limited irrigation and your bottom line
DESCRIPTION
How to get the most dollars in return for every inch of irrigation water used, from UNL Extension in the Panhandle District of NebraskaTRANSCRIPT
Limited Irrigation & Your Bottom Line
Jessica Johnson Asst. Extension Educator, Agricultural
EconomicsPanhandle Research and Extension Center
Get the most $$$ per inch of water.
• No Till Limited Irrigation Experiment
• Understanding Response Curves
• Curves: Yield to Net Income
No Till Limited Irrigation Experiment
Limited Irrigation & Your Bottom Line
No Till Limited Irrigation Experiment– Gary Hergert, UNL – PREC since 2005
Wheat, Beans, Canola:
4”, 8”, 12”
NO-TILL
Corn:
5”, 10”, 15”
Winter Wheat-Corn-Dry Bean-Canola Rotation Initiated 2005 Growing Season
Limited Irrigation & Your Bottom Line
• Get the most $$$ per inch of water.
No Till Limited Irrigation Experiment– Gary Hergert, UNL – PREC since 2005– Corn (5,10,15”)– Wheat, Dry Edible Beans, Canola (4,8,12”)
…irrigation timings are based on crop development, precipitation and ET data…the bulk of the water is applied around the reproductive period.
Limited Irrigation No Till ExperimentWHEATWeek
Projected Plant Stage 4” 8” 12”
Early OCT 1.5 1.5 1.5
5 tillering 1.00
6 tillering 1.00
7 Jointing 0.50 1.00 1.00
8 Pre-Boot 1.00 1.00
9 Boot-head 1.00 1.00
10 Head-Flowr 1.50 1.00
11 Flowr-Fill 1.00 1.00 1.50
12 Grain milk 1.00 1.00 1.00
13 Grain Fill 1.00
14 Soft dough 1.00
Limited Irrigation No Till ExperimentDry Beans
WeekProjected Plant
Stage 4” 8” 12”
2 Emerge 0.50
3 Uni-1st tri 0.50 1.00
4 1st-2nd tri 0.50 1.00
5 2-3 trifoliate 0.50 1.00 1.50
6 Cover10-50 0.50 1.50 1.50
7 Cover50-80 1.00 1.50 1.50
8 Cover80-Full 1.00 1.50 1.50
9 Full Cover 1.00 1.00 1.50
10 Pod Elong 0.50 1.00
11 Pod Fill 1.00
Limited Irrigation No Till ExperimentCORNWeek
Projected Plant Stage 5” 10” 15”
7 5leaves 0.50
8 6leaves 0.50
9 8 leaves 0.50 1.00
10 10 leaves 0.50 1.50
11 V12 1.00 1.00 1.50
12 V14 1.00 1.00 1.50
13 Silks--R1 1.00 1.50 1.50
14 Blister 1.00 1.50 2.00
15 Milk 1.00 1.50 2.00
16 Roasting ear 1.50 1.50
17 Dough 1.00 1.00
18 beg Dent 0.50
Corn YieldsIrrg ’05* ‘06 ’07# ‘08 ‘09 ’10 ’11 ’12 Avg
RainApr-Oct
14.9 7.8 5.2 9.8 13.9 12.2 11.7 3.0 9.7
In. -------------- bushels per acre --------------
0 45 75 30 60 90 75 80 20 60
5 133 138 97 115 149 123 152 120 128
10 153 172 139 165 185 165 205 165 168
15 174 188 172 183 194 177 212 200 188
* Hail reduced yield # Severe freeze Jun 7 reduced yield
Water Response Curves
0 2 4 6 8 10 12 14 16 18 200
20
40
60
80
100
120
Inches of Irrigation
Rela
tive Y
ield
Wheat Corn Dry Beans
Water Response Curves
Hergert: Relative Yield Inches of Water Corn Wheat Dry Bean
0 32 40 321 40 49 422 47 57 503 54 64 594 60 71 665 66 77 736 72 82 797 77 87 848 81 90 889 85 94 92
Water Response Curves
Hergert: Relative Yield Inches of Water Corn Wheat Dry Bean
10 89 96 9511 92 98 9812 94 99 9913 96 100 10014 98 100 10015 99 99 9916 100 98 9817 100 95 9618 100 93 9319 99 89 8920 98 85 85
Understanding Response Curves
Water Response Curves
0 2 4 6 8 10 12 14 16 18 200
20
40
60
80
100
120
Inches of Irrigation
Rela
tive Y
ield
Wheat Corn Dry Beans
Limited Irrigation & Your Bottom Line
0 2 4 6 8 10 12 14 160.0
20.0
40.0
60.0
80.0
100.0
Wheat
Inches of Irrigation
Rela
tive Y
ield
Non-irrigated
yield
Max Total Yield
Diminishing Returns – still gaining yield.
Each inch of water = less
yield than the previous inch.
