If you raise corn and soybeans, cover cropping could help you increase profits, but not right away, according to Rob Myers, regional director of Extension programs for the USDA-NIFA North Central Region Sustainable Agriculture Research and Education Program.
Myers is with University of Missouri. He presented “The Bottom Line with Cover Crops: Evaluating Their Economic Impact on Corn and Soybean Production” as a recent webinar hosted by Purdue University Center for Food and Agriculture Business, Cornell University Cooperative Extension, American Farmland Trust, Wood Soil & Water Conservation District and IPM Institute.
Though he focused on corn and soybeans, “Many of the principles would apply to other crops as well,” he said.
He shared results from the SARE Cover Crop Economics Report released in the summer of 2019, which is based on data from five years of national surveys along with other data.
Myers said that the median costs of cover crops per acre include seed ($25); planting the seed ($12); and termination ($0) to total $37. He said the costs can vary widely, as seed ranged from $10 to $40, depending upon the cover crop selected. Planting ranged from $0 to $18. Some farmers sow seed while making passes with other equipment such as harvesting implements; others may use more expensive means such as hiring aerial applicaiton. The termination costs range from $0 to $10; however, so few pay for termination that the median cost per acre is $0.
“Some may make a special trip across the field to terminate but most make a spray down in the spring before planting,” Myers said. “Those costs really vary.”
Factors that can increase the cost of cover crop application include the species selection, seeding rate, seeding method and seed source.
“A row crop planter versus a grain drill can keep costs lower,” Myers offered as an example. “There’s less labor involved with larger equipment.”
A farmer who saves his own seeds spends less when compared with one who orders seeds from elsewhere.
Farmers want to see a return on those expenditures. Myers said that using cover crops can result in higher yields, lower costs and greater resiliency.
Among survey participants, the corn yields consistently increased in the year following a cover crop. For soybeans, a similar pattern emerged.
It may appear that the initial surge in yield indicates a greater immediate benefit; however, Myers said that the 2012 drought in major corn and soybean growing regions skewed the statistics.
“We found that cover crops helped,” he said.
He added that the yields gradually increase the longer cover crops are used, increasing to 3% for corn and 4.96% for soybeans at five years. That means that in year one, farmers lose $31.36 per acre with corn and $23.44 per acre with soybeans that have a cover crop. By year five, they’ll see an increase per acre of $17.90 for corn and $10.18 per acre for soybeans, assuming average weather and management conditions.
“In year one, it’s costing us to use that cover crop,” Myers said. “By year three, we’re starting to break even and by year five, we’re starting to see a modest profit.”
In addition to yield improvement, farmers should also look at soil health as a positive result of cover crops.
For both crops, famers may see an average savings of $2 per acre for reduced expenses in erosion repair and beginning in year three, up to $10 per acre savings in weed control costs.
Cover cropping may also reduce fertilizer application. For soybeans, farmers may save $8.40 an acre for phosphorus by year five. By that time, farmers raising corn may save $11.40 per acre on nitrogen and $10.50 per acre on phosphorous.
Farmers leasing fields may operate based upon an annual lease; however, if they feel that they’ll likely continue working the same fields, cover crops may be worthwhile.
“With other management practices, we have things we do on a multi-year timeframe, like liming a field, which takes two to three years for that practice to pay for itself,” Myers said. “Likewise, we buy equipment that is amortized over a few years.”
Using cover crops may also reduce need for herbicide application, up to $27 per acre.
Raising healthy crops requires well-drained, loose soil. Myers said that the struggle of wet years like 2019 could be mitigated by cover crops.
“Tilling is a typical response,” he said regarding compacted soil.
But tilling costs farmers in terms of fuel, labor and equipment use.
Myers estimates that cover crops can save farmers $15.30 per acre by year number two for soybeans and breaks even by year two for corn.
As for soil fertility, Myers said that cover crops help farmers break even in year two for corn and pay off in year three for soybeans.
Because of all of these advantages — and more — “we’re finding more and more farmers are adopting more management strategies like cover crops,” Myers said. “Many farmers who switch to no-till have a slight yield dip in the first few years.”
He believes that combining no-till with cover cropping may help mitigate that yield dip.
Cover crops may also provide another benefit to farmers: offering grazing opportunities for animals.
“This is one of the most commonly cited ways farmers can do quite well with cover crops,” Myers said.
Based upon the hay replacement model developed by economist Alan Weber, farmers can obtain a $49 return per acre on their cover crops through grazing if they already have fencing and access to water set up.
Myers said that three key aspects affect cover crop economics: evaluating cover crops holistically as part of an overall soil health plan; viewing cover cropping as a multi-year plan; and using cover cropping as a means to improve the resiliency of the cropping system.
“Value cover crops both for their immediate benefits and as investment in the long-term success of the farm,” Myers said.