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 Copyright
 Front Cover
 Title Page
 Introduction
 Procedures
 Results and discussion
 Determining irrigation schedul...
 Partial budget examples
 Summary
 Reference






Group Title: Research report - Agricultural Research and Education Center - NF 83-1
Title: Economics of irrigation scheduling for field corn in North Florida
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
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Permanent Link: http://ufdc.ufl.edu/UF00073716/00001
 Material Information
Title: Economics of irrigation scheduling for field corn in North Florida
Series Title: Quincy AREC research report
Physical Description: 12 leaves : ; 28 cm.
Language: English
Creator: Eason, Mark, 1957-
Rhoads, Fred ( Frederick Milton )
Agricultural Research and Education Center (Quincy, Fla.)
Publisher: Institute of Food and Agricultural Sciences, Agricultural Research and Education Center
Place of Publication: Quincy FL
Publication Date: 1983
 Subjects
Subject: Corn -- Irrigation -- Florida   ( lcsh )
Irrigation scheduling -- Florida   ( lcsh )
Corn -- Economic aspects -- Florida   ( lcsh )
Genre: bibliography   ( marcgt )
non-fiction   ( marcgt )
 Notes
Bibliography: Includes bibliographical references (leaf 12).
Statement of Responsibility: by M.A. Eason and F.M. Rhoads.
General Note: Caption title.
Funding: Florida Historical Agriculture and Rural Life
 Record Information
Bibliographic ID: UF00073716
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: oclc - 84657023

Table of Contents
    Copyright
        Copyright
    Front Cover
        Front Cover
    Title Page
        Title Page
    Introduction
        Page 1
    Procedures
        Page 2
        Page 3
    Results and discussion
        Page 4
        Page 5
        Page 6
    Determining irrigation schedules
        Page 7
    Partial budget examples
        Page 8
        Page 9
        Page 10
    Summary
        Page 11
    Reference
        Page 12
Full Text





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Copyright 2005, Board of Trustees, University
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Economics Of Irrigation Sche n

For Field Corn In North F 6&)R
JUL i. of od
By M.A. Eason and F.M. Rhoads jA-S -- Un. f Florid
I.F.A.S.-Univ. of Florida


Florida Cooperative Extension Service
Institute of Food and Agricultural Sciences
University of Florida, Gainesville


QUINCY AREC RESEARCH REPORT NF-83-1





AREC RESEARCH REPORT NF-83-1


ECONOMICS OF IRRIGATION


SCHEDULING FOR FIELD CROPS


IN NORTH FLORIDA


BY


M. A.


Eason


and


F.M. Rhoads


Institute of Food and Agricultural Sciences
Agricultural Research and Education Center


Quincy, Florida


QUINCY









Economics of Irrigation Scheduling for Field Corn in North Florida

M. A. Eason and F. M. Rhoads1


INTRODUCTION

The two most commonly used methods of irrigation in the Southeastern United

States are the cable tow and center pivot systems. Production cost budgets usually

consider only one level of irrigation scheduling but show break-even prices for

several yield levels. Research has shown that yield potential varies with the irriga-

tion schedule. In general, the effect of irrigation scheduling on yield has caused

yield to increase with an increase in frequency of the irrigation cycle. According to

research at the Agricultural Research and Education Center, Quincy, Florida

(Rhoads and Stanley 1973, 1975) a three day irrigation cycle can be expected to

produce about 200 bushels of corn per acre, a five day cycle can produce about

175-180 bu/A, and a 7 day cycle should produce about 150 bu/A.

Fertilizer requirements have been shown to vary with yield potential (Stanley

and Rhoads 1977). Therefore, if the yield is limited by irrigation scheduling then

fertilizer application should be adjusted accordingly. The effects of optimizing

fertilizer application rates on costs and returns for irrigated corn are shown else-

where (Eason and Rhoads 1982). Yield potential, irrigation costs, and fertilizer

costs must be considered in order to determine the most economically feasible irri-

gation schedule. The capacity of the irrigation system will determine the maximum

frequency of the irrigation cycle for a center pivot system or the maximum number

of acres that can be irrigated at a given frequency with a cable tow system. Fur-

thermore, the capacity of the system determines the total cost of irrigation. In the

yield range of 150 to 200 bushels, input costs per acre such as seed, herbicides,

insecticides, tillage, harvesting, and etc. are not expected to vary appreciably.


