Both those that have embraced the newest precision farming technology and those that have taken a wait-and-see approach are in agreement on one thing. Both groups, according to one precision farming survey, believe precision farming tools will more profitable in five years than they are now.
The survey of 5,976 cotton farmers in a six-state region, which included Alabama, Florida, Georgia, Mississippi, North Carolina and Tennessee, asked growers how much they would be willing to pay for a cotton yield monitor.
“Precision farming may increase cotton production efficiency, reduce input use, and increase yields and profits. However, most producers have made only modest investments in precision farming technologies. We wanted to better understand attitudes toward this new technology, and the likelihood that farmers would consider investing in precision farming at different price levels,” said Roland Roberts, an agricultural economist at the University of Tennessee in Knoxville and co-author of the precision farming survey.
Not surprisingly, what the group of Extension economists most often found was that the decision whether or not to adoption precision farming practices comes down to a matter of simple economics.
“Adopters reported that profit was the most important factor prompting their adoption of precision farming,” Roberts said. “Precision farming early-adopters, on average, reported a perceived lint yield increase of 21 pounds per acre. In addition, 38 percent of adopters said they have experienced some improvement in environmental quality through the use of this new technology.”
Even more important, Roberts said, is the fact that both adopters and non-adopters believe that precision farming tools will offer a greater profit opportunity five years in the future.
Of those responding to the precision farming survey, 85 percent of those that have already adopted the technology and 63 percent of those who have not, believe precision farming will be profitable for them to use in the future. When asked to rank the future importance of precision farming technology on a scale of one to five, the adopters gave it a ranking of 3.9, and the non-adopters gave it a ranking of 3.5.
The move to high-tech, the survey found, is greatly influenced by both the price of the precision equipment and the perceived potential for yield increase.
When asked to list what they believed to be the typical price for a cotton yield monitoring system with a monitor, a GPS receiver and sensors on two chutes of a four- or five-row picker, neither group was accurate in its estimation. “The average purchase price given by adopters was $8,776, while the average price given by non-adopters was $1,215 less at $7,561. The list price for a yield monitoring system at the time was $9,500, so both groups believed the price was lower than the actual purchase price,” Roberts said.
Cotton growers participating in the study may have been unsure of the current sticker price for a yield monitoring system, but they were certain as to how much they would be willing to pay to put one on their farm.
As could be anticipated, growers' willingness to purchase a yield monitoring system increased as the purchase price decreased.
When provided with a purchase price over $10,500 to retrofit an existing four-row cotton picker, 59 percent of adopters and 54 percent of non-adopters said they would opt not to buy a cotton yield monitor system. However, when offered a price of $4,500, only 35 percent of all respondents said the price was too high.
“We saw a definite trend downward in the percentage of respondents that would purchase it as the price increased,” Roberts said. “We also saw a similar trend when we asked growers at what price they would consider purchasing or leasing an optional cotton yield monitoring system when purchasing or leasing a new four-, five- or six-row picker.”
The price trend was more significant for non-adopters, which Roberts attributes to the possibility that early-adopters have obtained more information on what the actual price of a yield monitoring system and what it can do on their farm.
“Overall, the percentage of farmers saying yes to a cotton yield monitoring system certainly trends downward as the price increases, even when they are purchasing a new picker and the yield monitoring system is an option,” Roberts said.
A majority of the cotton growers responding to the survey use computers for farm management purposes, and more than 75 percent of them say their primary source of household income comes from farming.
According to the survey, however, there are several notable differences between those farmers adopting precision farming technology and those farmers taking the wait-and-see approach.
The survey found that adopters are younger than non-adopters and, although they have less experience in farming, often farm larger acreage. In addition, adopters, on average have completed one more year of college than their counterparts.
“Most farmers think precision farming will be profitable in the future, and as more information becomes available, cotton producers will have greater opportunities to make more informed decisions about the use of these technologies on their farms,” Roberts said.