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A bioeconomic model is used to estimate how managing glyphosate resistance to horseweed affects short- and long-run profits in corn, soybean, and corn-soybean rotation systems. Model results found that resistance management reduces profits in the first year of implementation, but increases profits in the second and subsequent 18 yr. In all three systems, long run gains begin to outweigh short-run costs (and resistance management “pays for itself”) by the second year. Over a 20-yr horizon, the estimated annual average profit advantage from managing resistance exceeded $158 ha–1($64/acre) for corn, $137 ha–1($55/acre) for corn-soybean, and $55 ha–1($22/acre) for soybean. Seed immigration from a neighbor's field can reduce these gains, but this reduction is negligible if the neighbor also practices resistance management. If the neighbor did not manage resistance, however, the grower's estimated annual profit advantage fell to roughly $123 ha–1($50/acre) for corn, $60 ha–1($24/acre) for the corn-soybean rotation, and virtually zero for soybean. Methods applied in this study identify corn and corn-soybean rotations as cases where resistance management “pays for itself' quickly and significantly, even if the neighbor does not manage resistance. Continuous soybean presents a more challenging case that may require additional programs and incentives to encourage collective resistance management among growers. Even for continuous soybean, however, joint grower–neighbor resistance management can pay for itself within 2 yr.

Optimal crop choice and fertilizer applications depend on the stochastic dynamics of commodity prices, fertilizer prices, and the agronomic effects of rotation versus monoculture. The efficient decision rule accounts for real option values associated with maintaining land disposition in an environment with highly uncertain future prices and irreversible past planting decisions. We parameterize a baseline model for a representative acre in Iowa and compare the model's predictions and profits to relatively naive, shorter horizon decision rules, and a field managed with optimal fertilizer applications conditional on corn and soybeans always being rotated. We also examine the effects of a permanently larger premium on corn prices relative to soybean prices, which has been observed in locations near recently established ethanol plants. We then compare the various decision rules to actual crop choices in a panel of over 6,500 Iowa plots during 1979-2007. As compared to less forward-looking objectives, we find the agronomic benefits of rotations coupled with real option values can lead to a more inelastic response of planting decisions to both transitory and permanent price changes. Always rotating, regardless of prices, is close to optimal, but so are shorter-horizon objectives. One implication is that reduced corn monoculture and fertilizer application rates might be implemented with modest incentive payments of $4 per acre or less.

The 2000 Agricultural Risk Protection Act and 2002 Farm Security and Rural Investment Act reduced price and yield risks faced by many U.S. crop producers to low levels. We use a non-structural methodology extended for application to pseudo panels and national survey data to examine the risk attitudes of U.S. corn and soybean producers to test whether, and examine how, risk attitudes varied during the 1996–2001 and 2002–2008 periods by revenue category. We cannot reject the hypothesis of risk neutrality for the entire population, and for each revenue category, for the former period, but can reject risk neutrality, in favor of risk tolerance, for the entire population and for the larger revenue categories for the latter period. Estimated risk premiums for the latter period suggest that U.S. corn and soybean farmers who earn more require larger payments to remain indifferent between receiving their expected income with certainty and receiving an uncertain income from farming and government programs.

Emphasis on reducing emissions from the greenhouse gases (GHG), carbon dioxide (CO2), nitrous oxide (N2O) and methane (CH4) has increased in recent years in the USA, primarily for industry, transportation, energy and agricultural sectors. In this study, we utilized on-farm data collected by the USDA-National Agricultural Statistics Service (NASS) Agricultural Resource Management Survey (ARMS), secured under an agreement with the USDA-Economic Research Service (ERS) to analyze the profitability of organic and conventional soybean production, based on changes that ‘green payments’ in a cap-and-trade system would introduce in agricultural markets in the USA. In particular, the analysis focused on establishing whether organic producers would be better positioned to sequester carbon (C) and reap the benefits of the C-offset scheme compared to conventional producers, given the differences in costs, management practices and environmental benefits between organic and conventional production methods. We estimated several changes in profitability of soybean producers according to management practices, incentives for the generation of offset credits, and increase in energy input prices that a potential cap-and-trade system may introduce in future agricultural markets in the USA. Survey data suggested that even with lower yields, conventional producers could profit from converting to organic agriculture, given organic price premiums. In addition, taking into consideration both direct and indirect costs, average cost for conventional-till (CT) organic soybean production was approximately 9% lower than no-till (NT) conventional production. With a C market and payments for soil C sequestration through potential Clean Energy legislation, additional profit could be accrued by organic producers, because organic production would have 28% greater ton CO2 eq. acre−1 yr−1 sequestration than conventional NT. Thus, the environmental benefits from GHG reduction could incentivize increased conversion from conventional to organic production across the USA.

