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02 - RUE & Optimization Technique
02 - RUE & Optimization Technique
Resources in farming may be anything biotic or abiotic factor of production which contributes in the production
process to produce its end product, eg. land, labour, capital, manures & fertilizer, water, agro-chemicals, energy etc.
Efficiency in any system is an expression of obtainable output due to addition of unit amount of input. Resource use
efficiency (RUE) in agriculture is the output of any crop, livestock or any agricultural production per unit of the
resource utilized under a particular set of soil and climatic condition. The efficiency of a farming system is its
success in producing as large magnitude of output as possible from given sets of inputs. Maximum efficiency of a
firm is attained when it becomes impossible to reshuffle a given resource combination without decreasing the total
output.
Farrell proposed that the efficiency of a firm consisted of three components: technical, allocative and
economic efficiencies.
Technical efficiency is defined as the ability to produce a given level of output with a minimum quantity
inputs under certain technology
Allocative efficiency refers to the ability to choose optimum input levels for given factor prices
Economic or total efficiency is the product of technical and allocative efficiencies
∑ aidi
t =1
CLUI = ------------------
A x 365
Where, n total number of crops; ai area occupied by the ith crop, di, days that the
ith crop occupied and A = total cultivated land area available for 365 days.
o CLUI can be expressed as a fraction or percentage. This gives an idea about how the land area has
been put into use. If the index is 1 (100%), it shows that the land has been left fallow and more than
1, tells the specification of intercropping and relay cropping. limitation of CLUI is its inability to
consider the land temporarily available to the farmer for cultivation.
Fertilizer use efficiency/ nutrient use efficiency: FUE is the output of any crop per unit of the nutrient applied
under a specified set of soil and climatic conditions. The NUE/FUE can be expressed in several ways.
Mosier et al. (2004) described 4 agronomic indices to describe NUE:
o Partial factor productivity (PFP): kg of crop yield per kg of input applied
o Agronomic efficiency (AE): kg of crop yield increase per kg of nutrient applied
o Apparent recovery efficiency (ARE): kg of nutrient taken up per kg of nutrient applied)
o physiological efficiency (PE): kg yield increase per kg nutrient taken up
o Crop removal efficiency: Removal of nutrient in harvested crop as % of nutrient applied
Energy efficiency
o Energy efficiency = Energy output (MJ/ha) / Energy input (MJ/ha)
o Net energy (MJ/ha)= Energy output (MJ/ha) - Energy input (MJ/ha)
o Energy productivity (kg/MJ) = Output [grain & straw] (kg/ha)/ Energy input (MJ/ha)
o Energy intensity (MJ/ha) = Energy output (MJ/ha) / Output [grain & straw] (kg/ha)
o Energy intensity (MJ/Rs) = Energy output (MJ/ha) /Cost of production (Rs./ha)
Economic efficiency
o Gross return
o Net return
o Return per rupee invested= Gross return/ production cost
o Net return per rupee invested = Net return/ production cost
o Per day return (Rs./day)= Net return / Cropping periods (days)
Optimization technique
o Optimization technique is a powerful tool to obtain the desired design parameters and best set of operating
conditions through system modeling.
o A model is a simplified abstraction of the real world. It simulates the behavior of a real system. Modeling begins
with the analysis of the system, its circumstances and purposes
o Model helps in prioritizing enterprises, better planning and designing of FS, farm management and policy
development
Linear Programming (LP)
o Linear programming was developed by George B Dantzing (1947) during second world war
o It has been widely used to find the optimum resource allocation and enterprise combination.
o LP is defined as the optimization (Minimization or maximization) of a linear function subject to specific linear
inequalities or equalities.
o The purpose of constructing a LP farming system model is to identify which one of the new technologies are
profitable at farm level and by which type of farm they are likely to yield the best financial outcome
o It is a mathematical technique which is used to overcome various short comings of planning techniques
o The programming has been developed to to handle complex situations and its practical use has been made
possible only with the development of relevant software (LINDO, MPEXPRESS, MS EXCELL)
o In general, LP can be expressed as
n
Max Z = ∑ Cj Xj
j=1
Where, Z: total gross margin
Cj: gross margin of jth activity
Xj: level of the jth activity
n
= ∑ aijXj≤ bi [i=1 to n
j=1
Where, aiji : quantity of the it resource requiredto produce a unit of jth activity
Xj ≥0 [j=1 to n
bi: amount of the ith resource available
Linearity: It describes the relationship among two or more variables which are directly proportional.
Additivity: Total input required is the sum of the resources used by each activity. Total product is sum of the production
from each activity.
Divisibility: Resources can be used in fractional amounts. Similarly, the output can be produced in fractions
Finiteness of activities and resource restrictions: There is limit to the number of activities and resource constraints.
Non negativity: Resources and activities cannot take negative values. That means the level of activities or resources
cannot be less than zero
Single value expectations: Resource supplies, input- output coefficients and prices are known with certainty
Advantages of L.P
Limitations
Linearity:
Considers only one objective for optimization.
Does not consider the effect of time and uncertainty
No guarantee of integer solutions
Single valued expectations.