19.05.2016
Category: Cash Crop
By: Samuel Balieiro, Jeanette Malchow

Irrigation pays off for corn production


irrigation corn

chart - direct costs

Direct costs rainfed vs. irrigated corn (S. Balieiro, agri benchmark Cash Crop 2015)

chart - total profitability of land use

Returns to land in selected typical farms comparing rainfed to irrigated corn (S. Balieiro, agri benchmark Cash Crop 2015)

Irrigation is commonly accepted as an important strategy to enhance productivity of crops. But besides legal and technical issues related to water access, irrigation requires substantial investments. Therefore, a close look is needed to answer the question whether it is interesting to invest in irrigation to produce corn. 

Samuel Balieiro has analysed the overall effect of irrigation for corn production based on data from three typical farms of the agri benchmark Cash Crop network, which produce irrigated and non-irrigated corn side-by-side. These farms are located in Lalomitia County, southeastern Romania (RO6500IL), northwest Kansas, USA (US2025KS), and in the region Western Free State of South Africa (ZA1700WFS).

Not surprisingly, irrigation caused a significant increase in yields on all farms, with more than doubling yields on the US and ZA farm. In Romania the increase was even more impressive: Irrigated yields soared about 80% compared to rainfed production. But how does irrigation affect the unit costs of production on these farms?

Figure 1 shows that irrigated areas are in general more input-intensive than rainfed, which – together with better water supply – explains partially the yield gap observed. For instance the nitrogen input is notably higher. It is widely known that corn is highly-responsive to N input and that water availability is crucial for N absorption by the plants, resulting in higher production. Moreover, seed cost is also significantly higher in the irrigated plots, indicating a larger population of plants per hectare which can only be sustained if enough water is available.

But despite higher total costs (machinery & labor costs, investments, other operating costs) per hectare, costs per tonne of output are remarkable lower in the irrigated systems compared to rainfed systems. The obvious reason is that the increase in total cost is lower than the increase in yield. When considering the profitability of land use the finding implies that irrigation greatly increases return to land which it is here defined as market revenue minus total costs (excluding land costs). The results are presented in Figure 2.

Balieiro’s complete analysis, including a detailed description of production cost of the US and South African farms, is published as part of the Cash Crop Report 2015.

Free for download:

Cash Crop Report 2015, (pdf-document, 4693 KB)

 


© 2022 by TI and global networks