Off-farm work is a growing reality in the US agricultural sector as a whole. Another staple program in the US agriculture is the use of crop insurance. This paper assesses hitherto unaddressed issues of fuel consumption and hence pollution generated by farm households associated with off-farm work and crop insurance. We applied a quantile regression method on a unique national farm-level survey data to address the fuel consumption issues. Results indicate that off-farm work by operators tends to decrease fuel expenses. In contrast, households with crop insurance had higher fuel consumption thereby increasing fuel usage. Finally, our study shows that the net effect of these two activities resulted in an increase in the pollution level.

An early-warning system generates economic value to the extent that it improves decision making. The value of the information hinges on the degree to which a timely response, aided by warnings, facilitates successful damage mitigation. USDA's Coordinated Framework for Soybean Rust includes a network of sentinel soybean plots and wild kudzu stands monitored by extension agents for the presence of soybean rust, a potentially recurring threat to the U.S. soybean crop since 2005. The linchpin in this early-warning system is a website that provides near real-time, county-level information on the location of the disease. We consider factors that may influence information value.

Introductions of nonindigenous organisms into the United States have been linked to international trade. The individual contributions of imports, immigration, and international travel, however, are poorly understood because introduction dates are unavailable. We examine relationships between economic trends and discoveries of nonindegenous insects and use these relationships to infer the timing and determinants of introductions. We find that a few variables can explain much variation in species introductions and identifications. The most significant contributor to the introduction appears to be agricultural imports. Currently available proxies for academic effort are weak determinants of the probability that introduced species are identified.

Cold treatment periods, and associated levels of quarantine security, that maximize net US welfare under USDA's current medfly detection and control program are examined using a deterministic bioeconomic optimization model. As anticipated, the efficient level of quarantine security is shown to increase with indices of medfly pressure (initial infestation rates) in areas in which the medfly is known to exist (the QCs). Efficient cold treatment periods and weighted mean medfly survival rates are 8, 11, and 12 days and 5.0 × 10–2, 1.7 × 10–3, and 5.2 × 10–4 under low, moderate, and high initial infestation rates, respectively. When model output is averaged across initial infestation rates, an 11-day cold treatment period, resulting in a weighted mean medfly survival rate of 1.6 × 10–3, maximizes US welfare. These findings suggest that the current minimum cold treatment period of 14 days and the current objective of US cold treatment policy—the probit 9 level of quarantine security—are economically inefficient. Adopting the 11-day cold treatment period is shown to increase US social surplus by an annual $24.9 million, of which $21.5 and $3.4 million would accrue to US consumers and producers, respectively, and QC producer surplus by an annual $24.8 million. Nous avons examine, a l’aide d’un modele deterministe d’optimisation bioeconomique, les periodes de traitement par le froid et les niveaux de quarantaine de securite connexes qui maximisent le bien-etre net des Etats-Unis d’apres le programme actuel de detection et de lutte contre la ceratite, instaure par le USDA. Comme prevu, le degre de quarantaine de securite efficace augmente en fonction des indices de pression des ravageurs (indices d’infestation initiale) dans les pays ou la ceratite est presente (pays dont les produits sont soumis a une quarantaine). Selon qu’il s’agit d’un indice d’infestation initiale faible, moyen et eleve, les periodes de traitement par le froid efficaces sont de 8, 11 et 12 jours respectivement et les taux de survie moyens ponderes de la ceratite de 5,0 × 10–2, 1,7 × 10–3, et 5,2 × 10–4 respectivement. Lorsque l’on etablit la moyenne ponderee de la sortie du modele par taux de survie, une periode de traitement de 11 jours et un taux de survie moyen pondere de 1,6 × 10–3 maximisent le bien-etre des Etats-Unis. Ces resultats donnent a penser que la periode minimale actuelle de traitement par le froid de 14 jours et la politique actuelle concernant le traitement par le froid (la norme probit 9) sont economiquement inefficaces. L’adoption d’une periode de traitement par le froid de 11 jours augmenterait le surplus collectif des Etats-Unis de 24,9 millions (M$) par annee, dont 21,5 M$ et 3,4 M$ reviendraient aux consommateurs et aux producteurs des Etats-Unis respectivement, et un surplus de 24,8 M$ par annee aux producteurs des pays dont les produits sont soumis a une quarantaine.

