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(Reference retrieved automatically from Web of Science through information on FAPESP grant and its corresponding number as mentioned in the publication by the authors.)

Crop Diversification Strategy to Improve Economic Value in Brazilian Sugarcane Production

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Author(s):
de Moraes Farinelli, Juliana Borba [1] ; Lopes Santos, David Ferreira [1] ; Fernandes, Carolina [1] ; Honorato Fernandes, Mariele Monique [1] ; da Silva, Matheus Flavio [1]
Total Authors: 5
Affiliation:
[1] Sao Paulo State Univ UNESP, Sch Agr & Veterinarian Sci, Via Acesso Prof Paulo Donato Castellane S-N, BR-14884900 Jaboticabal, SP - Brazil
Total Affiliations: 1
Document type: Journal article
Source: AGRONOMY JOURNAL; v. 110, n. 4, p. 1402-1411, JUL-AUG 2018.
Web of Science Citations: 0
Abstract

Crop diversity is beneficial to rural properties in terms of reducing business risks and increasing agricultural revenues. In sugarcane (Saccharum spp) farming, crop diversity using rotation or succession planting remains a paradigm for rural producers, largely because the productive cycle of sugarcane differs from that of annual crops, obliging farmers to grow it for between 4 and 6 yr to compensate for the high initial investment in planting. Sugarcane producers in Brazil only plant another crop at the end of the cycle to renew the plantation. The present study questions this paradigm by using the real options theory to capture the value of managerial flexibility in diversifying production to minimize risk and increase revenue by alternating between sugarcane and soybean (Glycine max) crops, considering a polynomial model that combines market and yield volatility. To that end, the research data were based on an experiment performed over 6 yr using different sugarcane succession systems on a rural property in the region of Jaboticabal, Sao Paulo, Brazil. Results suggest that succession planting of soybean/crotalaria/soybean/sugarcane exhibited the best agronomic and economic-financial performance and that diversifying crops using the portfolio theory increased the value of the project. Greater return on investment was obtained by replacing sugarcane with soybean, making it possible to opt for the crop change at the third cane cutting, a completely new scenario in Brazil, the largest sugarcane producer in the world. (AU)

FAPESP's process: 11/06491-0 - Soil uses during the interval between two sugarcane growth periods in order to diversify crops and improve the productive soil capacity for the next sugarcane growth period
Grantee:Carolina Fernandes
Support Opportunities: Regular Research Grants