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Ohio farmer: Precision ag pays

JAMESTOWN, N.D. -- Most farmers attending a Precision Agriculture Summit instinctively believe precision agriculture pays, but when one of their own puts a pencil to it, they take notice. Brian Watkins is on the eastern edge of the corn and soybe...

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Brian Watkins, owner of Watkins Farms, Kenton, Ohio, says farmers need to consider the economic returns on precision agriculture investments. Photo taken Jan. 19, 2015, at Jamestown, N.D. (Forum News Service/Agweek/Mikkel Pates)

 

 

JAMESTOWN, N.D. - Most farmers attending a Precision Agriculture Summit instinctively believe precision agriculture pays, but when one of their own puts a pencil to it, they take notice.

Brian Watkins is on the eastern edge of the corn and soybean belt in Ohio and was one of the early adopters of variable-rate application technologies. He farms with a brother and a nephew on a total of 7,500 acres of corn and soybeans, as well as 2,800 sows in a contract swine production system.

He spoke at the Precision Ag Summit Jan. 19 in Jamestown, N.D., and said the adoption of technology has made his operations better, making or saving hundreds of thousands of dollars because of better yields or less waste. He offered an extensive spreadsheet to illustrate his point.

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The Watkins family started precision farming in the 1990s, with yield-mapping and variable-rate fertilizer applications. He has shifted into variable- rate seeding, grid soil sampling, management zone mapping, electrical conductivity mapping, variable-rate lime, remote imaging and real-time kinematic (RTK) global positioning systems.

Watkins also is the CEO of CropZilla, a computer model for evaluating capital spending and other inputs on his farm, including equipment, fuel and labor.

More productive

Watkins practices minimum- or no-till farming, and said technology such as auto steer has made people more productive.

He also said the use of computer-assisted machine controls, with automatic shut-off technologies has been a benefit on his farm, where field size averages about 80 acres. The farm managers can manage more closely by characterizing applications according to soil types and managing by smaller land pieces. He said there is a lot of variability in terms of slope, soil type and productivity in his part of the country.

Armed with farming credibility and an MBA, Watkins has consulted with technology companies and with international farming entities. He suggested farmers develop a mini model to track the costs and benefits of a new technology.

“When you can capture that variability, understand it and have the tools to manage it, you can be more efficient with your inputs,” he said.

He gave examples from his own farm where auto-steer and auto-swath technologies are used to shut off operations for planting and spraying machines. He said saving costs of skipping or overlapping operations can be calculated at about 2 percent on farms in his area, and the returns can be calculated directly against the cost.

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“If you’re out on the leading edge of some of these technologies, there’s some costs in that, but there’s definitely some advantages,” Watkins said. “It’s not just the costs of off-the-shelf technology. It’s the implementation, changing the system on which you farm.”

Internal return rate

Watkins said corporate America evaluates everything with a certain set of financial tools. Better application tools for records are coming, but more is being required of farmers by bankers and others.

Watkins pays attention to the internal rate of return for potential investments. That rate is 92 percent per year for auto steer on his farm, he said, indicating tens of thousands of savings.

“I know those are good numbers. We make that much by having it on our farm,” he said.

Saving money allows him to borrow less, which increases his equity position and cuts the costs of funds he has to borrow.

One thing about technology, he said, is it isn’t a high-repair item, but it is a “high-obsolescence” item.

“If you had an auto-steer system from six years ago - six of them - and called the auctioneer, I don’t think you’re going to get much for them,” he said, drawing nods from the crowd.

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Watkins calculates that after six years, the newest technology investments are worth nothing. He noted that his own farm had invested $45,000 for one tractor to set up RTK.

“There is a cost to be out on the edge, but there are also benefits,” he said.

Among the admirers of Watkins’ accounting results was conference attendee Bill Ongstad, a Harvey, N.D., farmer.

“In my heart, I’ve always known this kind of technology paid, but he’s been one of the first ones to prove it,” Ongstad said.

Mikkel Pates is an agricultural journalist, creating print, online and television stories for Agweek magazine and Agweek TV.
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