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United States Department of Agriculture

Agricultural Research Service

Research Project: Economic Analysis of Integrated Farming Systems That Enhance Soybean Productivity on Marginal Lands under Climate Change

Location: Soil Drainage Research

2013 Annual Report


1a.Objectives (from AD-416):
To analyze the cost and benefits of integrated farming systems which include no-tillage, cover crop, crop rotation, and gypsum soil amendment that enhance soybean productivity on marginal lands under climate change.


1b.Approach (from AD-416):
All inputs, operating costs, crop yields, nutrient removal, heavy metal impact, GHG emissions, soil quality improvement, and soil C sequestration rates will be recorded. Economic analyses of farm level profitability and environmental impacts for each of the studied systems will be conducted based on these experimental results. Harvested marketable units will be valued at their net farm (farm gate) price. Variable inputs will be measured and valued at their market or opportunity prices. Transportation costs will be included for inputs purchased from the market. Opportunity cost concepts will be used to value inputs not purchased from the market. Land will be valued at the cash rental rate in local markets and labor will be valued at a rate consistent with local labor markets. Fixed costs of machinery and equipment are difficult to evaluate in experimental situations, as equipment used for plot work may not be sized optimally or represent machinery used by practicing farmers. An appropriate set of equipment will be identified for a representative farm size and priced using new or used equipment market values. Annual use values (depreciation and interest on investment) will then be calculated. Fixed costs of each equipment item will be allocated among enterprises based on the proportion of total machine use by each enterprise. Economic and ecosystem services analyses will be conducted as described by Vadas et al. (2008).


3.Progress Report:

At the end of the 2012 production year, the input and yield data were assembled and analyzed for economic insights. A regression analysis was conducted on data across all sites. The results to date can be summarized as follows: 1. Gypsum level was not statistically significant as an explanatory variable for soybean profitability. 2. The presence of a cover crop was significant at the 0.01 probability level. Cover crop added more cost than value, and hence diminished profitability (-$56/ac). 3. High oil soybean varieties were significantly more profitable (+$66/ac), even though a price premium was not included for these varieties. They simply yielded more. 4. Continuous soybean plots were not significantly different than soybean-corn (S/C) rotation plots. 5. Intercept shifters were applied, to control for the main weather impacts at each location. Hoytville was the excluded location. Results show that all three named locations had lower profitability than did Hoytville. 6. The R-squared for the regression was 0.93, suggesting that about 93% of the variation in profitability was explained by this simple model. These first year results should be viewed cautiously for at least two reasons. First, 2012 was a severe drought year in several test locations: Crop performance (and profitability) varied greatly across the four test sites due to severe drought conditions at several sites. Secondly, this is the first year of a multiple year experiment. Gypsum application levels, cover crop impacts, and crop rotations may all have incremental and additive effects over time.

Research activities conducted for this Specific Cooperative Agreement contribute directly to Sub-Objective 2a of the parent project: Evaluate no-till, soil amendment, and cover crop practices as compared to conventional management practices for improving crop yield and soil/water quality in intermittently wet soils.


Last Modified: 9/2/2014
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