"Managing Honey Bees and Profitability in the New
Proceedings First Caribbean Beekeeping Congress, Tobago, West Indes, September, 1998, pp. 23-38.
Malcolm T. Sanford
This paper is an attempt to describe effects of sweeping change as it has affected both honey bee colony and financial management over the last hundred years. I will try to bring both of these into historical focus and provide a few prognostications for the future. The challenges of managing the infinitely complex honey bee within the context of exotic pest introductions and other contemporary developments have increased dramatically during the last century. At the same time, the modern business environment has also been buffeted by radical shifts, especially those orienting it toward a more global focus. There is every reason to believe that changes in both these areas will continue and accelerate, in the future. In order to survive, the beekeeper will have to work harder and smarter to improve both colony and financial health as we enter the new millennium.
One word summarizes the most important thing that beekeepers must confront as the new millennium arrives. This is "change." Of the many agricultural activities engaged in over the last centuries, beekeeping has perhaps been one of the most conservative. Even up until the 1950s, few radical innovations had been seen in the craft during the 20th century. Most were perfected before its turn, including development of the moveable-frame hive, smoker, extractor, and wax foundation. Only one, instrumental insemination could be said to be a child of the first half of the 1900s.
Changes in other arenas, however, many brought on by technologies developed during World War II, have materially affected beekeeping. Thus, advances in transportation, food processing, antibiotics and others have been far more important than those strictly associated with managing bee colonies. This tendency continues. Many futurists believe that entrepreneurs will increasingly find more valuable information outside their immediate field, rather than inside, as has been the case in the past
Introduction of exotic pests, including Acarapis woodi, Varroa jacobsoni and Aethina tumida has also provided enormous challenges to beekeeping. Perhaps most shocking to traditionalists has been a shift to routine use of chemicals and pesticides inside a living beehive. This activity brings into focus the real possibility of upsetting the delicate equilibrium found in a colony, as well as bee product contamination and what that means for future consumer confidence.
Other changes have affected financial analysis and profitability. The ability to economically sustain beekeeping within the modern business environment is becoming more difficult. Globalization of economies is one of these. Honey, and to a lesser extent, other bee products are now world commodities. All that is lacking is a futures market so that producers could hedge ensuring a reasonable return on investment. Marketing has also been a focus of change in the United States. The Honey Research, Promotion and Information Act created for the first time a nationwide promotional effort managed by what is called The National Honey Board. Other major shifts are occurring in the labor and capital markets. Finally, changes such as on-time delivery brought on by computers and/or cooperation replacing competition as a driving force in the market place will also be reflected in beekeeping.
Colony Management Issues:
Management is generally stated as an activity that helps meet objectives. By definition, therefore, there can be no management without specific objectives. Beekeepers have traditionally had goals in mind, but they are often not refined, nor flexible enough to effectively adapt to change. Broad objectives may include increased knowledge about bees as a recreation, money or financial return, more production of honey or other commodities, or simply maximizing colony numbers. Of the above five, production by the colony and economic return are usually at the top of the list. However, the others are always present and can potentially influence the rest.
Asking a beekeeper which of the following factors are most limiting in an operation, money, equipment, knowledge or time may yield a variety of answers. Perhaps the most important thing to manage in beekeeping is time. There is always more to do than hours in the day. Time is unique in that we all begin with the same amount each day. Lack of focus, however, can lead to unwise use. Classical time management techniques include developing a list of possible actions and then prioritizing them so that the most important gets done first.
Often there is not enough information or knowledge available to manipulate all possible situations. For example, it is no use worrying whether a colony has a virus when this condition cannot be detected, or there are no helpful recommendations for rectifying the condition. Thus, to effectively manage time, beekeepers should choose those things over which there is the possibility of exerting the most influence or control.
Managing Colony Location:
The real estate maxim for human habitation is the same as that for honey bees: location, location, location. Most important for bee colonies is whether adequate pollen and nectar resources exist. This is not a short-term process; three to five years may be necessary to make a final determination. In addition, other variables can affect locating colonies, such as activities of neighbors (urban or rural), adequate supplies of water and/or the potential of pesticide application. Because so much bee forage is wild or ruderal in nature, locations in many developed regions are becoming more scarce due to agriculture and urbanization, which results in environmental degradation.
