Sand County
Foundation
When land does well for its owner,
and the owner does well by his land;
when both end up better by reason of
their partnership, we have conservation.
When one or the other grows poorer, we do not.
- Aldo Leopold
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Use Ecosystem Services to Improve
Environmental Return on Investment
Shift to Performance Based, Market Driven
Agricultural Conservation Strategies
Need to understand
• Environmental consequence of change in
practices
• Costs of practices
• Farmer acceptance
Then can calculate better environmental
investment strategies
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Agricultural Causes of Nitrogen Runoff
3 Key Functions Altered Nitrogen Discharge
Increase Use of Synthetic Nitrogen
Move Water Off Landscape Very Efficiently
Shift From Forage and Small Grains To
Expanded Large Grand Production
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QuickTime™ and a
TIFF (LZW) decompressor
are needed to see this picture.
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Nitrogen Application
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Wetlands Loss
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Subsurface Agricultural Drainage
QuickTime™ and a
TIFF (LZW) decompressor
are needed to see this picture.
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Disconnect Riparian Functions
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Top 10% Nitrogen
Contribution
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Groundwater Contamination
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How Are Farm Decisions Made?
Don’t jeopardize future of the farm
What can we do?
what do we know how to do
what do we have capability of doing
How do we stay in business
• How do we maximize yield
•Largely economic decisions
QuickTime™ and a
decompressor
are needed to see this picture.
Maybe good environmental management
should help the economics
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US Corn Production For Ethanol Use
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
1980/81 1984/85 1988/89 1992/93 1996/97 2000/01 2004/05 2008/09 Source USDA
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Markets Highly Volatile
12
11
U.S. Crop Prices Received by Farmers
Crop Price Change
April 2008 vs. April 2007
soybeans
$ / Bu. - corn, soybeans and wheat
$ / 10 Cwt - cotton
10
9
8
Wheat
Soybeans
Corn
Cotton
+ 107 %
+ 72 %
+ 51 %
+ 27 %
7
6
cotton
5
4
wheat
3
corn
2
1
0
2000
2001
2002
2003
2004
Source: USDA, NASS
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2005
2006
2007
2008
Fertilizer Prices
Index of Fertilizer Prices Paid by Farmers, Jan. 1995 - April 2008
350
325
300
275
225
200
175
150
125
100
Source: National Agricultural Statistics Service, USDA.
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2008
July
2007
July
2006
July
2005
July
2004
July
2003
July
2002
July
2001
July
2000
July
1999
July
1998
July
1997
July
1996
July
75
1995
1990-1992 = 100
250
Price of Ag Commodities
Commodity Price Change
Wheat
+ 304 %
Corn
+ 170 %
Soybeans
+ 155 %
Fertilizer
+ 228 %
April 2008 VS January 2000
National Agricultural Statistics Service, USDA
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So What do We Do?
Becoming a Conservation Capitalist
•We expect to pay for most things we use
• We expect farmers to provide water
quality for free*
• Regulatory strategies are resisted and
inefficient for not point source issues
• How do we overcome impediments to
more efficient conservation delivery?
* See Water as a Crop presentation
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Improving Environmental Management:
Shifts to Performance Based
Incentives
• Faster
• Cheaper
• Less Disruptive
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Pilot Use of Markets in Innovative Ways
• Prioritize investments
• Prioritize subsidies
• Create trades between sectors
• Get farmers in ecosystem service
business
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Conservation Delivery Highly Inefficient
• Current Farm Bill provides $24 Billion for
Conservation
• Fund Distribution Strategy Designed
largely in 1985 - does not target, focus on
performance or use market principles
• Taxpayers are not getting good value
• Innovation is not encouraged
• The result is higher costs & lower
environmental quality
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Overcoming Impediments
Creates Performance Data
A Comparative Analysis of the Environmental
And Economic Performance of Management
Alternatives
In other words
• Which practices are most effective at
environmental improvement (recognizing
location variations)
• What are the costs of various practices
• What is the return on investment
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Prioritizing Investment
Create Incentives for N Loss Reduction
Which practices
What location
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Management Options
Source Reduction
Sink Creation
Change Crops
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Examples of Source Reduction
• Nutrient Management Plans
• Calibrate manure spreaders
• Improving N application techniques
• Moving animal concentrations out
of waterways
• Use
of N stabilizers
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Source Reduction:Nutrient Mgmt Plans
– Soil Test
– Determine Agronomic or
Economic Need
– Credit Manure
– Credit Legumes
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Sink Creation
• Wetlands Restoration
• Floodplain Restoration
• Drainage Management
• BioReactors
• Cover Crops
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Sink: Drainage Management
Raised Water Table
Water Level
Control Structure
Soil Surface
Solid Pipe
Drain Water
Riser Boards (Adjustable)
The water level control device is installed in the tile drain near the outlet and at various locations
within the field depending on topography
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Sink: Bio Reactor
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Bio Reactor: Installation
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So What?
Demonstrate a variety of management practices in
variety of locations
• Assess farmer acceptance of practices
• Assess environmental effect of each practice
• Assess the cost of each practice
• Evaluate cost effectiveness of various practices
In other words, ask the question where do we get a
higher return on our environmental investment?
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Nitrogen Management Potential
Discharge Reductions
• Agronomic Practices
• Cover Crops
• Drainage Management
• Bioreactors
• Bioreactors w/ Drainage Mgt.
• Wetlands
• Minimize drainage intensity
(for replacement systems)
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20 - 30%
10 - 40%
20 - 50%
20 - 40%
50 - 80%
5 - 60%
5 - 35%
Cost Effective Practices
•Nutrient Planning
•Wetlands Restoration
•Manage Drainage
•Bio Reactors
•Cover Crops
•Precision N Application
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$0.13/lb
$0.10 - 0.90/lb
$0.10 - 1.40/lb?
$1.05 - 1.75lb
Net Saving?
Low Hanging Fruit
• Agronomic practices
What is the price?
• Wetlands
What is the price?
• Drainage management
 Design to meet production needs
 Bio digesters
What is the price?
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Sand County Foundation
Alex Echols
echols@conrod.com
703/660-2366
Brent Haglund
bhaglund@sandcounty.net
608/663-4605
http://www.sandcounty.net
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