Nutrient Balance And The Future Of Land
Land values are sky-high right now, but landowners still need to keep up with soil nutrition levels.
February 1, 2013
The dollar value of agricultural land in the North American Corn Belt has reached prices few ever thought possible. High commodity prices and favorable interest rates are cited as major factors behind the increases. At the same time, we see trends in nutrient balances that if unchecked will erode the fertility and productivity of those same land parcels that are today so highly valued.
In December, I was the evening speaker for the annual meeting of a highly successful regional investment firm that focusses on agricultural land and biofuel plants. My topic was “The Future of Land” and I emphasized three points:
- Land faces challenges in every country.
- Land plays a critical role in the most significant issues of the coming decades.
- The future of land will reflect the success of land managers in meeting stakeholder goals (a 4R concept).
It has become very clear that the market place today also sees land playing a critical role in the future. A report from Iowa State University shows that the value of farm land in the state of Iowa in 2012 increased 24% from 2011 to an average of $8,296 per acre. Averages for most counties in the northwest quadrant of Iowa exceeded $10,000 per acre. According to USDA-NASS, cropland value for the U.S. as a whole increased 14.5% in 2012 to an average of $3,550 per acre and other sources indicate that this trend is not unique to North America. The value of Brazilian cropland is estimated to have increased 18% last year on top of a decade with average annual increases of 14%. In Great Britain, even with the country’s difficult economic climate, arable farmland increased 5% in value in 2012 and much of Central Europe has been experiencing huge increases in land value.
At the same time, a popular topic at state and regional meetings this winter was nutrient balance (nutrients being applied vs. nutrients removed in crop harvest) and the International Plant Nutrition Institute’s (IPNI) new and planned tools dealing with nutrient balance such as NuGIS, our new nutrient removal Web portal, and mobile phone apps. These tools show us that phosphorous (P) and potassium (K) balance in much of the Corn Belt has become decidedly negative and our soil test summaries have demonstrated that these negative budgets are frequently drawing down soil fertility to less than optimal levels, a situation that threatens the future productivity of the same land that has become incredibly expensive.
It’s a good time to remind ourselves that crops obtain much of the nutrients they absorb not from the fertilizer we apply this year, but from nutrients in the bulk soil and so the fertility level of that bulk soil is critically important. Allowing fertility levels to drop below critical thresholds is akin to falling over the “fertility cliff” where we have a high probability of experiencing:
- Loss in ability to harvest the increasing genetic potential of crops.
- Reduction in system efficiency.
- Increased potential for nutrient losses.
- Greater susceptibility to weather extremes like the Corn Belt experienced in 2012.
- And perhaps, a loss in land value.
Allowing highly positive nutrient balances to continue where soil fertility is already above optimal levels also leads to negative consequences and may in extreme cases negatively impact future land value.
I was sitting next to Marc Vanacht during a presentation at the 2012 annual meeting of the Soil and Water Conservation Society when the speaker referred to a “restorative economy.” Both Vanacht and I immediately moved that concept into our own world as a “restorative agronomy.”
Shortly after the meeting, Vanacht expanded the concept into three terms:
- An extractive agronomy that leaves the soil and the resource base worse off.
- An exploitive agronomy that maintains the status quo but leaves the resource base vulnerable to extreme situations.
- A restorative agronomy which rebuilds the resource base to make it more resilient to extreme situations. As the dollar value of land increases, it seems that these terms should be front and center in our minds and plans made to assure that what we practice is indeed a restorative agronomy.
Good tools are available from IPNI and other sources to draw attention to these conflicting trends of increasing land values and inappropriate nutrient balances … tools that can help growers, their advisers and input suppliers make appropriate adjustments to create a restorative agronomy within 4R Nutrient Stewardship programs. Such adjustments are necessary if highly valued land is to remain highly productive land.
Fixen is senior vice president, Americas and Oceanic Group and director of research for the International Plant Nutrition Institute, Brookings, SD.