The document discusses declining yields and production levels in Ontario's greenhouse vegetable industry over the past 5 years. Average yields have decreased by around 15% from 2011 to 2015, from 44.84 kg/m2 to 38.07 kg/m2. While total production increased due to expanding greenhouse acreage, the rate of increase declined each year and production decreased slightly in 2015 compared to 2014. The decreasing yields have negatively impacted profits and led to 10 greenhouse businesses collapsing from 2010-2014. Improving management practices, especially of labor, will be needed to reverse the trend of declining yields and maintain financially healthy businesses that can compete in the market.

1. Ontario’s
greenhouse vegetables future
Opinions
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2. For what reason do we have to be worried about
the future?
 Because it is necessary to predict the
production and the profit for being as flexible
as it can possible to be adjustable to the
market policy.
 Being independent from the market means to
have more freedom for the business.
 A healthy business, can win the struggle in
the market; otherwise a weaker business can
loose that struggle.
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3.  Greenhouse
business wants to
produce as much
production as is
possible with a
lower cost and
staying within
budget.
 A good output
insures a good
profit.
Gross profit….or
...........gross margin leads
to a pleasant cash flow.
As high the cash flow is,
stronger the business will
be.
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4. But…how strong that kind of
business is?
 In average the
greenhouse vegetables
industry in Ontario has a
gross profit 20%.
 That profit is not yet a net
profit. To have the net
profit, it is necessary to
calculate the cost of
production as a summary
of variable cost and fix
cost….and everything
depend on yield.
 If there is a
comparative yield that
is above average and
is competitive on
market, we could say
that the business is
going healthy.
Otherwise, the
business is doing
steps back.
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5. Knowing the situation
 Without a good yield
in quantity and
quality, the business
early or lately is
going to collapse and
the collapse could
happen abruptly or
slowly.
 The market will judge
that process
 The market is not
interested to know such
details as there is
good crop, we used
that fertigation strategy,
that kind of IPM,that
kind of management
etc.
 The market equation is
simple: what is the
yield, what is the price.
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6. What is the yield?
 In the beginning we have to
know the general situation,
the average yield and after
to compare with the specific
yield of a certain business.
 Based on the statistics, in
Ontario for 5 consecutive
last years the yield had
been…..
 2011---44.84 kg/m2
 2012---41.95 kg/m2
 2013---42.06 kg/m2
 2014---40.73 kg/m2
 2015---38.07 kg/m2
 Of course that yield is
average of all the 230
greenhouses(2014)(in
2010 greenhouse
farmers had been 240)
that grow vegetable in
Ontario. In some
greenhouses that yield
is higher and in some
that number is lower
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7. So…?
 Out of business!!!
 During five consecutive
years we see that 10
businesses were
collapsed, because were
not able to be
competitive in the battle
of market. In that topic
there is not any excuse.
The market is the criteria
of a healthy business.
 ….but let us see how
much was the average
production during those
years.
year 011 012 013 014 015
Mil
kg
348,
443
640
385,
452
990
408
498
857
420
340
993
415
998
335
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8.  During those years,
the amount if total
production was
increased till
2014,but in 2015
there was a very
tiny decrease.
 During those years
all the increase of
production was
guaranteed by
building and putting
in production new
greenhouses.
…and the yield?
The yield was decreased and
even the increase of harvesting
are, in 2015 the amount of
production was smaller than a
year before.Onthast context, even
the total production in absolute
terms was increased, in relative
terms was decreased.
So if we se the difference of the
amount between two consecutive
years, becomes smaller and
smaller and in 2015 is negative
.So the increase of harvesting
area was not able to maintain the
increase of production.
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9. Let us do a graph
 Year(vertical)production(horizontal)
011
012
013
14
15
Difference between
years
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10. Difference between years
 Let us compare
 The difference of
production between 2012
and 2011 had been 37 mil
kg,diff between 2013 and
2014 had been 23 mil
kg,between 2014 and
2013 21 mil kg but
between 2015 and 2014 -
5 mil kg;so in a
consecutive year the
amount of production had
been smaller than the
previous year
 ….in percentage the
difference decrease had
been
 2011 N/A
 2012 14
 2013 11
 2014 17
 2015 -1
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11.  Why that decrease
?
 Because even
though the
acreage of
greenhouses was
increased around
150 acres/year ,
the yield was
decreased around
15% between 2011
to 2015.
…let us continue
To calculate some other data
relating to the increase of yield
and production in total.
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12. If the yield were the same of 2011
 In 2014 the yield had
been 44.84 kg/m2.
