 Thank you, Beth. Good morning, everyone. Before I answer the question, do cover crops pay? I want to acknowledge Sarah for this funding opportunity and as you're going to learn, I myself am also a farmer and I've had three farmer grants and I highly encourage you farmers to take advantage of the farmers of the farmer rancher grants and the reason is that it'll allow you to try something on your farm that you may not otherwise try and there's no financial risk to it because they pay for everything and actually you get paid to experiment on your farm So that's a that's kind of a nice thing The other thing I want to do just before We answer this question is I want to talk about my my employer at the Michael Fields Institute All right, so we're a non-profit located in southeast, Wisconsin And we work in the area of sustainable agriculture. We have three program areas We have an education program. We have a policy program and a research program of which I am the director the education and the research programs work regionally The policy program works both the state level and the federal level and that's really important they work in a broader coalition and really what they do there in the policy area is try to increase funding for Conservation programs, but also for the Sierra program and the funding has gone up quite a bit in the last couple years Because of the work of this group So we're a small shop We've got nine employees nine core employees and then we have casual employees and Seasonal labor and that kind of thing, but we can't move the world with just nine people So one of our operating models is to work in partnership. So listed here Are the people that I work with I work with a whole range of folks from NGOs so I work with nature conservancy I do a lot of work with the university both campus-based Researchers as well as county extension agents Several agencies within the state but most importantly I work with farmers and that's what we're gonna talk about today So here's our website and I invite you to look at our website We have a lot of resources on there all my research gets written up in research briefs Which jumped to the to the point to give you the recommendations and today's presentation. We were told In our instructions playing for 20 to 100 people Well, it's kind of hard to make handouts, and I'm glad I didn't make a hundred handouts So that's posted under the research tab So I want to talk just a little bit about my research Areas and then focus on the economic component. So in addition to our organic corn braiding program We have an organic transition research project going on right now We just through a generous gift bought a new farm a 200 acre farm. That's this picture right up here and We transitioned organic We purchased it from nature conservancy one of the requirements was that we switched to organic So I thought well, that's great. If we're going to transition Let's put out a study, but we're not looking at transition per se We're looking at the effect on long-term organic production. So that's ongoing We are in our second year of doing industrial hemp research I've spent the last 30 years doing cover crop best management practice research trying to come up with a set of recommendations that farmers can use so that And it's tailored for our first year For people that are trying cover crops for the first time. So these recommendations hopefully will help them Have a better chance of succeeding and that's really important because survey after survey after survey says that If a farmer has a bad experience the first time, they're probably not going to continue with cover crops. So And if they're not going to continue, we're not going to get adoption. So we're trying to help people be successful The one I'm going to focus on today is economics. So I've had economic components and all my research But what we're really focusing on is this right here the gap between The yield of a crop that follows a cover crop and that it doesn't so this is some research that we've been conducting in southern Wisconsin looking at Particularly the nitrogen credit for corn following a cover crop. And so we were so solely focused on That nitrogen credit that we missed the bigger picture, which is the yield advantage To having the cover crop in this particular site here 25 bushel extra yield For just having the cover crop. Plus I got the 55 pound nitrogen credit So Sarah and the conservation technology information center have been tracking us through farmer surveys So the survey data that I based my proposal on for this project was 2012 through 16 and you see the range of Corn yield 1.9 to 9.6 percent that's substantial So it means 2.8 to 11.6 Just for having the cover crop never mind nutrient savings or the ability to harvest it as forage and what have you so that's huge And that's the genesis of this project here So our project has two objectives one is to document the economic impact of Cover cropping on the farm's bottom line and then to expand our learning circle So we've got a group of people who've been meeting on a regular basis very informally it's in a farm shop at the end of the day after or over several beers and That's that's when the conversation Flows freely. Anyway our group. There's four of us. We are all longtime no tillers We are all longtime cover crop users We farm very fragile soils in southeast Wisconsin. Like I said, we've met informally for years and The last thing to say is two of the members participate in formal outreach of my research program So here's an example of the the highly erodible soil and believe it or not This is the flattest field of all my project fields and you see how it rolls You look at the back of the photo there. You see that ridge. That's the terminal moraine That's where the last glacier stopped three of the farmers farm on the north side They have very light soils highly erosive soils I'm on the other side and I've got very thin topsoil Over gravel my grandparents made more money with their gravel pit than they did farming So here's our group there's four of us this guy here Tom Novak. He is the linchpin He's the one that keeps the group moving and he does two things. He's got a farm and he and his wife run the farm and They grow pumpkins. They've got 20 acres of pumpkins. They have a retail farm or a retail store on the farm And they also have wholesale accounts, but that's his after-school job. He also was a crop consultant And this is key. He's got 25 clients and he's on he's got management control or management influence Over 15 to 16,000 acres. So that's huge The next is Tom or sorry Nick Nick Caw He farms a little more acreage. He's got corn soybeans wheat and hay his big Enterprise is the hay. He's got custom dairy farmers that he grows hay on contract for and so that's his focus And the same can be said for Tom Burlingham He's