Study shows positive economic returns from no-till and cover crops

The benefits of no-till and cover crops to soil health are well known. However, the economic advantages of the two practices are harder to quantify.

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To determine how no-till and cover crops might affect farmers’ bottom lines, the National Association of Conservation Districts (NACD) and Datu Research analyzed data from several farms. 

The analyses suggested that economic benefits to corn and soybean farmers adopting cover crops or no-till can run as high $100 per acre. 

The research analyzed several categories of on-farm costs and income over three years from 2014 through 2016. The analysis examined the impact of no-till and cover crops on each of the farm’s bottom lines, using previous years’ economic data as the baseline figure. 

Overall, the data indicated fertilizer costs could be cut by $50 per acre; costs for erosion repair could be reduced by $16 per acre, and revenue from yield increases could amount to $76 per acre. 

Three of the farms profiled here are located in Illinois, Missouri, and Iowa. The researchers compiled case studies for each farm, which are published at nacdnet.org/ soil-health-research/.

Triple-Digit No-Till Return

A significant finding on one corn and soybean farm in central Illinois showed that 20 years of no-tilling alone, without growing cover crops, had a positive economic impact of more than $100 per acre above the baseline, which was an average of the farm’s budgets for 1992 and 1993. The farm is operated by K.F. Farms in Effingham County, Illinois.

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The NACD analysis focused on 1994, the first year of no-till on the farm; 2004, the midpoint in the farm’s no-till history; and 2016. 

The case study says: “Our analysis of the three selected years confirms the positive economic impacts of no-till, showing increases each year ranging from $54.72 to $107.81 per acre above the baseline. 

“The main savings in the first year and midpoint year were accounted for by fertilizer reduction (which includes all machinery, fuel, and labor costs associated with fertilizer application), while the primary positive income change in the most recent year (2016) was an increase in yield,” the case study says.

The analysis of the farm looked at negative and positive income changes attributed to no-till on 11 budget categories. The study traced changes in quantities of inputs and then used standard valuation to monetize them. The dollar amounts were then adjusted to their equivalents in 2015 dollars. 

The study showed that switching to no-till added costs for machinery changes and increased use of herbicides, fungicides, and insecticides. 

Decreased costs resulted from a reduction or elimination of tillage as well as reduced fertilizer use and lower costs for erosion-related repairs. 

The savings in fertilizer costs resulted from switching from broadcasting to in-row application. According to the case study, “… more precision in the application reduced nitrogen by 23 pounds per acre, phosphorus by 73 pounds per acre, and potassium by 105 pounds per acre.”

No-Till and Cover Crops

Another farm studied by NACD and Datu Research was Frank Moore’s corn-and-soybean operation in northern Iowa’s Howard County. The farm has been primarily no-till for 30 years, but cover crops are relatively new to the farm. The NACD analysis tracked the economic outcome of the first three years of Moore’s experiment with cover crops. The analysis spanned the years from 2014 to 2016. The average budget from four years before 2014 served as the baseline. 

The economic benefits from cover crops were not yet clearly evident at the end of the three-year evaluation period. The case study says: “Frank’s net changes in income in the early years of planting cover crops were always negative, mirroring other producers’ experience. Early adopters often report a lag of at least two seasons before cover crops start making a difference.” 

In a 2020 interview with Successful Farming magazine, Moore said about cashcrop yields on fields that had cover crops: “We’ve had better yields on fields that have had cover crops, although I believe other factors could play a role as well in yield increases. The bottom line is that cover crops haven’t hurt us. Some farmers believe they’ll take a yield reduction by growing cover crops. But that hasn’t happened to us.”

Over the three-year course of the analysis, Moore’s average annual net change in income attributed to adopting cover crops showed a loss. More important, says Moore, are the “intangible benefits” he has seen from growing cover crops. 

“Cover crops may have shown a negative return in direct benefits, but intangibles moved that more to the positive,” he says. “Cover crops are helping to suppress weeds that have become herbicide-resistant, and they’re increasing soil health,” he says. Organic matter has increased from 2% to 4% in some fields, and from 4% to 8% in others. Water infiltration has improved as well. 

“Cover crops are also helping to reduce erosion,” he says. Moore strip-tills cornfields, and cover crops help hold the loosened soil in the ridges in place during a heavy rainfall. This has saved Moore about $10 an acre in erosion-repair costs. 

Moore’s combined cost for cover crop seed and aerial application amounts to $38 per acre. He aerially applies cereal rye to standing corn and annual ryegrass to soybeans in early September. He seeds annual ryegrass at a rate of 20 pounds per acre and cereal rye at a rate of 70 pounds per acre.

Cover Crops Relatively New

A third farm studied by NACD and Datu Research was a corn-and-soybean operation in Gentry County in northwest Missouri. Operated by Ron Willis and his sons, Michael and Matthew, the farm has been in no-till since 1986. Like Moore’s operation, cover crops are relatively new, starting in 2012. 

The NACD analysis evaluated cover crops on four fields between 2013 and 2016. The average of the previous three years’ budgets served as a baseline, tracing income changes by category of expenditure. 

In one study year, heavy rains prevented soybean planting, skewing the results of the analysis. In the remaining three years, the economic impact of cover crops was positive. The study stated: “When conservation incentive programs are taken into account, cover crops on average made a positive impact of $16 per acre to the farm’s budget each year, compared to the baseline.” 

The case study notes that “... cover crops helped reduce the need for fertilizer and erosion repairs, and (via cattle grazing) produced a small reduction in feed costs.” 

Corn yields on cover crop fields increased from 120 bushels to 153 bushels per acre, according to the case study results. Average soybean yield increased from 38 bushels to 52 bushels per acre. 

As time passes, Ron Willis sees a steady increase in yields of corn and soybeans that he attributes to cover crops and its intangible benefits. 

“Overall, our farm’s yields are increasing,” he says. “We also see better weed control, better soil health, and higher soil organic matter. As with no-till, the benefits of growing cover crops are not immediate. You have to commit to it before it pays off."