Cover crops can provide economic benefits to farmers. Hairy vetch cover crops have been shown to boost no-till corn yields enough to cover establishment costs in some studies. Cover crops can reduce economic risk for farmers. The direct costs of cover crops include seed, inoculant, herbicide, and costs of establishment and termination. Indirect costs include potential negative impacts on cash crops. Matching cover crop species and varieties to objectives like grazing or nutrient scavenging is important. The economics of cover crops include both on-farm costs and benefits as well as off-farm environmental benefits.

1. Cover Crop Economics
from outside the box
Joel Gruver
Western Illinois University

3. GREAT BOOK
but
No chapter on cover crop economics !

4. Page 9 - The N value of legumes is the easiest cover
crop benefit to evaluate, both agronomically and
economically. This natural fertility input alone can
justify cover crop use.
• Hairy vetch boosted yield for no-till corn
more than enough to cover its establishment
costs, a three-year study in Maryland showed.
Further, the vetch can reduce economic risk and
usually will be more profitable than no-till corn
after a winter wheat cover crop (1993 data). The
result held true even if corn were priced as low as
$1.80 per bushel, or N fertilizer ($0.30/lb.) was
applied at the rate of 180 lb N/A
Not exactly current

5. From the Literature cited section
Ott, S.L. and W.L.Hargrove. 1989. Profit and risks of using
crimson clover and hairy vetch cover crops in no-till corn
production. Amer. J. Alt. Ag. 4:65-70.
Hanson, J.C. et al. 1993. Profitability of no-tillage corn
following a hairy vetch cover crop. J. Prod. Ag. 6:432-436.
Lichtenberg, E. et al. 1994. Profitability of legume cover
crops in the mid-Atlantic region. J. Soil Water Cons.
49:582-585.
Jackson, L.E. 1995. Cover crops incorporated with reduced
tillage on semi-permanent beds: Impacts on nitrate
leaching, soil fertility, pests and farm profitability. SARE
Project Report #AW92-006.Western Region SARE.
Logan,Utah. www.sare.org/projects

9. ?

13. CC biomass and N credits
should be predictable
using canopy sensors

14. Cost accounting for
cover crops

15. Direct costs
vs.
Indirect costs
vs.
Opportunity costs

16. DIRECT COSTS
Material costs
•seed
•inoculant
•herbicide
•fertilizer
Operational costs
•establishing
•terminating
•managing residues

17. Results of cover crop seed price survey
Vendor Cereal rye Annual Hairy vetch Medium red
ryegrass clover
1 (WI) 0.188 0.52 (0.69) 1.60 (1.98) 1.22 (1.62)
2 (IL) 0.147 (0.179) 0.47 (0.63) 1.42 (1.65)
Prices were obtained through direct
3 (MN) communication with vendors via(1.90) or (1.84)
0.153 (0.171) 0.50 (0.56) 1.70 phone 1.66
4 (NE) email during September 2010. Prices 1.65 (1.95)
0.157 (0.179) 0.55 (0.65) 2.10 (2.50)
represent cheapest variety available (often
5 (IL) (0.213) (0.75) (2.20) (2.60)
VNS). Wholesale and retail prices were
6 (IL) 0.188 (0.214) (0.70)
requested when available. Prices in
7 (MO) 0.197
parentheses are retail prices. All other 1.21
0.46 1.47
8 (IL) (0.20) prices are wholesale (1.80)
(0.60) prices. (1.75)
9 (IA) (0.195) (0.62) (2.00) 2.00
10 (IN) (0.239) (0.75) (2.20)
11 0.125 0.48 1.05
(ILfarmer)*

18. ?????

19. Cereal rye production statistics (USDA-NASS)
Acres/1000 Acres/1000 Average Total
planted for harvested yield production Average
Year all purposes for grain (bu/ac) (bushels*1000) price ($/bu)
1950s 4060 1674 14.2 23907 1.23
1960s 4134 1460 20.9 30102 1.01
1970s 3236 987 24.8 24981 1.82
1980s 2496 700 28.3 20023 2.20
1990s 1555 380 27.2 10336 2.70
2000 1329 296 28.3 8386 2.60
2001 1328 250 27.6 6896 2.86
2002 1355 263 24.7 6488 3.32
2003 1348 319 27.1 8634 2.93
2004 1380 300 27.5 8255 3.22
2005 1433 279 27 7537 3.30
2006 1396 274 26.3 7193 3.32
2007 1334 252 25 6311 5.01
2008 1260 269 29.7 7979 6.32
2009 1241 252 27.8 6993 4.78
2010 1186 250

20. Performance over Price
• Buy CC seed on value not price
Vendor Cereal rye Annual Hairy vetch Medium red
ryegrass clover
WI 0.188 0.52 (0.69) 1.60 (1.98) 1.22 (1.62)
IL1 0.147 (0.179) 0.47 (0.63) 1.42 (1.65)
MN 0.153 (0.171) 0.50 (0.56) 1.70 (1.90) 1.66 (1.84)
NE1 0.157 (0.179) 0.55 (0.65) 2.10 (2.50) 1.65 (1.95)
IL2 (0.213) (0.75) (2.20) (2.60)
IL3 0.188 (0.214) (0.70)
MO 0.197 0.46 1.47 1.21
IL4 (0.20) (0.60) (1.80) (1.75)
IA (0.195) (0.62) (2.00) 2.00
IN (0.239) (0.75) (2.20)
(IL farmer) 0.125 0.48 1.05