got a little smaller farm, but it's the same crops. I don't have a picture of Tom He's got a face for radio. You don't need a picture of me because I'm sitting up here My day job is a research director, but I also farm and I grow corn soybeans and wheat I haven't grown much wheat lately because I get tired of giving it away at the elevator when I when I run it in So like I said, we're highly interconnected So Tom the crop consultant works with the other three farmers in the group Nick When he's not growing hay works for Tom writing nutrient management plans These two spend a lot of time together They send me a lot of these paired up selfies and if you look at them closely, they spend so much time together They're starting to look like each other just like old-time spot or long-time spouses do One of them's got a shave or one of them's got a grow off a beard and then they'd really look alike and Tom here. He's the one that hosts our Hosts our meetings in his farm shop the other thing I should say is that I Now do statistical analysis for free for Tom because he does on farm trials And I learned during the course of this trial and I'm way off script here that Nick there is a dissident relative of mine So our project design is really simple with or without cover crop the farmers manage it the way they want to manage it And we just have at it. We track what they do. We take agronomic measurements So we measure a cover crop biomass yield and residue Soil nitrate to see what the impact of the cover crop was on saving nutrients in the system and then primary crop yield So I'm in charge of doing all of this and then for the economics they provide me with their actual costs their input costs and What they contracted a grain for and that's how we come up with the economic Analysis so here's an example of one of our sites This is Nick's this is in Oak Hill This is winter rye following soybean and so this goes to corn You look at the above ground biomass and there's a picture of it here 400 pounds of biomass which doesn't seem like a lot, but if you look at the residue cover 39% That's huge for preventing erosion This picture was taken at the end of April and this is a period we call in Wisconsin. We call it the ugly 90 Those are the months of April May and June when we have the most soil erosion going on So if we have green cover there, we can prevent or at least reduce that soil erosion You can see from the nitrate data. We are able to drive down nitrate even though we've got relatively low yields there Most importantly to our study Corn yield response 9.9 acre or 9.9 bushels per acre. So that's a that's substantial So here's some pictures Showing our strip trials. So this is harvest from this last fall. You can see the nature of the soils and the strips All our farmers use GPS to guide them. So it's really easy to find our strips and there's a yield map there in the So I show this slide because it shows the magnitude of the strip trial harvest So we use way wagons to measure the yield and that gets dumped into the combine I tell my board. This is my pet project Why is it my pet project because I get to drive the semi from field to field? That's the only time a year few farmers gas great. He got to drive Semi no, it's huge for me because in time of year And so these are pictures of the various things the way wagon if you're not familiar with Sorry the grain gets gets dumped into there. It's got a scale on it Which you see right here. I take samples I get moisture or partial weight and that kind of thing And then we dump the grain into the the semi So let's jump to the chase. So I've got ten cases so far I just completed the second year of agronomic Measurements ten cases we have had positive yield response in eight of the ten Unfortunately only two of them and these are the ones with the stars are Significantly statistically significant So as a scientist sitting up here in front of you I'm not supposed to talk about it anymore because the difference wasn't significant you tell a farmer Who got 9.9 bushel of additional yield just to the cover crop that that's not significant So we transform the data by looking at the economics and all of a sudden I can talk about it Oh, I want and you're all farmers so I can talk about it. Anyway, of course Dean's a scientist But he's smile So our economic analysis is real simple. We use partial budgeting. We don't make any assumptions We look just at the change from one system to another So I showed you we have additional yield in eight of the ten cases that additional yield is not free You have to dry it you have to haul it and you have to account for the nutrients that are removed from the soil Because you have to replace that so keep that in mind. It's not free yield Looking at the system when we're looking at the cost the additional cost to the cover crop We have what we call constant costs and these are the costs associated with a cover crop. So it's the cover crop seed it's the cover crop management establishment additional chemical if we need to terminate it and Also interest and interest is huge because in a couple of these systems We're planning in March or July of one year and we're waiting until November the following year To collect income off of that. You all know interest rates are going up my operating note right now is at 7% So I pay particular attention to interest The constant costs are there regardless of the yield response So then we have the yield dependent costs which are down here and those are the drying charges the hauling charges and Nutrient removal Here's the model. It's real simple return to cover crop is equal to the additional income So that's yield times price Less the constant cost so all the costs related to cover crop less the yield dependent cost So the removal and the hauling and that kind of thing Before I show you the data and I've just got one summary slide to show all of it I want to say and you all know this We are operating in a period of very depressed crop prices and Her input prices are at a moderate level. So that's kind of the The environment we're operating in we're going to complete this Next year we're going to take all the data and I'm going to play what f's with it So I'm going to take it back six to twelve years ago when commodity prices were way up here And of course input prices were way up there, but see what the difference is But just keep that in mind when I show you the the data here Survey says Here's our economic data. I've got nine cases here the the huge significant Increase the 18 bushel increase. I don't have the financial information back from the farmer yet So I can't present that I guarantee it will be positive So here's the system the cover crop system. Most of the farmers are using winter rye Before the next crop. This is the response crop most cases. It's corn, but last year we did have