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The Business of Cover Crops:�Trends and Opportunities

COVER CROP

TRAINING MODULE

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Developed by

Dr. Rob Myers, University of Missouri

Reviewed by

Dr. Alan Weber (producer/economist) and Joe LaRose

(U of MO extension specialist)

Funded by

Walton Family Foundation

These training modules are being made available by free use of other educators through University of Missouri and the Midwest Cover Crops Council, which participated in the WFF project supporting development of these modules and provided many of the technical reviewers.

All photos are by Rob Myers, University of Missouri, unless otherwise noted.

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Trends on cover crop acreage and use
New approaches with equipment and establishment of cover crops
How can ag retailers and other ag companies develop new business income from cover crops?

Presentation Outline

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Data source: 2017 Census of Agriculture

Cover Crop Acreage Planted by State in 2017

In the 2017 Census of Agriculture, farmers were asked the simple question – how many acres of cover crops did you plant in 2017? It was up to the farmer to decide what was considered a cover crop – no definition was provided. This likely contributes to Texas being ranked fairly high in cover crop acreage. According to people working with cover crops in Texas, much of what is counted as a cover crop in the Census is winter wheat that farmers plant hoping they might get some timely rains that would allow them to harvest the wheat; however, if the rains don’t come, the planted wheat simply serves as a cover crop and either crop insurance is collected or a summer crop is planted the next year.

One thing to mention here is that almost every county in the United States that produces crops also has some cover crops. There is often a mistaken impression that cover crop are only found in the higher rainfall areas. While they are certainly more common where there is more rainfall, cover crops are being used successfully by some farmers in drier areas of the country, sometimes with irrigation, often without. The Great Plains states of North Dakota down through Texas, all considered lower rainfall areas, collectively had over 2 million acres of cover crops in 2017.

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Two Ways of Looking at Cover Crop Acres

Data source: 2017 Census of Agriculture

This slide depicts how looking at raw number might make one think cover crops are most popular in states like Iowa and Missouri, whereas in reality, a much higher percentage of the available cropland is planted to cover crops in the eastern part of the Corn Belt. This probably reflects a much longer period of cover crop promotion in those states, in part due to water quality issues with the Chesapeake Bay, along with smaller more diversified farms where the farmers have been more open to integrating cover crops.

Cropland is based on 2017 Census of Agriculture data, with “available cropland” equaling total cropland reported in the Census (396.4 million acres) minus pastured cropland, hay land and haylage acres, and CRP/ WRP acres (those categories total 93.6 million acres) minus harvested winter wheat acres (26.2 million acres). Winter wheat was excluded from the base on the presumption that winter annual cover crops would not be used where winter wheat was grown (of course some summer crops could be used after winter wheat harvest, or in the fallow areas of the west, but such use is relatively minor in nearly all states). These calculations were made by Joe LaRose and Rob Myers at University of Missouri, and published as part of a “Soil Health Census Report” through the Soil Health Institute at:

https://soilhealthinstitute.org/wp-content/uploads/2019/07/Soil-Health-Census-Report.pdf

This slide is a good time to mention to the audience that results in some parts of the U.S. show that it is possible to get cover crops used on at least half the acres in a county and a third or more of the acres in a state. Even in the Midwest there are individual counties with more than 20% cover crop adoption, and a few of 30% or higher adoption.

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Cover Crop Acreage Midwest States

This shows the 12 North Central region states, the same states that are part of the Midwest Cover Crop Council (minus Ontario). States are listed in order by the total cover crop acreage in 2017.

This is a good place to show that increase in adoption has varied by state. It’s also important to note that acreage has kept rising. Through satellite image analysis and other data, Indiana reported having at least a 1.0 million acres of cover crops in the fall of 2019 and an estimated 1.3 million acres of cover crops in the fall of 2020 (actual acreage of winter living covers was estimated at 1.5 million acres but included up to 200,000 of cereal grains grown for harvest). An Iowa Nutrient Management Council study estimate that cover crops in Iowa may have reached 2 million acres in the fall of 2020. In Missouri, the author (Rob Myers) estimated cover crop acreage as having reached one million acres in the fall of 2020. Cover crop acreage in other states is rising as well.

