Characteristics of Diversified Farming

Characteristics of Diversified Farming

Characteristics of diversified farming have been briefly explained below. These characteristics include the cultivation of cash crops, use of technology, limited profitability, labor employment and access to credit facilities.

1.   Cash Corps Cultivation

First characteristic of diversified farming is cultivation of Cash crops like vegetable, tobacco etc. in subsistence farming only few staple are cultivated for family use. Thus we can say that diversified farming is a profit based farming, while subsistence farming was need based farming.

2.   Diversification of Risk

Diversification of risk associated with staple product failure is another important characteristic of diversified farming. In diversification farming farmer can bear the losses incurred in a particular cultivation, because they have chance to earn profit in other corp. cultivation (risk is diversified).

3.   Use of Technology & Fertilizers

Second characteristic of diversified farming is use of technology and fertilizer in the farming. Tractor and other basic machinery are used in diversified farming tractor, it is to be noted that high capital investment is not feature of diversified farming.

4.   Profits

Profitability is another characteristic of diversified farming. However, these profits are lower than corporate farming. Thus profitability is important aspect to divide farming into different categories.

a)    Subsistence farming- no profit objectives.

b)   Diversified farming – limited profitability objectives.

c)    Corporate farming- profit maximization is objective.

5.   Labor is employed

Another important characteristic of diversified farming is the employment of labour during the whole year. We know that in subsistence farming labour was employed only during the season of cultivation.

6.   Access to Credit Facilities

Another key characteristic of diversified farming is access to credit facilities. In subsistence farming the farmer were not interested to take credit from the market.

7.   Step to Corporate Farming

Diversified farming is said to be first step toward corporate farming.

We have briefly explained the characteristics of diversified farming. These characteristics clearly indicate that diversified farming is quite different from the subsistence and corporate farming.

Characteristics of Corporate Farming

Characteristics of Corporate Farming

Characteristics of corporate farming have been briefly explained below. These characteristics include production of various corps, capital investment, use of premium quality fertilizer, profit maximization etc.

1.   Range of Corps

First characteristic of corporate farming is cultivation of range of products. In corporate farming a range of crops are produced. These corps includes the staple corps (wheat, rice etc) and cash corps (Vegetable, Tobacco etc).

2.   Capital Investment

Second characteristic of corporate farming is huge investment in the business of farming. Advanced machinery is used in corporate farming to improve productivity & efficiency.

3.   Premium Fertilizers & biological techniques.

One of the important characteristics of corporate farming is use of premium quality fertilizer and biological techniques in farming. This type of farming heavily rely on the improved seeds.

4.   Economies of Scale

Third important characteristic of corporate farming is Economies of scale. Large output result in economies of scale. This is one of the fundamental characteristic of corporate farming.

5.   Big Farms

One of the important characteristic of corporate farming is use of big farms for the cultivation to attain economies of scale. It is to be noted that large farms can only be acquired by a corporate entity.

6.   Organized Business

Corporate Farming is managed as organized business. Professional manager and agriculture expert is part of management team. All decisions are made by the professional in professional manner. Organized management is a key characteristic of corporate farming.

7.   High profitability

Reasonable profit or high profit from the farming is another important characteristic of corporate farming. Profitability is one of the important characteristic of corporate farming.

8.   Products are properly marketed

In corporate farming marketing of product is an important aspect, because marketing has direct linkage with profitability. Products are sold at right place and at right price. Product marketing is another important characteristic of corporate farming.