ECONOMICS OF PRODUCING FOR AN IDENTITY-PRESERVED (IP) GRAIN MARKET

Demand for identity-preserved (IP) crops produced by Northern Plains farmers is increasing. Buyers are willing to pay a premium for grains that can be guaranteed to possess a unique characteristic. Several general crop management practices apply to crops raised for IP. These include greater investment in segregated storage facilities, more meticulous production, isolation, added cleaning/sorting, documentation, greater testing, additional marketing, and risks of liability. To illustrate, the economics of producing certified seed for sale to other farmers is used as an example of IP grain production. Many of the concepts and specific practices of certified seed production are applicable to most IP crops raised.