The document discusses the impact of limited irrigation practices on agricultural profitability, focusing on experiments conducted on wheat, corn, and dry beans since 2005. It examines water response curves, net income calculations, and provides crop budgets for 2014, highlighting the diminishing returns of water usage. Tools for optimizing irrigation costs and calculating potential profits are also mentioned, with emphasis on maximizing income per inch of water used.

1. Limited Irrigation &
Your Bottom Line
Jessica Johnson
Asst. Extension Educator, Agricultural Economics
Panhandle Research and Extension Center

2. Get the most $$$ per inch of water.
• No Till Limited Irrigation Experiment
• Understanding Response Curves
• Curves: Yield to Net Income

3. No Till Limited Irrigation
Experiment

4. Limited Irrigation & Your Bottom Line
No Till Limited Irrigation Experiment
– Gary Hergert, UNL
– PREC since 2005

5. Wheat,
Beans,
Canola:
4”, 8”, 12”
NO-TILL
Corn:
5”, 10”, 15”
Winter Wheat-Corn-Dry Bean-Canola
Rotation Initiated 2005 Growing Season

6. Limited Irrigation & Your Bottom Line
• Get the most $$$ per inch of water.
No Till Limited Irrigation Experiment
– Gary Hergert, UNL
– PREC since 2005
– Corn (5,10,15”)
– Wheat, Dry Edible Beans, Canola (4,8,12”)
…irrigation timings are based on crop development,
precipitation and ET data…the bulk of the water is applied
around the reproductive period.

7. Limited Irrigation No Till Experiment
WHEAT
Week
Projected Plant
Stage 4” 8” 12”
Early OCT 1.5 1.5 1.5
5 tillering 1.00
6 tillering 1.00
7 Jointing 0.50 1.00 1.00
8 Pre-Boot 1.00 1.00
9 Boot-head 1.00 1.00
10 Head-Flowr 1.50 1.00
11 Flowr-Fill 1.00 1.00 1.50
12 Grain milk 1.00 1.00 1.00
13 Grain Fill 1.00
14 Soft dough 1.00

8. Limited Irrigation No Till Experiment
Dry Beans
Week
Projected Plant
Stage 4” 8” 12”
2 Emerge 0.50
3 Uni-1st tri 0.50 1.00
4 1st-2nd tri 0.50 1.00
5 2-3 trifoliate 0.50 1.00 1.50
6 Cover10-50 0.50 1.50 1.50
7 Cover50-80 1.00 1.50 1.50
8 Cover80-Full 1.00 1.50 1.50
9 Full Cover 1.00 1.00 1.50
10 Pod Elong 0.50 1.00
11 Pod Fill 1.00

9. Limited Irrigation No Till Experiment
CORN
Week
Projected Plant
Stage 5” 10” 15”
7 5leaves 0.50
8 6leaves 0.50
9 8 leaves 0.50 1.00
10 10 leaves 0.50 1.50
11 V12 1.00 1.00 1.50
12 V14 1.00 1.00 1.50
13 Silks--R1 1.00 1.50 1.50
14 Blister 1.00 1.50 2.00
15 Milk 1.00 1.50 2.00
16 Roasting ear 1.50 1.50
17 Dough 1.00 1.00
18 beg Dent 0.50

10. Corn Yields
Irrg ’05* ‘06 ’07# ‘08 ‘09 ’10 ’11 ’12 Avg
Rain
Apr-
Oct
14.9 7.8 5.2 9.8 13.9 12.2 11.7 3.0 9.7
In. -------------- bushels per acre --------------
0 45 75 30 60 90 75 80 20 60
5 133 138 97 115 149 123 152 120 128
10 153 172 139 165 185 165 205 165 168
15 174 188 172 183 194 177 212 200 188
* Hail reduced yield
# Severe freeze Jun 7 reduced yield

11. Water Response Curves
0
20
40
60
80
100
120
0 5 10 15 20
RelativeYield
Inches of Irrigation
Wheat Corn Dry Beans

12. Water Response Curves
Hergert: Relative Yield
Inches of Water Corn Wheat Dry Bean
0 32 40 32
1 40 49 42
2 47 57 50
3 54 64 59
4 60 71 66
5 66 77 73
6 72 82 79
7 77 87 84
8 81 90 88
9 85 94 92

13. Water Response Curves
Hergert: Relative Yield
Inches of Water Corn Wheat Dry Bean
10 89 96 95
11 92 98 98
12 94 99 99
13 96 100 100
14 98 100 100
15 99 99 99
16 100 98 98
17 100 95 96
18 100 93 93
19 99 89 89
20 98 85 85

14. Understanding Response Curves

15. Water Response Curves
0
20
40
60
80
100
120
0 5 10 15 20
RelativeYield
Inches of Irrigation
Wheat Corn Dry Beans

16. Limited Irrigation & Your Bottom Line
0.0
20.0
40.0
60.0
80.0
100.0
0 5 10 15
RelativeYield
Inches of Irrigation
Wheat
Non-
irrigated
yield
Max
Total
Yield
Diminishing
Returns – still
gaining yield.
Each inch of
water = less
yield than the
previous inch.

