Brown manure legumes lower total crop risk

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Robert Patterson from Rural Management Strategies in Cootamundra, NSW, is exploring the potential for brown manuring legumes to help reduce cropping risks.

PHOTO: Rural Management Strategies

Brown manure legumes may be one way for growers who have removed livestock from their operations to lessen the risk of
total cropping in a drier climate

A crop production system involving brown manure legumes can be as profitable as continuous cropping and, even if slightly less profitable, has much lower production and financial risk due to lower input and operating costs.

Brown manure cropping involves growing a grain legume crop with minimal fertiliser and herbicide inputs to achieve maximum dry-matter production before the major weed species have set viable seed.

The grain legume crop is sprayed with a knockdown herbicide before seed-set to kill the crop and weeds, ideally no later than the start of the crop’s pod development to also conserve soil moisture.

A second knockdown herbicide is generally applied to achieve a ‘double knock’. This is different to green manure where the crop and weeds are cultivated.

Brown manuring with legumes should be considered, especially by growers in southern New South Wales, as diminishing growing-season rainfall is putting downward pressure on yields. To counter this, most growers are increasing the quantity – and cost – of inputs, particularly herbicides and nitrogen. This adds even more to production and financial risks.

Consequently, growers are putting more effort into crop rotations, especially crop sequences where wheat follows crops such as lucerne or oilseeds. However, over the past, relatively dry decade, the benefits of lucerne to subsequent crop production have been challenged due to pastures failing to establish under cereal crops in dry springs, as well as poor crop performance following lucerne where soil moisture recharge has not occurred prior to cropping.

It has reached the point that, for many larger growers, canola remains the only viable cash break crop. However, this requires increasing quantities of artificial nitrogen to maintain yields and grain protein; weed control has also become more problematic.

Legumes option

By contrast, brown manuring with legumes, even if not immediately as profitable as continuous cropping, significantly lowers seasonal risk due to the lowered costs.

While vetch is a common brown manure crop, early-sown field peas may be more competitive against weeds and potentially produce more dry matter. Higher dry-matter production should lead to higher nitrogen accumulation, and more stubble cover provides shading to reduce evaporation and reduce sunlight available to germinate weeds.

Brown manure legume crops provide three major benefits over long fallows:

  • competition for weeds (reducing knockdown herbicide use during the growing season);
  • accumulation of soil nitrogen; and
  • the maintenance of ground cover during the growing season and over the summer preceding the next crop.

The major disadvantage of brown manure crops compared with long fallowing is the cost of the grain legume seed ($30 to $35 per hectare), plus the cost of sowing, although this is low in the overall scheme of things.

Crop sequences

Grain legume crops such as lupins have traditionally been followed by wheat, which responds well in terms of yield and grain protein.

However, in dry springs many of these wheat crops ‘blow up’, due to high early dry-matter production depleting soil moisture. This results in reduced wheat yields and high protein grain, but also high screenings.

Given the desire to establish canola early with stored soil moisture and adequate nitrogen to optimise yield potential, canola is now being grown after brown manure crops. This enables almost complete prevention of annual ryegrass and wild oat seed-set in two successive years, depleting the seedbank to the extent that control measures may not be necessary in the following two cereal crops.

The two-year broadleaf crop sequence of brown manure legume followed by canola is also predicted to provide control of crown rot. Reduction of take-all levels under high-disease-pressure weather conditions should also be adequate to allow early (mid-April) sowing of the first wheat crop with little root disease risk.

The ability to sow early with confidence (subject to variety) should lead to higher wheat yield potential.

A common crop sequence now being adopted is a brown manure legume, followed by canola, wheat and feed barley. While field peas have generally been the first brown manure crop grown, vetch is being adopted in the second sequence to minimise the disease experienced with a shorter break between field pea crops.

Economics

An economic analysis of two farming systems in southern NSW with a 450-millimetre annual rainfall is presented in Tables 1 and 2.

The two farming systems analysed were:

  • continuous cropping of wheat and canola only; and
  • continuous cropping, but including brown manure field peas grown on 25 per cent of the arable area.

The economic analysis is based on two similar-sized properties in southern NSW, with two family labour units performing most of the operations.

Farm data from properties that have adopted brown manure peas have shown 25 to 30 per cent yield increases for both canola and wheat crops grown in the two years following brown manure field pea crops.

The analysis assumes a 20 per cent increase in yield above average in the first two crops following brown manure peas. Wheat prices have been adjusted to reflect protein levels.

Table 1 shows the estimated capital required for each of the farming systems. The difference in plant investment is due to a larger header and bins being required for the continuous cropping system.

The working capital requirement of the continuous cropping system is higher than the brown manure field peas system due to the higher inputs (herbicides, fungicides and artificial nitrogen).

The amount of working capital required is a measure of the system’s degree of risk because there is virtually a guarantee that costs of continuous cropping will be higher, but there is no guarantee that gross income will be higher. This results in the potential for a greater loss to occur in that year if seasonal conditions are unfavourable, leading to the potential for this additional working capital to become long-term debt.

The brown manure system is considered to be robust and low risk in drier seasons, as there is less potential to spend money on crop inputs in the pursuit of higher yields.

The annual trading results measured by earnings before interest and taxes (EBIT) and three key financial ratios are shown in Table 2.

EBIT is a measure of profitability after allowances for plant replacement and family labour.

Based on the assumptions used, predicted EBIT from continuous cropping is slightly higher than that from the brown manure legume system. There is little difference between the financial ratios, except that while the gross income and EBIT from continuous cropping is higher, it has the lower EBIT margin, due to its higher costs relative to income.

This lower EBIT margin suggests a higher degree of risk with this system.

The results of the comparison are sensitive to the price of nitrogen fertiliser. A $100 per tonne increase in the price of urea increases costs in continuous cropping by $19,200 a year compared with $5200 in the brown manure legume system. This would bring the respective EBITs within $2000 of each other.

   Continuous crop
Brown manure field peas
Table 1 Capital required for business.
 Land 1680ha at $3211/ha
 $5,394,480  $5,394, 480
 Plant and vehicles
 $950,000  $900,000
 Working capital
 $535,000  $420,000
 Total capital required
 $6,879,480  $6,714,480

 

   Continuous crop
Brown manure field peas
Table 2 Annual trading results and financial ratios ($/per annum).
 Trading income
 $1,028,220  $874,800
 Operating costs
 Variable  $469,656  $339,716
 Fixed
 $271,600  $264,100
 Total operating costs
 $741,256  $603,816
 EBIT  $286,964  $270,984
 Sales to assets (sales/assets)
 15%  13%
 EBIT margin (EBIT/sales)
 28%  31%
 Return on assets (EBIT/assets)
 4.2%  4.0%

More information:

Robert Patterson
02 6942 3666

robertp@rmsag.com.au

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