State Of Precision
Fluctuating fertilizer and crop prices are turning more growers on to the benefits of precision ag.
June 8, 2010
The last year has been a test for retailers and growers alike, as they look for more tools to offset input and crop price uncertainties. The editors of CropLife® magazine wanted to see how precision agriculture fared amidst the turmoil, so we surveyed more than 2,000 dealership readers — with special emphasis in Corn Belt states — to gauge their use of the technologies. We also talked personally with a dozen retailers and consultants to delve a little deeper for their perspectives. The news was pretty good for 2009-10: More growers see that precision ag can help them gain efficiency — and profits.
"We've found that when farm economics are tightest is actually the time we have the best demand," says Dan Frieberg, president of precision ag data processor Premier Crop Systems LLC, West Des Moines, IA. "People care a lot more about managing when things are tight."
And Steve Cubbage, president of Record Harvest Enterprises, Nevada, MO, reports that even though fertilizer prices have moderated in recent months, soil sampling and nutrient variable-rate technologies (VRT) continue to grow. He's also seen a significant increase in adoption of seeding prescriptions with more growers purchasing new planters or retrofitted older ones with not only row clutch control but also variable-rate drives.
Of Signals And Profits
Our surveyed dealers are offering different levels of service bundles, which can include grid soil sampling, variable-rate maps, variable-rate application of fertilizer and lime, variable-rate seeding prescriptions, and yield mapping. They're using equipment from many manufacturers, and most say no one company can meet all their needs. Plus, they may be lending tech support on components that grower-customers are using themselves.
They're generally pleased with the quality of GPS correction and signals, though work is still getting stalled by downtimes. Lane Pickwell, precision ag manager with Hintzsche Fertilizer, Maple Park, IL, is frustrated that he simply can't help his drivers when they call in saying their autosteer's not working because WAAS has gone out, usually for about 10-15 minutes.
Some respondents, such as Sid Parks, manager of precision farming with GROWMARK, are utilizing multiple signal sources — including Coast Guard Beacon, WAAS, OmniSTAR, GreenStar, and RTK — while others have found that WAAS is still good enough to meet their accuracy needs.
Indeed, Steve Clement with the precision ag division at Brandt Consolidated, Springfield, IL, has found WAAS is good enough for tillage, but "as we get into planting, harvesting, and strip-till applications, most growers want something better than WAAS," he says. He adds that RTK has been a favorite among a lot of his growers, though coverage can be an issue, and Brandt is continuing to expand its RTK networks. "Some growers start out with OmniSTAR and later upgrade to RTK, mainly to help spread out the cost a bit," he says.
"We're satisfied with how current signals are working as long as our employees and customers understand the limitations of each one — what application each one fits — and don't expect more accuracy and repeatability than each one can deliver," says Glen Franzluebbers, technology director with Central Valley Ag, Oakland, NE.
Ceres Solutions LLP, Perrysville, IN, implemented GLONASS capability at all of its RTK network bases last year — and it's been a huge benefit to customers during times of low GPS satellite coverage, says Jason Stonecipher, technology manager.
In terms of hardware, Cubbage sees a serious shift in focus. "In the past few years, autosteer technologies have been the shining star of the precision arena — but that has changed. It's all about integration of technologies that relate back to the agronomic basics and the bottom line," he says. "GPS autosteer technology drove us back to where we need to be in precision agriculture, and that is in the data and management pieces."
When assessing the profitability of precision services, Stonecipher believes it's tough to cover the costs of the people and equipment it takes to effectively do the work. He says margins are tight in this segment, as they are in the rest of retail ag. "You have to be very detail-oriented to make sure everything balances," he says.
Brandt's Clement says, "We feel precision services have given us an edge over the competition. Being able to provide data management, VRA, and precision equipment, we can grow the business in other areas."
Ronan Cummins, Opti-Crop division sales lead at Miles Farm Supply, Owensboro, KY, notes that the company has picked up quite a bit of service work taking precision soil samples and creating prescription layers for growers. Why? The marked increase in grower-owned spreaders in the past two years, with growers looking for the flexibility their own equipment offers in purchasing fertilizer.
