is little specialized broccoli production equipment available. Equipment used by many vegetable growers, can also be used with this crop. Slight modifications may be made to customize existing cultivation or spraying equipment for the broccoli crop. Harvesting can be slightly mechanized through the use of several machines. The most common harvesting aid is a conveyor which is mounted on a tractor and travels perpendicular to the rows. The conveyor delivers hand-cut product to a wagon where a worker can grade and/or pack the heads into cartons or bulk bins to be hauled to the packing/cooling area. Marketing Markets: Broccoli is marketed either fresh or in a processed (usually frozen) form. Although broccoli is often sold on PEI as a single head, most broccoli intended for fresh consumption is sold in bunches of two to three heads tied together with rubber bands or twist-ties and weighing approximately 0.6 kg. Broccoli is most often packed in a standard waxed carton with14 to 18 bunches per carton (14's or 18's), for a net weight of 20 to 24 pounds; but can also be sold as 20's or 22's, depending on the customer’s preference. Broccoli can also be sold as caps or crown-cut, which is a single head of approximately 13 cm. in diameter with little or no stalk attached. Broccoli spears and diced stalks also are a saleable product in some markets. Customers expect broccoli to be clean, trimmed, graded for consistent size and colour, and with tight heads. For medium- to long-distance hauling of fresh broccoli, icing and refrigerated transportation are essential. Most wholesalers and supermarkets expect all broccoli to be iced for delivery. Frozen broccoli is usually marketed as florets, spears, or diced stalks. However, other products include mini broccoli and blends of florets and stalks, sometimes combined with other vegetables. Frozen broccoli is often sold under the processor’s own brand or as retail chain brands. Processors usually purchase fresh cut broccoli (stalk alone or heads and stalk material); fresh florets (stalk length must not exceed one half the florets width); or fresh broccoli spears (7.5 to 15 cm long with uniform shape). All material must be from fresh, sound plants from approved varieties, be uniform in size, colour and maturity and be relatively free from defects. There is no tolerance for foreign material of any nature, including insects, grit or decay. For cut broccoli, there is usually a requirement for a minimum of 35% floret material and a maximum of 65% stalk. All products are steam blanched prior to freezing to help the product retain its colour. Broccoli for processing is contracted by the processor, often with minimum volume requirements. However, opportunities for selling broccoli for processing is decreasing, as several large processors are now purchasing prefrozen broccoli from Mexico for packaging. Competition: Locally grown broccoli is available in the Atlantic region from late July through to the end of October. Currently, between 10 to 20 hectares of broccoli are grown in PEI each year, with all of this production going into the fresh market. In 1998 Nova Scotia produced Agricultural B usiness P rofile on Broccoli 6 PEI D epartment of Agriculture and Forestry approximately 200 hectares of broccoli, most of which also went to the fresh market. New Brunswick produced 130 hectares of broccoli in 1998. However, the vast majority of that production was processed by McCains with the remainder being grown by operations producing only 1-1.5 hectares each for the local fresh market. Since it has such a short shelf-life, broccoli for out-of-season use is obtained from the vegetable producing areas of the western US and Mexico. Over 90 percent of broccoli grown in the US is grown in California and Arizona, where it can be produced year-round. It is important to realize that PEI product is available when all other broccoli producing areas in Canada and the US also have an abundance of product. For this reason, coupled with the high cost of trucking and the difficulty in breaking into new markets, there is limited potential for expansion in broccoli production for the traditional fresh market (crown cut, bunched, spears), either locally or for export. Although most processors have established suppliers and the contract is often dependent on price, quantity of product available, and quality, there may be some potential for individuals or groups of producers to obtain contracts to sell to processors. This market will be a challenge since processors are able to obtain pre-frozen broccoli from Mexico at a competitive price. Expansion of broccoli production on PEI is dependent on the potential for sale of a value- added product. Since the market share for floreted7 products appears to be growing, there may be more potential for sale of value-added (ie: hydrocooled, floreted, boxed and iced) broccoli, than for the traditional bunched or crown cut products. Facilities exist in PEI which could produce valueadded broccoli products (floreted, cooled and packaged) for the fresh market or for sale to the large processors8. It should be noted that Prince Edward Island, with its cool, wet growing season ideal for