Part 6 · Capstone: Design Your Own Subsistence Farm
Economics: Costs, Surplus and Fair Price
Cost your design to build and to run, prove it feeds the household before it sells anything, then price the surplus at a fair wage.
Subsistence first, and then a fair price for the surplus later. The eighth deliverable is a costed budget and a fair-price sheet: what the design costs to build and to run, and what the surplus is worth when it leaves the farm. This is where the course takes its position plainly. A farm that needs a course, a channel, or a following to stay solvent is not the farm a person should stake their time on.
What you produce
Two sheets. A cost budget in two columns, capital and annual, and a surplus sheet with one line per surplus crop, its cost of production, and its fair price. Neither sheet may hide a purchased input, and neither may count work as free.
The exact format
The cost budget:
| Item | Capital (once) | Annual (each year) | Note |
The surplus sheet:
| Crop | Surplus (lb) | Cost per lb | Fair price per lb | Surplus value |
The cost per pound is the honest one. It takes the annual money you spent and the hours you worked, prices the hours at a fair local wage, and divides the total by the pounds the surplus cost you to grow. That number is the floor below which selling is a way of giving your work away. It has nothing to do with the market price or with beating a supermarket.
What the loop costs, and what it saves
The other side of the ledger is the cost the design avoids. The reference farm ran on 33 litres of fuel a decade, and bought in about 3 cubic metres of compost a year. Its whole environmental load ran 79 percent below the conventional hectare, and its fuel bill was almost nothing, because the farm powered itself with sunlight, legumes, and hand tools. Those are real numbers in the household's favour, and they belong on the budget beside the costs.
Worked example at the 10,000 square foot scale
Capital on our bench is small because the design builds from the land. A spade, a scythe, a sickle, a hoe, an A-frame, and a wheelbarrow, a few hundred dollars if bought new and nothing if already in the shed. A fanya juu ditch and a swale are labour, not money. The fruit and nut trees and the hazel are the largest true cost: two thousand feet of hazelnut at a fair price per tree is the single biggest line, and it pays nothing for four years.
Annual costs are smaller still. Seed you keep back is free, which is why the ledger reserved 6 percent of the grain and 10 of the peas. Fuel for the scythe and the pump is a few litres. Compost is made on site from the residues and the hens, worth about 3 cubic metres a year at the reference farm's rate. Purchased inputs allowed: none. So the annual money cost of the design rounds near zero, and the real annual cost is the 121 hours from Lesson 607.
The surplus sheet is where honesty bites. Wheat trades low, and the reference farm's own accounting found that growing wheat does not save money against buying it, because grain is cheap and the land it needs is not. The surplus worth selling is the oil, the nuts, the honey, and the seed, because these carry value per pound that grain never will. Price each at its cost per pound plus a fair wage for the hours, and if the market will not pay that, the surplus stays home as a gift to the neighbours or a seed bank against the bad year. Selling below cost is a subsidy to the buyer, paid by the farmer.
The test
The budget passes when it feeds the household before it sells a pound, which means the surplus line comes after the two-year store is full, not before. It passes when no work is priced at zero, because work counted as free makes every enterprise look profitable and none of them honest. And the surplus price passes when it is the cost of production plus a fair wage, not the highest price the market will bear. A design that must grow to survive its own bills has failed the course's first principle, and no price will repair that.
Exercise
Price your own surplus
Pick the one crop you would have most of. Add your annual money cost and your hours priced at a fair local wage, and divide by the pounds of surplus. That is your cost per pound. Now look up the local market price. If the market is below your cost, write down which crop you will grow for the store instead, and keep the surplus as seed.
Fieldwork
Walk the surplus to its buyer
Take one surplus crop, a jar of oil or a bag of nuts, and carry it the whole route to its buyer on foot or by hand cart. Write down every hand and every mile it passes through, the grower, the packer, the driver, the stall, the table. Note the cost added at each stop and the time the whole trip took. Bring back the walked route with each hand, mile, and added cost written against it.
Failure mode
The failure mode is a budget that only balances with free labour, free land, and free water. Price your own hours at zero and every enterprise looks profitable, right up to the year the farm cannot pay anyone including you. Count every purchased input and every hour at a fair wage, or you are subsidising your buyer with your own season.
The farm's own position, stated here as the course states it: subsistence first, then a fair price for surplus, and enough is a fine amount to have. We are pro-market and pro-trade. What we reject is the farm that needs a following to pay its bills, because that farm is selling the idea of farming rather than the food.
