Overton, Texas
April 7, 2004
Alfalfa has the potential to net
more dollars per acre than any other traditional agricultural
venture in East Texas.
Dr. Vincent Haby, soil scientist with the Texas Agricultural
Experiment Station, has been working to make alfalfa a viable
crop for the acid soil conditions of East Texas for the last
decade. Recently, he subjected four years of production costs
and returns by actual farmers to economic analysis.
"Alfalfa has the potential to pay for farmland in East Texas. On
one site in particular, net profit for alfalfa was more than
$1,200 per acre over a four-year period," said Haby, who is
based at the Texas A&M University System Agricultural Research
and Extension Center at Overton.
The economic data used for the study were from on-farm alfalfa
production evaluations in cooperation with local farmers. In
many ways, the on-farm studies were conducted like research –
but with an eye on the financial bottom line.
Haby selected the sites in four counties after locating willing
cooperators whose fields had good drainage and aeration, and a
subsoil pH of 5.5 or higher at depths to 48 inches. The Southern
Sustainable Agriculture Research and Education Program provided
funds to establish and maintain alfalfa, and in return for
owning the hay produced, the farmer-cooperators agreed to fence
the sites and harvest the alfalfa.
Dr. Greg Clary, Texas Cooperative Extension economist,
calculated net returns based on establishment costs, all
production and harvesting costs, interest on production costs,
labor and what's called opportunity costs – the expected returns
had the farmers leased the land rather than grown alfalfa.
Total net return for the first four years, with alfalfa hay
valued at $135 per ton and establishment costs prorated over
four years, was estimated to be $989 per acre on the Griffin
Ranch in Gregg County, $1,206 per acre on the 7-P Ranch in Smith
County, $895 per acre on the Taylor Ranch in Cherokee County and
$518 per acre on the Riley Ranch in Anderson County. Clary, who
is also based at the Overton center, added the returns were
considerably higher than any other mainstream agricultural East
Texas venture such as cow/calf, stocker cattle or bermudagrass
hay.
"Historically, just based on this year's data when calf prices
are still relatively high and figuring three acres per cow/calf
unit, the producers just break even," Clary said.
A stocker calf operation does better, with a net return of $132
per acre. Conventional improved grass hay operations might
return $10 or less per acre, according to Clary.
"These are best estimates based on current market prices and
input costs," Clary said.
Alfalfa is not new to the South. Southern farmers grew alfalfa
earlier in the past century. The onslaught of the alfalfa weevil
and increasing soil acidity severely curtailed that production.
New, more environmentally friendly and effective pest control
chemicals made alfalfa production economically attractive. In
East Texas and across the Coastal Plains states of the South,
however, the acid soils still posed a hurdle to efficient
production.
Haby warns that alfalfa production isn't for everyone. Success
depends upon precise management, careful attention to site
selection, proper liming, fertilizer application, and pest
control. Initial high establishment costs – from $232 to $353
per acre – can also be an inhibiting factor.
Also, even with the best manager, not every field in East Texas
is a candidate for alfalfa production. Soil pH is a factor, and
for profitable production, subsoil pH becomes important.
As it is very difficult to change pH in depths below the top 6
inches of the soil, locating an existing site where the soil pH
is 5.5 or above to four feet deep can make a big difference in
alfalfa production. When the soil pH drops below 5.5, aluminum
in the soil becomes a big factor. Concentrations of soluble
aluminum at levels greater than one part per million can inhibit
root growth and limit alfalfa yield, according to Haby.
An aluminum level above 1 ppm in the 6- to 12-inch or 12- to
24-inch soil depth is justification for rejection of a site for
alfalfa production unless the site can be irrigated to maintain
plant-available water in the surface depth, Haby observed.
Haby has detailed guidelines for site identification and
establishment. The guidelines can be found on the Internet at
http://soils.tamu.edu.
Alfalfa production budgets, in the form of Excel spreadsheets,
may be downloaded from Clary's rural business Web site at
http://ruralbusiness.tamu.edu/forage/.
"I know of no other agronomic forage crop in East Texas where
the return on investment can be as high as $300 to $400 per
acre," Haby said. |