Potential Profitability of Strip Intercropping with Corn and Soybeans

Barry Ward, Brian E. Roe and Marvin T. Batte
Department of Agricultural, Environmental and Development Economics

Agronomic trials suggest that planting narrow strips of corn and soybeans side by side in the same field can generate greater total revenue than planting the equivalent number of acres in large, monoculture fields (Lesoing and Francis 1991, West and Griffith 1992). This approach, which is referred to as strip intercropping, may improve the efficiency of light reception for the taller crop (corn), though at the expense of shading the shorter soybean crop. Strip intercropping is viewed as an opportunity to increase total crop production primarily because of greater efficiency of sunlight capture. Recently, trials reporting the effects of strip intercropping on corn yields in industry publications (Winsor 2011) have sparked the imagination of many farmers and affiliated professionals in the North American field crop sector, leading to increased interest in the potential profitability of such a change in cultivation practices. However, these trials have not considered the full cost-side ramifications of altered cropping systems for modern, large-scale corn and soybean production systems nor have these studies explored sensitivity of results to crop prices. Both are crucial for understanding the relative appeal of this cropping system to commercial U.S. farmers.

A group of researchers within the College of Food, Agricultural and Environmental Sciences at The Ohio State University developed a systematic comparison of the relative net revenue differences for a large-scale (5,333 acre) corn-soybean operation under two separate cultivation systems: (1) traditional cultivation practices where each field involves monoculture cultivation of either corn or soybeans and (2) a strip intercropping system featuring narrow strips of corn and soybeans in each field.

Our analyses has shown that because the yield premiums for strip intercropped corn were relatively larger than the yield penalty for soybeans, the intercropping practice generated more gross revenue per unit land than the same crops grown in field-level monoculture. Projecting from yield effects in recent Illinois field trials, we discovered that the gross farm revenue improvements involved in implementing strip intercropping ranged from less than one percent to 12 percent. Narrower strips yielded substantially larger gross revenue relative to monoculture. Expansion to wider strip widths increasingly dilutes the higher-yield edges with wider center row segments, resulting in lower average yields and gross revenues. For example, in a year with normal rainfall and high prices, 4-row corn strips intercropped with a soybean strip of the same width yields an increase in gross revenue per acre of $134 (10%) over monoculture, while a 6-row corn strip intercropped with a soybean strip of the same width yields only a $83/acre improvement. In a dry year, the additional revenue from a 4-row corn strip drops to about $53/ac. Commodity price also is important, both in terms of absolute level and the relative level of prices for the crops in strips. A drop in commodity prices from $7/bu corn, $17.50/bu soybeans to $4/bu corn, $10/bu soybeans results in a decline in the 4-row strip advantage of $57/ac, assuming typical weather. Because corn yields increase while soybean yields decline over the strip cropped area, an increase (decrease) in the soybean/corn price ratio decreases (increases) the revenue advantage of strip intercropping.

Of course, revenue is only one side of the ledger when considering such a substantial change in cultivation practices. We explore differences in labor and machine costs for the 5333 acre corn/soybean operation to implement a 6 row intercropping system. All other costs, including seed, chemical and marketing costs, are assumed to be identical between the systems. More total hours spread across multiple implements are needed to complete field operations for strip intercropping. The total wage bill is nearly double for strip intercropping, as both field hours and hours spent in transition are considerably higher. Machinery ownership costs are 90% higher with strip intercropping as more, smaller implements and tractors are required to accomplish operations in a timely fashion. A key conclusion is that strip intercropping would lead to net revenue improvements over a conventional production system only for high base prices for crops and for normal moisture conditions with the most favorable result occurring when corn has the highest relative price, wages are lowest and fuel is most expensive. In this scenario, strip intercropping would return a modest $30 more per acre than the conventional operation. In other less favorable scenarios, increased costs of strip intercropping typically exceeded improvements in revenues.

These analyses do not consider the one-time costs of altering the machinery complement to allow the strip production system with narrow strips. Such transitional investment requirements might be a significant deterrent to farmer adoption of strip intercropping. On the other hand, our analyses also ignores possible yield boosts from decreased compaction resulting from the smaller equipment used in strip intercropping. Compaction related yield penalties are well documented, but their effect has not be isolated or the accumulated effect traced over time in current agronomic and pilot tests of strip intercropping yield comparisons. Further, additional work is needed to consider the potential profitability for smaller operations that currently possess smaller capacity equipment and may have the capability to expend additional time to plant, spray and harvest smaller strips without risking timeliness of each operational step. Also, we do not consider how row-specific management approaches within a strip intercropped system might affect yields or net revenues, where different planting populations and fertilizer levels for edge rows could spur further yield boosts for corn. Finally, all analyses here assume the prevailing machinery technology is employed for both monoculture and strip intercropping production systems. The advent of radical new technologies might greatly alter the cost calculus for farming small strips, allowing capture of yield advantages of very narrow strips without the much higher machine and labor costs calculated in this study.

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