1M. A. Eason, Extension Farm Management Economist, F. M. Rhoads, Professor of
Soil Science, AREC, University of Florida, Route 3, Box 638, Quincy, Florida
32351.




-2-
However, irrigation and fertilizer costs will differ. Irrigation and fertilizer costs will

be the only costs considered to change with yield potential in this report to illustrate

the effect of irrigation scheduling on returns from producing irrigated corn.

The purpose of this report is to provide some guidelines for determining the

effect of irrigation scheduling with cable tow and center pivot systems on costs and

returns for the production of field corn.


Procedures

Enterprise budgets were used in this study to determine the most profitable

irrigation schedule. The budgets are subdivided into cash expenses and fixed

costs which add up to equal total costs. Cash expenses describe those costs that

vary with output (yield) during the production period. These costs are related to

the price and quantity of inputs such as seed, fertilizer, irrigation and etc. Fixed

costs, however, are unrelated to output and do not vary during the production

period. The fixed costs considered include depreciation, insurance, taxes, and

interest. An example of an irrigated corn budget is shown in Table 1.

Production costs and returns were calculated for three irrigation schedules

and two irrigation systems. The irrigation schedules chosen evolved from irrigation

research and are based on the number of days between irrigation events to give a

wetting-drying cycle. The three schedules studied were three, five, and seven

day cycles. Irrigation costs were calculated for a cable tow system and a 138 acre

center pivot system. Fertilizer costs were adjusted to correspond to the yield poten-

tial dictated by the irrigation schedule selected.

A 600 gallon per minute (gpm) cable tow system was selected to illustrate the

effect of different irrigation schedules on costs and returns per acre. Irrigation

costs were arrived at by assuming 20 A/day could be irrigated with the system.

This would make it possible to irrigate 60 acres on a three day schedule, 100 acres

on a five day schedule, and 140 acres on a seven day schedule.






Table- 1. Estimated costs of producing one acre of corn
60 acre cable tow system on a 3 day irrigation
202 bu/A, North Florida.


under irrigation with a
cycle. Yield potential


Item Unit Quant Price Value Your Cost

Cash expenses:
Seed Ib 18.0 1.20 21.60
Fertilizer (5-10-15
or equivalent) cwt 10.5 7.50 78.75
Nitrogen Ib-N 102 .26 26.52
Lime ton .33 18.00 5.94
Insecticide Ib 15.0 0.95 14.25
Herbicide Ib 5.5 4.00 22.00
Tractor (135 hp) hr 1.44 7.96 11.46
Truck, pickup mi 20.0 .10 2.00
Truck, 2 ton mi 20.0 .15 3.00
Other machinery hr 1.44 1.83 2.64
Combine hr .6 12.62 7.57
Labor hr 4.0 3.75 15.00
Irrigation costs $/A in 6.6 6.91 45.61
Land rent acre 1.0 35.00 35.00
Interest on cash exp.- $ 291.34 .075 21.85
Total cash expenses 313.19
Fixed costs:
Tractor (135 hp) hr 1.44 11.06 15.93
Truck, pickup mi 20.0 .13 2.60
Truck, 2 ton mi 20.0 .16 3.20
Combine hr 0.6 38.52 23.11
Other machinery hr 1.44 3.20 4.61
Irrigation acre 1.0 84.98 84.98 _
Total fixed costs 134.43
Total costs 447.62


1 15% for 6 months.




-4-


Total irrigation costs for the cable tow system included the well, pump, power

unit, traveler unit, underground pipe, diesel fuel, oil, repairs, labor, interest,

insurance and taxes. Annual costs were derived from straight line depreciation

values for each component of the system. Irrigation cost information was derived

from budgets prepared by D. S. Harrison, Department of Agricultural Engineering,

University of Florida.

Selection of the center pivot was based on a 138 acre system. The sprinkler

system was assumed to cost about the same regardless of the irrigation schedule

used. However, the size of the pump, power unit, and well varied with the dif-

ferent irrigation schedules. Total costs per acre were lowest for a seven day

schedule, intermediate for a five day schedule, and highest for the three day

schedule.


