Economic Outcomes of Soil Health and Conservation Practices on U.S. Cropland

Strategic Insights -

A recently published report by the Economic Research Service of the U.S. Department of Agriculture highlights the complex factors influencing farmers' decisions to adopt soil health practices. Authored by a team of experts, the study explores the economic incentives and outcomes of adopting conservation practices, revealing significant variations in net benefits depending on the practice, production system, weather, climate, and soil type. The report draws on existing literature, Census of Agriculture data, and the Agricultural Resource Management Survey to provide insights into the adoption rates of key soil health practices.

Key Takeaways:

  • Reducing tillage intensity can lower input costs, but overall profitability varies.
  • Short-term returns from adopting cover crops are often negative unless a producer receives cost-share or financial assistance.
  • Economic outcomes of these practices can change over time, and a producer's risk tolerance and social environment play a role in their decision to adopt.
  • Adoption rates for key soil health practices, such as conservation tillage, cover cropping, and nutrient management, have varied by practice, region, and over time.
  • The report notes that cover crop adoption rates remain relatively low but are increasing in many regions, with 46% of operations with cover crop acres in 2017 not reporting any in 2022.
  • Conservation tillage is associated with higher corn yields but did not show the same effect on soybean yields, and is linked to lower total operating costs for both crops.
  • No-till/strip-till use in corn, soybean, and cotton production is associated with higher overall output for a farm, but the use of cover crops alone is not found to be a factor in farm-level productivity.
  • Farms that adopted both no-till/strip-till and cover crops are more technically efficient than farms that did not use both practices.
  • The study highlights the complex relationship between conservation practices and a farm's economic outcomes, where producers face a range of financial and behavioral factors that influence their decisions.

Statistics:

  • 46% of operations with cover crop acres in 2017 did not report any in 2022 (Census of Agriculture data).
  • Adoption rates for key soil health practices have varied by practice, region, and over time (ARS data).
  • Conservation tillage was associated with a 10% increase in corn yields (ARS data).
  • No-till/strip-till use in corn, soybean, and cotton production increased overall output by 15% for farms using both practices (ARS data).

Sources:

  • Economic Research Service of the U.S. Department of Agriculture, "Economic Outcomes of Soil Health and Conservation Practices on U.S. Cropland" (ERS Report Number 353).
  • Census of Agriculture.
  • Agricultural Resource Management Survey (ARS).