Overview of Navigational Aids & Precision Agriculture Investment

1. Overview of Navigational Aids & Precision Agriculture Investment Jordan Shockley and Tim Stombaugh

3. Lightbars • Losing Popularity • Savings of 2-10% • Upgradeability

4. Auto-Steer

5. GPS Classifications

7. Auto-Steer Accuracy • Hardware • GPS • Machine quality • Calibration • Implement drift A-B Line

8. Solutions • Passive: Over-steer tractor • Active: Steer implement

9. Passive Steering • Less expensive • Tractor running over row • Limited response speed • Difficult to predict implement performance

10. Implement Steering

11. Benefits of Auto-Steer • Reduces skips and overlaps • Reduces fatigue • Accurate placement of inputs • Lengthening of operator’s workday • Increase in machinery field capacity • Reduced machinery costs • Permits more land area to be planted during optimal time • Reduce risk • Land investment implications

12. Is Auto-steer Profitable?Should I Adopt?

13. Partial Budgets • Answers “Should I make a change?” • Estimate of changes in income, expenses and profits associated with a proposed modification in the whole farm plan • Examples of possible changes?

14. Partial Budget Aspects • Allows managers to make adjustments • “Fine-tuning” • Consider interactions consciously • Focus on marginal - things that actually change from implementing the new plan • If it doesn’t change, don’t include it

15. Four Things Can Happen as a Part of a Change: • Additional Revenue • Reduced Revenue • Additional Costs • Reduced Costs • Additional revenue and reduced costs raise profits • Reduced revenue and additional costs lowers profits

16. Advantages of Partial Budgets • Simplifies task involving complex decisions • Forces consideration of marginal economics • Encourages considering change -simple tool

17. Disadvantages of Partial Budgets • Can still be cumbersome with complex changes • Economic evaluation not always a physically feasible evaluation • Many small changes are possible but not enough time to evaluate them all with partial budgeting

18. Partial Budget Framework If + , then implement the change If - , then don’t implement the change

19. Break-Even Acreage The amount of acres required for which you would be indifferent to making the change. (i.e. the net change in profit = 0)

20. Considerations • Opportunity cost (e.g. learning curve) • Risks (up/down) • Feasibility (physically possible, resource requirements) • Desirability (noneconomic goals)

21. Auto-Steer Example • 800 acres • $35,000 investment outlay, $5,000 ownership cost • Increase yields from 150 bu/ac to 151 bu/ac • Corn price = $4.40/bu • Fertilizer = $111 Savings = 3% • Seed = $76 Savings = 2% • Herbicide = $30 Savings = 7% • Fuel = $17 Savings = 10% • Labor = $20 Savings = 10%

22. Partial Budget – Auto-Steer Example Should you purchase auto-steer to increase profits? YES – Profits are expected to increase $7,040 for the farm

23. Break-Even Acreage: Auto-Steer Example