broccoli production, has the ability to produce a high quality product with yields comparable to other broccoli growing areas. More research into suitability of new varieties, particularly for processing use, is required, as only varieties for the fresh market have been grown here in recent years. Market Considerations: Producers who are considering broccoli production must be prepared to spend significant time and effort researching the market and finding ways to access it. Ensuring quality from the farm to the consumer is the most important factor in fresh vegetable marketing. Since product appearance has a major effect on the consumers willingness to purchase the product, particular attention must be given to uniformity of shape, size, colour, and maturity. The product must be free from defects, wilting and dirt. Harvesting early to ensure a tender texture is also important. These factors are also important to processors. Marketing activities for broccoli could include the development of small speciality markets; for example, fresh broccoli spears, diced stalks, or small packs of florets for salads. Growers need to visit customers and market the product based on its own specification and price merits. 7 Agricultural B usiness P rofile on Broccoli PEI D epartment of Agriculture and Forestry Many companies selling produce are positioning themselves to take advantage of global markets due to changing consumer trends. Innovative uses for vegetables is now an important part of the freshcut industry. Providing premium whole and value-added products that meet customer needs has become the focus of many progressive produce firms. Research Broccoli contains important plant chemicals, or phytochemicals and is an excellent source of antioxidants such as beta-carotene, sulforaphane and indole-3-carbinol. Broccoli is also high in compounds such as indoles and isothiocyanate which are currently being tested as enzyme systems enhancers of the body that fight cancer and cancer causing toxins. There are currently several medicinal products commercially available in North America which contain broccoli extracts for their antioxidant properties. Processing Since limited opportunities exist for the sale of fresh, cooled product, adding value to the raw commodity will be essential. Markets could be sought for floreted, cooled broccoli, as is being done for cauliflower by one local business. As well, the potential for sale of frozen broccoli products such as cut broccoli, florets, diced stalks or spears could be investigated. Freezing Broccoli: Broccoli florets and stalks are suitable for individual quick freezing (IQF), and broccoli spears are suitable as a wet pack (block frozen). For freezing, the harvested broccoli must first be trimmed, cleaned and hydrocooled. It is visually inspected for colour, size, maturity, foreign material and defects, and then spray washed. The broccoli must be sorted and cut (if this is done mechanically then an orientation machine may be required), then blanched to inactivate the peroxidase enzyme system for longer storage life. Next, it is frozen either in a batch blast freezer or an IQF freezer unit. Professional advice on the exact process should be sought. Other considerations may include microbial testing, nutritional labeling and working with food scientists to pilot the process prior to setting up for commercial production. Table 1. Estimated Processing Equipment Costs9: Hydrocool tank High pressure spray washer Sorter/cutter + orientation machine Batch blancher Batch blast freezer (IQF) Total Agricultural B usiness P rofile on Broccoli $ 3,000 5,000 50,000 10,000 10,000 30,000 $107,000 8 PEI D epartment of Agriculture and Forestry Additional costs could include the building that houses the processing line; conveyors and forklifts to move product; packaging units; and, unless the product is being shipped immediately, cold storage facilities would also be needed. To help cover the overhead of the investment in equipment, processing other products in the same facility should be considered. As well, leasing of the processing equipment should be considered for smaller operations. Those interested in processing should also look at existing operations in the region that may have excess processing capabilities. Examples of Value-Added Products: - block frozen spears - Modified Atmosphere Packaged (MAP) florets - broccoli coleslaw - broccoli sprouts - baby broccoli - bite size broccoli for salad packs - broccoli pickles Human Resources Broccoli is a crop which requires high levels of labour, particularly during transplanting and harvest. These activities can be mechanized to some degree, but manual labour needs will remain high. All of the manual jobs are physically demanding. Harvest workers must have the skills to be able to identify marketable product. Depending on the scale of the operation, availability of labour may be a concern. Large numbers of workers are required for short periods during planting, hand weeding (if necessary) and harvest and for trimming and packing heads after harvest. Wage rates would be in the range of $6 to $9 per hour, with tractor and truck operators possibly receiving slightly