8 University of New Hampshire [Sta. Bull. 323 



as a distinct enterprise. However, the association with other possible 

 enterpi-ises nnist always l)e considered part of the ])icture. 



Costs associated witli tlie use of land can be considered here on the 

 basis of the alternate use value of the sites. 



It is iuiportani to note that the costs for the use of land are distinctly 

 per acre charges. As stated before, the costs associated with labor and 

 materials are largely determined by the number of trees. The annual 

 cost for the use of land will be a straight horizontal line indicating a con- 

 stant amount each year. 



Land valued at $40 per acre based on the highest alternative use value 

 would represent an annual charge of $2.80 per acre assuming taxes and 

 interest at seven per cent. For 27 permanent trees planted on an acre the 

 annual cost would only be about 10 cents per tree per year. In planting 27 

 permanent and 27 semi-permanent trees per acre, there would be no ad- 

 ditional cost involved in the additional 27 trees. In the same way fillers 

 would involve no exti'a land cost. On some fields the operator might 

 harvest hay on half the land in the initial stages of the orchard and 

 in this event the growing of serai-permanents or fillers would involve 

 opportunity costs. 



Total operating costs 



These three sets of cost items, labor, material, and land, represent the 

 annual operating costs for the orchard. (Fig. 3) They are esti- 

 mated of course, and may not represent the actual cash costs which each 

 orchardist would face. They do indicate roughly the relative costs over 

 the period. 



The sum of all the expenses, including out-of-pocket outlays for ma- 

 tei'ials, labor requirements at assumed rates of pay, and an estimated 

 charge for land based on opportunity costs, are shown in figure 4. This 

 cost curve is used throughout this study as the standard curve of costs 

 tlii'oughout the life of the oi'chard. Whenever this standard curve is 

 moditied to study the influence of changing factors, the modification is 

 definitely stated. 



High and low land rentals 



In order to study the effects of variations in land cost three additional 

 curves were constructed: one based on $20, one on $80, and a third on 

 $200 per acre value instead of $40 as in the standard curve. (Fig. 4) 

 This is based on the use of permanents only. If semi-permanents and 

 fillers are used, the cost associated with land would be less per thousand 

 tree-s. (Fig. 5.) 



High cost curve 



The .standard curve is based on efficient use of labor, something beyond 

 the present average requirement but in line with the more efficient pro- 

 ducers. There are fruit men who seemingly caiuiot organize their pro- 

 duction proces.ses to nieet this standard and obviously would have to 

 plan a large cost in terms of man liours. Perha])s the logical conclusion 

 is that if they are less efficient the estimated rates of pay pei- hour would 

 be less and that for tiie purpose of this study this difference in efficiency 

 would not matter. 



