Date of Award

2012

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Environmental Science

First Advisor

Kurkalova, Lyubov

Abstract

Field level farm management decisions such as crop rotation, tillage, and nitrogen application are impacted by the energy and other input costs, by the land quality, and by the anticipated grain prices. These decisions can significantly impact the acres planted, the yield, and the crop production, as well as both the fertilizer and energy use. This study develops an Excel based profit-maximizing optimization model for these farm management decisions, all varying by the field level Corn Suitability Rating land quality indicator for the agricultural land in the State of Iowa. The model developed for this analysis incorporates production costs, production yield impacts, the anticipated crop revenue, and profit at all land quality levels in production. This analysis identified a general trend towards less intensive rotations, tillage, and nitrogen levels as fuel prices increase. The results of the study estimate that the state-level elasticity of corn production to the price of diesel is -0.294, and for soybeans the estimate is 0.269. Corn production decreases in response to higher diesel prices because fewer acres are included in corn production. Soybean production increases because of an increase in the acres of soybeans planted. However, these impacts are not spatially uniform due to varying land quality. Within the model, changes in energy prices impacted these farm management decisions distinctly unevenly throughout the range of the land quality. Clear trends emerged as changes that impacted lower land quality at lower price levels progressed through to the higher land quality as the price continued to rise.

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