Each year the staff at Cooperative Producers Inc., Axtell, NE, ensures the company has a reasonable margin built into its programs to make them self-sustaining, with a little extra to experiment with new applications. "We're working to have precision ag as a separate department, and making it more profitable rather than just being a service we can provide to our customers," explains Tyrell Fickenscher, precision ag coordinator.
Hintzsche's Pickwell puts it simply for his company: Precision services may not be a huge profit generator, but they help the company sell more fertilizer and chemicals. And most growers don't seem to be balking at any extra costs for variable-rate services. "They know they're putting their fertilizer where it's doing them the most good," he says.
Managing The Data
Many dealers interviewed feel that only a marginal percentage of growers (estimates ranged from 10% to 25%) are using field data to make informed decisions. What's the problem? Issues such as limited knowledge of how to use it, inconsistent or poor data collection from yield monitors, and system or data compatibility issues.
Brian Hunt, Precision Points manager, All Points Cooperative, Gothenburg, NE, says many of his customers have yield monitors but are not logging the data because it's a lot more work than they originally thought.
Indeed, Pickwell has found that growers have a lot of data, and they might look at it for five minutes — but never again. They go out and do the same bad things year after year, he says. He's heard comments such as "I bought a combine and this damn thing [yield monitor] came with it. I don't know how to use it." Pickwell responds with, "Well, the monitor's the best thing you've got, here's what it's telling you." He tries to explain to them that it's an agronomic ally telling what's really going on in fields.
In fact, Ceres' Stonecipher says his firm recently restructured its yield mapping services to encourage more clients to take advantage of yield data in their decision-making processes. "We have lots of yield monitors in combines, but there are many that are not being used to their full potential," he says.
Retailers didn't necessarily pass judgment on customers for their lack of data savvy. "Our role is to sort through their information, separating good from bad, and to collect good data through our services," says Franzluebbers. "We analyze, combine, and create a usable product for them in the form of variable-rate prescriptions." He says his company also organizes their layers of data to help them make other informed management decisions.
Brandt's Clement estimates that as many as 50% to 60% of his company's growers are using a portion of their data to make decisions. They're utilizing yield maps to compare hybrids or hybrid maps to compare tillage, population, and the like.
Clement and Parks have found some growers can collect, store, and analyze their own data, but the largest number of them would prefer someone to either help or manage this data for them — which makes for an ideal service opportunity for retailers.
Stonecipher says his customers are also using data to locate areas of poor performance in fields. For instance, the information generated in his region often shows water-related problems, and he recommends tile where it can be justified.
"One of the bigger drivers for use of this data comes through government programs in which growers are required to report what was done to a field in order to qualify for enhancement dollars," says Fickenscher.
Several retailers agreed that the lack of a data standard is holding producers back in decision-making. "This will continue to be a problem until hardware manufacturers adopt a standard for data entry," says Cubbage. "Otherwise, analyzing data will only become more of a headache as collected data piles up."
The goal would be software that provides a standard "format" for entering seed varieties, crop protection products, and seed treatment. Producers and retailers can then compare "apples to apples." (To that end, Cubbage works with the AgX Platform, a standardized database created by SST Software for use in agricultural GIS data collection. It's available to all precision ag hardware and software companies for adoption, and readers can find more information at www.agxplatform.com.)
"Until retailers work to promote this with their growers and demand such a standard from hardware manufacturers, this industry will be stuck chasing its tail for years to come," Cubbage says.
Hunt says All Points' variable-rate program has grown exponentially since its beginning four years ago. The first year the company's leadership had hoped to apply 10,000 acres with the technology — and wound up doing 30,000. Recent totals put the number at nearly 70,000 acres.
Why the boom? Phenomenal cost savings for customers, says Hunt. "And on the fertilizer, we're still pulling off record yields using the same, if not less, fertilizer." Some customers have also turned to doing multiple applications of nutrients, instead of putting them all out up front. The change in timing has seen yield responses.
Hunt doesn't want to overwhelm clients. "Were just trying to slip in and take care of the variability for them. A lot of times it's just an extra dry application, variable-rating three different products all at once, and you're done," he explains.
