Cost-benefit assessment of organic versus conventional vegetable production systems

Abstract:

Consider a vegetable grower in western Siberia deciding whether to shift from conventional to organic methods—the yield risk is obvious, but what about the economics? This research compared the cost structure, profitability, and benefit-cost ratios of organic and conventional production systems for four vegetable crops (tomato, cabbage, carrot, and onion) across 24 farms in Omsk and Saratov oblasts, Russia, during 2021–23. A stratified random sample of 12 certified organic and 12 conventional farms was surveyed using structured cost accounting schedules. Organic systems showed 23.4% higher labor costs but 38.7% lower agrochemical expenditure than conventional systems. Despite 18.2% lower average yields, organic vegetables commanded a 41.6% market price premium in regional markets. The mean benefit-cost ratio was 1.84 for organic versus 1.67 for conventional production. Net returns per hectare were 14.3% higher under organic management when the price premium was captured. Organic farms also showed a 32.1% improvement in a composite soil health index over a three-year period. These results suggest that organic vegetable production is economically viable in western Siberia when reliable premium markets are accessible.