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Minnesota Crop News > 2001-2008 Archives
December
5, 2001
Using
the "Bottom Line" to Compare Tillage Systems
George Rehm, Extension Soil Scientist and John Cunningham, Extension
Educator, Big Stone County
Ridge-till, strip (zone)-till,
and no-till are conservation tillage systems that are adapted
to growing conditions in Minnesota and surrounding states. The
advantages of each system have been described in many ways. The
economic advantage of these systems, however, is fequently
overlooked.
Minnesota crop producers who use a conservation tillage planting system frequently
point to an improved "bottom line" as a major advantage considering
the current situation with higher production costs and low commodity prices,
it is critical to achieve optimum yield with efficient costs of production.
The economic advantage of conservation tillage can be described in several
ways. Economic information, however, is usually most effective if it
is provided by farmers who keep good records. In order to obtain useful
economic information, it was apparent that a survey involving current farmers
was needed. Therefore, a survey was designed that would compare production
costs of one conservation tillage system (ridge-till) to those of a conventional
tillage system.
To complete this survey, several ridge-till farmers were asked via personal
interviews to provide production costs for both corn and soybeans in both owned
and rented management systems. These producers also identified a neighbor
who farmed approximately the same number of acres using a conventional planting
system. The neighbor provided similar information for their farming operation.
Using yields provided by the growers (ridge-till and conventional planted systems)
and associated production costs, it was possible to calculate the cost of growing
a bushel of corn or soybeans. This calculated cost is frequently referred
to as the bottom line. The information collected for corn production
is summarized in the following table. All costs are calculated on a per
acre basis.
Production costs in conventional and ridge-till plant systems
Production
Input |
Tillage System
and Land Ownership
|
|
Conventional (own) |
Conventional (rent) |
Ridge-Till (own) |
Ridge-Till
(rent) |
$/acre
|
| fertilizer |
55.69 |
58.84 |
49.15 |
37.95 |
| seed |
32.89 |
34.68 |
37.75 |
34.62 |
| herbicide |
26.04 |
30.61 |
21.31 |
16.13 |
| fuel |
10.94 |
7.92 |
6.95 |
5.81 |
| cash rent |
-- |
89.05 |
-- |
73.28 |
| total production cost |
278.61 |
335.87 |
226.70 |
246.96 |
| yield (bu/acre) |
144.9 |
140.7 |
149.0 |
139.5 |
| cost $/bu. |
1.94 |
2.38 |
1.52 |
1.77 |
Similar values for soybean production are summarized in the next table.
Production costs for soybeans in conventional and ridge-till planting
systems.
Production
Input |
Tillage System
and Land Ownership
|
Conventional (own) |
Conventional (rent) |
Ridge-Till (own) |
Ridge-Till
(rent) |
| fertilizer |
0.70 |
5.81 |
5.34 |
5.27 |
| seed |
23.55 |
18.54 |
24.34 |
25.05 |
| herbicide |
26.54 |
20.37 |
17.31 |
14.99 |
| fuel |
8.80 |
8.08 |
6.14 |
4.77 |
| cash rent |
-- |
73.95 |
-- |
78.18 |
| total production cost |
169.99 |
192.75 |
158.37 |
196.28 |
| yield (bu/acre) |
41.5 |
40.3 |
43.7 |
40.1 |
| cost $/bu. |
4.13 |
4.85 |
3.69 |
5.08 |
When the amount of money needed to produce a bushel of corn
is considered, there was a substantial difference between the
farmers using the conventional system and those using the ridge-till
system. For owned land, the ridge-till farmer had an
advantage of $.42 per bushel while reporting a slightly higher
average yield. When land was rented, the cost of growing
a bushel of corn was $.61 per bushel less when the ridge-till
planting system was used and reported yields were nearly equal.
Costs of individual inputs can be evaluated when seeking an explanation for
the lower cost of production. Major costs are listed in the first table. While
the money spent for seed was nearly the same, farmers who used the ridge-till
planting system spent less for fertilizer, herbicide and fuel. The ridge-till
farmer also spent less for machinery and machinery replacement. With
less expense and the same yield, a lower cost of production would be expected. It's
important to note that the cost for producing a bushel of corn in the ridge-till
system is less than the current loan rate for corn.
When the soybean crop is considered, the ridge-till farmer spent less to produce
a bushel if the land was owned. This was not the situation if the land
was rented. The money spent to fertilize soybeans varied widely for farmers
who used both tillage systems. Seed costs were nearly the same. There
were, however, substantial differences in the amount of money spent for herbicide
and fuel.
The information gathered in this survey supports the statements made by many
farmers who use the ridge-till planting system. Yields are equal to yields
in a conventional tillage planting system; but, costs are lower. As a
result, there is a higher potential for profit at the end of the year with
the ridge-till planting system used in the corn-soybean rotation.
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