more. Producers should also be aware that in addition to the base wage, additional labour costs will include the employers’ contributions to Canada Pension Plan (CPP) and Employment Insurance (EI). Participation in the Workers Compensation Plan (WCP) should also be considered. The 1999 cost for vegetable farm workers under WCP is $3.86 per $100 of payroll. Management skills, standard for any small business, would be needed by the manager of a broccoli enterprise. See CFBMC Canadian Framework for Effective Business Management Practices, available from the Canadian Farm Business Management Council, for more Agricultural B usiness P rofile on Broccoli 9 PEI D epartment of Agriculture and Forestry information. Regulatory Issues There are no regulatory issues that apply specifically to broccoli. A prospective investor should be aware of a number of Acts which apply to agriculture. Pesticides Control Act - Anyone purchasing and/or applying pesticides, with the exception of domestically-labeled products, must be certified under this Act. Environmental Protection Act - Anyone wishing to irrigate, by drawing water from a watercourse or well, must have a permit under this Act. If a stream crossing is required to access a field or property, a permit must be obtained under this Act. Also, regulations regarding buffer zones between row crop production and watercourses should be followed. Roads Act - Anyone who intends to install a new highway access (or change an existing access) to a production field requires a permit under this Act. Canada Agricultural Products Act - Anyone wishing to market fresh produce interprovincially must be in compliance with this Federal Act with respect to import and interprovincial trade. Food and Drug Act - Anyone selling broccoli should be concerned with this Federal Act with respect to agricultural chemical residues, food additives, labeling and processing. Occupational Health and Safety Act - At the present time, farming operations which are located on property that qualifies for a farm assessment under the Real Property Assessment Act are not subject to the requirements of the Occupational Health and Safety Act and Regulations. However, the Act and Regulations can provide excellent guidance on worker health and safety issues. Manure Spreading Guidelines - While not covered by an act or regulations, the spreading of manure is covered by Guidelines for Manure Management for Prince Edward Island published in 1999. Costs Setup Costs: Setup costs for a broccoli enterprise would include land, land improvements, buildings and machinery as detailed in Table 2. The costs are priced as for new equipment; costs for used equipment would be less. For existing operations with access to some of the equipment listed, investment in machinery would be less. The use of custom operators to provide some would further reduce additional machinery purchases. Agricultural B usiness P rofile on Broccoli 10 PEI D epartment of Agriculture and Forestry The land values and prices will depend on location and circumstances of the existing operation. If land must be purchased, capital cost could range from $2,500 to $10,000 per hectare. If broccoli production is to be part of an existing operation, then land purchase may not be required. Due to the wide range of possible scenarios, land costs are not included in these cost estimates. Land improvements are generally limited to initial land preparation. These are outlined in Table 3. A building would be needed to serve as a receiving/packing shed. This would be an area where product could be received from the field and trimmed, hydrocooled, packaged and loaded onto trucks. Depending on the extent of on-farm handling, a refrigerated storage area may be required as well. An adequate water source for cooling would be required. Building and cooling facility requirements will be determined by the scale of operations and the distance to markets. Table 2. Potential machinery and building costs. tractor (45hp) tractor (45hp), with loader plow harrow transplanter cultivator sprayer wagons (2) harvester conveyor tote boxes (10) pallet jack truck receiving shed cooling facility misc. handling equipment Total $ 30,000 35,000 3,000 2,000 10,000 2,000 4,000 3,300 5,000 1,000 600 20,000 15,000 5,000 3,000 $ 138,900 Potential Returns and Expenses: There is little information available on the returns and expenses for broccoli production on Prince Edward Island. Interested persons must be prepared to conduct research and carefully estimate setup and operating costs, as well as market prices. For broccoli, the time required from planting until the crop generates revenue is one season. In Table 3, many of the costs have been estimated by using custom work rates. 