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Producers Invest in Water Infrastructure

October 27, 2012
By: Ed Clark, Top Producer Business and Issues Editor
p34 Pivots Spread East
  
 
 

Producers invest in water infrastructure to control risk

Mother Nature’s highly unreliable temperament in recent years is prompting farmers to take  matters into their own hands. Center-pivot irrigation systems, once thought to be suitable only
for Kansas, Nebraska or California’s San Joaquin Valley, are going up in the eastern Corn Belt.

"Irrigated land comprises 30% of Lawrence County, Ill.’s total acreage, but 60% to 65% in Russell and Allison townships," says Norm Kocher, chairman of the Russell-Allison Water Authority, farmer and dealer for T-L Irrigation. "That’s double the amount in the two townships from 10 years ago." That’s an extreme case, but it puts numbers to the brisk adoption rate.

"For Reinke, the market has increased rapidly in Illinois, Indiana, Missouri, Ohio and western Tennessee," says Tim Goldhammer, Reinke Mfg.’s vice president of marketing. "We’ve added  dealers in those high-demand areas."

Several factors—such as high-priced grain, rising input costs, sky-high land values and rents, and, more often than not, quirky weather—are working in concert to drive the trend to irrigate.

The cost of erecting a center-pivot irrigation system varies significantly, says Rich Panowicz, vice president of North American sales for Valley Irrigation. As a rule of thumb, a total irrigation  installation for 130 acres requires an investment of approximately $1,000 per acre, plus costs for underground pipe and electrical tie-ins. The cost of drilling a well can bring the price tag much  higher, depending on how deep you need to go to reach water, he notes.

Tired of dealing with dry weather every year, Cecil, Ohio, producer Curt Potter invested in a new irrigation system earlier this year. The ability to water when needed did the trick—he realized a 100 bu. per acre difference between irrigated and nonirrigated acres. After an initial investment of $1,100 per acre, the estimated costs have been just a few dollars per acre.

Get started. Before you grab your checkbook, there are several factors to consider to determine if irrigation is right for you, says Lyndon Kelley, an irrigation specialist for Michigan State and  Purdue universities.

First, Kelley says, you need water. Access differs dramatically by location, even within the same township.

"You need a water source that allows you to pump 500 gal. of water per minute for 100 acres for corn. That’s the bare minimum," Kelley says.

At this rate, producers can generate 1" of water every four days, which is what corn requires.  Soybeans need less water, so some producers with less than ideal volume might still be able to irrigate with scheduling changes. Corn and soybean peak water demand comes at different times, as well.

Second, what soil types do you have? Sandy loam soils respond well to irrigation, and sandy soils that are most vulnerable to drought are probably the best place to begin. That’s not to say that heavier soils should never be irrigated, however, and some producers who irrigated for the first time this year report excellent yield responses from soils with a denser profile.

Existing irrigators are also taking advantage of strong incomes to upgrade systems, Panowicz  says. More growers are adding corner units to minimize the number of acres that are not reached by the center-pivot circle.

New technology, such as variable flow rates that take into account variations within a field, allows for finetuning of existing irrigation systems.

"As the cost of putting in a crop has increased in the past five years, farmers can’t afford to have a crop failure due to drought conditions even one or two years out of 10," Panowicz adds.

Another factor driving irrigation’s renaissance is high-priced farmland, which is requiring farmers to reap every last bushel from fields before expanding, says Randy Wood, vice president of  irrigation, sales and marketing for Lindsay Corporation.

"Irrigation is an efficient method of increasing yields," he says. For example, if irrigation means an extra 100 bu. in yield (not the case every year), it means investing $1,000 with a rapid payoff, as opposed to paying as much as $8,000 an acre to buy land, assuming you can find any.

Other benefits. An irrigation system does more than just allow producers to boost yields. This fall, Potter’s soybeans, for example, had only 9% to 10% moisture. At harvest, he turned on the irrigation to achieve his desired 14% moisture.

Crop and livestock producer Steve Miller uses his new system to capture the value of the manure from his hog buildings. He can apply nitrogen throughout the year by mixing manure at a 4-to-1 ratio (water to manure).

"We can apply manure with no soil compaction, and we don’t lose any of manure’s nutrients,"  says Miller, who farms near Bucyrus, Ohio.

At a loss about the logistics of manure irrigation at  first, Miller estimates a 100 bu. per acre yield pop on fields that were irrigated this year. He is hoping for a modest 30 bu. per acre yield  advantage over a 10-year period.

He plans to increase the number of acres irrigated in 2013. However, irrigation is not for every  farmer in the Midwest, he admits. "It wouldn’t work a few miles from here," he explains because of the difference in water accessibility.

Federal crop insurance was not a good investment for Sandborn, Ind., farmer Vaughn Huey, so he instead invested in irrigation for the first time. It worked to his advantage—he harvested 170 bu. more corn per acre on irrigated ground. "From June 1 to the end of July, I ran the unit 24 hours a day, seven days a week. I knew it would be a good investment. I just didn’t know it would be this good."

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FEATURED IN: Farm Journal - November 2012

 
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