A paradox in is that although many introduced, exotic plants are good for bee colonies, efforts to reduce or eliminate such plants from so-called "native" habitat adversely affect availability of locations. Honey bees themselves are introduced insects in many parts of the world and from time to time beekeepers may also find efforts to exclude these insects from areas where they are deemed to be inappropriate competition for other pollinators.
New Geographic Information System’s (GIS) technology is now increasingly available to exactly pinpoint any location on the globe. An example of this is the Geographic Positioning System or GPS. Depending on the need, GPS might be used to protect colonies from pesticide poisoning or strategically locate colonies in fruit fields for maximum pollination. Remote sensing by satellite or aerial photography also has the potential not only to identify where the most nectar-producing plants are, but also their nutritional and/or moisture content <http://apis.ifas.ufl.edu/apis98/apmar98.htm#4>.
The beekeeper often has very powerful control over bee populations. Feeding, dividing, and uniting are time-honored methods. Feeding is perhaps the best known, most used and reliable beekeeping technology. Usually, this has meant stimulating population growth by supplying sugar syrup to a colony. Modern food processing has led to new bee foods. Most successful is high fructose corn syrup (HFCS), a maize byproduct used successfully by beekeepers since the 1970s. It is relatively inexpensive and, perhaps most importantly, comes as a liquid. Thus, the usual messy, labor-intensive work of reliquifying processed sugar is avoided.
Convenience comes at a cost, however. Although the syrup is adequate food, it may not be the best for all potential outcomes. Thus, some producers prefer to use refined sugar syrup for colony buildup, substituting HFCS when colony maintenance is the goal. Although HFCS in general is a good food for honey bees, there are instances when its use can be problematic. Use of this syrup is not advised, for example, when already contaminated with other components (e.g. soft drink colorants). Sometimes beekeepers resort to inferior product when it is sold at a deep discount because it does not meet the needs of certain manufacturers. Other "off-spec" syrup may also be damaging to colonies. This is true for that produced using acid hydrolysis resulting in a low pH and/or an increase in hydroxymethylfurfural (HMF) <http://apis.ifas.ufl.edu/apis97/apfeb97.htm#3>.
Besides carbohydrates, the other side of the nutritional coin should not be ignored by the beekeeper. Brewers yeasts and related species have been used as base for several artificial protein diets <http://apis.ifas.ufl.edu/apis92/apfeb92.htm#2>. Unfortunately, feeding protein is more problematic than that for carbohydrate. It is much easier to monitor both quality and quantity for the latter than the former <http://apis.ifas.ufl.edu/apis97/apaug97.htm#4>. In addition, many protein diets are not well accepted by bees. Supplements, where natural pollen is added to the diet, are often better utilized. It will not be surprising to see more new diets on the market in the future. At least one technology to better determine protein content in a colony is in development.
Transportation advances have affected beekeeping in many ways. Package bees are now routinely shipped by air, even over the world’s oceans. Mature colonies are also regularly trucked on semi trailers. Thus, colonies are employed in harvesting three to four honey crops a year from different plants. Movement has become the lifeblood of any modern beekeeping enterprise. Some 150,000 Florida colonies are transported both in and out of the state for early spring pollination on the eastern seaboard. In California, many more are moved to arguably the world’s most important honey-bee-pollinated crop, almonds. Many outfits use forklifts and other kinds of small-scale trucks along with pallets and booms to help move colonies.
Beekeeping equipment has traditionally been wood. However, plastics have moved in as substitutes. Thus, plastic hive bodies, frames and even foundation are increasingly being used, especially as wood continues to become more scarce and expensive. Plastic use has revolutionized section honey (e.g. Ross Rounds®) <http://www.rossrounds.com/>and queen rearing paraphernalia from cups to cages.
The traditional deep or standard super is over nine inches in depth. This translates into a ten-frame unit that could weigh almost a hundred pounds. As lumber sizes have been inevitably reduced, more beekeepers are going to shallow supers as part of an economizing as well as a weight-reducing strategy. Other materials have been used for supers, especially in the tropics including concrete, other aggregate and of course plastic. Whatever is used, it should meet the universal attributes of durability, interchangeability and manageability.