21. How much is
good
technical
support
worth to
you?

22. http://www.greencoverseed.com/

23. What does it cost to inoculate?

24. +20 lbs N/a

26. University of Illinois Machinery Cost Estimates
“Adding 5 to 15 percent to
estimated costs is appropriate
for determining custom rates”

27. Per acre costs of cover crop planting operations
based on custom rate surveys
Field operation IA* IL IN* MO*
Fertilizer buggy 4.15 (1.50-7.50) 4.72 (3.07-6.37) 4.97 (3-15) fert
6.02 (3.50-15)
fert+seed
Harrowing 8.10 (4-12.50) 6.78 (3-12)
Cultipacking 6.55 (3-10) 8.50 (5-15)
Broadcast w/ 10.35 (8-12) 7.44 (3-12.50)
ATV
Conv. grain drill 13 (7.50-20) 11.40 15.89 (13.63- 13 (8-24) sg
18.15) s 14.09 (10-24) gc
No-Till grain drill 15.35 (12-25) 14.60 14.47 (10.80- 14.80 (10-24) s
18.14) 14.25 (5-25) sg
Air seeder 16.40

28. IA and IL Aerial Applicator Survey (May-June 2010)
Name Location Experience w/CC Cost
no exp., no customer
Cady Aerial Spray Rock Falls, IL interest $8.00/a norm app $8.50/a cc
Benoit Aerial
Spraying Kankakee, IL turnips and rye $8.00/a norm app $10.00/a cc
Franks Flying
Service Morrison, IL ryegrass and c. rye $8.00/a norm app $10.00/a cc
Reeds Fly-on yes, c. rye, small part
Farming Mattoon, IL of business $8.00/a norm app $12.00/a cc
Killiam Flying rye, wheat on beans, $8.00/a norm app $10.00/ac
Service Carlinville, IL rye on corn or 10/lb
Curless Flying
Service Astoria, IL ryegrass and turnips $8-15.00/a all app.
Klein Flying St. Francisville, ~$12.50/a cc, $9.00/a liquid
Service IL annual rye and turnips app
Agriflite Services Wakarusa, IN rye, wheat, ryegrass ave $15.00/a for cc app.
Al's Aerial $10-15.00/a cc $10.00/a
Spraying Ovid, MI rye and wheat liquid

29. Examples of total cover crop management programs ($/ac)
Costs Program 1 Program 2 Program 3 Program 4
Seed 11.25 7.50 11.25 9.00
Seeding operation 4.15 15.00 10.00 10.00
Seed incorporation 6.50
Herbicide 2.00 2.00
Termination 6.50 6.50
operation
Total 30.40 31.00 21.25 19.00
Program 1 Program 2
Seed: 90 lbs/ac cereal rye Seed: 60 lbs/ac cereal rye
Seeding operation: spread w/fertilizer buggy Seed bed preparation: none
Seed incorporation: rolling stalk chopper Seeding operation: no-till drill
Herbicide: 24 oz. glyphosate Herbicide: 24 oz. glyphosate
Termination operation: 90’ boom spray rig Termination operation: 90’ boom spray rig
Program 3 Program 4
Seed: 90 lbs of cereal rye Seed: 3 bushels of bin-run oats
Seed bed preparation: none Seed bed preparation: none
Seeding operation: aerial seeding Seeding operation: aerial seeding
Herbicide: no added cost, burn-down standard Herbicide: none – winter-kill
Termination operation: no added cost, burn-down standard Termination operation: none – winter-kill

31. Illinois NRCS cover crop specifications

32. Indirect costs
Costs associated with challenges
created by the addition of cover
crops to cropping systems.
Examples include cover crop
residues hindering establishment of
succeeding cash crops due to slow
soil warming or delayed organic N
release and cover crops that
become weeds.

33. CCs affect many agronomic factors
simultaneously
Control
erosion
Feed
livestock
Cover
Crops
Adapted from Magdoff and Weil (2004)

34. Not all effects are positive
Host
pests
Tie up N
? ?
Become a
weed
Interfere w/
equipment
performance
Suppress crop
growth
Cover
Crops Dry out soil
Prevent excessively
soil drying
Add cost
Increase
management
Adapted from Magdoff and Weil (2004)

35. Match CC objectives with species
Grazing
GRAZING = #1 way to make cover crops pay!
brassicas, clovers, small grains, a. ryegrass, sorghum-sudan
Nutrient scavenging/cycling
brassicas, small grains, annual ryegrass
Bio-drilling
brassicas, sugarbeet, sunflower,
sorghum-sudan sweet clover, alfalfa
N-fixation
clovers, vetches, lentil, winter pea, chickling vetch, sun hemp, cowpea, soybean
Bio-activation/fumigation
brassicas, sorghum-sudan, sun hemp, sesame
Weed suppression
brassicas, sorghum-sudan, cereal rye, buckwheat