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Cover Crop Numbers from 2017 Census of Ag

Total cover crop acres in the U.S. increased from 10.3 million acres in 2012 to 15.4 million acres in 2017, a 50% increase
Total number of farm operations with cover crops increased by 15.2% to 153,402 farm operations
Eight states more than doubled their cover crop acreage in that five-year stretch – IA, AZ, IL, MO, MS, NE, VT and OH
Ten states had at least 20% cover crops and Maryland had 41% of available cropland planted to cover crops

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Projected Growth in U.S. Cover Crop Acres

2017	15.4
2018	16.7
2019	18.1
2020	19.6
2021	21.2
2022	23.0
2023	25.0
2024	27.1
2025	29.3
2026	31.8
2027	34.5
2028	37.4
2029	40.5

Cover crop acreage grew by an average 8.4% compounded annually from 2012 to 2017. Assuming that same growth rate for the next decade, U.S. cover crop acreage would look like the following:

Next Census in 2022 would have 23 million acres,

by a decade from now there would be 40 million acres

There is a good chance that the next Census of Agriculture will show U.S. farmers planting at least 23 million acres of cover crops in the fall of 2022 (but data won’t be released until early 2024). Projecting farther ahead is more difficult, but if the current growth rate in acreage held, there would be 40 million acres by the fall of 2029.

Big questions for adoption:

Early adopters of cover crops have been among the most conservation minded farmers
There is some room for additional growth in cover crop acreage among existing users of cover crops, of which less than 20% were 100% cover cropped in the 2019-20 SARE/CTIC survey
How fast will more ”middle adopters” get involved with cover crops? It has happened in some states and counties, so it’s not an insurmountable hurdle, but more education is needed and these middle adopters need to believe the economics of cover cropping won’t hurt them, at least over a few year period. The trend towards more public and private sector incentive programs for cover crop planting will very likely help expand further adoption.
More farmers are grazing cover crops which will contribute to growth in acreage
More farmers are using cover crops to help with herbicide resistant weeds, which could be a big factor in further adoption

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What’s up with equipment for cover crops?

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High clearance cover crop broadcast seeder

Von Tillburg farm (Ohio)

One of the innovations among manufacturers of some high clearance spraying equipment, such as the Hagie unit pictured here, is modifying the sprayers to instead broadcast cover crops. Hagie (based in Iowa). The spray tank is replaced by a seed box, and an air unit blows the cover crop seed out through tubes on the spray boom to drop nozzles where the seed hits metal diverters that broadcast the seed into the corn stand.

Hagie calls this the Cover Crop Interseeder and claims the unit can seed up to 500 acres per day, but that would depend on field size and seed loading arrangeements. Other manufacturers have similar units and some farmers have custom modified their own spray units to make into cover crop seeding.

The advantage of this type of unit compared to airplane seeding is that it can be done on a windy day and doesn’t run the risk of getting cover crop seed onto a neighbor’s field, which can happen with wind drift from aerial seeding.

The disadvantage compared to aerial seeding is that these units can’t run when the ground is too wet, and may cause some wheel traffic damage in late season soybeans.

Looking ahead, more use of these types of units is likely. Some farmers have bought them and developed a custom business seeding not only their own fields with cover crops but also hiring out to do other fields in their area. There is also good potential for ag retailers with high clearance spray units to make use of those at a time in late August or September when there is little demand for their spray units or labor force. More cover crop seeding services from ag retailers could really help boost adoption.

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Vertical Tillage Tools with Seeders

Another option for getting some incorporation of broadcast cover crop seed is through use of a vertical tillage tool. Since many farmers are already doing a vertical tillage pass in the fall, several of the companies selling vertical tillage units have started offering cover crop seeder add on kits. These all have a similar approach, adding a seed box with an air blower unit and seed distribution tubes on top of the vertical tillage frame. Most have the seed broadcast in front of the vertical tillage unit, a few do it at the back.

Broadcasting seed in front of the vertical till unit can work well for cover crop seed that can tolerate being an inch or more deep, such as cereal rye, triticale, winter wheat, oats, and Austrian winter peas. However, this method can end up planting some types of cover crop seed too deeply; radishes, rapeseed, clovers, and other small seeded cover crops generally will do better planted at a half inch depth or less. Those may provide a case for broadcasting the seed at the back end of the vertical till unit.

Use of a cover crop seeder with a tillage tool may seem at conflicting odds, since the ideal system is to combine cover crops and no-till. However, the fact is many farmers are not yet ready to give up at least a modest amount of tillage, such as running a single vertical tillage pass (which does leave a fair amount of residue intact). Applying the cover crop seed in the same pass as a tillage action that would be done anyway, makes the cover crop seeding very affordable and time efficient for the producer.

