Economic performance ofsustainable farming practices
By Karen Klonsky and Pete Livingston

	SAFS research assistant Aaron Ristow checks datalogger monitoring surface runoff in vetch cover crop plot.   (Photo by: Sam Prentice)

One of the major goals of the Sustainable Agriculture Farming initiatives at UC Davis is to provide information about the feasibility of adopting conservation tillage and cover cropping at the farm level. The project includes two tillage schemes: standard tillage (ST) and conservation tillage (CT), and three farming methods: conventional, organic, and winter legume cover crop. All three production methods are used in combination with both tillage systems for a total of six alternative systems. Each of the six systems is used in the trials to grow both processing tomatoes and field corn. This article will examine the profitability of the alternative farming systems under investigation at SAFS based on the 2004 cropping season results.

We calculated the costs and returns for each of the alternative farming systems and each of the crops based on the calendar of operations used in the trials and the yield results. The costs per acre are based on the equipment used and the time it would take in a farm setting rather than a field trial. We used the input rates for the trials along with input costs provided from local suppliers. The prices received are those typical for the area in 2004. We calculated the organic system revenue both with and without organic premium prices realized by local growers. The profitability of each system equals the revenue minus the costs. A positive return indicates that the system is economically sustainable at least in the short run.

Tomato. The 2004 tomato yields were disappointing for all systems, falling below the Yolo County average. In all cases the standard tillage systems were higher-yielding than the conservation tillage systems (Table 1). At a price of $50.10 per ton the standard tillage systems garnered $179 more per acre for the conventional system, $46 more for the winter legume cover crop system, and $372 per acre more for the organic system at conventional prices and $475 more at the higher organic premium price of $65 per ton (Table 1).

These higher profits equal the break-even cost savings required to make the profit from the conservation tillage systems equal to that of the standard tillage systems. For example, if conservation tillage results in a savings of more than $179 per acre for the conventional system then it is more profitable to use CT because the reduction in costs is higher than the loss in revenue. On the other hand, if the cost saving from CT is less than $179 then it is more profitable to use standard tillage because the loss in revenue reduced profit more than the cost savings increases profit.

For the conventional system the cost savings from conservation tillage was only $13 for the conventional system and $20 per acre for the cover crop system, well below the break-even thresholds (Figure 1). The savings came from reduced weed control costs and reduced residue management costs (Figure 1). The ground prep costs were actually higher for CT than ST because of the extra operations used to manage the beds due to the high amount of residue left from the preceding corn crop. For the organic system the production costs were actually higher for CT than ST due to higher hand weeding costs.

Figure 1. Comparison of Conventional Tomato Costs with Conversion to Conservation Tillage 2004		Figure 2. Comparison of Conventional Corn Costs with Conversion to Conservation Tillage 2004

Corn. The yields for the conventional systems for corn were above the Yolo County average in 2004, but the organic and winter legume cover crop systems fell far below the county average for both the conservation tillage and standard tillage methods (Table 1). The constraints of cover crop management in the winter legume and organic systems delayed planting these systems, which most likely impacted potential yield. In all cases the standard tillage systems yielded about 400 pounds per acre more than the analogous conservation tillage system for a difference of $18 per acre (Table 1). At a price of $88.52 per ton, the difference is $18 per acre. For the organic system at the premium price of $140 per ton, the CT system showed higher revenue of $26 (Table 1). It is important to keep in mind that, in general, processing tomatoes are a much higher grossing crop than field corn. Therefore, profit maximizing decisions are based primarily on the performance of the tomato crop and not the corn crop.

The savings from conservation tillage was much higher for corn than tomato. The savings were due to a decrease in ground preparation, weed control, and residue management. The savings were $145 per acre for the conventional system, $73 per acre for the organic system, and $61 per acre for the winter legume cover crop system (Figure 2). However, the conventional system was the only one to show a positive return above operating costs. In this case the cost savings from conservation tillage of $145 per acre was higher than the revenue reduction of $18 per acre for a net increase in profit of $127 per acre (Table 1). Both the organic system and the winter legume cover crop system showed a loss with conservation tillage and standard tillage, although the loss was greater under standard tillage.

Conclusion

The analysis clearly demonstrates the potential for CT to decrease operating costs for both processing tomato and corn. The cost savings in 2004 were greater for corn than tomato because of the extra operations used to shape the tomato beds before transplanting. Also, the organic tomato system using conservation tillage required additional hand weeding. Despite these encouraging findings, CT will not be attractive to growers unless yields are comparable to those under standard tillage. Therefore, the challenge for the coming season will be, first and foremost, to modify the systems to improve yields without compromising the spirit of conservation tillage. We are exploring modifications to optimize yield and/or economics in the winter legume and organic systems. These include evaluating varieties to overcome planting date issues, optimizing CT to reduce field passes and soil disturbance, and determining innovative weed management practices.

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