June, 1940] 



Budget Analysis of Orchards 



23 



This assumes that these trees would be cut out at the end of the twenty- 

 fifth year and would have no value. Based on these two curves a pre- 

 liminary line was drawn freehand. Since the value of the permanent 

 trees (Fig. 17) was placed at $15 or about $10 below the discounted value 

 of expected future income, the semi-permanent value was put at $8 at 

 15 years to be in line with the value of permanent trees. 



10 



15 20 



40 



45 



50 



55 eo 



25 30 35 



Age of Trees 

 Figure 20. — Comparison of Inventory Value Per Tree for the 



Three Types of Trees. 



Fillers 



The expected net income for fillers discounted backward from the 

 eighteenth year is much below the cost of production line, with a peak 

 of $3.30 at the thirteenth year. The discounted value of the expected in- 

 comes would be the maximum value and since the earnings are close at 

 hand, a curve with a peak of $3.30 at the thirteenth year was considered 

 to be in line with the others. (Fig. 19.) 



Comparison of the three methods 



In figure 20 the value curves of the three types of trees are shown. 

 The position of these curves substantiates the conclusions on page 15 on 

 the use of semi-permanents and fillers. The filler tree in its short life 

 of 18 years yields only 20 boxes of apples, the semi-permanent in its 25 

 years yields 56 boxes, as compared to a total yield of 250 boxes for the 

 permanent tree. 



The costs in the first 18 years are not significantly different. These 

 conclusions on planting apply to New Hampshire conditions. 



These budget analysis curves, of course, are based on the sod mulch 

 system under New England conditions. Entirely different conclusions 

 would be made under conditions existing in other sections. For instance, 

 under the conditions of the Pacific Northwest with high costs for water 

 rights, with heavy labor requirement, with irrigation, with high yields of 

 apples, and with a short cycle of commercial Ife, the costs associated 

 with the land area are important. Under such conditions, close plant- 

 ings, with removal of part of the trees at a later period may be a sound 

 procedure. In New Hampshire where use of land is a minor cost the re- 

 verse is true. 



