The USDA’s Economic Research Service (ERS) has released a report, Farm Profits and Adoption of Precision Agriculture.
The report covers current trends in precision agriculture (PA), production practices and farm characteristics associated with adoption. The report also looks at corn data from 2010 to determine if PA practices lead to increased profitability.
The report looked at three types of Precision Agriculture: GPS-based mapping systems (including yield monitors and soil/yield mapping), guidance or auto-steer systems, and variable-rate technology (VRT) for applying inputs.
The type of technology and the size of the farm were two of the greatest variables for adoption rate. Yield monitors that produce the data for GPS-based mapping are used on about half of corn and soybean farms. Auto-steer or guidance systems are being utilized on about one third of U.S. farms, and GPS-based yield mapping is reported on about a quarter of farms. Somewhere between 16 to 26 percent of farms are using soil mapping with GPS coordinates and variable-rate technology.
The number of corn and soybean acres are higher than the share of farms, leading researchers to understand that larger farms are more likely to use PA technology. The report also concludes that hired labor costs are higher larger farms utilizing PA, likely the result of farmers using specialists to help implement the systems.
A few other factors that influenced adoption were yield goals, unpaid labor costs, and machinery stock. Farmers already close to their yield goals were unlikely to try PA technology, while those with lower yields where likely attempting to raise yields on less productive ground. A high fixed overhead for machinery and labor costs decreased a growers flexibility for implementing precision practices.
Regardless of the size of the farm or the type of technology, all PA practices showed a positive impact on net return.
- GPS mapping shows the largest estimated impact among PA technologies, with an increase in operating profit of almost 3 percent on corn farms. The impact of mapping on net returns is almost 2 percent.
- Guidance systems raise operating profit on corn farms by an estimated 2.5 percent and net returns by 1.5 percent.
- Variable-rate technology (VRT) raises both operating profit and net returns on corn farms by an estimated 1.1 percent.