how precise is precise enough? · 2020. 2. 4. · how precise is precise enough? alfons weersink...
TRANSCRIPT
How Precise is Precise Enough?
Alfons Weersink
Dept of Food, Agricultural & Resource Economics (FARE)
FarmSmart Agricultural Conference
Guelph, ON
January 18, 2020
Overview of Presentation
Purpose-
▪ Is the extra precision of precision agriculture worth it?
▪ Focus on variable rate application of nitrogen fertilizer
Overview
▪ Elements of Agriculture 4.0
▪ Benefits of Precision Agriculture
▪ Economics of Fertilizer Management
▪ Flat Payoff Functions
▪ Adoption Rates of Precision Agr Technologies
▪ Implications
“A fourth agricultural revolution is underway, and this
one isn’t powered by seeds or diesel. It’s all about data”
Schrumm
Previous Technological
Revolutions in Agriculture
1. Mechanical
2. Green
3. Biotech
4. Digitial (Agriculture 4.0)
Previous Technological
Revolutions in Agriculture
▪ Previous innovations tended to allow farmers to
increase the scale of operation
▪ Farmers able to increase the size of management
unit
▪ Standardized practice used across that unit
▪ (i.e. single rate of fertilizer, TMR)
Elements of Agriculture 4.0
1. Robotic advances
▪ Greater degree of automation
2. Declining costs of sensor technology
▪ Real-time measurement of factors
3. Affordable computing power
▪ Creation of decision support tools
4. Emerging Big Data analytical platforms
▪ i.e. cloud computing and machine learning algorithms
Evolution in Farm Data Collection
Evolution in Farm Data Collection
Evolution in Farm Data Collection
Evolution in Farm Data Collection
Evolution in Farm Data Collection
▪ The amount of data collected on farm through sensors
has increased dramatically over the last decade.
▪ Yield monitors, drones, smart phones
▪ The form of data has also changed from from simple
numerical values (e.g., yield) to include more qualitative
measures (e.g., type of practice, odor).
▪ Both types of variables are being gathered more
precisely and at a highly localized scale.
Benefits of Agriculture 4.0
▪ When fully realized, tools of agriculture 4.0 allow
farmers to be more precise in application of inputs
▪ Increase efficiency by tailoring inputs to the
spatial and temporal microclimates on each farm
▪ Contrast to current uniform management across
whole field or herd
But are the Benefits > than the Costs?
▪ More information has been gathered but what is
the value of the information?
▪ Data useless unless it can be curated in ways that
can be turned into useful decision support tools
▪ How does the technology improve decision making?
▪ If yes, are the benefits large enough to offset the costs
of the technology?
Process for Agriculture 4.0
1. Generate and Capture Data
2. Compute
▪ Determine appropriate treatment by zone
3. Deliver
▪ adjust treatment for observed heterogeneity
The process is only as strong as its weakest link
Crop Production Example
▪ Typical crop producer makes 40 production
decisions each year
▪ Planning
▪ Planting
▪ In-season
▪ Harvesting
▪ What is the value of additional information from
Agriculture 4.0 that improves a decision(s)?
Precision Agriculture Technologies
in Crop Example
1. Geographic
▪ Guidance systems
2. Observational
▪ Yield monitors
▪ Mapping
3. Variable rate application
▪ Seed, fertilizer, pesticide
High Adoption of Guidance Systems
▪ Ability to cover more area
in a given time period
▪ Ensures complete
coverage
▪ Reduces overlap
▪ $1/acre for tillage
▪ $8/acre for planting.
Next Step Autonomous Tractors?
High Adoption of Monitoring Tools▪ Yield monitors are now
standard equipment
▪ Maps produced at low-cost
▪ Value to identifying
chronically underproductive
areas.
▪ Identifies area of crop stress
in season
Adoption Rates Low for VRT
▪ Technical ability to apply variable rate
▪ But what rate should be applied to a given
location?▪ Should a high-yielding zone receive more or less inputs?
▪ Many pieces of information ranging from geo-
physical to climatic to production to economic
are necessary to generate a prescription for the
variable application of inputs to reap the benefits
Economics of Fertilizer Management
Economics of Fertilizer Management
What N rate maximizes profit?
0
0.5
1
1.5
2
2.5
0 10 20 30 40 50 60 70 80 90 100
Yie
ld (
ton
ne
/ha
)
Nitrogen (kg/ha)
Production function
Start with the relationship between nitrogen
applied and crop yield (production function)
Source: Pannell (2019)
Economics of Fertilizer Management
What N rate maximizes profit?
