Nate Bruce, Farm Business Management Specialist, nsbruce@udel.edu and James Adkins, Irrigation Engineer, adkins@udel.edu
Producers across the region are looking at ways to cut down on production costs this season. With current offroad diesel prices, some producers may evaluate cutting down on irrigation. Below is a chart that lists the average price of May offroad diesel prices ($/gallon) and May corn prices ($/bushel) going back to 1995. May corn prices are almost always higher than May offroad diesel prices (the two exceptions being 2005 and 2006). Even with the current volatility in the commodity markets, this trend has continued in 2022.
Across 15 pumping plant performance evaluations performed on diesel power units, on average 1.5 gallons of diesel were required to irrigate one acre-inch. Testing results ranged from 1.09 gal/ac-in for the most efficient low pressure power unit to 1.96 gal/ac-in for a 50-year-old high pressure pump with grossly oversized power unit. The 35+ electric systems tested averaged roughly ½ of the operating cost of diesel depending on electric provider cost structure.
Below is a graph that shows the number of bushels of corn that is required to justify one inch of irrigation expense at average May diesel and corn prices. Using the average May offroad diesel price multiplied by the tested average of 1.5 gal/ac-in divided by the average May corn price to find the bushels needed to cover the irrigation expense.
The results show that despite the extreme current diesel price, that the cost of operation relative to corn price is still below ’01,’05,’06,’10,’14,’15,’18 & ’20. The average pumping plant will need to increase corn yield by just 1.09 bushels for each inch of irrigation water applied to breakeven in 2022. The 20-year seasonal irrigation demand for Delmarva has been running 9 ac-in for corn or 9.81 bushels of corn to breakeven on diesel cost for pumping in the current pricing environment. Keep in mind that the costs for electric systems will be roughly half or 4.9 bu./a. Cutting down on irrigation due to diesel prices is not a production area to consider cutting back on in 2022.