Cost, Average Returns, and Risk of Switching to Narrow Row Corn

The objective of this analysis was to compare the production cost, average profitability, and risk of corn (Zea mays L.) in 30 in. rows with rows of approximately 20 in. Baseline yield advantage estimates were made by pooling publicly available research data. A narrow row yield data set from Pioneer Hi- Bred International (Pioneer) was used to test the sensitivity of results. For the producer who currently uses a 30 in. row planter for corn only, narrow row corn would increase long term equipment costs by about $6.50/acre per yr. Much of the narrow row cost discussion has focused on equipment, but for many producers increased corn rootworm (Diabrotica spp.) insecticide costs would be more important. This analysis indicated that narrow row corn has potential economic advantages in the northern Corn Belt. Some benefits and costs of narrow row corn could not be quantified in this analysis. These included use of narrow row planters for both corn and soybeans, potential for reduced herbicide use, increased stalk breakage, increased starter fertilizer, and business risks related to use of custom operators and resale value of equipment. Research QuestionCorn row width is an economic compromise between the ideal of equidistant plant spacing and the cost of decreasing row width. The general objective of this analysis is to compare the production cost, average profitability, and risk of the current standard of 30 in. rows with rows of approximately 20 in. This analysis focuses on intermediate to long term costs and returns when commercially available narrow row equipment is purchased. It does not deal with transition costs of retrofitting or modifying wide row equipment. Literature SummaryFarmers and those who advise them face a bewildering array of narrow row corn yield studies. Paszkiewicz reported an average 3.2% yield increase in replicated trials by universities and seed companies, with the largest benefit in the northern Corn Belt. In northern Iowa, increases averaged 4.1%. In the central Corn Belt south of Interstate 80 and north of Interstate 70 the average increase was only 1.5%. He reported that narrow rows often depress yields in southern Corn Belt locations. Based on his work in Indiana and a review of work in neighboring states, Nielsen concluded that yield increases in the central Corn Belt have been relatively small and variable. In Ontario, Scheifele reports yield increases of 6% to 19%. Calmar points out that the narrow row yield benefit depends on adapting agronomic practices to optimize the narrow row environment. No in depth economic analysis of narrow row corn is available. Almost every farm magazine in the Corn Belt has published testimonials on the benefits of narrow row corn. Many of these articles cite the costs and benefits achieved by producers, but it is difficult to generalize from these specific cases. Study DescriptionFor the baseline comparisons, yield data for row width comparisons was pooled from publicly available sources, either in print or on the World Wide Web. This is the data that is available to farmers, crop consultants, and commercial agronomists. Only data for dryland corn grown for grain from commercial hybrids after 1960 was used. If experimental design was factorial, the 30 in. and narrow row yields with similar agronomic practices (e.g., plant population) were compared. Treatment mean yields were averaged over replications by year, location, and agronomic practice. Yield data from Pioneer Hi-Bred International (Pioneer) narrow row corn trials was obtained to test the sensitivity of results. Spreadsheets were developed to calculate the cost and return differences for the whole data set and by region. Narrow row costs are estimated assuming that the producer currently uses a 30 in. row planter only for corn and that a switch is made to 20 in. rows for corn only. Twenty inch rows were chosen for the equipment estimates because that was the narrowest row width for a mass produced combine cornhead at the time of the analysis. Applied QuestionsHow much does equipment investment increase with 20 in. row corn? For the baseline case of a farm with 900 acres of corn, equipment investment increases by about $24 500. This is based on a change from a 16 row 30 in. planter to a 24 row 20 in. machine, and from an eight row 30 in. corn head to a 12 row 20 in. unit. Planter investment increases by about $1650 per added row in the same overall planter width. Corn head investment increases about $2000 per added row in the same harvest width. How much do annual equipment costs increase with 20 in. row corn? For the baseline case of a farm with 900 acres, annual equipment costs for corn increase by about $6.50/acre if the corn head has a normal resale value. Planter costs increase about $3.40/acre and corn head costs increase about $2.30/acre. The resale value of the corn head has only a small impact on the average annual equipment cost. Even if the corn head must be junked after 10 yr, the annual cost is only $0.64/acre higher. Producers with smaller equipment on fewer corn acres would have slightly higher per acre costs. Do rootworm insecticide costs increase substantially with 20 in. row corn? While the focus of the 20 in. row cost discussion has often been on equipment, for many producers insecticide costs will be a bigger item, rootworm insecticide is usually applied per linear foot of row and a move from 30 in. to 20 in. rows increases the feet of row per acre by 50%, hence insecticide costs are increased by 50%. At average prices and recommended application rates, the insecticide cost would be increased by $8/acre. In addition, it should be noted that some insecticides have an upper limit on the quantity of product per acre and use at the recommended rate per linear foot may exceed that upper limit. Does 20 in. row corn increase profits? It depends on location and whether insecticide has to be applied. Narrow row corn seems to have some potential for increasing profits in the northern Corn Belt in areas where insecticide is not required on first year corn. If insecticide is needed, narrow row corn is not profitable enough to justify switching. For the scenario in which a producer has a planter used only for corn, added profits when using the pooled public yield data are about $8/acre in the northeastern Corn Belt (e.g. Wisconsin, Michigan, Ontario). In the northwestern Corn Belt added returns are in the range of $2/acre for both the public data and the Pioneer yield information. Returns would be higher for producers who can switch from a corn planter-soybean drill to a single narrow row planter while maintaining soybean yields. When 15 in. row cornheads become more available, producers who can use a 15 in. row soybean planter for corn also may show higher benefits than those estimated in this study. Is 20 in. row corn riskier than 30 in. row? Both the publicly available data and the Pioneer information indicates that yield and profit variability is similar across row widths. Twenty inch row corn does not appear to be a fragile production system that breaks down in difficult growing conditions. In the risk analysis outlined here, narrow row corn is the preferred production method only in the northeastern Corn Belt. In other areas risk analysis results are inconclusive. Narrower rows increase business risk by making it more difficult to find custom operators and by potentially reducing resale value of equipment. RecommendationCorn producers north of Interstate 80 in areas that do not require insecticide on first year corn should consider narrow row corn as part of a strategy to fine rune their production system. Producers in the northern Corn Belt who have to apply insecticide to first year corn, should continue to use 30 in. rows and reconsider the narrow row decision when rootworm resistant corn hybrids become available. In other corn growing areas, producers should continue to produce corn in wide rows, but monitor technology developments that may increase the yield boost from narrow rows or reduce the cost.