Asian soybean rust (rust) is an emerging issue in U.S. crop production and was identified in nine states during 2004. Recent farm surveys indicate that many producers are adjusting their management practices to the possibility of a rust infestation. The economic and environmental impacts of such adjustments are not known in the medium run given these new developments. We combine 2005 data on the geographical distribution of the fungal pathogen that causes rust with 2005 information on the availability and material costs of fungicides to analyze three treatment strategies. Our results indicate a higher range of economic impacts than previous research has indicated, but are consistent with earlier findings indicating that rust infestations will likely result in reduced soybean production, reduced exports, and higher prices.

We use a regulatory model with resistance evolution in two pests to insecticidal Bt cotton and pyrethroids (a conventional insecticide) to examine non-Bt cotton (refuge) planting requirements designed to manage Bt-resistance evolution in the midsouth. Our analysis suggests that reduced refuge requirements would enhance producer profitability, sprayed refugia are more cost effective than unsprayed refugia, and producers would receive slightly higher returns under dynamic relative to static refuge policies. Pyrethroid susceptibility in one of the pests was a renewable resource, and toxin-mixture effects associated with pyrethroid use in Bt cotton were important considerations for midsouth refuge policies. Copyright 2004, Oxford University Press.

When post-harvest marketing strategies are restricted by disallowing speculative purchases, sales out of storage becomes an irreversible decision and the dynamic marketing problem becomes analogous to the optimal exercise of a financial option. The optimal marketing strategy is to hold at low prices and to sell at high prices with a cutoff price function marking the boundary between low and high prices. A method for estimating the cut-off price function is developed and applied to Illinois soybean prices. The decision rule is demonstrated to result in substantial gains from storage. Copyright 2002, Oxford University Press.

Nitrous oxide is a powerful greenhouse gas that is emitted from cropland treated with nitrogen fertilizer. Reducing such emissions through nutrient management might be able to produce offsets for sale in a cap and trade program aimed at reducing greenhouse gases. We use the Nitrate Leaching and Economic Analysis Program (NLEAP) model and data from the Agricultural and Resource Management Survey to examine what changes in rate, timing, or method of application a farmer would take to produce offsets. We find that reducing the application rate is the most favored approach for producing offsets. We also find that some management choices may increase nitrate losses to water.

We estimated standard and Bayesian random coefficient models (RCMs) to examine the risk attitudes of US corn–soybean farmers by revenue class using national survey data covering the 2000–2006 growing seasons. Attitudes toward risk are shown to depend on revenue class, with the magnitude of the effect being relatively small. The hypothesis of risk-neutral preferences is not rejected for small- or medium-revenue farmers but is rejected, in favor of a very slight level of risk tolerance, for large- and very large-revenue farmers and for the entire sample of farmer types. The hypothesis of downside risk neutrality is not rejected for small-revenue farmers but is rejected, in favor of a very slight level of downside risk aversion, for medium-, large-, and very large-revenue farmers. Although risk neutrality is rejected for the entire sample of farmer types, the magnitudes of our estimates of the coefficients of absolute risk aversion and absolute downside risk aversion are extremely small. This suggests that the frequent assumption of risk-neutral preferences adopted in the agricultural economics literature is justifiable for the case of US corn–soybean farmers during 2000–2006.