Managing Bee Products:
From the consumer point of view, managing and processing bee products is a most important area. Two kinds of produce come from honey bees. The insects collect one group: honey, pollen and propolis. By their very nature, these are quite variable and present challenges when being marketed to consumers accustomed to uniformity in their purchases. Others are manufactured by the insects themselves: beeswax, venom and royal jelly. These are more uniform in nature. Each product, therefore, demands specialized treatment or management.
New technologies are helping process and package innovative kinds of value-added food products. Honey has traditionally been used as part of the process and is added to many foods. Food technology use has been increasing in the United States, brought on to a great extent by efforts of the National Honey Board <http://apis.ifas.ufl.edu/threads/nhboard.htm>. There is a new wave of substances being called "pharmafoods" or "neutraceuticals," in which honey may well play an increasing role. Many of these are based on not only honey, but propolis, pollen and venom.
Honey is perhaps the most important bee product and is truly a world commodity in all senses, except it lacks an organized futures market. Its management has taken on another dimension, given the increasing possibilities of adulteration and contamination.
HFCS is a two-edged sword for the honey industry. Although an excellent alternative bee food, this material so like honey and much cheaper, creates huge incentive to economically adulterate. Detection techniques, therefore, have taken on greater and greater importance worldwide to prevent entry of bogus sweet into the market place. Fortunately, there continues to be limited research in this arena and an international standard test (ISCIRA- Internal Stable Carbon Isotope Ratio Analysis) exists, which can determine much economic adulteration <http://apis.ifas.ufl.edu/apis98/apsep98.htm#5>. A less sensitive, but inexpensive, method can be used in many cases by employing Fluorescent ultraviolet (black light) <http://apis.ifas.ufl.edu/papers/MERIDA3.htm#4>.
Increasing use of chemicals to control many of the exotic organisms affecting honey bees over the last two decades has also brought the possibility of contamination to the table. Because of adulteration and contamination issues, honey quality assurance long a tradition in Europe, has recently become a hot topic in the United States. It will be a major factor in an upcoming referendum for the beekeeper-financed National Honey Board.
Pollination is a service. Thus, the circumstances surrounding this enterprise are much different than producing and marketing products. Some beekeepers have made a transition to this activity as a primary source of income. There appears to be plenty of potential growth in this enterprise, as more and more growers understand the value of this bee activity. One innovation is what S.E. McGregor called a "stable pollination service." In McGregor’s view such an organization would help establish guidelines for pricing and delivering pollination services through cooperation of its members <http://www.airoot.com/beeculture/book/index.html>. Few of these exist in the United States, but several successful ones appear to have been implemented in Europe <http://apis.ifas.ufl.edu/letters/aix2_24.htm>.
Although principally beekeepers, entrepreneurs involved in pollination should consider diversify. It is known that the honey bee is not always the best insect choice for efficient pollination. Other insects like bumble bees, solitary "pollen bees," and even wasps may be the insects of choice in some arenas. Within the context of this beekeepers might well promote their activity within the rubric of "pollination consultant." <http://apis.ifas.ufl.edu/apis95/apjul95.htm>
As part of managing colonies, something that has captured beekeeper attention relatively recently is the opportunity to control honey bee diseases. Beginning with sulpha drugs and followed by more traditional antibiotics now at the disposal of the beekeeper, possibilities of controlling both American and European foulbrood have emerged and become almost routine. Although effective, sulfa (sodium sulfathiozole) is now no longer labeled in the United States and cannot be used. It is a contaminant of honey, has a long period of activity, and many people are found to be allergic to even small amounts of the material.
In the United States, the antibiotic oxytetracycline HCL (Terramycin®) is labeled for foulbrood control and extensively used. The label should be strictly followed and a full treatment applied (200 mg per colony); three applications four-five days apart as a dust from TM 25®, soluble product <http://edis.ifas.ufl.edu/scripts/htmlgen.exe?DOCUMENT_AA090>. This is only as a preventative, however, and should not be employed as a cure. Outbreaks of American foulbrood have shown that antibiotic treatment alone is no substitute for a formal bee inspection service which insists on burning affected colonies.
