Agricultural Planning

Fernando Bomfim Margarido1 and Fernando Santos2,    1Santelisa Vale, Brazil,    2Universidade Estadual do Rio Grande do Sul, Porto Alegre, RS, Brazil

According to the classical definition, it could be said that managing means planning, organizing, directing and controlling. On the basis of this definition, planning means deciding in advance what should be done for a particular purpose to be achieved, namely, to maximize agricultural and industrial yields and, thus, profits. That is the starting point for good management. Planning plays an important role in farming activities and it has taken on paramount relevance due to the expansion of areas planted with sugarcane, the influence of increased production, and the need to work to a budget. This chapter addresses planning through technical expertise aimed at operational practices. It is, therefore, a simplified view of planning.

Keywords

Sugarcane; Ethanol; Sugar; Planning; Agricultural

Introduction

Nowadays, management involves less risk than it used to. However, the responsibility involved is much greater, considering the technological processes surrounding an administrative decision. According to the classical definition, it could be said that managing means planning, organizing, directing and controlling. On the basis of this definition, planning means deciding in advance what should be done for a particular purpose to be achieved, namely, to maximize agricultural and industrial yield and, thus, profits. That is the starting point for good management.

The sugar and ethanol sector in Brazil is going through one of its best periods. There has been significant change in the sector’s dynamics resulting in reduced competitiveness among industrial units, expansion of cultivated areas and adjustments in strategies adopted by companies. This chapter addresses planning through technical expertise aimed at operational practices. It is, therefore, a simplified view of planning.

1.1 Planning

The main role of agricultural managers is to foment the activity. In simple terms, fomenting the agricultural activity means guaranteeing the supply of raw materials for the industry, which involves, in the case of sugarcane culture, agricultural production, soil conservation and preparation, planting, crop practices for cane-plants, harvesting, crop practices for the ratoon and supplying mills with raw material during the harvest period. Such supply relates not only to the total quantity of cane to be crushed over the harvest period, but also the constant hourly supply, involving the concept of logistics throughout the plantation, observing machinery size and personnel availability. The agricultural production system is relevant for strategic planning in industrial units, so as to anticipate production, storage and marketing of final products.

According to Pinazza (1985), high productivity levels derive from four basic types of factors: physical, structural, institutional and development factors. Physical factors represent the edaphic and climatic conditions of a region and agricultural production. Institutional factors involve government action by means of implementation of agricultural policies. Development factors are related to the research system, and to what extent knowledge generates increased productivity. Structural factors refer to the management system adopted, and have a decisive influence on the strategic and operational performance of mills and distilleries.

Agricultural planning observes industrial planning, therefore, the starting point is the amount one plans to process along the next three growing seasons. It is important to take into account that the agricultural sector requires planning at least 2 years ahead, since it is necessary to arrange partnership agreements, prepare the soil and wait for harvest time – on average, the first cut is carried out 1½ years after planting.

1.1.1 Planning for Planting

In agricultural planning, it is important to know the productive potential of the region vis-à-vis climate, soil quality and resources available for production (use of vinasse, irrigation and fertilization). This information is especially necessary for the introduction of a new unit. When a unit is already in operation, one can look at productivity history over the last 5 or 6 years. Historical data older than 10 years are not pertinent, since varieties will not behave in the same way after such a period.

The technical area is very important as, at this point, it is necessary to survey the amount of arable land available at the various properties, their productive potential, the opportunities to purchase raw materials in regional markets, the options of land renting or production partnerships; in addition, the technical area should analyze the edaphic zoning (per production environment), topography (feasibility of mechanical harvesting), climate characteristics in the region (temperature, rainfall, light, photoperiod, water balance, frost) and the region’s road system, anticipating the flow of production. In some cases, these factors make it unfeasible to locate a production unit in a particular area, for example, where high toll fees would increase transportation costs, or areas with a ban on sugarcane burning (as of 2012, in the State of São Paulo) on slopes with over 12% gradient or with the presence of stones. It should be noted that, for sugarcane production in the past, soil fertility was the sole determinant of land value, but currently, topography and presence of obstacles in the area are also determining factors.

Table 1.1 shows an example of a balanced sugarcane plantation, considering theoretical average productivity of the site and areas with equal size in each category of cutting.

Table 1.2 considers that first cut sugarcane has been used for planting and that 1 ha produces seedlings to plant 7 ha. It should be noted that, in this case, the area where the first cut took place was smaller.

For a better picture of agricultural planning, we will use as an example the construction of a new industrial unit with overall capacity to crush 2,000,000 t of sugarcane, and daily crushing capacity of 12,000 t. In this case, several factors should be considered in planning, such as physical, edaphic and climate conditions in the region, planting system, crop practices and harvesting.

Tables 1.3 to 1.11 refer to a planting plan aimed at crushing 2,000,000 t within 5 years. In this case, initial planting is large (7500 ha), decreasing slightly in the second and third years (5000 ha) and stabilizing in the fourth year (4100 ha). The technical manager in charge of planning can easily use an Excel spreadsheet to make projections, change planting areas and productivity to obtain yearly production values.