17. Limited Irrigation & Your Bottom Line
0.0
20.0
40.0
60.0
80.0
100.0
0 5 10 15
RelativeYield
Inches of Irrigation
Wheat

18. Curves: Yield to Net Income

19. Yield to Net Income
Net Income = (Yield*Price)-(fixed costs)-(variable costs * yield)
Yield = Water Response Curves
Fixed cost = most costs associated with production
 Depreciation, insurance, overhead, labor
Variable Cost = costs estimated on a per unit basis
 Hauling, drying, fertilizer

20. 2014 Nebraska Crop Budgets
• Western Nebraska Budgets
– Corn, wheat, dry beans, millet, peas,
and sunflower
– Available online
http://cropwatch.unl.edu/economics/bud
gets

21. 2014 Crop Budgets
• Input costs mostly up
– Except nitrogen and glyphosate
herbicides
• 2013 land values higher
– Expected to be steady or lower in 2014
• Fixed Cost
• Variable Cost
– Fertilizer
– Hauling
– Drying

22. Futures Prices…
Irrigated Corn
180 bu. Yield
NT Wheat
90 bu. Yield
2/24/14 Futures $4.65/bu. – Dec ‘14 $6.83 – Sept. ‘14
Local December Basis
‘07-’12
- $0.32 -$1.11
Forecasted local price $4.33/bu. $5.72/bu.
• Strong basis during 2013/14
• USDA Outlook 2013/14
http://www.usda.gov/oce/forum/2014_Speeches/Ash.pdf
– Corn $4.50/bu.
– Winter Wheat $6.80/bu.

23. 2013/14 W. NE Corn Basis
-1.00
-0.50
0.00
0.50
1.00
1.50
SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG
Western NE Corn Basis
2007/08-2012/13 Average Basis 2013/14

24. Estimating Dry Bean Price
• Discovered 4:1 Dry Bean/Corn
relationship
Read Article Here http://panhandle.unl.edu/agecon_6
• Estimate local corn price $4.33/bu.
Quick Math
4.33/56=0.0773…*4*100=$30.93/cwt

25. Limited Irrigation Calculator
Available ONLINE go.unl.edu/pagecon

26. Limited Irrigation & Your Bottom Line
0.0
20.0
40.0
60.0
80.0
100.0
0 5 10 15
RelativeYield
Inches of Irrigation
Wheat

27. -200
-150
-100
-50
0
50
100
0 5 10 15 20
NetIncome
Inches of Irrigation
Profitable
Area of
Production
Limited Irrigation & Your Bottom Line
Max
Net
Income
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.

28. -200
-150
-100
-50
0
50
100
0 5 10 15 20
NetIncome
Inches of Irrigation
LogicalAreaofProduction
Limited Irrigation & Your Bottom Line
Max
Net
Income
Max
Avg.
Income
Diminishing
Returns – still
gaining Profit.
Each unit of
water = less
income than the
previous unit.
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.

29. Comparing Curves
-500
-400
-300
-200
-100
0
100
200
300
0 5 10 15 20
NetIncome
Inches of Irrigation
Wheat Corn Dry Beans
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.

30. Comparing Curves
Wheat Corn Dry Beans
Profitable Area
of Production
7”-19” 15”-19” 6”+
Max Average
Income per
Inch
12”
99% of relative
Yield
17”
100% of
relative Yield
11”
98% of relative
yield
Max Net
Income
13” 17” 14”
*Based on limited irrigation watering technique, UNL cost estimates, and futures prices on the day of calculation.
Modified from original presentation, contact Jessica Johnson 308-632-1247 for details.

31. Other Tools
• Water Optimizer
http://agecon.unl.edu/wateroptimizer/
download.html
• IRRICOST Irrigation Cost Estimate
Workbook
http://lancaster.unl.edu/ag/crops/irrig
ate.shtml

32. Office: 308-632-1247
go.unl.edu/pagecon
jjohnson@unl.edu
PanhandleAgEcon
Extension is a Division of the Institute of Agriculture and Natural Resources at the University of Nebraska-
Lincoln cooperating with the Counties and the U.S. Department of Agriculture.
University of Nebraska-Lincoln Extension educational programs abide with the non-discrimination policies
of the University of Nebraska-Lincoln and the United States Department of Agriculture.
Get current Panhandle price & basis information
TEXT “@UNLPREC” to 651-968-8358
Standard message & data rates apply.
Cornhusker Economics Outlook
Sidney 9-11:30AM & Chadron 2:30-5:00PM
March 4, 2014

33. Back Page

34. 2014 W. Nebraska Crop Budgets
No-Till
Dryland
Budget # Yield Cost/Unit
Change
from „13
Millet 40 22 cwt. $8.72 NEW
Peas 43 35 bu. $5.75 NEW
Sunflowers
57
58 - EcoFallow
13 cwt.
16 cwt.
$17.81
$16.23
↓18%
↓16%
Wheat 61-63 45-55 bu. $5.26 - $6.40 ↓4to↓10%
Irrigated Budget # Yield Cost/Unit
Alfalfa 12 6.6 tons $78.44 NEW
Corn
22
26
180 bu.
$4.04
$4.49
↓3%
Dry Beans 30-32 25 cwt.
$23.59-
$23.69
↓6-↑2%
Sugarbeets 53-56 26 ton
$32.88 -
$38.02
↓14 to ↓10%
Sunflower 59 30 cwt. $14.84 ↓1%
Wheat 65-66 85-90 bu. $5.13 - $5.65 ↓3 to ↑7%