Use of antibiotics brings risk of developing resistance in the target organism. An outbreak of oxytetracycline-resistant foulbrood in Argentina, for example, has been laid at the feet of those who employed the material in unwise fashion. They did not have the luxury of detection by or follow-up of treatment by a committed cadre of professional, independent inspectors <http://apis.ifas.ufl.edu/papers/TERES.HTM#7>. The same phenomenon has recently been seen in the United States, where it is thought use of antibiotic extender patties may be resulting in resistant bacteria <http://apis.ifas.ufl.edu/papers/COLORADO.HTM#14>. Thus, the use of this technology is being reexamined and there is an incipient movement back to the dusting treatments of oxytetracyline (Terramycin®) that were used in the past. Antibiotics should be used with restraint in any case. Using them simply because bees "look better" as is done in other branches of agriculture is not warranted. Beekeepers in other countries, such as France, New Zealand and the United Kingdom employ a no-use philosophy with good success.
A large research base shows that fumagillin (Fumidil B®) is an effective control for the adult disease nosema. As spore counts begin to exceed 40 million per bee, honey production suffers. Up to a thirty- percent increase has been effected in Florida operations by routine feeding fumagillin in syrup. Because results are not immediately apparent, however, all too often beekeepers have ignored this relatively well-proven technology <http://apis.ifas.ufl.edu/apis97/apdec97.htm#5>.
Managing Exotic Organisms:
Beginning in the late 1950s, the introduction of exotic organisms began to make an impact on world beekeeping. For the United States, the first was introduction of chalkbrood, which presumably entered the country in imported pollen. To this day the problem is important in some areas, which have periodic outbreaks. There is no chemical control registered for this problem . Good beekeeping practices are thought to prevent stress, which can lead to colonies less prone to be affected.
The tracheal mite (Acarapis woodi) was introduced into the United States in 1984. It was because of this parasite that the 1922 United States bee law forbidding importation of stock was passed. This statute still remains in effect, although some believe it has lost its usefulness <http://www.law.cornell.edu/uscode/7/281.shtml>. After a few years of devastating losses in certain regions, the problem now appears to have become regional in scope. Thus, concern continues about this pest in temperate areas of North America, whereas in subtropical (Florida) and tropical (Mexico) climates, it appears to be of much less consequence. Nevertheless, it began the now common place tradition of using vegetable oil patties in beehives, which are thought to interfere with mite transfer among young worker bees <http://apis.ifas.ufl.edu/apis95/apdec95.htm#T4>.
The event that has changed beekeeping forever in most areas of the world is introduction of the bee mite Varroa jacobsoni. Detected in the United States in 1987, this parasite is thought to be responsible for over 90 percent of feral colony loss. Because most hives are treated to control the mite, it is difficult to estimate concurrent losses in beekeepers’ colonies. Besides being a parasite, Varroa is suspected of being responsible for vectoring viruses. Managing Varroa is a real challenge; it usually must be done in concert with other beekeepers as reinfestation from untreated colonies is always a possibility. Thus, treatment should be coordinated with nearby locations and usually whole apiaries must be treated rather than single colonies. Parasitic bee mite syndrome, which has symptoms that are reminiscent of other diseases has also been associated with both Varroa and tracheal mite infestation <http://apis.ifas.ufl.edu/threads/varroa.htm>.
The risk of introducing other organisms also exists. Investigators have found Asian mites that are considered even more potentially damaging than Varroa. These include Tropilaelaps clareae and Euvarroa sinhai. The consequences of these arachnids introduction is unknown, but given Varroa’s effect, their appearance is looked at with apprehension. Beyond mites, there exist other organisms that can affect beekeeping, some relatively innocuous in their home range. The best example of this is the 1998 introduction of the heretofore almost unknown insect, the South African small hive beetle (Aethina tumida), into the United States. This beetle is now found on three states and there have been colony losses in localized areas from this aggressive scavenger <http://www.ifas.ufl.edu/~insect/misc/bees/small_hive_beetle.htm>.
