Farm‐Level Economic and Environmental Impacts of Eastern Corn Belt Cropping Systems

Output from two process simulation models (EPIC and GLEAMS) was combined with a farm level linear programming model to assess the economic and environmental implications of selected eastern Corn Belt farming systems. The farm level economic results suggest that an alfalfa ( Medicago sativa L.)‐based cropping system is generally less profitable than a corn‐soybean ( Zea mays L.‐Glycine max L. [Merr.]) rotation produced under farm program prices or recent average market price conditions. Net returns are projected to decline by approximately 38% if alfalfa is included in an eastern Corn Belt cropping system. The adoption of a corn‐alfalfa cropping system could reduce annual soil erosion and the quantity of nitrates in surface water runoff relative to a conventional corn‐soybean rotation. The corn‐alfalfa system, however, leads to an increase in atrazine and alachlor runoff in surface water and an increase in nitrate percolation. A more environmentally desirable outcome may be attained by continuing farm programs that reduce acreage planted to corn. Yet to maintain farm income and encourage voluntary farmer participation, taxpayer costs may be unacceptably high. Thus, there are significant trade‐offs among environmental goals, federal budget reduction efforts, and income and employment in farming and agribusiness. Research Question Proponents of alternative agriculture suggest that certain sustainable cropping systems can reduce soil erosion and water pollution without adversely affecting farmers ’ incomes. This research evaluated the farm level environmental and economic impacts of cropping systems in the eastern Corn Belt, which include alfalfa in rotation with other conventional row crops. Literature Summary Most economic studies of alternative crop production systems have focused on the costs of adoption but have generally ignored the environmental impacts. Studies that have considered environmental impacts have typically focused on a single factor, for example soil loss or sedimentation. Study Description Two 500 acre farms were modelled: one on a Drummer silty clay loam, a high productivity soil commonly found in northwestern Indiana and eastern Illinois; and the second on a Clermont silt loam, a low productivity soil found in southern Indiana and Ohio. Three cases were analyzed: (i) a government program case with a 10% corn set‐aside, (ii) a market price scenario based on observed market prices for the crops, and (iii) a policy option requiring one‐fourth of the farm to produce alfalfa. Input use amounts can be found in Table . A farm‐level linear programming model was used for the economic analysis. The objective function of the model maximized gross revenue minus variable costs subject to constraints which included land, labor, and machinery resource requirements and availability during critical crop production periods. Two process simulation models were used to analyze the environmental impacts of the different cropping systems. The first of these was the Erosion Productivity Impact Calculator (EPIC). The second was Groundwater Loading Effects of Agricultural Management Systems (GLEAMS). Applied Question Was alfalfa profitable and did it enter the optimal cropping pattern? At an average yield of 5 tons/acre on the high productivity soil and 3.50 tons on the low productivity soil, alfalfa was a profitable crop, but not as profitable as corn and soybeans. Therefore, it did not enter the optimal solution as generated by the linear programming model. Sensitivity analysis showed that it would enter the solution on the highly productive soil at a price of $86.50/ton or at a yield of 7.33 tons/acre. Likewise, on the lower quality soil it would enter at a price of $84.50/ton or a yield of 4.50 tons/acre. What happened to returns when alfalfa had to be planted? When 1/4 of the farm was planted to alfalfa, whole farm net returns were reduced 50% and 64% on the high and low productivity soils, respectively, relative to the government program cases, which produced the highest net returns. How did the cases compare environmentally? On both soil types, the results from this study suggest that the adoption of a corn‐alfalfa Cropping system could reduce annual soil erosion and decrease the quantity of nitrates in surface water runoff relative to a conventional corn‐soybean rotation (Fig. ). The corn‐alfalfa system, however, can lead to an increase in atrazine and alachlor runoff in surface water as well as an increase in nitrates lost in percolate (Fig. and ). Input use amounts for crops used in simulation models. Input: N P Atrazine Alachlor Metolachlor Bentazon Dimethoate Carbofuran Trade name: Atrazine Lasso Dual Basagran Cygon Furadan Crop Formulation: 4 L 4 EC 8 EC 4 EC 4 EC 4 F ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐lb‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ High productivity soil Corn 153 23 1.2 2.0 Soybeans 30 2.5 1.0 Alfalfa 70 0.4 0.75 Set‐aside 50 Low productivity soil Corn 90 8 0.9 2.0 Soybeans 24 2.0 0.33 Alfalfa 70 0.4 0.75 Set‐aside 50 Fertilizer use rate is actual pounds applied. Herbicide and insecticide use rate is pounds per acre of active ingredient.