Limited Irrigation & Your Bottom Line
Net Income
0 2 4 6 8 10 12 14 160.0
20.0
40.0
60.0
80.0
100.0
Wheat
Inches of Irrigation
Rela
tive Y
ield
Curves: Yield to Net Income
Yield to Net IncomeNet Income = (Yield*Price)-(fixed costs)-(variable costs * yield)
Yield = Water Response Curves
Fixed cost = most costs associated with production Depreciation, insurance, overhead, labor
Variable Cost = costs estimated on a per unit basis Hauling, drying, fertilizer
2014 Nebraska Crop Budgets• Western Nebraska Budgets
– Corn, wheat, dry beans, millet, peas, and sunflower
– Available online http://cropwatch.unl.edu/economics/budgets
2014 Crop Budgets • Input costs mostly up
– Except nitrogen and glyphosate herbicides
• 2013 land values higher– Expected to be steady or lower in 2014
• Fixed Cost • Variable Cost
– Fertilizer – Hauling – Drying
Futures Prices…
Irrigated Corn 180 bu. Yield
NT Wheat90 bu. Yield
2/24/14 Futures $4.65/bu. – Dec ‘14 $6.83 – Sept. ‘14
Local December Basis ‘07-’12
- $0.32 -$1.11
Forecasted local price $4.33/bu. $5.72/bu.
• Strong basis during 2013/14 • USDA Outlook 2013/14
http://www.usda.gov/oce/forum/2014_Speeches/Ash.pdf
– Corn $4.50/bu. – Winter Wheat $6.80/bu.
2013/14 W. NE Corn Basis
SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG-1.00
-0.50
0.00
0.50
1.00
1.50
Western NE Corn Basis
2013/14
Estimating Dry Bean Price • Discovered 4:1 Dry Bean/Corn
relationshipRead Article Here http://panhandle.unl.edu/agecon_6
• Estimate local corn price $4.33/bu. Quick Math
4.33/56=0.0773…*4*100=$30.93/cwt
Limited Irrigation Calculator Available ONLINE go.unl.edu/pagecon
Limited Irrigation & Your Bottom Line
Net Income
0 2 4 6 8 10 12 14 160.0
20.0
40.0
60.0
80.0
100.0
Wheat
Inches of Irrigation
Rela
tive Y
ield
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20($200.00)
($150.00)
($100.00)
($50.00)
$0.00
$50.00
$100.00
Inches of Irrigation
Net
Inco
me
Profitable Area of
Production
Limited Irrigation & Your Bottom Line
Max Net
Income
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20($200.00)
($150.00)
($100.00)
($50.00)
$0.00
$50.00
$100.00
Inches of Irrigation
Net
Inco
me
Log
ica
l Are
a o
f Pro
du
ctio
n
Limited Irrigation & Your Bottom Line
Max Net
Income
Max Avg.
Income
Diminishing Returns – still gaining Profit.
Each unit of water = less
income than the previous unit.
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.
Comparing Curves
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20($500.00)
($400.00)
($300.00)
($200.00)
($100.00)
$0.00
$100.00
$200.00
$300.00
Wheat Corn Dry Beans
Inches of Irrigation
Net
Inco
me
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.
Comparing CurvesWheat Corn Dry Beans
Profitable Area of Production 7”-19” 15”-19” 6”+
Max Average Income per
Inch
12”99% of relative
Yield
17”100% of
relative Yield
11”98% of relative
yield
Max Net Income 13” 17” 14”
*Based on limited irrigation watering technique, UNL cost estimates, and futures prices on the day of calculation.
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.
Other Tools • Water Optimizerhttp://agecon.unl.edu/wateroptimizer/download.html• IRRICOST Irrigation Cost Estimate
Workbookhttp://lancaster.unl.edu/ag/crops/irrigate.shtml
Office: 308-632-1247 go.unl.edu/[email protected] PanhandleAgEcon
Extension is a Division of the Institute of Agriculture and Natural Resources at the University of Nebraska-Lincoln cooperating with the Counties and the U.S. Department of Agriculture.
University of Nebraska-Lincoln Extension educational programs abide with the non-discrimination policies of the University of Nebraska-Lincoln and the United States Department of Agriculture.
Get current Panhandle price & basis information
TEXT “@UNLPREC” to 651-968-8358Standard message & data rates apply.
Cornhusker Economics Outlook Sidney 9-11:30AM & Chadron 2:30-5:00PM
March 4, 2014
Back Page
2014 W. Nebraska Crop BudgetsNo-Till
Dryland Budget # Yield Cost/Unit Change from ‘13
Millet 40 22 cwt. $8.72 NEW
Peas 43 35 bu. $5.75 NEW
Sunflowers 5758 - EcoFallow
13 cwt.16 cwt.
$17.81$16.23
↓18%↓16%
Wheat 61-63 45-55 bu. $5.26 - $6.40 ↓4to↓10%
Irrigated Budget # Yield Cost/Unit
Alfalfa 12 6.6 tons $78.44 NEW
Corn 22 26 180 bu. $4.04
$4.49 ↓3%
Dry Beans 30-32 25 cwt. $23.59- $23.69 ↓6-↑2%
Sugarbeets 53-56 26 ton $32.88 -$38.02 ↓14 to ↓10%
Sunflower 59 30 cwt. $14.84 ↓1%
Wheat 65-66 85-90 bu. $5.13 - $5.65 ↓3 to ↑7%