Cummins saw the fertilizer price spikes of 2008 kick-starting "the whole VR nutrients complex" in his region. Variable-rate P, K, and anhydrous ammonia (NH3) are now common practices among his grower group, and VR seeding has taken a foothold as farmers trade up to newer VR-capable planting equipment.
Clement says his company has done a fair amount of variable-rate NH3 and seed population over the last few years. "A lot of the new equipment is VR-capable and makes using these technologies an easy transition. But grower confidence in the technology can sometimes be a hurdle."
Frieberg has seen a surge in variable-rate application among Premier Crop's Midwest clients, but the growth is "not universal. There are as many companies going backwards and standing still as there are going forward. The companies we're working with are growing, but it's with a lot of effort."
CPI's Fickenscher has seen a significant increase in the number of growers who are using VRA themselves to variably plant and fertilize. He points out that many growers already have the equipment necessary, but are not sure how it works, how to start using it, how it will affect their bottom line, and who to go to for help.
In yet another vital new use for VR technology, Fickenscher says his firm is teaming with neighboring CropMetrics of North Bend, NE, to get variable-rate irrigation up and running in the region.
Cubbage believes VRT is being held back by the fact that hardware companies have provided new tools, but growers are not fully trained in how to use them. "It's sort of like giving someone a stick of dynamite and a match," he says. Used properly, the tools can be productive, but used incorrectly, they can have long-lasting effects on production. "Prescription VRT maps should not be treated like a three-year-old's coloring book where you just randomly choose the color of crayon on a whim," says Cubbage. "There needs to be agronomy, analysis, and consultation in most cases."
Barriers To Adoption
Precision agriculture still faces a host of challenges:
Time. It takes time to use data to make decisions, emphasizes Frieberg. "And there's a terrific pressure on the system to do it fast. Retailers and people who sell inputs to farmers are still the trusted advisors, but there's terrific pressure on them to sell more. If you have eight sales calls to make in a day, it just doesn't leave time to analyze, plan, and execute site-specific agriculture," he says.
"It's a whole lot easier to throw up your hands, pretend every field is uniform and spread 300 pounds of 9-23-30 on every acre," Frieberg points out. He understands this shotgun approach — if a dealer's or grower's goal is to get a lot of tons out, it's "pretty darn efficient to just spread a few hundred pounds of the same analysis every year."
Personnel and training. Many of our precision experts said there's just not enough of them to go around. Justin Welch, ag technology manager, Co-Alliance LLP, Danville, IN, says he's heard, "There's not enough Justins" many times, and says "my job should be the agronomic part of VR - it should not be to teach every grower how to run his monitor to actually make it work!"
"The people in the technology department are not typical ag employees," adds Stonecipher. "They need to have a special skill set — part techno-geek, part mechanic, part researcher, part cowboy."
Frieberg would say there's a skilled labor crisis in agriculture across the board. "We try and squeeze more productivity out of people. We keep stretching these talented people further and there's a terrific pressure as margins get tighter to sell more."
In particular, dealers have found it's a drain on profitability for precision staff to have to support hardware that growers purchased elsewhere. Some help can be done over the phone, and in growers' eyes, it's very hard to charge for that. "They don't realize it's the same as working on a tractor in the shop down at the local iron dealer," says Cubbage.
Compatibility of systems and data. Communication among precision components has been an issue for years, as discussed above. All Points Coop's Hunt says that when he started using precision technology four years ago, he had to use four different programs to get one result. Now he's relieved to be down to two. But, he admits, "everybody's operation is slightly different and there's not one program or machine that can do everything you need."
Growers. Growers erect a number of barriers when it comes to precision ag adoption, our respondents agreed. "Some older producers don't believe a VR machine can do that, they don't believe a satellite can tell them what their field is doing," says Hunt. He admits his own company tried to disprove the technology some seven years ago. But it worked, and All Points tries to convince customers one step at a time. "Today we go out to growers and say, 'Trust me. Give me one field and trust me,'" Hunt says.