Finally, perhaps the most celebrated introduction was that of the African race of honey bees (Apis mellifera scutellata) to the New World. This event first had catastrophic effects in Brazil, where it was first introduced. Over the years, however, this has been greatly tempered. So much so that many in the country have now declared the insect the savior of Brazilian beekeeping. It has spawned a huge outpouring of research at universities and elsewhere as well as entrepreneurial effort. Although this is the case for much of southern South America, Central and North America, more recently under the influence o this insect still are beset by a series of problems. These stem from the fact that the insect is a more migratory and defensive bee than the mixture of European races that had previously been introduced and exploited <http://apis.ifas.ufl.edu/threads/ahb.htm>.
Managing Chemical Use:
With the advent of tracheal mites, Varroa and the small hive beetle, chemical management has taken on much more importance in United States’ beekeeping. It is important to retain use of effective materials as long as possible by keeping resistance at bay. The use of these materials inside a living beehive also means increased possibilities of product contamination. Unregistered materials that are employed on an experimental basis by beekeepers are extremely dangerous in this context and must be avoided at all costs. Both resistance and contamination potential demand that such materials be used only in accordance with the label.
As an example of the above considerations, the one material that is registered for legal use to control Varroa in the United States, Apistan®, has little potential to contaminate honey, but wax is vulnerable. There is evidence that much of the world’s beeswax may in fact already be affected. Since so few materials are registered or capable of being labeled, approved chemicals should be managed so as to maintain the longest possible life. This is important both to the beekeeping industry and the enterprises manufacturing the substances <http://apis.ifas.ufl.edu/apis95/apfeb95.htm#FL>.
Unfortunately, resistance to Apistan®’s active ingredient, fluvalinate has already emerged in a number of places and recently has been confirmed in Florida <http://apis.ifas.ufl.edu/apis98/apaug98.htm#4>. This has prompted researchers and beekeepers to search for alternative chemicals, including both hard pesticides (amitraz, coumaphos, flumethrin) and soft chemicals (formic acid, oxalic acid, essential oils <http://apis.ifas.ufl.edu/letters/aix3_23.htm>
Chemical use and the potential for its abuse in beekeeping is expected to eventually lead to another philosophy that has been accepted in many other agricultural enterprises. This is integrated pest management, a combination of chemical, cultural, physical and genetic control methods to reduce mite populations <http://apis.ifas.ufl.edu/apis96/apoct96.htm#3>.
The honey bee is perhaps the least domesticated of organisms routinely used by humans for economic gain. Ironically, with the appearance of the Varroa mite, the bee has become much more reliant on the beekeeper <http://apis.ifas.ufl.edu/apis96/apoct96.htm#3>. It is also one of the most difficult to manage genetically, even though the technology to control mating, instrumental insemination, has matured and now can be routinely employed with success.
The honey bee’s mating system seeks to maximize variation. Narrowing the genetic base leads to inbreeding depression and related problems <http://apis.ifas.ufl.edu/apis97/apoct97.htm#4>. Because of its complexity, managing bee genetics is expensive in both time and money. As a consequence, it has for practical purposes been ignored, except in a very few instances in the United States and elsewhere in the world. Most "queen breeding" programs are really production systems based on limited selection <http://apis.ifas.ufl.edu/apis92/apsep92.htm#2>.
With the introduction of more and more exotic pests, there is increased evidence that bee breeding may be coming of age <http://apis.ifas.ufl.edu/apis95/apjan95.htm#BP>. Updated breeding schemes have been developed such as closed populations that appear to have promise. In addition, use of already known technologies like that surrounding the development of hygienic behavior may also be implemented <http://apis.ifas.ufl.edu/apis98/apsep98.htm#1>. At least one proposal has been put forth that the entire industry collectively support a true honey bee breeding program. Modern developments in genetics including DNA analysis also might hold promise in this arena in the future.
Fortunately, the queen, one individual is the key to successfully managing a colony. This makes it relatively easy to effect major change in a colony. Thus, the single overriding rule in beekeeping is, when in doubt requeen. A corollary to this is to ensure that the replacement queen has the necessary quality.
