The production of herbaceous biomass as a feedstock for fiber conversion is an equipment-based enterprise, meaning that, above some yield threshold, harvest/handling/hauling equipment productivity has more impact on delivered cost than land productivity. Performance of five large round bale harvest systems was simulated assuming an idealized harvest opportunity (field efficiency 80%, no weather delays, no maintenance delays). Round balers produce a lower density bale when baling a heavier windrow, and this factor had a significant effect on harvest cost. Baler achieved capacity is maximized when hay (15% M.C.) in the windrow is between 2.2 and 3.6 kg/m. At higher windrow densities, the bales produced have a lower density (mass) and total wrap-eject time as a percentage of field time increases; consequently, baler productivity (Mg/h) decreases and cost per bale increases. A raking strategy was selected to produce a windrow with a material density of at least 2.2 kg/m. If one rake swath produced a windrow with less than 2.2 kg/m, two rake swaths were combined and so forth until the 2.2 kg/m density was reached. Using this strategy total harvest cost was kept almost constant as yield increased up to 12 dry Mg/ha. As yield increased from 12 to 18 dry Mg/ha, total harvest cost increased from $16.65 to $20.00/dry Mg, or 20%. (Only in-field costs were computed, therefore the simulation costs are lower than current commercial practice.) Increases in yield above some optimum (12 dry Mg/h based on simulation results) will not reduce per-Mg harvest cost, and there is strong evidence to suggest cost will increase. A second factor significantly affecting harvest cost was annual operating hours. Suppose two grass species are planted and these species are harvested at different times. If the two-grass strategy allows an operator to double productive machine hours from 200 to 400 h/yr; per-Mg harvest cost is reduced 10%. Production management decisions, e.g. selection of grass species and management for multi-cut harvests, can increase potential harvest days during the season. An increase in harvest days reduces per-Mg harvest costs, but more importantly, increases Mg/yr/machine. The simulations showed that return on equipment investment increased 174% when annual operating hours increased from 200 to 400 h/yr. (C) 1996 Elsevier Science Ltd.