Report on cost structure and economic profitability of selected precision farming systems

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This paper analyzes the economic profitability of selected Precision Farming (PF) technologies — site-specific management of weed, lime and nitrogen — Auto Guidance and Controlled Traffic Farming at farm scale.

 First, economic benefits are analyzed by calculating expected yields or cost savings from implementing each PF technology compared with conventional practices. The calculations for site-specific weed, lime and nitrogen management, as well as, Controlled Traffic Farming are based on data within winter wheat cultivation in the Lower-Austrian region. In the case of Auto Guidance calculations are based on Danish data. This paper focuses on winter wheat cultivation. Deliverable 5.7, also extend the analysis to include the cultivation of maize, rape seed, and sugar beet. 

Second, the costs of implementing PF technology are based on annual machinery costs for a 500 hectare model farm. Benefits rely on literature reviews for the various technologies, and recent farm trials in and outside Europe. In the table below are summarized the benefits and costs for implementing a number new PF-technologies.

Technology

Equipment

Costs of implementing new technology

Benefits of implementing new technology

Surplus (=benefits-costs)

Total net return of implementing new technology

Total net return for conventional

 

 

---------------------------------------€/ha--------------------------------------------------

Site specific weed/ herbicide management

Patch spraying based on manual weed detection and electronic equipment on sprayer

14.49

9.36 – 14.04

(-5.13) – (-0.45)

84.70 – 89.38

89.83

Site specific lime management

Soil samples and analysis, lime application contracting

 

12.50

4.5 – 13.5

(-8) – 1

81.83 – 90.83

89.83

Site specific nitrogen management

With N-sensor electronic equipment for fertiliser spreader

7.90

6.4 – 19

(-1.50) – 11.10

88.33 – 100.93

89.83

Auto Guidance

RTK technology

21.79

Savings of overlap by 3-9%

14.14 – 27.24

(-7.65) – 5.45

-

-

Controlled Traffic Farming

RTK technology (benefits after 10 years)

32.16

61.31 – 112.20

29.15 – 80.04

118.98 – 169.87

89.83

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The calculations show savings in input quantities, savings in variable costs, and increase in yields depending on the technology applied. Gross margins and total returns are for all technologies positive, and higher compared to conventional farming. Introduction of Controlled Traffic Farming and Auto Guidance seems to lead to the most profitable results.

 

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