Farm Profits and Adoption of Precision Agriculture

David Schimmelpfennig ()

No 249773, Economic Research Report from United States Department of Agriculture, Economic Research Service

Abstract: Precision agriculture (PA) and its suite of information technologies—such as soil and yield mapping using a global positioning system (GPS), GPS tractor guidance systems, and variable-rate input application—allow farm operators to fine-tune their production practices. Access to detailed, within-field information can decrease input costs and increase yields. USDA’s Agricultural Resource Management Survey shows that these PA technologies were used on roughly 30 to 50 percent of U.S. corn and soybean acres in 2010-12. Previous studies suggest that use of PA is associated with higher profits under certain conditions, but aggregate estimates of these gains have not been available. In this report, a treatment-effects model is developed to estimate factors associated with PA technology adoption rates and the impacts of adoption on profits. Labor and machinery used in production and certain farm characteristics, like farm size, are associated with adoption as well as with two profit measures, net returns and operating profits. The impact of these PA technologies on profits for U.S. corn producers is positive, but small.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Production Economics (search for similar items in EconPapers)
Pages: 46
Date: 2016-10
New Economics Papers: this item is included in nep-agr and nep-eff
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Citations: View citations in EconPapers (68)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersrr:249773

DOI: 10.22004/ag.econ.249773

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