Cover crops reduce cropping input costs, with other benefits farmers “can’t put a price on”

This blog is authored by Bethany Baratta, senior writer at Iowa Soybean Association. It originally posted on the Iowa Soybean Association Newsroom.

Cover crops have proven benefits for soil health. A recent Iowa Soybean Association study shows that cover crops can also reduce the input costs associated with growing crops.

“Cover crops are an added cost to the operation. However, this study shows a subset of participants in a corn-soybean rotation are able to offset those costs by finding a yield advantage, reducing inputs or both to improve overall profitability,” said Heath Ellison, ISA senior conservation agronomist who led the study in partnership with the Walton Family Foundation, Environmental Defense Fund and Iowa-based Regional Strategic, Ltd.

Completed during the 2018 cropping season, the study with 20 Iowa conservation-minded farmers set out to analyze the economic and yield impacts of conservation practices. Those of particular interest were zero and reduced tillage, nutrient management and cover crops.

The study broke out participants in a variety of ways, one of which was looking at a comparison of farmers using all cover crops or no cover crops in a particular year of the rotation. The comparisons below are an average of all farmers within this study meeting these parameters.*

A study led by Iowa Soybean Association senior conservation agronomist Heath Ellison found that utilizing cover crops in certain crop rotations could have economic benefits for farmers. (Photo: Joseph L. Murphy/Iowa Soybean Association)

Crop rotations make a difference for cover crop values

“One of the more interesting finds in this study was that participants who were utilizing cover crops on all of their corn acres in 2018 in a corn-soy rotation saw a reduction in crop input cost — more than making up the cost of utilizing the covers when compared with farmers not utilizing covers ahead of corn,” Ellison said. Any financial incentive, such as cost share, was deducted from the overall cost of establishing and terminating the cover crops.

Looking at the data broken out by the all-or-none qualifier and then looking at each year in the rotation (corn after soybeans, soybeans after corn, corn after corn), farmers saw greater financial benefits planting covers before corn following soybeans. Here’s the breakdown:

  • Using cover crops ahead of corn in a corn-soybean rotation, the average input cost reduction was $16.93 per acre (assuming $3.50 per bushel corn). In this scenario, once accounting for cover crop costs, cover crop cost share and a positive average yield impact of 5.1 bushels per acre, this group saw a positive net impact of $21.83 per acre compared to farmers not using cover crops.
  • Farmers utilizing cover crops in a corn-on-corn rotation spent an average $88.02 per acre less than farmers not using cover crops (assuming $3.50 per bushel corn), before cover crop-associated costs were figured in. However, including cover crop costs, cost share and a large average yield reduction, farmers using cover crops in a corn-on-corn rotation saw an average negative impact of $18.70 per acre (assuming $3.50 per bushel corn).

Nutrient boost reduces input costs while increasing yield

Iowa farmer and study participant Allen Kadolph has seen a reduction in input costs when using cover crops in his corn-on-corn acres. He admits, though, that his return differs year to year.

“It’s kind of a wash some years,” said Kadolph, who has been “dabbling” with cover crops for 10 years on his farm near Hubbard. “The more growth you get on the covers, the better return you get because of the nutrients returned to the soil.”

Looking at the same breakout of all cover or no cover described above, farmers using cover crops ahead of soybeans had a slight $1.01 per acre increase in non-cover crop related input costs on average compared to farmers not using covers.

This slight input cost increase was coupled with an average soybean yield increase of 7 bushels per acre when cover crops were utilized, resulting in a return of $53.73 per acre (assuming $9 per bushel soybeans), including seeding and establishment costs, and an average cost share subsidy of $6.57 per acre.

“This is exciting to see some of the positive financial impact that cover crops can bring to farmers over time,” Ellison said. “The results of this study also indicate that more research and education is needed to understand how these farmers are utilizing cover crops to improve profitability and to improve the outlook of cover crops in a corn-on-corn rotation.”

“I would plant cover crops even if it cost me”

Iowa farmer and study participant Tim Smith doesn’t get hung up on the numbers. He sees reductions in input costs when utilizing cover crops in his corn-soybean rotations, but his commitment to cover crops is bigger than that.

“I would plant cover crops even if it cost me,” said Smith, who farms near Eagle Grove in Wright County. “I’ve been looking at it more from a perspective of water quality and preventing nutrient loss. More important to me than the economic benefits are the soil conservation aspects of cover crops and strip-till and no-till.”

He says the savings associated with incorporating cover crops into his strip- and no-till operation relates to decreased tractor and equipment use, chemical costs and even some things he can’t put a price on.

“We consider depreciation on machinery, but we don’t even consider the depreciation on the soil by losing the topsoil,” Smith said. New study shows that cover crops can improve soil health and reduce the input costs associated with growing crops. Click To Tweet

Other benefits include improved water quality, reduced erosion

Mike Jackson, a study participant and a sixth-generation farmer, says protecting water quality and preserving the soil are key to his operation.

He farms with his wife, uncle and his father, past ISA president Mark Jackson, near Oskaloosa. They began working with ISA researchers and exploring cover crop opportunities for their farm in the mid-2000s.

“It’s more of a management change than anything else,” Jackson said.  His family grows cover crops on 100% of their acres in conjunction with no-till.

He said he’s trading equipment costs for management costs, but with good results.

“After that second year we started to see the benefit of that nutrient banking,” he said. “It starts to put nutrients back into the soil and plants are able to take that in.”

Significant rainfalls in recent years are also showing how well their cover crops keep their soil in place compared to other farms in the area which see erosion due to full tillage practices.

“God only made so much soil,” Jackson said. “So anytime you can keep it on the farm and put a seed into it, that’s possible profit for the farmer and cleaner water for everyone.”

* In analyzing this data, ISA and its partners were looking for trends and broad indicators. The actual numbers presented are averages across multiple operations. While informative, we always recommend evaluating the impacts of these practices within your own operation. Contact an ISA agronomist if you are interested in field trials evaluating the impact of cover crops on your operation.

Contact Bethany Baratta at bbaratta@iasoybeans.com.

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