Growers may be ready to adopt technology, but "some in the hardware industry are treating it more like a commodity," says Cubbage. He emphasizes the products are management tools — it's not like buying disks or plows — and the price competition on the hardware side makes it difficult to have the margin to properly train and educate customers in the features and benefits of a product.
Pickwell has found some precision equipment manufacturers will promise growers "that a system will do all this stuff — but it can't, because it's just not made to." He winds up at clients' houses, sometimes into the night, showing them how to do tasks — or showing them product limitations. Stonecipher reports similar problems: "We see growers almost every day who have been sold a bill of goods and cannot get support or answers they need after the sale." Such bad experiences sour growers on precision technologies.
Frieberg views the frustrated do-it-yourselfers as "the low hanging fruit in the market. Usually after they've tried it a few years, they are just so anxious to have someone help them." He says there are many sharp, college-educated growers — who have technical expertise like never before — but will very gladly partner with somebody who brings additional expertise to the table.
Keeping up with changes. Retailers and consultants say it's very challenging to keep up with all the changes in the precision industry. And the environment of innovation, consolidation, and shifts within precision companies is unsettling to buyers, says Cubbage.
"It's overwhelming," says Pickwell. "I have to work with all the manufacturers because our customers have just about everything."
Cost. Some growers still operate solely on price, says Stonecipher. They won't move on adopting precision ag, even though value-added programs like Ceres Solutions' AgVantage consulting services go well beyond just soil sampling and try to tie in as much information about the farm as possible. "We run into cases where the farmer who is 'cost-conscious' may not find value in the information and advantages of VRA," he says.
Retailers we talked with were excited about new precision technologies hitting the scene or under development.
Wireless data transfer/telemetry. Many of our dealer respondents were keenly interested in this technology, and some are starting to work with new products in this area, including John Deere's AgLogic and Raven's Slingshot. This season, 35 trucks at Co-Alliance are using Farmworks' telemetry system to transmit prescriptions and retrieve as-applied data, reports Welch.
Getting data to a machine can sometimes cause big holdups for Pickwell, who currently sends operators out with memory sticks. He says wireless transfer would help — and he'd like to use the technology to coordinate the logistics of rigs as well: "We've got floaters meeting on the road, and we shouldn't."
Stonecipher appreciates the efficiency wireless could bring to the business, especially as his company covers larger geographies from fewer locations.
As with many dealers, Cummins at Miles Farm Supply is disappointed that cell phone signals and remote Internet access continue to be a problem for his area, limiting the company's ability to add telemetry systems or simply e-mail files out to a truck in the field. He says he's not seen an integrated solution he likes yet, meaning a system that works and complements back-office operations such as tracking product, real-time billing, scheduling and dispatch of equipment, and getting personnel and materials to the next job. For him, all segments would be linked to inventory control and ultimately, billing.
Cubbage believes this telemetry will offer the next big efficiency breakthroughs in precision ag. But again, he factors in the lack of data standardization when assessing the value of wireless data transfer. "If each hardware company thinks that data collected has to be wirelessly beamed only to their server where a grower has an account, that's just not going to work," he explains. "You wind up with relevant data stored on multiple servers on multiple accounts. Wireless transfer will either transform our industry for the good or it will end up being a Pandora's Box."
CORS/VRS networks and improved GPS options. "They're some of the most talked-about technologies among our customers," says Franzluebbers.
"And VRS networks would give us the possibility of coverage in areas currently not covered with RTK," adds Clement.
Cubbage says these networks will be the next evolution in RTK technology, but the tough part is, again, going to be compatibility among hardware manufacturers.
Crop sensors. These units still seem to be getting a lukewarm reception by the retailers we talked with. Cubbage sees them as a growing market, but it will take education and trained agronomists to implement adoption on a larger basis.
Says All Points' Hunt, "I think the technology is sound, but the practicality is not there yet." The on-the-go sensor units he's looked at simply go way too slow. With almost $300,000 to $400,000 wrapped up in a machine it has to cover lots of acres. Plus, he says the equipment poses logistical questions, such as how much fertilizer to load. "Because it's real-time application, how much do we send out there?" he asks.