Enterprise Budget:

Beekeeping
Honey bees have been producing with a strict division of labor between
honey for over 150 million years. the various types of bees in the colony. Enterprise Assessment
Annually in the United States approxi- Colonies include a queen, drones and
workers. The queen is the only sexually Capital needed
mately 200 million pounds of honey
developed female in the colony and is for startup
are produced, valued at $140 to
$170 million dollars. Beekeeping the largest bee in the colony. The queen
is responsible for laying eggs that will Importance of
can be a very profitable enterprise.
grow into new workers, drones, and experience with
Honey, beeswax, pollen, royal jelly, and
every once in a while a new queen. A grain crops
pollination are all revenue generating
parts of beekeeping. The main sources productive queen can lay 3,000 eggs in
a day. Drones are stout male bees that Managerial input
of revenue in a beekeeping enterprise
have no stingers. Their sole purpose is needed
are honey and pollination services.
to mate with the queen. If the colony
Without the services of beekeepers,
is short on food, drones are often Labor input
especially pollination services, the costs
kicked out of the hive. Workers are required
of many fruits, vegetables, and other
the smallest bees in the colony and
agronomic crops would be greater than
are sexually undeveloped females. A Years needed to
they are today. Many beekeepers start
colony can have 50,000 to 60,000 develop produc-
out small, with two to four colonies,
workers. The lifespan of a worker is tion expertise
and let their operation grow with their approximately 30 days. Workers feed
experience and management skills. the queen and larva, guard the hive, Years needed to
and keep it cool. Workers collect nectar develop marketing
Physical Attributes to make honey. Workers are responsible expertise
for the production of all the products
Honey bees produce and store honey
marketed in a honeybee enterprise. Years to financial
for food used during the long winter
months. Honey bees usually produce break-even point
Potential Return
more honey than they can eat; this
excess honey is what beekeepers Yields Return on
harvest. Honey bees are social insects investment (%)
In 2008, according to the National
Agricultural Statistics Service (NASS),
the average yield per colony was
70 pounds. The Iowa average yield was Risks
reported at 62 pounds per colony. Bees are at risk for some diseases and
mites. However, strict guidelines in
Price
the industry help prevent the spread of
The prices for honey have been increas- some of these diseases. It is important
ing in the past few years. Retail prices are for beekeepers to be alert for diseased
around $4.68 a pound and wholesale at bees when they check the hives. It is
$3.46 a pound. Products sold at the local also important to place the hives away
level will have varying prices. from fields that would be sprayed with
insecticide, potentially killing some of

