Wednesday, November 15, 2006

Economic Analysis of Trade-offs in Six Long-Term Management Systems in Southwest Michigan.

Sara Parr, Michigan State Univ, 3700 E Gull Lake Dr., Hickory Corners, MI 49060

Rising prices for agricultural inputs, particularly land, fuel, and agrochemicals, as well as a labor shortage problem, have led farmers to have to make choices of which types of systems work best for their particular farming system. Six management systems were compared to examine trade-offs input costs and revenues in Southwest Michigan within the northern boundary of the U.S. corn belt. These systems included four annual treatments (conventional, no-till, reduced-input, and organic) in a corn-soybean-wheat rotation, perennial alfalfa, and fast-growing poplar trees as a fuel crop. Data was collected and analyzed from 1989-2005, and included seed, fertilizer, pesticide, and field operation costs, as well as grain sales. Among the annual treatments, grain sales were similar among treatments most years, although organic treatments had significantly higher sales (particularly during corn years). Among the annual treatments, fertilizer and pesticide costs were lower in the reduced input and organic treatments, while the organic and reduced-input systems had higher seed costs due to the use of cover crops. Alfalfa had high labor and chemical costs, though a steady stream of income throughout the field season through crop harvesting. While poplar trees were the least labor and input intensive, this crop had a high initial investment and a long period (9 years) before harvest. With the increase in fuel costs, a switch to management systems less reliant on agrochemicals and intensive tillage may be more profitable per acre. This analysis shows that some systems may be more profitable, though each farmer should chose based on what resources are most limiting (labor, machinery, land, etc.) to balance their profit/acre with the amount of resources available to manage their agricultural land.