36. Do you think that these cows are
happy to have more than corn stalks
for lunch today?

39. Coming soon to a farmer’s market near you…

40. Opportunity costs
Income foregone when less
profitable crops are included in
crop rotations (e.g., small grains)
or cover crops are grown at times
when cash crops could be in the
field (e.g., cover crops following
wheat vs. soybean double crop)

41. Internal costs vs. External costs
aka
On-site costs vs. Off-site costs
On-site benefits vs. Off-site benefits

42. The economics of off-site erosion
Karl L. Guntermann, Ming T. Lee and Earl R. Swanson - 1976
Erosion and sedimentation in agriculture has traditionally
been thought to result in substantial costs to the producer
implying that voluntary measures at soil conservation would
be in the individual's and society's interest. The research
reported here indicates that off-site sediment damages
are far greater than the on-site productivity effects of
erosion and that there is considerable justification for
stronger public policies in this area. The development of
the efficient production frontier reveals that conventional
production techniques are quite inefficient compared to
procedures that could be adopted.

43. There are no silver bullet solutions that
sustainably balance environmental quality with
productivity and profitability in agriculture!
A better silver
strategy is . . . buckshot!
Silver buckshot is a concept promoted by
a collaboration of agencies and orgs called
GREEN LANDS BLUE WATERS

44. Winter cover crops
Perennial-based
crop rotations
Permanent pasture systems Perennial bio-energy crops

45. Reductions in long-term costs!
Impact of the 2008 floods on IA soils
20 tons per acre average soil loss across 2,284,000 ac!
Conservation structures needing repair
12,157 Grassed Waterways
8,137 Terraces
3,375 Water and Sediment Control Basins
800 Grade Stabilization Structures
Fields with combinations of two or more conservation
practices (e.g., no-till + cover crops) performed much
better than fields with a single practice

46. Have any of you priced
one of these?

47. The science is clear - cover crops can reduce nitrate leaching
at lower cost than most other practices!
Bare fallow
Kaspar et al. J. Environ. Qual. 36:1503-1511

48. …while also
improving soil
health

49. Same soil type
and landscape position
CROP SOD
Students in my Soil Properties class each
analyzed paired soils from their farms

51. Research has documented yield increases
even in very high yield environments

52. What do you see in
this photo?

53. Which compaction alleviation
strategy is more cost effective?

55. Precision radishes w/o peas
Precision planted radishes w/ peas from 5 ft of row

56. Precision planted radish on 30” rows w/ peas

57. About a month ago

58. We are playing with lots of
precision planting options
on a small scale

60. Brassicas appear Nutrient cycling: Phosphorus
to be particularly
adept at 150
solubilizing P Soil Test P
Wye,loam at Wye, fall 2003
Silt Fall 2003
Soil test P, mg/kg 120 Means for top 18 inches
Means for 0-45 cm
a
90 a
50%
b increase
bc
Biological 60
pumping + c
organic acid root
exudates
30
Third year of cover crop
0
treatments in a corn- e e l ad ad
ap Ry ntro r r
soybean rotation R co ge ed
fora o ils
e
Cover crop treatment

61. Fall 2003
Oilseed Radish
cover crop
greatly
increased non-
parasitic
nematodes in
June 2004
soybean field.
> non-parasitic
nematodes
↓
> N cycling

62. Corn following cover crop experiment in 2011
Relative
Cover crop system
corn yield
Volunteer oats 79%
Radishes planted on 30” 99%
Radishes drilled on 7.5” 91%
Corn planted on radish rows

63. We have also documented negative yield effects

64. Wow...cover crops are
not idiot-proof!
Cover crops require more management
than broadly adapted off-the shelf technologies

65. Can you think of any ag
technologies that substitute
for management skill?

66. ?

68. Corvus Atrazine
WIU student
project this fall
Flexstar
Lexar Halex

69. A recent survey by
Farm Futures
magazine of more
than 1,000 farmers
found those on the
cutting edge of
conservation were
actually more
profitable than
other farmers.
In short, it is
possible to be both
green and gold!

71. • Only 11% used cover crops within past 5 years.
• Only 8% planted cover crops on their farm in the fall of 2005.
Only 4.8% in IA.
• 43% using conservation practices with cost sharing, 57% w/out.
• 56% said they would use cover crops with cost-sharing

72. Real financial data for thousands of
farmers across the Midwest

73. WHY DO SOME FARMS CONSISTENTLY HAVE HIGHER
PROFITS THAN OTHER FARMS?
$148!

74. Moving beyond cover crops as add-ons
to new cropping systems

75. Cover crops should not be viewed as the missing
puzzle piece(s) in current cropping systems!

77. ~ 160 profiles since 2008
New economics Qs this year

78. WIU Organic Research farm
Spring 2012
Fall 2012
Some things
are priceless :-> Student’s
home farm