Results and Discussion

A summary of the irrigation schedules selected is presented in Table 2.

Acreage varied for the cable tow system but remained constant for the center

pivot system. Yield potentials for each schedule were assumed to'be the same

for each system. The inches of irrigation required is based on an average year

in north Florida. This value will vary from year to year and will cause the cost

of irrigation to change accordingly.

Table-2. Summary of irrigation schedules selected, acreage for each system,
yield potential, and irrigation requirement.

Irrigation Acres irrigated Yield (bu/A) Inches of
Schedule Cable tow Center pivot Potential Irrigation
3 days 60 138 202 6.6
5 days 100 138 179 4.0
7 days 140 138 151 2.8


The effect of the various irrigation schedules on yield, cost and returns for

a cable tow system is shown in tables 3, 4 and 5. As the length of the irrigation







cycle increased, production costs and yield per acre declined (Table 3). This

resulted because fewer inputs (irrigation) per acre were applied, thus allowing

more acreage to be produced. However, total cost increased with the increased

number of acres; as did gross returns. Gross returns increased because more

acreage could be irrigated (produced) since less water was applied per acre

(Table 4). A selling price of $2.50 per bushel was used to maintain constant

values for all examples.

Total net returns increased as the length of the irrigation cycle increased for

the cable tow system (Table 5). However, net returns per acre were largest

for the five day cycle. Since the most profitable schedule was the 5 day cycle,

adjustments should be made in the system's capacity to maintain a 5 day schedule

for the specified number of acres.

Yield, cost and return data for the center pivot system are shown in tables

6, 7 and 8. Total costs and costs per acre decreased for the center pivot system

when the irrigation schedules were less frequent, even though break-even cost

per bushel was larger for the seven day cycle (Table 6). Irrigating less frequently

with a smaller capacity pumping system resulted in a lower production cost per acre

because fewer fertilizer inputs were needed with the decreased amount of water.

As a result, yield potentials were also decreased. Maximum profit was not achieved

since decreased costs were not enough to offset the revenue lost from lower yields.

Gross returns were largest for the three day schedule with the center pivot

because yield increases were enough to offset the additional costs (Table 7). Total

net returns and net returns per acre were the highest for the three day schedule

(Table 8).

Because of the constant acreage and fixed costs of the center pivot system,

the three day irrigation schedule proved to be the most profitable.







Table-3. Effect of irrigation schedule on acres, yield, breakeven cost, cost per
acre, and total costs of corn production with a cable tow system.

Irr. schedule Acres Yield Breakeven Cost Total
days irrigated bu/A cost/bu per acre Cost

3 60 202 $2.22 $ 447.62 $ 26,857.20
5 100 179 1.99 356.59 35,659.00
7 .140 151 1.96 295.39 41,354.60




Table -4. Effect of irrigation schedule on gross returns from corn irrigated with
a cable tow system.

Irr. schedule Acres Yield Price Gross
days irrigated bu /A per bu. Returns

3 60 202 $ 2.50 $30,300.00
5 100 179 2.50 44,750.00
7 140 151 2.50 52,850.00




Table-5. Effect of irrigation schedule on net returns from corn irrigated with
a cable tow system.

Irr. schedule Acres Yield Total net Net returns
days irrigated bu/A returns per acre

3 60 202 $ 3,442.80 $ 57.38
5 100 179 9,091.00 90.91
7 140 151 11,495.40 82.11




Table-6. Effect of irrigation schedule on yield, breakeven cost, cost per acre,
and total costs of corn production with a center pivot irrigation
system.

Irr. schedule Acres Yield Break even Cost Total
days irrigated bu/A cost/bu per acre cost

3 138 202 $ 1.96 $ 396.57 $ 54,726.66
5 138 179 1.96 349.94 48,291.72
7 138 151 2.08 313.53 43,267.14




-7-

Table-7. Effect of irrigation schedule on gross returns from corn irrigated
with a center pivot system.

Irr. schedule Acres Yield Price Gross
days irrigated bu/A per bu. Returns

3 138 202 $ 2.50 $69,600.00
5 138 179 2.50 61,755.00
7 138 151 2.50 52,095.00



Table-8. Effect of irrigation schedule on net returns from corn irrigated with
a center pivot system.