two soybean So here's our yield increase Expressed as a percent so across these nine sites you see right here. We averaged 2.3 percent yield increase. So that's pretty good run the numbers. What happens? In nine in eight of nine cases we lost money Two of them Well, let's look at the positive first Nick here with corn after after rye He was able to increase per acre five dollars. So that's a that's reasonably good some of the cases lost a tremendous amount of money this one here and This one here 59 30 an acre That's on my farm. Not only did I get no yield response. I also didn't get a nitrogen credit so I was just investing in soil health and in um Protecting the soil so anyway That's the case there. So it doesn't look That good giving given the the market conditions right now So my spreadsheets allow me to play what ifs so I can set either the price or The yield to different levels to come up with a break even level. So when we look at price That's this column right here in the case of Nick He could have sold his corn for a lot less than he did and still break even so he made he made a profit The rest of us lost money, but if you look at the prices these two cases here, that's within the realm of Possibility even in today's current market environment for someone It's really aggressive with forward contracting and pays close attention to the markets The rest of them are out of the realm and look at this one here the yield response of Soybean Prices would have to go up to almost $40 a bushel. That's never going to happen. That doesn't even happen after we have a nice national drought So forget it there take home point from that is we're not going to make it on price We need to look at the yield response. So here's the break even yield response In this column both as bushel per acre, but then as a percent and Averaged over all our sites. We have to get five point two When I'm done with this project I'm going to pool all the data and I'm going to look where we got the best yield response and tease it apart and Figure out what happened at that site here to let that farmer capture that kind of yield increase So I showed this to my group over a couple of years And you know what they said? Jim so what? The cooperators are very quick to point out that that yield increase Reduces the net cost of cover cropping and that's shown in this table here So by case this is the actual cost of the cover crop I'm spending way too much money on my cover crop. That's take-home message number two We need to cheapen up our cover crop as much as possible But when you take the yield increase and then translate that to the net cost for the cover crop You can see that we can drive that thing down. Here's the average down here now the two high-cost systems They kind of drive that average up a little bit But it's the same for both the actual and the net and we can cut with that yield response We can cut our cover crop cost Roughly in half and look at these Five six dollars an acre that's huge for doing the right thing protecting your soil The other thing that I should say well, let me let me Let me let the cooperators speak for me so I asked them about this and I got some candid responses this one here is verbatim that The investment in the cover crop keeping the soil and nutrients in place is worth it even on rental ground So there's two key components in there a lot of surveys say the farmers that grow cover crops will do it on land that they own They will not make the investment in improving soil on rental ground and part of the reason for that is rental ground changes operators back and forth, you know people all bid each other and So they don't want to make that investment The other point is keeping the soil and nutrients in place in my study here We don't account for nutrient retention or Any of the other benefits so these are probably the numbers I'm showing you are the worst-case scenario The other quote, and I really clean this one up Is it covers allow us to farm the way we want to so if you grow certain crops if you need to Meet conservation compliance Soybeans on these types of soils not allowed winter wheat if you harvest the straw not allowed by putting the cover crop in They can do whatever they want giddy up so These guys are all hardcore cover croppers this guy Tom Burlingham. He does not want a Bear acre on his farm So I set up a trial for my nitrogen credit or a site with my nitrogen crediting where I grew red clover So I had fellow strips in there you look at the field see the headlands back there. He's got his summer mix Back there the rest of the field had summer mix on it. He didn't want my control strips the fellow strips so he He planted them all with his summer mix that totally messed up my trial. So I said all right Tom I'm gonna fix your wagon so I compare it his cover crop using actual cost and return to mine Guess who won I can't wait to share this with the group and I'm not going to share it with him alone I'm gonna share it with the group because he does a lot of bragging on it. I'm gonna jump to the chase I beat him by $36 an acre which is huge and I also we had a nitrogen credit in this one. So this is a nitrogen rate trial It's complicated there's like There's 12 Yeah That's on my website. So Michael fields just Google Michael fields and under resources. You'll see it's got the got the mix in there It's quite a mix on flowers and there's little stuff growing down low and what have you anyway? So our learning circle so we one of our objectives was to expand our our larger group We weren't able to do that We were supposed to do that last year last year was a really difficult year in the upper Midwest and Wisconsin for sure We had to sit out April and part of May Because of rain and snow I planted corn Two weeks after the snow melted which is phenomenal, but we got behind So the hey guys they got behind on their hay So they had to work hard to catch up Tom got behind on his crop scouting So we weren't allowed every we function that we just couldn't Couldn't expand our group. So what we're gonna do this next year is have formal outreach Where we're gonna invite in Tom's clients. That's huge because we have He knows them well. And so that's kind of leveraged to get them in and so we're gonna have formal Well, how formal can a twilight meeting be especially when you're drinking beer, but we're gonna rotate between our farms and Each of us is gonna talk about our experiences. We're gonna collect one more year of data and so then I'll have 18 total site years by the end and then invite the growers in And we will present the data to them and now here's the really cool thing about our project because Tom is Writing their crop management plans. He knows what they're planting. So this gives us a mechanism Gives us at least I didn't hit the kill button a mechanism to track long-term adoption