Farming as a Business | TheFencePost.com

Farming as a Business

Rick MooneyConsultant Patty Koller runs the numbers for Darrell Egli's operation. "It is eye-opening to see the fuel it takes to produce and dry an acre of corn," she says.

Darrell Egli never overlooks a chance to improve his farm’s energy efficiency. He’s constantly trying to reduce the amount of energy required to grow corn and soybeans, especially with escalating diesel fuel and fertilizer costs.

“I am all about efficiency,” says Egli, who farms near Columbus Junction with wife, Glenda. “I am always evaluating how to increase how much product I can get per acre to increase profits.”

But even someone who strives to get more for less from an acre of Iowa farmland can sometimes find new energy savings.

Last year Egli and 50 other farmers participated in a farm energy audit through the Iowa Soybean Association’s Certified Environmental Management Systems for Agriculture (CEMSA) program. They used the audit to evaluate different crop production scenarios for their farms to help find ways to reduce energy consumption.

Diesel fuel equivalent. The energy audit looks at two types of energy costs. Direct energy is fuel costs associated with fieldwork”tillage, applying fertilizer, planting, spraying, harvesting”transportation and drying. Indirect energy factors costs required to manufacture commercial fertilizer, particularly nitrogen. The spreadsheet converts all energy”fuel, propane, natural gas, electricity”to gallons of diesel fuel equivalent (GDFE) per acre for comparisons across energy sources.

Shannon Gomes, owner of Cedar Basin Crop Consulting in Waverly, Iowa, and three other crop consultants with MGT Envirotec used grant funding from the National Resources Conservation Service to develop the audit. They assigned GDFE values from data collected from several Midwestern universities.

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CEMSA program manager Heath Ellison says the lowest corn production scenario in the group was 5.29 gallons of diesel fuel equivalent per acre, and the highest was 64.81. Soybeans ranged from 1.6 to 7.11.

“There is much more GDFE variability in corn production because growers are more likely to tweak various practices based on soil type and field conditions,” says Ellison. “Plus, it indicates how much the type and rate of nitrogen influences a farm’s energy efficiency when growing corn.”

Egli and his certified crop adviser Patty Koller with Field Quest LLC, Donnellson, Iowa, used the spreadsheet to determine where he could be more energy efficient.

“We broke down the entire crop operation,” says Egli. “We looked at nitrogen and manure applications, what would happen if I allowed corn to dry another percent in the field and changes in tillage options. You can look at different scenarios in the spreadsheet and calculate the costs.”

Like the other audit participants, Egli was surprised to learn tillage is a small part of a farmer’s energy budget. Moldboard plow consumes 1.7 GDFE per acre; disk chisel, 1.3; field cultivator, .65; and tandem disk in stalks, .45.

But the audit also showed two big areas where farmers can cut energy costs: Replace or supplement nitrogen fertilizer with manure, and harvest corn at a lower grain moisture content. Koller points out if a stalk nitrate test, strip trials, etc. indicate you can reduce nitrogen without cutting yield, applying 30 fewer pounds per acre of anhydrous ammonia equals a savings of 4.68 GDFE. She estimates it also reduces indirect energy costs by 21% and total costs by 12%. The audit showed that every 10 pounds of anhydrous ammonia equal 1.56 GDFE.

CEMSA’s Ellison points out that one reason manure looks so energy efficient compared with commercial fertilizer is because the spreadsheet developers assigned manure an indirect energy value of zero. “We didn’t do a good job capturing energy costs for manure, but we plan to re-evaluate them for the 2008/2009 audit.”

Although calculations vary by operation, Koller says generally harvesting corn at 17% rather than 18% moisture can save about 10% in drying costs. “It is eye-opening to see the fuel it takes to produce and dry an acre of corn,” she adds.

Applying the results. Egli is already using the audit to look for ways to reduce his energy bill. He injects hog manure in the fall on nearly one-third of his acres and applies nitrogen in the spring with the planter. The audit indicated Egli should consider building another hog house and expanding that enterprise for more manure. But with today’s low hog prices and high corn prices, Egli doesn’t think that’s an option.

He is, however, using pop-up starter on corn to reduce total nitrogen. “With the starter and by drying grain 1% more in the field, I can lower energy use 22%,” he says. “I can’t change my transportation costs to and from fields I farm in three counties. But I did learn it is more energy efficient to haul grain direct to the river from a field 11 miles from my home than to store it.”

Energy savings. Egli has already put about 6% more profit in his pocket through less fuel use by switching from conservation tillage to no-till. The audit showed a change in his crop rotation might also help cut energy costs. A 50-50 corn/soybean rotation would be more efficient than the corn/corn/soybean rotation he now follows. The spreadsheet estimates he now uses 27.3 GDFE per acre versus 17.51 with the crop rotation change.

“This is operation-specific advice. Farming is one of the few occupations where you can work to conserve energy and produce a source of renewable energy at the same time,” says Koller. CEMSA’s Ellison says the goal is to add another 100 energy audit participants in 2008 and make it available to other states.