Irr. schedule Acres Yield Total Net Net returns
days irrigated bu/A Returns per acre

'3 138 202 $ 14,963.34 $ 108.43
5 138 179 13,463.28 97.56
7 138 151 8,827.86 63.97



Determining Irrigation Schedules

Partial budgeting can be used to help a producer determine which irriga-

tion schedule would be the most profitable. Partial budgets use information

contained in enterprise budgets. This decision making tool is attractive because

it is simple to use and can be used on a variety of decision making problems.

A partial budget is defined as a systematic listing of the possible estimated

changes in costs and returns in a given time period when production practices

change.

The possible changes that can occur in a resource change situation fall

into one of four categories. Those categories are "added returns", "reduced

returns", "added costs", and "reduced costs". These changes are usually

grouped into positive effects (added returns and reduced costs) and negative

effects (added costs and reduced returns).

Reduced income is made up of "reduced returns" and "added costs".

There are no "reduced returns" because price is held constant and yield

increases. "Added costs" are the difference (increase) between a 5 day and







PARTIAL BUDGET EXAMPLE

The partial budget technique may be used as an aid in decision making
in numerous situations such as comparing enterprises, determining whether
to drop an enterprise completely or change the size of the enterprise. Figur-
ing the cost of a production practice by different methods is another use of
this tool.

Change being considered: Change from a 5 day to 3 day irrigation schedule

for a center pivot system

Assumptions made: 138A center pivot; irrigation increased from 4" to 6.6"/A;


yield increases from 179 to 202 bu/A; corn price


is $2.50/bu; production


costs are shown in budgets; increase power unit


A. ADDED INCOME


1. Added Returns:
23 bu x 138 x $2.50





Total


TOTAL ADDED INCOME (Added Returns + Reduced Costs)


1. Reduced Returns:
None





Total


$ $7,935.00





$ 7,935.00


from 75 Hp to 100 Hp.


2. Reduced Costs:
None





Total


$ 0





$ 0
$ 7,935.00


$ 3,622.50
1,219.92
219.18
385.02
916.32

$ 6,434.94


B. REDUCED INCOME


$ 0





$ 0


2. Added Costs:
fertilizer
nitrogen
irrigation V,.C.
irrigation F.C.
interest on V.C.

Total


TOTAL REDUCED INCOME (Reduced Returns + Added Costs) $ 6,434.94


C. ESTIMATED CHANGE IN INCOME PER YEAR FOR CROP
(Difference in Total Added Income and Total Reduced Income $ 1,500.06
--------------------------------------------------------------------------

Other considerations: (1) Can your cash flow handle the investment of a larger
power unit? (2) Is present management capable of producing the higher yield,
timeliness is of great importance?


"







Table-9. Estimated costs of producing one acre
a 138 acre center pivot system on a 3
potential 202 bu/A, North Florida.


of corn under irrigation with
day irrigation cycle. Yield


Item Unit Quant. Price Value Your Cost

Cash expenses:
Seed Ib. 18.0 1.20 21.60
Fertilizer (5-10-15
or equivalent) cwt. 10.5 7.50 78.75
Nitrogen lb. N 102 .26 26.52
Lime ton .33 18.00 5.94
Insecticide lb. 15.0 .95 14.25
Herbicide lb. 5.5 4.00 22.00
Tractor (135 hp) hr. 1.44 7.96 11.46
Truck, pickup mi. 20.0 .10 2.00
Truck, 2-ton mi. 20.0 .15 3.00
Other machinery hr. 1.44 1.83 2.64
Combine hr. .6 12.62 7.57
Labor hr. 4.0 3.75 15.00
Irrigation costs $/acre in 6.6 4.58 30.23
Land rent acre 1.0 35.00 35.00
Interest on cash exp.- $ 275.96 .075 20.70
Total cash expenses 296.66
Fixed costs:
Tractor (135 hp) hr. 1.44 11.06 15.93
Truck, pickup mi. 20.0 .13 2.60
Truck, 2-ton mi. 20.0 .16 3.20
Combine hr. .6 38.52 23.11
Other machinery hr. 1.44 3.20 4.61
Irrigation acre 1.0 50.46 50.'16
Total fixed costs 99.91
Total costs 396.57


S15% for 6 months.




