Type of indicator

Quantitative

Relative dimension and aggregated criteria

Economic sustainability : Profitability: Profit

Description

  • Farm gross margin describes the farm’s profitability by comparing the total production value to the costs directly involved in producing output. It is equal to the farm gross output minus direct production costs, where all farming enterprises are taken into consideration.
  • Direct production costs include:
    • The costs of crop-specific inputs (e.g., seeds and plants, fertilizers, crop protection products, soil analysis);
    • The costs of livestock-specific inputs (e.g., feed, veterinary fees and reproduction costs, milk tests); and
    • The costs associated with other gainful activities (e.g., biogas production costs, product processing, forestry-specific costs).
  • Farm gross margin is divided by unpaid labour input to represent the profit available to pay unpaid family labour.

Indicator calculation

[(πΉπ‘Žπ‘Ÿπ‘š π‘”π‘Ÿπ‘œπ‘ π‘  π‘œπ‘’π‘‘π‘π‘’π‘‘) βˆ’ (π·π‘–π‘Ÿπ‘’π‘π‘‘ π‘π‘Ÿπ‘œπ‘‘π‘’π‘π‘‘π‘–π‘œπ‘› π‘π‘œπ‘ π‘‘π‘ )] / πΏπ‘Žπ‘π‘œπ‘’π‘Ÿ 𝑒𝑛𝑖𝑑𝑠 π‘œπ‘“ π‘’π‘›π‘π‘Žπ‘–π‘‘ 𝑏𝑦 π‘’π‘›π‘π‘Žπ‘–π‘‘ π‘“π‘Žπ‘šπ‘–π‘™π‘¦ π‘šπ‘’π‘šπ‘π‘’π‘Ÿπ‘ 

Unit

€/AWU

Indicator interpretation

Higher values indicate larger margins over operating costs and thus better economic performance.

Scale definition

Scales Values (€/AWU) Dexi interpretation References
>=75th percentile >= 123961.05 High + Based on the FADN data distribution for EU specialised dairy farms European Commission, 2022). Quantile method, 2016-2018 data.
[median; 75th percentile] [75974.07; 123961.05] Medium to high
[25th percentile; median] [20499.77; 75974.07] Medium to
low
< 25th percentile < 20499.77 Low –