Illinois
Fertilizer Conference Proceedings
January 29-31, 1996
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J.D. Hibbard, K.B. Ritchie, J.C. Siemens, and R.G. Hoeft1
Starter fertilizers have been shown to increase no-till corn yields, but their economic viability has yet to be examined. This study is an economic evaluation of 2X2-banded, seed-placed, and surface-applied starter fertilizers in no-till corn production. Average increases in yield and net returns associated with various starter fertilizer rates were computed for each application method at three locations in Illinois. Additionally, a minimum net return that could be expected at least 90% of the time, due to yield variability, was calculated. Yield and net return were increased by some 2X2-banded and seed-placed fertilizers at two of three locations. Surface-applied starter fertilizer did not significantly increase net return at any location. Banding starter fertilizer was the most consistent and safest method of increasing both yield and net return.
Starter fertilizers can increase nutrient availability and yield in no-till soils (Fixen and Lohry, 1993; Mengel, 1990; Randall and Hoeft, 1988; Ritchie et al., 1996; Schulte and Bundy, 1994). In the study by Ritchie et al. (1996), various combinations of N, P, and K were applied in a replicated field experiment using the following methods: 1) 2X2 banded (fertilizer placed 2 inches beside and 2 inches below the seed), 2) seed-placed, and 3) surface-applied at planting. These application methods were compared to a "control" where no starter fertilizer was used. They ranked the starter fertilizer application methods with regard to effectiveness in improving no-till corn yields in the following order:
2X2 banded > seed-placed liquid > surface dribble > no starter.
Although starter fertilizers have been shown to increase no-till corn yields, this question needs to be answered: Do the increased yields cover the additional costs associated with using starter fertilizers? To answer this question, it is necessary to not only consider the increase in corn yield but also the costs associated with applying the starter fertilizer. Application of a starter fertilizer requires extra equipment costs for planter attachments (e.g. tank, pump, meter, coulter, etc.), and field capacity (acres planted per hour) of the planting operation will likely be decreased due to the time required to fill fertilizer tanks.
The objective of this study is to provide an economic evaluation of starter
fertilizer rates and application methods in no-till corn production by calculating:
1) average increases in yields and net returns, 2) the minimum per-acre net
returns that remain to cover other costs such as planter attachments and reduced
planting efficiency, and 3) an example of potential equipment costs.
For this study, the costs of the various fertilizers are based on approximate spring 1995 prices (Table 1). Several of the starter fertilizer formulations used in the study by Ritchie et al., (1996) are not typically available without mixing existing fertilizer materials. Therefore, prices for the various starter fertilizers considered in the analysis are calculated based on prices of existing formulations (Table 2). Note that the liquid starter treatments with K2O are significantly more expensive than those without K2O.
For corn yield responses to starter fertilizer rates and application methods, the results reported by Ritchie et al. (1996) were used. Net returns were computed for each starter fertilizer rate and application method using a corn price of $2.25/bu, and the average corn yield increase with starter fertilizer compared to the average yield with no starter fertilizer. Additionally, a "worst-case scenario" based on the statistical analysis of corn yields was calculated. The worst- case scenario represents the minimum net return that would be expected at least 90% of the time.
Extra costs of owning and operating the attachments for applying banded and seedplaced starter fertilizers on a no-till planter were estimated using a computerized Farm Machinery Selection and Management Program (Siemens et al., 1990). The assumed list prices and field capacities for the analysis are listed in Table 3.
Costs for owning and operating the planters are estimated by the program using
the methods presented in the Standards of the American Society of Agricultural
Engineers (ASAE EP496.2, 1995 and ASAE D497.2, 1995). Ownership costs include
depreciation, interest, insurance, and housing. Operating costs include maintenance,
repair, and labor. For each situation, the planter was assumed to be used on
a 1,000 acre corn/soybean farm with the planter used only to plant 500 acres
of corn each year. Soybean was assumed to be seeded with a drill on the farm.
With the above assumptions and parameters the computer program was used to estimate
the costs of using the 2X2-banded and seed-placed fertilizer attachments.
The results for the 2X2-banded, seed-placed, and surface-applied starter fertilizers
at various locations are found in Tables 4-12, and the results for each of these
application methods are discussed separately.
2X2-Banded Starters
The average corn yield response at Ashton with the 2X2 starter ranged from 8.5 to 15.8 bu/ac. Corn yields with the 25-30-0 and 25-30-20 starter fertilizers were significantly higher than with the 25-0-0 starter fertilizer (Table 4). Net returns with the 25-30-0 and 25-0-0 starter fertilizers averaged $19.24 and $11.68/ac greater, respectively, than for no starter fertilizer. These increases in net return account for the increases in corn yield and the cost of the starter fertilizer, but the extra costs for planter attachments to apply the starter fertilizer are not included. As previously explained, a "worst-case scenario net return" was calculated because of the variability in field experiments (Table 4). For the 25-30-0 starter fertilizer the worst case scenario was calculated to be $9.68/ac. This means the cost for owning and operating the planter attachments for applying the starter fertilizer must be less than $9.68/ac for the application of 25-30-0 starter fertilizer to be profitable 90% of the time.
At Gridley, average corn yields were significantly higher with 25-30-0 and 25-30-20 starter fertilizers when compared to the yield with no starter fertilizer (Table 5). The 25-300 and 25-30-20 starter fertilizers increased net return, but not significantly, by $6.26 and $9.78/ac, respectively.
