One of the most important industries in Russia is the cultivation of grain crops. Let us briefly describe the technology and business plan of this type of entrepreneurship in order to navigate what is required for its organization.
Demand for crop products around the world is considered to be the highest. And in our country there are natural conditions in order to fully satisfy the buyer's requirements. The most important thing is to decide on a seed crop and a suitable site for its cultivation.
The relevance of the agricultural business
At the state level, a law has been adopted on the development and regulation of this industry, which contributes to the support of entrepreneurship in the cultivation of grain crops, and also makes it possible to increase the volume of their production and processing.
In this case, state subsidies for project investment are provided, as well as various tax benefits. Even if you do not have enough funds to organize this type of business at the proper level, you can count on loans with favorable conditions.
Statistical data also speaks of an increase in acreage and growing sales of grain. And although there are certain risks when growing various crops, the profitability of the business remains at a high level. Experts say that in one year it is possible to reach full payback only through wholesale sales of products within the country.
If we add to this a high level of exports, then the profitability and attractiveness of this business idea only grows. It is important to decide what exactly you will grow. For example, about half of the crops are wheat, as it is considered the most popular crop from which bakery and confectionery products, cereals, flour and much more are prepared. At the same time, there are several important factors influencing the development of a business:
- Expansion of areas for sowing wheat, which significantly increases the gross indicators.
- When exporting, the list of countries for the supply of goods is constantly updated, and its volumes increase every year.
- World prices for this type of product often change.
- In addition to the usual demand for cereals, there is also a need for this cereal on livestock farms.
But business strategy must be built deliberately. After all, there are various fluctuations in the market according to changes in weather conditions, the amount of grain reserves, price trends, etc. Even political sanctions affect the level of demand and the cost of the final product. Therefore, the entrepreneur in this industry will have to constantly monitor changes on a large scale.
Where to begin?
When organizing the production of grain crops as a business, you need to understand this issue. And if you do not have enough relevant experience or theoretical knowledge, then it is better to take a professional agronomist as a permanent assistant.
After all, when choosing a plot of land and the crops themselves, you need to focus on the climatic conditions of the region, take into account the timing of sowing and harvesting, the seasonality of the business, the need to use fertilizers, drawing up a plan for the purchase of equipment, etc.
The main stages of the organization of entrepreneurship will be the following:
- Choice of crops for cultivation according to the possibilities of the region.
- Search for investments for start-up costs.
- Buying or renting a suitable field for sowing.
- Registration of an enterprise with the issuance of a permit for this type of work.
- Acquisition of specialized machinery, equipment, inventory, etc.
- Creation of storage facilities in accordance with the requirements for grain storage.
- Recruitment of personnel with proper training and experience.
- Purchase of seeds in the right quantity.
- Carrying out sowing work.
- Field care according to standards.
- Harvesting.
- Storage and sale of goods.
Activity registration
In the case of the creation of such an enterprise, it will be necessary to register a personal subsidiary (LPH) or a peasant farm (KFH). But it should be noted that in order to reach high profits and to reduce risks in this industry, experts recommend growing crops in large volumes. Therefore, the second form of organization will be more acceptable.
It will be necessary to develop a competent business plan and make a feasibility study of the project. To do this, it is better to contact a professional who will develop the right strategy, which will become the basis for the successful development of the enterprise.
Here you can download for free as a sample.
Selection of land
With all the diversity of the territory of our country, it is better to focus on the southern regions for sowing most grain crops. Although the regions of the middle lane are also suitable for certain plant species. Take into account not only climatic conditions, but also the terrain, previous uses of the field, the duration of its operation, and much more.
It is important to understand that the land cannot produce a good harvest every year, therefore, periodically experienced agronomists provide it with rest or sow it with different crops, replacing them with each other. The ideal plan is:
- the available territory is divided into four zones;
- three of them are used, for example, for wheat, sunflower and barley;
- the fourth is left untouched;
- annually change the place of sowing for each of them and choose a new site for recreation.
As a result, there is a change in the composition of the soil and its periodic restoration, which has a beneficial effect on the overall yield, and hence the profitability of the project.
It makes no sense to engage in the cultivation of crops in a small volume. Therefore, it is recommended to rent an area of at least 400 hectares. With an average business size, this figure is already 5,000 hectares.
