Agroforestry

Definition of 'Agroforestry'


The integration of agriculture and/or farming with forestry so the land can simultaneously be used for more than one purpose. This practice is meant to have both environmental and financial benefits. The presence of trees can provide benefits such as sheltering livestock from the elements and improving the soil so that crops will be more productive. The agroforestry system can also provide a more even income for landowners since all of their income is not tied to a few crops or a single season. Agroforestry can also make it easier for farmers to transition from one type of crop to another as market demand for their products changes.

Investopedia explains 'Agroforestry'


Agroforestry does require more planning and know-how than simpler land uses because the system must take into consideration the diverse and sometimes contradictory needs of each component (the grazing needs of cattle versus a tree's need to have its roots undisturbed, for example). Examples of types of agroforestry practiced in the United States include alleycropping, silvopasture, windbreaks, riparian buffer strips and forest farming.


Filed Under:

comments powered by Disqus
Hot Definitions
  1. Organic Growth

    The growth rate that a company can achieve by increasing output and enhancing sales. This excludes any profits or growth acquired from takeovers, acquisitions or mergers. Takeovers, acquisitions and mergers do not bring about profits generated within the company, and are therefore not considered organic.
  2. Family Limited Partnership - FLP

    A type of partnership designed to centralize family business or investment accounts. FLPs pool together a family's assets into one single family-owned business partnership that family members own shares of. FLPs are frequently used as an estate tax minimization strategy, as shares in the FLP can be transferred between generations, at lower taxation rates than would be applied to the partnership's holdings.
  3. Yield Burning

    The illegal practice of underwriters marking up the prices on bonds for the purpose of reducing the yield on the bond. This practice, referred to as "burning the yield," is done after the bond is placed in escrow for an investor who is awaiting repayment.
  4. Marginal Analysis

    An examination of the additional benefits of an activity compared to the additional costs of that activity. Companies use marginal analysis as a decision-making tool to help them maximize their profits. Individuals unconsciously use marginal analysis to make a host of everyday decisions. Marginal analysis is also widely used in microeconomics when analyzing how a complex system is affected by marginal manipulation of its comprising variables.
  5. Treasury Inflation Protected Securities - TIPS

    A treasury security that is indexed to inflation in order to protect investors from the negative effects of inflation. TIPS are considered an extremely low-risk investment since they are backed by the U.S. government and since their par value rises with inflation, as measured by the Consumer Price Index, while their interest rate remains fixed.
  6. Gilt-Edged Switching

    The selling and repurchasing of certain high-grade stocks or bonds to capture profits. Gilt-edged switching involves gilt-edged security, which can be high-grade stock or bond issued by a financially stable company such as the Blue Chip companies or by certain governments.
Trading Center