Economics of Cropping Systems

Earl O. Heady.

Two sets of forces determine the most profitable rotation or cropping system for a farm: Physical considerations, which determine crop yield possibilities, and economic considerations, particularly the prices and costs of the products.

The physical considerations determine the enterprise relationship among the various crops and how each fits into the overall management plan.

The economic considerations weigh the relative advantage of each crop and service in the selection of a rotation to increase the profits of the farm.

The best system of crops or rotations cannot be selected with one of these types of information alone. Even though the effects of soil type, fertility level, and climate on the yield of different crops are known, deciding on the most profitable system of land use requires the use of economic principles. But even though we know the price and cost ratios, we cannot specify the optimum cropping plan until crop production possibilities have been predicted from the relevant information as to soil and crop yields.

The importance of price in determining the best rotation depends on whether the enterprise relationship is one in which crops compete with one another.

The physical characteristics of the soil and the indirect effects one crop has on yields of the other determine these enterprise relationships. Two of them, the competitive and complementary relationships, are of particular importance in crop combinations and in determining how crops should be grown together. A third relationship, the supplementary relationship, determines how well the crop program fits in with the livestock program and the overall plan of the farm.

The main advantage in combining crops into a rotation occurs when they complement each other when the output of one on a given acreage also leads to an increase in the output of the other. As an example, suppose a field of 100 acres has been planted continuously to corn; the yield is 30 bushels an acre; the total production is 3 thousand bushels from the 100 acres. A switch to a rotation of corn-corn-corn-oats-meadow gives yields of 50 bushels an acre of corn, 40 bushels of oats, and 2 tons of hay or meadow. The 100 acres now produce 3,800 bushels of grain (or 3,400 bushels of corn equivalent, if a bushel of oats is considered to be worth one-half bushel of corn) and 40 tons of hay. Thus the shift of land, labor, and capital from corn to hay brings about more production of both grain and forage. In this sense, the two crops go hand in hand. They are complementary.

The complementary relationship exists only when one crop, or a soil-management practice associated with the crop, provides a nutrient or service required by the other crop. Thus, grasses and legumes may serve in a complementary capacity to grains or row crops when the grasses and legumes furnish nitrogen, control erosion, eliminate diseases and pests, and maintain or improve soil structure to an extent that a greater production of grains or row crops comes from fewer acres.

Grains and row crops also can be complementary to grasses and legumes. In zonal locations such as the Northern Chernozem soils from North Dakota to Kansas and the Prairie soils in the western Corn Belt, continuous production of deep-rooted legumes depletes subsoil moisture to an extent that yields deteriorate with time. For-age production from a given acreage consequently may be augmented if the sod is frequently plowed up and the land is planted to corn or other row crops until it is returned to forages.

Similarly, in regions of greater rainfall, such as New England, or irrigated lands of the West, or parts of the Southeast, forage stands may deteriorate from winter killing, disease, or grazing to a point where a year of grain or other crops in the rotation allows an improved stand and greater total production of forage as the land is returned to grasses and legumes. Fallow land is complementary to wheat and other small grains over much of the Great Plains.

A rotation of fallow and wheat in places where moisture is sufficiently limited increases the yield of wheat to the extent that a greater total production is possible from fewer acres.

Examples of complementary crops can be found on many soil types. Yields from the Morrow experimental plots at the University of Illinois indicate that 100 acres of Drummer silt loam devoted to continuous corn would have produced 2,433 bushels of corn in the period 1904-1949. A similar plot of 100 acres devoted to a corn-oats-clover rotation would have produced the equivalent of 2,677 bushels of corn (1 bushel of oats is figured to be worth one-half bushel of corn) and 21.7 tons of hay.

After continuous treatment from 1915, continuous corn on Webster silt loam in Iowa would have produced at the rate of 3,220 bushels of corn on 100 acres in the period 1945-1949. In the same period, 100 acres in corn-corn-oats-clover would have produced 3,881 bushels of corn equivalent and 44.5 tons of hay.

Experimental data from Fort Hayes, Kans., for the period 1918-1949 show that 100 acres devoted to continuous wheat would have produced 1,460 bushels. A rotation of fallow-wheat-wheat-wheat would have produced 1,538 bushels and the year-to-year Output would have been more stable.

Data from Aroostook County, Maine, are such that we could predict 1,320 bushels of potatoes from 100 acres cropped continuously to potatoes. In the same period, 100 acres devoted to a potato-oats-clover rotation would have produced 1,275 bushels of potatoes and some oats and hay.

The complementary relationships between crops extends only over a limited range of crop combinations, however. They finally cease and give way to the competitive relationship. complementarity ends because of the physical law of diminishing returns equal additions of moisture, nitrogen, and organic matter, improved soil structure, and disease or pest control that are furnished by one crop to another adds less to the acre yield of the second. Eventually the reduced acreage of the second crop more than offsets increases in yields. Then a further shift of land from one crop to the other allows production of the first to increase only at the expense of the second. The presence or absence of complementarity between crops has particular implications in determining whether monoculture or crop rotation is more profitable on a particular soil.

Two Mops are competitive with each other when an increase in the acreage and output of the first crop causes the acreage and output of the second to decline on a given acreage. Even when one crop (or the soil-management practices associated with it) provides enough nutrients or services to cause complementarity with a second, this complementary relationship always merges into a competitive relationship.

In the examples I cited, a further increase in forage, as represented by a corn-oats-clover rotation, on 100 acres of Webster silt loam causes the corn equivalent to drop to 2,968 bushels, while hay increases to 48.4 tons. Compared to a corn-corn-oats-clover rotation, more hay is produced only with a sacrifice in total grain production, and the relationship is one of competition. (Between continuous corn and a corn-corn-oats-clover rotation, the hay served in a complementary capacity with grain.) At Fort Hayes, Kans., a wheat-fallow rotation reduced wheat production on 100 acres to 1,190 bushels.

When the range of crop competition follows after a range of complementarity, the yield of one crop ordinarily can be increased only with increased sacrifices of the other.

For example, experiments on Canfield-Wooster soils in Ohio showed that in 1937-1943 the 20 percent of land acreage devoted to hay in a corn-corn-corn-wheat-alfalfa rotation, as compared to a continuous corn rotation, was complementary to corn. As the same three crops were combined into a rotation with 33 percent alfalfa, however, each pound added to total hay production caused a sacrifice of 0.19 pound in total grain production. With an increase in alfalfa acreage to 40 percent, each pound added to total hay production caused total grain production to decline by 0.22 pound. With an increase of alfalfa to 50 percent of the acreage in rotation, each pound added to total hay production caused a sacrifice of 0.53 pound in total grain production. These sacrifice or substitution ratios between crops and the price ratios for them determine the economically efficient combination or rotation.

A schematic representation of the enterprise relationships between crops grown in combination or rotations. While relationships are indicated as between grain n and forage, similar possibilities may exist within particular categories, such as row crops, grains, vegetables, and others.

Two crops that have similar requirements of moisture and nutrients and are grown in approximately the same season are almost always competitive. Competition is almost always at a constant rate.