 But how much had
been the production
if we were able to
maintain the yield of
2011considerin the
acreage increase?
year 011 012 013 014 015
acre 2067 2270 2400 2550 2700
Pro
Mil
kg
348 412 435. 463 490
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13. If there were an increase for
f.u.(m2)
 If we are going to
use good an d best
varieties, the
average yield is
going to be
increased by 0.7%
yearly. But based in
the yield of 2011 by
44.84 kg/m2,the
yields in consecutive
years should have
been…..
 2012 45.15
 2013 45.47
 2014 45.79
 2015 46.11
 And the production
should have been
year 011 012 013 014 015
acre 2067 2072 2400 2550 2700
prod 414 442 472 504
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14. Let us do a summary
 Comparing the actual production and how
much should have been based on different
options.
year 2011 2012 2013 2014 2015
acre 2067 2270 2400 2550 2700
actual 348.4 385.5 408.5 480.3 416
2011
yield
N/A 412 435 463 490
0.7%
increase
N/A 414 442 472 504
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15. Yield decrease
 The decrease of yields
had caused the
decrease of production
in relative terms and
on the last year in
absolute terms.
 Let us compare the
yield of 2015---38.07
with the yield of
2003,12 years
ago…..46
kg/m2.almost 13%
less.
 Why that situation?
 As a matter of the facts,
we are 12 years ahead.
In 2015 the technology
was more advanced,
more technical
institutions there were,
more consultancy were
given and so on.
 …..but the yield was
decreased !!!!
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16. Yield decreasing tendency
 Let us see based on the
average of yields for five
consecutive years(2011-
2015).
 According to that trend,
the yield should be not
able to be more than
385 mil kg,equal the
quantity of 2012.
 Why that???!
 On my opinion everything
should be defined as an
appropriate management
in general and of the labor
in specific terms.
 Labor is able to move
around all other technical
factors and will produce
good or bad results.
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17. Labor management
 An appropriate agro
technical level will
produce good yield or
bad one depend from
the labor
management……but
that labor management
in a great deal of cases
is underestimated.
 The results of that
mismanagement are
connected closely
with yield decrease
on recent years and
logically the profit for
f.u.is decreased,
giving a negative
impact to the health
of business.
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18. Being out of the business
 The situation of being
not able to maintain a
healthy business, is
calling collapse. That is
the reason that for five
consecutive years
2010-2014,10
greenhouse vegetable
businesses were out of
the business.
 They were not
competitive to the market
and no justification is
valuable.
 Market does not buy
justifications; it buys
products and the amount
and quality of it depends
from the skillful and
educational managers
and level of growers.
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19. Their experience is decisive
 Competence of that
staff will give the
business more
strength to cope with
the market and to
win the battle to be
competitive to it. But
how was the
situation in 2015?
 In 2015 gross profit /f.u. had
been 75.07 doll.
 The cost of production,
based on variable cost+fix
cost is calculated to be in
average 72 doll/f.u.
 As a result the businesses
over 72 doll/f.u. had been
competitive. Higher that
amount, healthier had been.
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20. Being real
 The average amount of
money received after
selling the average
production 38.06 kg/f.u.
had been 75.07 doll.
The difference between
that number and the
cost of production will
give to us net profit and
having that number we
will judge how healthier
is our business or
otherwise.
 If the business is not able
to cope the cost of
production, it can only
survive and in some
cases collapse.
 If a business collapse
another will take
advantage on it and so
on.
 E.G,in 2015 the average
yield had been 38.06 kg-
75.07 doll/f.u.C alc ulating
with average farm gate
prices in 2015…..
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21. …..let us see and judge!
 The cost of production
in average should have
been 72 doll/f.u.
 With that money 42 kg
tomato,24 kg bell
peppers and 45 kg
cucumbers. Those
vegetables vary related
to operative expenses;
so bell peppers needs
less labor etc.
 So yield is 42,24 and
45(arranging with labor
expenses).That yield
presents the collapsing
level(that is
relative).More yield,
better is; less yield
worse is.
 Less yield will worsen
the health of business
and early or late the
bankruptcy will knock at
the business door.
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22. Last considerations
 Increasing yield is very
important to keep the
business healthy but a
yield increase without
maintain the appropriate
cost of
production,does’nt
value. Not being within
the budget means to be
negatively
decompensated on the
rentability price…..
 …and is the same
thing as a lower
yield.
 So, the yield and
cost, should be kept
in the same balance
with the aim to be
winner in the market.
Otherwise, loosing
the battle with the
market is evident.
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