When concluding a lease agreement, it is better to draw it up immediately for several years in advance in order to avoid the risks of changing payments and not disrupting the sowing schedule. If you want to do this business for a long period, it is better to try to buy the fields into your property as early as possible.
Dealing with plants
When choosing the crops that will be grown on the field, you need to think carefully about all the points. After all, the equipment used, sowing and harvesting time, business payback periods, average yields, sales markets and much more depend on this.
So, wheat can be lumpy and food, winter and spring. In addition to this type of crop, rye, barley and sunflower are in high demand. It is these plants that are considered the most favorable choice for growing in the middle and southern latitudes of Russia.
Equipment and machinery
In order to speed up and simplify the process of growing these crops as much as possible, it is advisable to purchase modern machines:
- Seeding complex.
- Baler.
- Tractor.
- Mowers.
- seeder.
- Disc harrow.
- Plow.
- Combine.
- Freight transport.
- Volokushka, etc.
And also in capital investments it is necessary to include expenses for the creation of warehouses, hangars, the construction of industrial premises, repair shops, the purchase of various equipment, etc.
Staff
As mentioned above, in order to develop a successful grain growing business, it is imperative to hire an experienced agronomist. In addition, it is desirable to acquire other employees:
- the head of the enterprise may be the owner himself;
- with large volumes of production, a substitute is needed;
- several tractor drivers;
- combiners;
- other workers;
- accountant for competent tax reporting;
- product sales manager.
Since this type of business is seasonal, most of the employees are hired only for a few months a year. The permanent staff usually consists of three people.
Growing technology
The whole process goes through the following steps:
- Harrowing the soil, which takes 8 to 10 days.
- Spring sowing work, which can take up to 10-15 days.
- Re-harrowing.
- Treatment with herbicides, fertilizers, etc.
- Harvesting, which will take at least 20 days.
- Storage of grain in barns.
With the use of modern technology and high-quality fertilizers, we can talk about high yields and good business development prospects.
Financial calculations
There are various factors that influence the overall income:
- climate;
- weather;
- soil quality;
- success in the rapid sale of grain;
- general market prices.
To draw up an approximate plan with calculations, you need to take the average indicators for the volume of cultivation of certain crops, take into account the size of the sown area and the pricing policy of the enterprise.
| Capital investment | Cost, in rubles | |
| 1 | Staff salary (per year) | 300 000 |
| 2 | Purchase of grain for sowing | 100 000 |
| 3 | Fuels and lubricants and other materials | 500 000 |
| 4 | Building a barn | 800 000 |
| 5 | Acquisition of equipment | 1 300 000 |
| 6 | Land lease | 300 000 |
| 7 | Other costs | 200 000 |
| Total: | 3 500 000 |
As a result, for the first year you will pay about 3.5 million rubles. But in the future, only the costs of paying for the work of employees, renting land and purchasing raw materials will be required. And with well-established sales markets, the sale of goods will be faster and easier every year, which will significantly affect the growth of profits.
From 200 hectares, 400-600 tons of grain can be harvested, depending on the yield and the specific crop. With an average cost of 6000 per ton of products, you can get 2,400,000-3,600,000 rubles. As a result, all initial investments will pay off in the first year. But since it is necessary to purchase or partially leave grain for the next crops, they usually talk about a full refund only after 2-3 years.
Sales market
Even when starting a business, you need to take care of how to sell products. In the agricultural direction, the usual methods of advertising are not needed.
To create a customer base, it is enough to conclude contracts with wholesale grain suppliers, grocery warehouses, large retail chains, farmlands, grain processing enterprises, etc.
Possible risks
As with anything, this industry is not without challenges. They usually consist of the following:
- A sharp, unexpected drop in the price of a commodity, especially when there is a harvest year and supply exceeds basic demand. When concluding futures contracts, these risks can be partially avoided.
- Equipment for harvesting and processing crops periodically fails and requires repair or replacement. If this happened during a critical period of active work, then the delivery time of products may be disrupted. Therefore, it is advisable to have several cars in stock or find an opportunity to rent equipment for a short time.
- Reducing the liquidity of the enterprise due to the uneven cultivation and sale of grain crops. If you pay off the debt before the deadline, then such troubles can be avoided.
- A lean year - sooner or later, all agricultural workers face this. Insurance and the formation of a plan will help to reduce risks, taking into account the minimum possible profit for the corresponding region.
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