Bio-Economic Modeling of Conventional and Organic Farming Systems in Chitwan Nepal

Abstract

A study in Chitwan, Nepal, aimed to compare economic and environmental factors between organic and conventional farming. Fifty-three farms (20 organic, 33 conventional) in Fulbari and Jagatpur villages of Chitwan district were surveyed for collecting data and analysis. Detailed data from 16 farms (eight from each organic and conventional farms) were used for modeling, focusing on input/output factors using linear programming. The average farm size of one hectare with sandy loam soil was selected for this analysis. An empirical analysis and a linear programming model were conducted to compare both organic and conventional farms. The model revealed that a cropping cycle involving carrots and other vegetables was key for achieving higher gross margins in both farming systems. Interestingly, a cropping cycle with 30% land allocated to legume crops showed higher variable costs and gross margins compared to one with 50% land dedicated to legume crops. Organic farming with a specific cropping cycle involving rice-broad bean-maize demonstrated superior environmental outcomes compared to the same cycle in conventional farming, particularly in terms of nitrogen and phosphorus surplus. Despite both types of farming being labor-intensive, the observed differences in labor use between organic and conventional farming were not significant for particular crops. However, when the model selected the optimal production plan, it showed that labor use was lower in organic farming than in conventional farming. The study concluded that while conventional farms exhibited higher economic performance, organic farming showcased better environmental outcomes, especially concerning nitrogen and phosphorus surplus. The continuation of organic farming is seen as crucial in supporting superior environmental performance at the farm level, rather than solely prioritizing increased production through conventional methods. To bridge the economic and environmental gap between organic and conventional farming for an optimal farm plan, further in-depth studies are essential, considering local factors such as labor availability, timely access to markets for organic products, and the specific cropping plans for optimal farm performance.