PAMCoBA Cost Benefit of Digitisation. Precision Agriculture

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1 PAMCoBA Cost Benefit of Digitisation Precision Agriculture 24 November 2017 The National Museum of Denmark, Conference on ICT and Robotics for a Sustainable Agriculture, ICT AGRI Department of Food and Resource Economics Søren Marcus Pedersen

2 Contents Development of PA Adoption and perception Economic perspectives of precision agriculture, auto-steering and CTF (Controlled Traffic Farming) Summary future perspectives

3 Development of Precision farming in Northern Europe : Introduction of GPS (Global positioning) (general purpose technology) 1984: First yield meter on Dronningborg combine harvesters (now a Part of AGCO) 1991: First yield maps (with GPS) at Vindum Overgård : Application maps and Variable Rate Technology - Courses for farmers (yield map interpretation) : Groundbased sensing systems (eg. Hydro-sensor) Soil electrical conductivity (EM-38) and Aerial photos (e.g Kemira) RTK systems applied in agriculture but mostly for research Research in autonomous weed detection systems and precise seeding systems Introduction of auto guidance in agriculture Early adoption of CTF among farmers Early adoption of UAVs 2015 Free access to Sentinel satellite images, Vegetation index. Place, date, unit, occasion etc. Slide 3

4 Faculty of Science Current developments of GNSS A European market report estimates that GNSS penetration into EU tractors will rise from 7,5 % in 2012 to 35 % in Average prices of GNSS/RTK devices will decrease by about 30 pct from (EP report 2014). Place, date, unit, occasion etc. Slide 4

5 Precision farming technologies

6 Example of application map source, KVL N 600 Dose Rate kg/ha m b m 1000

7 tons/ha 29/11/ Variable rate N-application jb1 jb3 jb4 jb6 6 N-application kg/ha TABLE 2. Total yield for winter wheat at different N-applications, tons/ha Uniform application Site-specific application Kg N/ha Tons/ha Tons/ha Jb Jb Jb Jb Avg. yield

8 Adoption of PF systems 16 % of all Danish farmers have used RTK-GPS systems on their tractor or combine harvester in and RTK-GPS is used on 45 % of the agricultural area. About 3 % use UAV s or satellite images for monitoring the field. Among these users of UAV and satellite images 44 % use it for fertilizer application and 16 % pesticides and 6 % seed. Source: Danmarks statistik 2017 Place, date, unit, occasion etc. Slide 8

9 Farmers adoption of RTK-GPS and satellite photos in Denmark 2017, Source Danish Statistics

10 Adoption in some other EU countries Greece, Germany, Finland and Denmark with 75, 74, 78 and 182 respondents Place, date, unit, occasion etc. Slide 10

11 Use of precision farming systems, 2009 % Denmark Germany Finland Grid soil sampling Directed, management zone soil sampling Yield monitoring, without GPS Yield monitoring Aerial photography Soil elevation/topography/conductivity mapping Taking action Variable rate fertilizer application Variable rate lime application Variable rate pesticide application Others

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13 Findings from adoption studies Some farmers are sceptical Compatibility is a concern Cost vs. Return Farm size has an impact on farmers adoption Young farmers among early adopters Place, date, unit, occasion etc. Slide 13

14 DKK per hectare 29/11/ Cost and benefits Yearly cost of the first RTK compared with benefits 600,0 500,0 400,0 300,0 200,0 Cost per hectare - high level Cost per hectare - expected Cost per hectare - low level Benefit - højt sat Benefit - forventet Benefit - low level 100,0 0, Hectare

15 DKK per hectare Cost and benefits Yearly cost per hectare for the first RTK unit with autosteering and section control on sprayer compared with potential benefits 600,0 500,0 400,0 300,0 200,0 Cost per hectare - high level Cost per hectare - expected Cost per hectare - low level Benefit - high level Benefit - forventet Benefit lavt sat 100,0 0, Hectare M F Pedersen and S.M Pedersen, 2017 (forthcoming) Place, date, unit, occasion etc. Slide 15

16 29/11/ Example: The marginal economic impact of section control, Franco et. al RC units Unit lenght Sprayed area % 24 % 17.2 % 13.6 % 11.2 % 10.4 % Herbicide costs (EUR per hectare Marginal cost reduction (EUR per hectare)

17 Socio-economic impact of Precision Agriculture (PA) and Controlled Traffic Farming (CTF) The objective was to assess the economic impact of implementing PA and CTF technologies in Denmark. On farms with a cultivated area of 500 hectare or more - about 15 % of farm land. Source Jensen et.al 2012 Place, date, unit, occasion etc. Slide 17

18 Applied general equilibrium model With 144 industries producing 148 commodities Two scenarios (i) Denmark only implements CTF and (ii) Denmark implements all PA technologies" including a full implementation of PA and CTF Place, date, unit, occasion etc. Slide 18

19 Some assumptions For site-specific lime and N management a yield increase is expected to be between 1 to 2 per cent and 1 to 4 per cent respectively Savings in herbicides with PA % Reduced overlap with auto-steering and (CTF) 3-5 % Further longterm yield increase with CTF 5-10 % Place, date, unit, occasion etc. Slide 19

20 Impact at the National level By implementing on 15.5 % of agricultural land a full implementation may provide an increase of GDP between 12 and 34.4 mill.. in Denmark Place, date, unit, occasion etc. Slide 20

21 Factors affecting economy and adoption of PA PA mainly targeted for large farms Benefits from auto-steering and RTK systems which lead to adoption of other technologies Technology can help to provide better logistics and planning Reservations Willingness to change old habits Cost vs. return Compatibility and implementation of systems can be time consuming and a barrier for adoption Change in farm structure - Specialisation crop rotations

22 How to improve the development Integrated Farm Management Information Systems Need for decision support systems that integrate (historic data about yields, soil and drainage conditions, weather forecasts, real time sensing and economic variables)

23 References Jensen, HG, Jacobsen, LB, Pedersen, SM & Tavella, E 2012, ' Socioeconomic impact of widespread adoption of precision farming and controlled traffic systems in Denmark ' Precision Agriculture, vol 13, nr. 6, s Lawson, L. G, Pedersen, S. M., Sørensen, C. G., Pesonen, L., Fountas, S., Werner, A. (2011). A four nation survey of farm information management and advanced farming systems: A descriptive analysis of survey responses. Computers and Electronics in Agriculture, 77(1), Pedersen, S. M., Fountas, S., Blackmore, B. S., Gylling, M., & Pedersen, J. L. (2004). Adoption and Perspectives of Precision Farming in Denmark. Acta Agriculturae Scandinavica, Scetion B - Soil & Plant Science, 54(1), 2-8. Pedersen, S.M., Ferguson, R.B., & Lark, R.M. (2001). A multinational survey of Precision Farming early adopters. Farm Management, 11(3),