This study aims to analyze the relationship between farm size and scale merit in paddy field farming, from the point of view of three factors ; productivity, marketing activity, and response to the government’s subsidy program.
The first point is that this study confirms structural changes paddy field farming based on Agricultural Census data from 2010, which shows that large farms in the 20 - 30 ha class and group type farms have been increasing rapidly in recent years.
The second point is that this study confirms that there are scale merits in rice production. The results cleary show that the scale economy curve goes flat around 10 ha.
The third point is based on data on farm type by commodity. I used this data to compare the cost of rice production between large farms, group farms based on community and the other group farming organizations. Our analysis shows that a cost gap does not exist among the farm types. But as we take management costs into account, the cost of the group farming organizations is higher than the other types.
The fourth point of this study is based on an analysis of the profitability of the paddy field farming including the effect of government subsidies provided through a set aside program. I find that the marketing activity has a greater effect on profitability of farming than farm size, especially for large farms and group type farming. But the larger farms show a tendency of a deepening dependcy on subsidies.
This study concludes that the primary reason for the trend of increased number of larger farms and group type farming organizations is because of the power of marketing activity and the response to the subsidy program rather than the productivity of paddy field farming.

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The purpose of this paper is to illustrate an optimal scale of upland farming in the Tokachi district. To accomplish this, three related topics are investigated. Firstly, the use of farming resources (ex. land, labor) among several sizes of cultivated land are compared. Secondly, production costs and earning power among several sizes of planted area are also compared. And finally, the use and intention of farming resources in the 100 hectares class of upland farming are investigated.
The Main findings are as follows :
1. By changing the working process, it is possible to keep land use and a rotation system on farms up to the 60 hectares class in upland farming. Farmers tend to change land and labor use, and prefer to use laborsaving crops, on farms over 60 hectares.
2. Comparing the production costs and earning power of upland crops in several sizes of planted area, it appears that (1)middle-size farming costs less than small-size farms, which is attributed to the higher performance of the same agricultural implements, resulting in lower implements cost. (2)large-size farming does not necessarily cost less and even has less profitability than other sizes, although it has much income because of cultivating more land. Consequently, the advantage of large-size farming does not originate in profitability but increase of gross income.
3. It is suggested from four surveys of large-scale upland farming that family farming can expand up to the 80 hectares class by changing the working process. In the 100 hectares class, land use is remarkably extensive and labor needed is beyond the bounds of that a family can provide. Therefore the introduction of employees is needed. In the survey, farm household gross income increases through size expansion, but income per hectare does not increase clearly and there is a concern that farms do not improve their stability against declining price.
Three conclusions are drawn from the above analyses :
1. From the viewpoint of agricultural income, optimal scale should not be determined by gross income. Because it is appears that land use changes between 60 and 80 hectares, and profitability tends to decline over 80 hectares, the "maximum optimum scale in family farming" is considered to be about 80 hectares.
2. From a viewpoint of production capacity, average scale farming has reached the level of minimum optimum technical unit. Large-scale farming does not cost less than other scales. Therefore, the optimal scale is considered to be about 80 hectares.
3. In the Tokachi district, the minimum scale of upland farming that can maintain a household is 28 hectares at present while the average scale is 37 hectares. That is to say that the average farming in Tokachi has already reached both the minimum optimum technical unit and the minimum scale of upland farming. This means that it is not imperative for farming to increase in size immediately.

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Livestock farming in Japan exhibits the characteristics of a marginal agriculture and leave from land use. Hokkaido dairy farming is a model of livestock farming that is dependent on land use.
According to a statistical analysis of the Hokkaido dairy industry, milk production costs fall as the number of cow increases. This is because while material and depreciation expenses remain constant, labor expenses fall. Therefore, production cost trends are determined by labor expenses. In addition, although feed expenses are almost constant, self-supplied feed expenses fall as the number of cow increases, and purchased feed expenses go up. On the other hand, large-scale farming has come to use so much employed labor, that reduction of production costs is not connected with an increase in profitability.
According to a case study of Hokkaido dairy farming, the material and depreciation expenses of large-scale farming is not low compared with family farming. This is explained by the fact that, while depreciation expenses of buildings and machines decrease, feed expenses are high since there are feedings of purchased feed, and contract charges, such as operation fees, are high. On the other hand, since large-scale farming saves labor, the production cost of milk is low, and its profitability is also high, and there is an accumulation of capital for further scale expansion.
The scale expansion logic of large-scale farms is based on returns to land use, maximizing the capacity of an employee’s work, and improvement of the operating rate of institutions. Although the last two things lead to an improvement in the utility rate of production elements, it is also associated with an irreversible change in farm development.
The economic advantage of large-scale farming is carried out through labor saving. Although large-scale farming has no advantage of material and depreciation expenses, the character of large-scale farming is that it is dependent on employed labor and land use dependency, which are associated with high profitability. On the other hand, the leave from land use leads to a weak profit structure because profits are easily influenced by changes in material cost. Therefore, the conditions for economic results by reasonable scale depends on land use according to each scale of a farm. In the Hokkaido dairy industry, which has established a specialized farming structure, it is thought that every scale class of dairy farming has arrived at a reasonable scale.

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In this paper, we would like to introduce the present condition of large-scale paddy field farms, based on the example of Fukuhara Farm. Fukuhara Farm is a large-scale paddy field farm, consisting of 156 hectares of paddy, located in Hikone City，Shiga Prefecture. On Fukuhara Farm, an important management issue has been the expansion of management area to attain costreduction and stabilization of yield and quality.
In order to assess these management subjects, we measured field accumulation of paddy field, the construction of large paddy field sections, and capability cultivation of employees :
The main contents of our measure are as follows.
1. As to paddy field accumulation and construction of large paddy field sections, a mechanism for having cooperated with the farmhouses of the area and the organs concerned with farmland adjustment was incorporated. And in paddy fields subject to use adjustment, the construction of large paddy field sections which utilized the laser leveling machine etc. is tackled.
2. As to capability cultivation of employees, a measure for manifesting the skill and knowledge in farm work is taken and a measure is made for the acquisition and practical use of information by ICT like IC tag and Mobile phone etc.

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The growing area of MATSUMOTO farm is 50 hectares. We grow carrots, burdock root, and so on. A lot of products are sold directly to major supermarkets.
Because the information that we have to manage is increasing with the expansion of growing area, we have developed an information system that is designed to manage production information as well as incorporate a traceability system. In order to improve business operations, we obtained Japanese Agricultural Standards for Production Information Publications and GLOBALGAP. The purpose of obtaining Japanese Agricultural Standard for Production Information Publications is to increase the levels of information management and to disclosure production information. We utilize GLOBALGAP for the purpose of standardizing safety management.
We think that about 20 hectares is the optimum scale for outdoor-grown vegetable farming, because then a farmer can focuses not so much administrative tasks but rather on production operations. The inefficiencies associated with scale expansion result from staffs with low motivation when the number of staff is increasing. It is important for scale expansion in farming to standardize motivation of staff and work content.

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