Recent survey data are examined to improve current understanding of the factors that help to determine the value of information reported on a website that serves as the centerpiece of the USDA's "Soybean Rust Integrated Pest Management-Pest Information Platform for Extension and Education." Respondents' initial beliefs about their chances of experiencing a rust outbreak are shown to affect the likelihood that soybean producers will visit the website and change their management of fungicide use as a result. Key Words: Asian soybean rust, probability beliefs, PIPE website, ARMS data, USDA Rural Development Broadband Program (ProQuest: ... denotes formulae omitted.) Asian soybean rust is a plant disease caused by an airborne, fungal pathogen, Phakopsora pachyrhizi. Yield losses, due to reduced numbers of pods, beans per pod and bean weights, and fungicide cost increases, have been attributed to rust outbreaks everywhere soybeans are grown; however, P. pachyrhizi was only very recently reported in the Americas. Rust was first reported in Brazil and Paraguay in 2001, where it became widespread in areas where soybeans are produced, because climatic conditions and the availability of suitable hosts promote proliferation of the fungus year-round. It was first reported in the United States in November 2004 (USDA 2006). Although the pathogen can overwinter in southeastern coastal areas on uncultivated plants, such as kudzu, it cannot survive the winter where the majority of soybeans are produced (Pivonia and Yang 2004). As a result, rust outbreaks have not been as widespread in the United States as in South America. Analysis of climatic data, however, suggests that it is possible for rust to occur everywhere U.S. soybeans are produced. Based on assumptions regarding regional impacts on yields and fungicide application costs associated with a fully established population of P. pachyrhizi, simulation results indicate that between 14 and 55 percent of planted acres might receive fungicides at an annual cost between $262 and $1,736 million (2006 US$), and that aggregate returns to soybean production might decline between 3 and 21 percent (Livingston et al. 2004, Johansson et al. 2006). P. pachyrhizi can survive the winter in northern Mexico, the northern Caribbean islands, and along the coastlines of Alabama, Florida, Georgia, Louisiana, Mississippi, South Carolina, and Texas. However, over 96 percent of U.S. soybeans are produced in other states (USDA 2008). The likelihood and severity of a rust outbreak occurring on a specific farm in areas where the majority of soybeans are produced is therefore very difficult to gauge at the beginning of any growing season, because it depends on the status of the pathogen in the south, the distance between the farm and southern source areas, how those areas expand northward during the growing season, the number of spores blown onto the farm when soybeans are present, contemporaneous weather conditions, and whether and how fungicides are applied.1 Fungicides must be used between developmental stages R1 (beginning-bloom) and R6 (full-seed) to reduce yield loss efficiently in the event that spores arrive on the farm when conditions suit development of an outbreak. Preventative fungicides, which reduce the likelihood of an outbreak, must be applied shortly before spores arrive, and curative fungicides, which reduce the effects of an outbreak, must be applied shortly after arrival. Because resistant plant varieties are not available, soybean producers must choose between three management options, which are to apply no fungicide whether or not rust occurs, to monitor their fields and apply a curative fungicide if an outbreak is observed, or to apply a preventative fungicide before spores arrive (Dorrance, Draper, and Hershman 2007). To improve the ability of producers to determine whether, when, and what type of a fungicide application might be needed, the U.S. Department of Agriculture (USDA) facilitated the development of the "Soybean Rust Integrated Pest Management-Pest Information Platform for Extension and Education" (PIPE), which is a coordinated surveillance, reporting, forecasting, and research program with land-grant universities, state departments of agriculture, and industry (U. …

We examine producer behavior, resistance evolution, and returns under alternative refuge requirements in an eastern North Carolina region with multiple corn, cotton, and soybean fields infested by a mobile pest. Returns are highest, pyrethroid sprays occur least frequently, and pyrethroid resistance evolution is delayed most effectively with no refuge requirement. Complying with the current 20% refuge requirement costs the producer $8.67 per cotton acre, or $34.21 per non-transgenic insecticidal (Bt) cotton acre. Returns are highest under each refuge requirement when one-toxin Bt cotton is not phased out; however, removal of the technology at the earliest phase-out date minimizes regional pyrethroid sprays.