-10-


Table-10.


Estimated costs of producing one acre of corn under irrigation with a
138 acre center pivot system on a 5 day irrigation cycle. Yield poten-
tial 179 bu/A, North Florida.


Item Unit Quant Price Value Your Cost

Cash expenses:
Seed Ib. 18.0 1.20 21.60
Fertilizer (5-10-15
or equivalent) cwt. 7.0 7.50 52.50
Nitrogen Ib. N 68 .26 17.68
Lime ton .33 18.00 5.94
Insecticide Ib. 15.0 .95 14.25
Herbicide Ib. 5.5 4.00 22.00
Tractor (135 hp) hr. 1.44 7.96 11.46
Truck, pickup mi. 20.0 .10 2.00
Truck, 2-Ton mi. 20.0 .15 3.00
Other machinery hr. 1.44 1.83 2.64
Combine hr. .6 12.62 7.57
Labor hr. 4.0 3.75 15.00
Irrigation costs $/acre in 4.0 7.03 28.12
Land rent 1/ acre 1.0 35.00 35.00
Interest on cash exp.- $ 238.76 .075 17.91
Total cash expenses 256.67
Fixed costs:
Tractor (135 hp) hr. 1.44 11.06 15.93
Truck, pickup mi. 20.0 .13 2.60
Truck, 2-ton mi. 20.0 .16 3.20
Combine hr. ..6 38.52 23.11
Other machinery hr. 1.44 3.20 4.61
Irrigation acre 1.0 43.82 43. 82
Total fixed costs 93.27
Total costs 349.94


S15% for 6 months.





-11-

a 3 day irrigation schedule ($6,434.94). These associated costs can be found on

the enterprise budgets for the corresponding schedule (Tables 9 & 10). Total

reduced income is $6,434.94 (reduced returns + added costs).

The solution is obtained by subtracting "total reduced income" from "total

added income". If the remainder is positive, as in this example, the change

should be made. Profit from growing the corn under the 138 acre center pivot

system with a 3 day irrigation schedule would amount to a total of $1500.06.

Factors other than monetary values must also be considered. Is it worth

the time, money and effort to change power units for $1500? Timeliness is of

vital importance in producing 200 bushels corn. Is the present management

level capable of producing the higher yield? Other factors may also be con-

sidered; every producer's situation is different.


Summary

Studies have shown that more frequent irrigation schedules applying greater

amounts of water per acre have a positive effect on yield. This paper examines

the cost and returns of three separate irrigation schedules for two different

systems. The systems used in this study are the cable tow and center pivot

systems. It was assumed that the cable tow system could irrigate 20 acres per

day, thus varying the number of acres irrigated with the different irrigation

schedules. A 138 acre center pivot system was used which varied well, pump,

and power unit capacities for the different irrigation schedules.

The results of the study indicate that net returns per acre are the greatest

for the 5-day schedule and 3 day schedule for the cable tow and center pivot

systems, respectively. As stated before, the purpose of this study is to provide

a guideline for determining the effect of various irrigation schedules on cost and

returns of producing irrigated corn. A producer should figure his cost and return

to determine which schedule would best fit his situation. Using a partial budget

can aid him in making this decision.





-12-

References

1 Eason, M. A. and F. M. Rhoads. 1982. Production and Marketing of

Irrigated Corn. University of Florida, Quincy AREC Research Report

NF-82-2.

2 Rhoads, F. M. and R. L. Stanley, Jr. 1973. Response of Three Corn

Hybrids to Low Levels of Soil Moisture Tension in the Plow Layer. Agron.

J. 65:315-318.

3 Rhoads, F. M. and R. L. Stanley, Jr. 1975. Response of Corn (Zea

mays L.) Grown on Soils of Three Textural Classes to Plow Layer Water

Management. Soil and Crop Sci. Soc. of Fla. Proc. 34:1-3;

4 Stanley, R. L., Jr. and F. M. Rhoads. 1977. Effect of Time Rate and

Increment of Applied Fertilizer on Nutrient Uptake and Yield of Corn

(Zea mays L.) Soil and Crop Sci. Soc. of Fla. Proc. 36:181-184.

5 Westberry, G. 0. 1979. Partial Budgeting. Staff Paper 130.




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