11 Agricultural B usiness P rofile on Broccoli PEI D epartment of Agriculture and Forestry Table 3. Estimated Costs of Production for one hectare of Broccoli. Broccoli Production for Fresh Market (Based on 1 hectare production) Income broccoli (7600 kg @ $0.95/kg) Direct Expenses Transplants (25,000) Fertilizer 10-10-10+ 2B (1T ) 34-0-0 topdress (0.10% ) Lime (2T every three yrs) Pesticides herbicide (TRE FLAN @4 .75L) herbicide (ROU ND UP@ 2.5L) insecticides (x5) 152.00 fungicide Labour (avg $8/hr) land preparation (2.0 hr) transplanting (4 x 5 hrs) spraying (7 x 2.5 hr) fertilizer spreading (0.6 hr) cultivation (2.5 hr) harvest (15 hrs x 6) trimming/packing (7.5 hrs) Field work (machinery rental @$ 15/hr) land preparation (2.0 hr) transplanting (2 x 5 hrs) spraying (7 x 2.5 hr) fertilizer spreading (0.6 hr) cultivation (5 hrs) harvest (12.5 hrs x 2) Boxes (non reusable @ 1.30 ea) Ice Tota l Direct E xpenses Contribution Margin $ 7220.00 $ 1016.00 356.00 38.00 38.00 68.00 24.00 50.00 16.00 163.00 142.00 5.00 20.00 732.00 61.00 30.00 152.00 267.00 9.50 76.00 381.00 1189.00 508.00 $ 5491.50 $ 1728.50 This budget is provided as a guideline only. Interested growers must develop their own set of figures for business planning purposes. The Contribution Margin must provide funds for processing and trucking along with interest, overhead and o ther indirect expenses, as we ll as for living e xpenses, loa n repayments and future investment in the business. The budget in Table 3 is provided as a guideline only. Interested growers must develop their own set of figures for business planning purposes. Agricultural B usiness P rofile on Broccoli 12 PEI D epartment of Agriculture and Forestry Key Management Issues10 It is essential that the following questions concerning production, marketing and management be answered if an individual or company is planning to continue to investigate broccoli production. 1) Are you prepared to develop a complete business plan for a broccoli operation and to test this plan on an affordable scale? 2) Are you prepared to learn all you can about broccoli production and marketing through visits to existing operations, workshops and reading all available materials about production and marketing of the crop? 3) Have you clearly identified the market(s) and the buyer(s) as well as the marketing activities for each segment of the market? 4) Have you clearly identified the crop production practices you will need to put into place to produce the quality of product required by the markets? 5) Have you defined the amount of time you will have to contribute to the continuous marketing of your product and to the improvement of your production performance? 6) Are you aware of the resources required to establish a broccoli enterprise of the scale you plan to set up, and the returns that can be expected? 7) Above all, are you prepared to take the risks associated with broccoli production? Resources PEI Department of Agriculture and Forestry Agriculture Resources Team Charlottetown Research Center 440 University Avenue Charlottetown, PEI C1A 7N3 1-800-959-8929 Farm Business Management Charlottetown Research Center 440 University Avenue Charlottetown, PEI C1A 7N3 902-368-5655 Enterprise PEI Food Division Agricultural B usiness P rofile on Broccoli 25 University Avenue P.O. Box 910 Charlottetown, PEI C1A 7L9 902-368-6300 Trade Development Centre 2nd Floor, 75 Fitzroy Street Charlottetown, PEI C1A 1R6 902-566-7382 Prince Edward Island Food Technology Center 101 Belvedere Avenue P.O. Box 2000 Charlottetown, PEI C1A 7N8 902-368-5548 Canada/Prince Edward Island Business 13 PEI D epartment of Agriculture and Forestry Services Centre 75 Fitzroy Street P.O. Box 40 Charlottetown, PEI C1A 7K2 1-800-668-1010 Atlantic Canada Opportunities Agency 100 Sydney Street P.O. Box 40 Charlottetown, PEI C1A 7K2 1-800-871-2596 Agriculture and Agni-Food Canada Market and Industry Services Branch 440 University Avenue Charlottetown, PEI C1A 4N6 902-566-7300 National Research Council 20 Watts Avenue West Royalty Industrial Mall Charlottetown, PEI 902-566-7640 Business Planning for Agriculture Ventures 1-888-322-2728 Local contact: Beaton Fitzpatrick Murray Chartered Accountants 902-892-5365 Business Development Bank of Canada BDC Place 111 Kent Street P.O. Box 488, Charlottetown PEI C1A 7L1 902-566-7454 Endnotes 1. PEI Vegetable Growers Co-op. Interview. 1999. 2. Statistics Canada - Cat. No. 32-230-XPB, 1996. 3. Mann Packing Co. Interview. 1999. 4. Cruciferous weeds are those in the mustard family and include wild radish, wild mustard, shepherd’s purse, yellow rocket and others. 5. Ontario Ministry of Agriculture, Food and Rural Affairs. “Guide To Weed Control” Publication 75. 1999 6. Atlantic Provinces Agricultural Services Coordinating Committee. Guide to Pest Management. Publication 1400A. 1996 7. Atlantic Provinces Agricultural Services Coordinating Committee. Guide to Pest Management. Publication 1400A. 1996 8. Island Quality Vegetables. Interview. 1999. 9. PEI Food Technology Centre, 1998. 10. Alberta Agriculture. Adapted from AG-Ventures Agricultural Business Profiles. Sources of Information Atlantic Provinces Agricultural Services Coordinating Committee. “Vegetable Production Guide for the Atlantic Provinces”. Publication 1400. Agdex 250. Agricultural B usiness P rofile on Broccoli 14 PEI D epartment of Agriculture and Forestry Atlantic Provinces Agricultural Services Coordinating Committee. “Vegetable Crops - Guide To Past Management” - Publication 1400A. Agdex 250. Postharvest Technology Research and Information Centre. 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