BFC 17 March 2010

1
Beekeeping
the bees. Climate also
can have an effect on Chart 1: First-Year Labor Hours
the bees. If the area is
getting a lot of rain,
this can prevent the
bees from going out to
collect nectar.
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
Marketing
There are three main products that established between beekeepers and
honeybees produce that are marketable: renters. Spelled out in the agreement
honey, pollination service, and wax. Each should be dates of service, location,
of these products has unique character- number and pattern of colonies, rental
istics and requires different production fees, and billing dates. There are strong
techniques and equipment. Producing markets for honey and bee products.
honey for profit is highly dependent You should start out small and expand
on successful marketing. This will be as your market and demand expand.
comprised of a combination of high- This also will allow your hive numbers
quality honey, packaging, advertising, to grow with your management ability.
and service to customers. Most honey Look for the same flaws in the hives as
Management the established colonies. Package bees are
is sold as liquid honey. Alternatives to
liquid honey are finely crystallized or Establishing colonies is usually done in the caged worker bees with a queen. Packages
creamy honey, chunk honey, cut-comb spring. New colonies can be established usually consist of 3 to 5 pounds of bees.
honey, and section-comb honey. It is with swarms, package bees, nucleus colo- These packages can be delivered through
recommended that beginning beekeepers nies, and established colonies. The easiest the mail. Package bees are free of disease,
start with comb honey because it is the and most expensive way to establish cheap, and very easy to handle. Package
easiest to produce and package. colonies is to purchase already established bees usually do not produce honey in the
colonies. The established colony is already first year. Package bees also will require
Places to market the honey products assembled, in production, and usually more labor and care to ensure a healthy
include: farmer’s markets, health food has a recorded history. You may want colony. Swarms can easily be collected and
stores, roadside stands, direct sales, to watch for standardization of equip- placed in a hive. New queens will be re-
and agritourism sites. Some producers ment, dilapidated equipment, and disease. quired; most swarms are led by old queens.
have contracts with companies. Rent- Nucleus colonies consist of four to five
The management of honey bees is mainly
ing hives to growers for pollination frames of brood, honey and pollen, adult
focused on ensuring the most vigorous and
services can be another important bees, and a laying queen. These types
healthy hive for the spring and summer
source of income for beekeepers. of colonies are cheaper than established
honey crop. Once colonies are established,
This will provide increased cash flow colonies, usually contain younger, more
beekeepers prepare their operation for
and access to plenty of plants for the productive bees, are easier to handle and
spring harvest. Feeding and medica-
hives. Written agreements should be can produce honey in the first year.
tion are normally done January through
February. Queens begin
Chart 2: Established Labor Hours Established labor hours laying eggs in January
and soon after the size
of the colony increases
quickly. Some colonies
will need supplemental
feeding of sugar syrup
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
(water and sugar) during
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
2
Beekeeping
Economic Considerations: Capital Budget Economic Considerations:
Item Cost ($) Life Deprc. Interest
Apiary Enterprise Budget
exp. Revenue Dollars ($)
Hives 1,340 25 53.60 67.00 Honey (620 lbs at $1.56/lb) 967.20
Protective clothing 40 25 1.60 2.00 Pollination fees (spring, summer) 550.00
Hive and tool/smoker 35 10 3.50 1.75 Wax 25.00
Feeder 23 25 0.92 1.75 Total 1,542.20
Queen excluders 57 25 2.28 2.85
Variable Costs
Fume board 25 25 1.00 1.25
Bees 114.00
Extractor 950 25 38.00 47.50
Disease control 186.95
Bottling tank with 715 25 28.60 35.75
Sugar (food) 25.00
cover and strainer
Jars/labels 262.10
Uncapping tank 195 25 7.80 9.75
Paint/equipment 94.00
Uncapping knife 67 5 13.40 3.35
Total 682.05
Total 3,447 150.70 172.35
Fixed Costs
this time. In February inspections of hives honey, has also increased Hives 141.90
will need to be performed. On warm days demand, which has an Clothing equipment 9.80
(at least 45°F), check colony health and effect on the market. Processing equipment 192.20
growth. At this time treatments for disease Depreciation 150.70
and re-queening should be performed
Sources Interest expense 132.75
if necessary. University of Kentucky Total 627.35

Before removal of surplus honey comb, www.uky.edu/Ag/NewCrops/ Net Income 232.80

be sure the colony has enough nutrients introsheets/honey.pdf
to sustain itself. Harvest will continue
American Beekeeping Federation Pennsylvania State University
from spring into fall. Take care to ensure
the colony will have adequate food sup- http://www.abfnet.org/index.cfm agalternatives.aers.psu.edu/Publications/
plies for the winter. Hives do not require bees.pdf
National Honey Industry
housing in the winter. The colony will
seal its hive and regulate its temperature http://www.honey.com/honeyindustry/ National Sustainable Agriculture
Information Service
in the winter, assuming enough food
supplies remain in the hive for the winter.
National Agricultural http://attra.ncat.org/attra-pub/beekeep-
Statistics Service ing.html
Colony health must be monitored year
round. Bees are susceptible to disease, http://usda.mannlib.cornell.edu/
parasites, pests, and predators. Most MannUsda/viewDocumentInfo. Prepared by Mike Duffy and Jodi Calvert,
do?documentID=1191 ISU Department of Economics, Extension
pests and predators can be controlled Economics. Designed by Victoria Watson, ISU
easily. Management skills are an integral graphics design student. Financial support from
element to beekeeping. Before entering the Leopold Center for Sustainable Agriculture.
into apiculture, be sure to consult with
experts about management techniques.

Market Outlook
… and justice for all
The market for honey is currently very The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race,
strong, especially for locally produced color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not
all prohibited bases apply to all programs.) Many materials can be made available in alternative formats for ADA clients. To
honey. Production increased from 2007 file a complaint of discrimination, write USDA, Office of Civil Rights, Room 326-W, Whitten Building, 14th and Independence
Avenue, SW, Washington, DC 20250-9410 or call 202-720-5964.
to 2008 with prices continuing to rise. Issued in furtherance of Cooperative Extension work, Acts of May 8 and June 30, 1914 in cooperation with the U.S.
China, the world’s largest consumer of Department of Agriculture. Jack M. Payne, director, Cooperative Extension Service, Iowa State University of Science and
Technology, Ames, Iowa.