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Other Tillage Tools with Seeders

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Planter modifications planting into cover crops?

Equipment changes for cover crops involve more than just planting the cover crop. There also equipment innovations that can benefit the process of planting a cash crop into the cover crop.

Roller crimpers were some of the first equipment pieces made to help deal with cover crops in the spring, and have their particular uses, especially for organic farmers or others seeking non-chemical termination means. However, many farmers are planting green into living cover crops, such as the 6 foot tall cereal rye pictured here, without first rolling it. For tall rye, most planters will knock down the rye fairly well. Planting into the standing cover crop reduces the amount of cover crop stems that are “hair-pinned” into the furrow. Residue pushed into the furrow can cause the seed furrow to dry out.

In trials as the University of Missouri with various planter set ups, and planting green with and without rolling the cover crop first, the best options for tall cereal rye in those silty clay loam soils was found to be planting straight into the standing cover crop with no coulters and no row cleaners. However, changing the closing wheels proved important, as depicted in the next slide.

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With the explosion of interest in no-till and cover crops, man different types of closing wheel options are being sold as add-on planter options to replace the traditional smooth rubber or metal wheels that have worked well in conventionally tilled seedbeds. A trial at University of Missouri with a range of closing wheel types found in those particular soils (silty clay loam) and conditions, that the spiked closing wheels did the best job of breaking down furrow sidewalls and getting the furrow closed.

Some farmers who have both cover crop field and more conventional fields have opted to have one closing wheel be a smooth round one and one being spiked, as shown in the planter unit in the lower left of the photo above. This allows a little more adaptability to a range of soil conditions. For 100% no-till cover crop situations, probably having some type of spiked closing wheel on both sides is preferable, assuming finer soil textures. In coarser soils, spiked closing wheels may be less needed.

Avoiding use of no-till coulters has been found to allow for more down-pressure on the remaining planter parts, so many farmers are taking off their no-till coulters. Of course, experimentation for the specific soil conditions that exist in a field are recommended. What works in one location or one year is likely to be different than other soil-weather-residue conditions.

Further customization of row crop planters for optimum planting into no-till cover crop situations can be expected in the future, but even now, many planters can work well for these situations, usually with just slight changes such as the closing wheel setup.

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What are the business opportunities with cover crops?

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Business Opportunities for Ag Retailers

1) Sell cover crop seed to farm customers

2) Provide management advice on cover crops, including adjustments in fertility management

3) Seed cover crops with high clearance rigs or other broadcasting equipment

4) Provide cover crop termination service

5) Help farmers monitor changes in soil health

This list of business opportunities related to cover crops specific to ag retailers is just a starting point (note the need for cover crop equipment innovation was handled in the previous few slides). Perhaps the speaker can engage the audience to see what innovations they feel are needed with cover crops.

A 2018 national survey of agriculture retailers by Datu Research found that 89% of the surveyed ag retailers were already offering some type of cover crop service, with many offering cover crop termination services in the form of spring herbicide spraying. 56% were selling cover crop seed in response to their customer demand. A smaller percentage, 29%, were offering cover crop seeding services, such as using broadcast fertilizer units to spread cover crop seed, or high clearance spray equipment modified for seeding.

https://www.croplife.com/crop-inputs/study-ag-retailers-seek-greater-cover-crop-adoption-despite-challenges/

There’s also a need for all types of companies that employ farm advisors, as well as individual certified crop advisors (CCAs), to offer consulting services on cover crop management, soil health testing, and implementation of soil health improvement strategies.

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Size of the Cover Crop Industry in the U.S.

Cover crop acreage in the fall of 2020 estimated at 20 million acres.

By 2029, current growth rate projects to 40 million acres.

40 million acres x $25 seed/acre = BILLION DOLLAR INDUSTRY

To sell seed for 40 million acres will require over one million acres of cover crop seed production.

Over 150,000 farm operations are using cover crops today, with thousands more each year.

What is driving this growth? Soil health measurement, consumer demand for sustainably produced foods, company interest in soil carbon sequestration, and farmer desire for better yields and profit, along with leaving the farm in better shape for the next generation.

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PEOPLE WANT TO KNOW MORE

ABOUT COVER CROPS!