Managing Profitability in Beekeeping:
Over the years, several studies have concluded that beekeeping is not profitable. However, it is necessary to define what that means based on an individual operator’s experience. As with management goals, components of profitability must also be defined. This is encompassed in the term "enterprise analysis."
Size of operation:
Economies of scale figure prominently in determining profitability. Studies in Canada have shown that operations with 500 to 700 colonies appear to be most efficient. This appears to correlate with the largest number of hives a single person might effectively manage. As employees are added, this takes a toll on profitability potential. That does not mean that large operations are inherently inefficient or not profitable, only that there are many more variables to consider as size increases
The kinds of costs to be considered in beekeeping profitability include those associated with capital and operations. Labor is considered a special cost because it is so important in managing bees. Indeed, the relatively high labor costs in comparison to capital investment makes beekeeping a good development tool in developing economies <http://apis.ifas.ufl.edu/apis84/apsep84.htm#1>. Many beekeepers decide not to pay themselves as laborers and consequently these figures do not make it into calculations and analysis of an operation. Most financial consultants view this with a jaundiced eye.
Two other cost classes are fixed and variable. The former is independent of production activity. Fixed costs are incurred whether or not bee management yields marketable results. Variable costs are dependent on the amount of capacity produced by an operation. Both should be analyzed individually, as well as their relationship to one another. Traditionally, this kind of ratio analysis has been used in many enterprises. Unfortunately, it too is variable and can only be adequately analyzed with reference to the standard or average ratios found in the enterprise as a whole. Those for beekeeping and for many agricultural operations are not known. Providing as much of this to bankers, however, in the search for credit should be the borrower’s goal <http://apis.ifas.ufl.edu/apis84/apfeb84.htm#2>
Cash is king! This is the most important thing to be remembered in any business operation. Cash flow analysis, therefore, becomes the yardstick by which any beekeeper can determine whether or not an operation is profitable. An annual financial analysis or checkup is in order for operations, therefore, to prevent unseen or unexpected costs from damaging the enterprise. This is encompassed in the phrase: "Even a small leak can sink a mighty ship."
Every operation is made up of many businesses. This is likened to an onion that can be peeled away in layers. Although an aggregate financial analysis might tell one story, separating it into its component parts can yield many others. Certainly producing and marketing honey is very different than providing a pollination service. Analysis of these different enterprises can yield surprising results.
Unfortunately, case studies of individual beekeeping operations are extremely rare. In addition, surveys of costs and returns are also not generally available. The most recent were published in the American Bee Journal (1992). Another is currently taking place under the auspices of the American Beekeeping Federation.
Beekeeping in the Digital Age:
Fortunately, tools to do one’s own financial analysis are increasingly available. The use of powerful spreadsheets on desktop computers has spawned generic possibilities. A template with a beekeeping focus can be found on the Internet <http://gears.tucson.ars.ag.gov/soft/bke/index.html>.
Beyond spreadsheets, the digital computer has ushered in an unprecedented age of information availability. No longer is information scarce and reluctantly let go of by a class of professional managers or educators. The World Wide Web, newsgroups, discussion lists chat rooms and other technologies reveal a new paradigm, one of sharing, not hoarding information. This brings into focus, however, the fact that availability of information alone is no longer enough. Indeed the sheer mass of information belies its efficient use. In addition, much is of little value or worse may be counter productive. Thus, the saying "caveat emptor" still holds sway although with a different twist. One must beware of even free information in the digital age <http://www.airoot.com/beeculture/digital/index.htm>.
This paper seeks to show those areas where change in beekeeping has and continues to matter. The true bee master is one that can "think like a bee," and anticipate and provide the needs of a colony. All things about a colony are not known, however, thus beekeepers must pick carefully to try to affect those things that will accomplish their stated goals. This is also true for financial management. A beekeeper once told this author that he had no time for the financial part of beekeeping. He cared only for working with his bees. If the stated goals were that beekeeping is a hobby or simply a pastime, this could certainly pass for accomplishing at least one beekeeper’s objective. However, for the vast majority of beekeepers that must somehow show a profit from one of humanity’s most risky enterprises, this is a certain recipe for quickly exiting the beekeeping arena.