Corn yield responses for 2X2-banded starter fertilizers at Oblong (Table 6) were quite similar to those at Ashton. The average corn yield increase with the starter fertilizers ranged from 9.1 to 13.7 bu/ac, significantly higher than with the no starter treatment. Average increases in net returns with the 25-0-0 and 25-30-0 starter fertilizers were significantly higher than with no starter, ranging from $12.54 to $18.55/ac. The worst-case scenario increase in net returns ranged from $2.80 to $4.16/ac.
Seed placed Starter
At Ashton, increases in average corn yield ranged from 3.86 to 17.50 bu/A (Table 7). Yields with the 10-34-0 and 10-20-10 seed-placed starter were significantly higher than the average yield with no seed-placed starter. However, average increases in net returns ranged from -$8.53 to $26.37/ac. Only the net return with 10-34-0 seed-placed starter was significantly greater than the net return with no starter. With the liquid 10-34-0, there is at least $7.44/ac available to cover the additional equipment related costs associated with seedplaced starter and still be significantly different from no starter.
At Gridley, corn yields with the seed-placed starter were not significantly different from the yield with no seed-placed starter (Table 8). Average corn yield ranged from 1.23 bu/ac less to 7.37 bu/ac more than with no seed-placed starter fertilizer. Seed-placed starter did not increase net returns.
At Oblong, statistically significant average corn yield increases ranged from 7.9 bu/ac to 13.6 bu/ac for all seed-placed starter fertilizers except 5-10-5. However, average increases in net return ranged from -$16.77 to $24.07/ac, with only the net return from 5-17-0 seed-placed fertilizer being significantly greater than no seed-placed starter. The increase in net return with 5-17-0 seed-placed starter provides at least $6.63/ac for other costs associated with applying seed-placed starter (Table 9).
Surface-Applied Starter
Com yield increases were not significantly different than no starter for any of the surface-applied starter treatments at any of the locations except at Oblong (Tables 10, 11, and 12). At Oblong, based on 1995 data only, a dribble application of 25-0-0 or a broadcast application of 25-64-0 resulted in a significant corn yield increase compared to no starter fertilizer (Table 12). None of the net returns due to applying surface-applied starter are significantly different compared to using no surface-applied starter. This indicates that the corn yield responses and net returns associated with using surface-applied starters are highly variable.
Equipment Costs
As previously mentioned, there are costs associated with applying starter fertilizers.
The purchase price of planter attachments for applying 2X2 starter fertilizer
was estimated to increase the price of a no-till planter by $1,000 per row,
and an increase of over $500 per row for applying surface-applied starter fertilizer
was calculated. Planter prices were used to estimate the increase in the cost
to own and operate a planter on a 1,000 acre corn/soybean farm assuming the
planter was used only to plant the 500 acres of corn each year. Extra costs
for the attachments decrease the longer they are used (Table
13). Costs for attachments for seed-placed starter fertilizer are estimated
to decrease from $3.34/ac if the attachments are only used one year to $0.90/ac
if the attachments are used for ten years. Attachments for 2X2-banded starter
fertilizer are estimated to vary from $6.70/ac for one year of use to $1.80/ac
for ten years of use. These estimated costs for attachments should be subtracted
from the net return above fertilizer costs to help determine whether applying
a starter fertilizer is profitable.
Limitations
The following limitations should be considered when interpreting the results
of this study. These experiments were conducted at a limited number of locations.
Starter fertilizers were found to be most economical at Ashton and Oblong, but
were not consistently economically feasible at Gridley. Hybrids may differ in
their response to starter (Gordon et al., 1995). Applying starter fertilizer
to no-till corn would increase net returns more if primary applications of N
and P inputs are reduced by the amount included in the starter, assuming yields
remain the same. However, this hypothesis was not tested in our experiments.
These issues should be addressed in future research.
Table 1: Approximate fertilizer prices, spring 1995
Table 2: Placement and cost of starter fertilizers
Table 3: Prices and field capacity of no-till planters
Table 4: Corn yield and net return increases for 2X2-banded fertilizers at Ashton, 1993-95
Table 5: Corn yield and net return increases for 2X2-banded fertilizers at Gridley, 1994-95
Table 6: Corn yield and net return increases for 2X2-banded fertilizers at Oblong, 1993 & 1995
Table 7: Corn yield and net return increases for 2X2-banded fertilizers at Ashton, 1993-95
Table 8: Corn yield and net return increases for seed-placed fertilizers at Gridley, 1994-95
Table 9: Corn yield and net return increases for seed-placed fertilizers at Oblong, 1993 and 1995
Table 10: Corn yield and net return increases for seed-placed fertilizers at Ashton, 1994-95
Table 11: Corn yield and net return increases for seed-placed fertilizers at Gridley, 1994-95
Table 12: Corn yield and net return increases for seed-placed fertilizers at Oblong, 1995
1J.D. Hibbard is a Research Assistant in the Farm and Resource Management Laboratory, Dept. of Agricultural and Consumer Economics; K.B. Ritchie is a Jonathan Baldwin Turner Fellow, Dept. of Crop Sciences; J.C. Siemens is a Professor, Dept. of Agricultural Engineering; and R.G. Hoeft is a Professor, Dept. of Crop Sciences; University of Illinois.
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