0
0.5
1
1.5
2
2.5
0 20 40 60 80 100
Yie
ld (
ton
ne
/ha
)
Nitrogen (kg/ha)
Production function
0
100
200
300
400
500
600
0 20 40 60 80 100
$/h
a
Nitrogen (kg/ha)
Revenue = Yield * Crop Price
Calculate Revenue as a function of N applied
Economics of Fertilizer Management
What N rate maximizes profit?
Subtract N cost from Revenue
0
100
200
300
400
500
600
0 10 20 30 40 50 60 70 80 90 100
$/h
a
Nitrogen (kg/ha)
Revenue
N Cost = N Price * Rate
Economics of Fertilizer Management
What N rate maximizes profit?
Payoff Function- the net return to
different rates of the input (N)
0
50
100
150
200
250
300
350
400
450
0 20 40 60 80 100
Pa
yo
ff (
$/h
a)
Nitrogen (kg/ha)
Profit-maximising
rate of nitrogen
Profit maximizing rate (50kg/ha) is associated with the
peak of the Payoff Function ($400/ha)
Economics of Fertilizer Management
▪ What influences profit maximizing rate?
▪ Output price
▪ Nitrogen price
▪ Responsiveness of yield to N
▪ Previous crop
▪ Soil fertility
▪ Weather
Does Precision Matter?
0
50
100
150
200
250
300
350
400
450
0 10 20 30 40 50 60 70 80 90 100
Pa
yo
ff (
$/h
a)
Nitrogen (kg/ha)
What range of N application rates would give payoffs
within 5% of the maximum payoff ($400/ha)?
Does Precision Matter?
What range of N application rates would give payoffs
within 5% of the maximum payoff ($400/ha)?
0
50
100
150
200
250
300
350
400
450
0 20 40 60 80 100
Pa
yo
ff (
$/h
a)
Nitrogen (kg/ha)
22 to 80 kg/ha!!Varying the N rate
within the vicinity of
the optimum doesn’t
make a big
difference to profit
Flat Payoff FunctionsThe payoff functions for many inputs,
including N fertilizer, are often very flat
Source: Nasielski and Deen
Flat Payoff Functions & VRT
0
200
400
600
800
1000
1200
0 50 100 150 200 250 300 350 400
Ne
t re
turn
($
/ha
)
N (kg/ha)
Payoff functions for 3 areas within a field (German wheat)
Flat Payoff Functions & VRT
The benefits of site-specific crop management within three
areas of a field with different payoff functions
0
200
400
600
800
1000
1200
0 50 100 150 200 250 300 350 400
Ne
t re
turn
($
/ha
)
N (kg/ha)
Implications of Flat Payoff Functions
▪ There is a large margin of error in choice of N rate
to maximize yield
▪ Note example is for a single application around planting
▪ Simple decision models are good enough
▪ Other factors will influence farmer choice of N rate
▪ Personal factors (i.e. yield max)
▪ Risk
▪ Credit constraints
Implications of Flat Payoff Functions
▪ The benefit of site-specific VRT of N is small
▪ Large adjustments in N rate to account for spatial
variability will increase revenue but not by much
▪ The technology needs to be cheap or the output
valuable
Spatial vs Temporal VariabilityWhile payoff functions tend to be flat within a year, there is a
big variation across years
Source: Nasielski and Deen
Implications of Temporal
Variability in Payoff Functions
▪ Explains why farmers tend to apply more than the
recommended rate▪ Benefit of applying more in the good years is greater than the cost
of applying too much in the bad years
▪ Value of information associated with in-season
demand for N (i.e. rainfall, temperature)
▪ Benefit from split application of N if demand for N
in-season can be determined.
Reasons for Adoption Differences
Across Precision Crop Technologies▪ GPS technologies are embodied-knowledge
technologies
▪ No additional information required to capture the value
▪ Technologies either simplify work or passively collect
data
▪ Information-intensive technologies (i.e. VRT)
requires additional skills and tools
▪ Data are inputs into decision support system and that
generates a prescription that is then applied
Adoption of Precision AgricultureAbility to derive decision rules in agriculture with
high value will be highest for:
a) Valuable output
b) Short cycle
c) Small uncertainty in production
d) High within-field or between-animal heterogeneity
e) Technologies to measure and deliver to that
heterogeneity
“In pursuing … optimal levels of decision
variables, precision is pretense and great
accuracy is absurdity.”
(Anderson, 1975)
Good decision makers ignore the bad
decisions / don’t sweat the small stuff
Summary▪ Success of precisions agriculture depends on
value created for end user
▪ not technological capability
▪ Ability to gather and compile data is becoming
easier and cheaper, but it is not enough
▪ Net value of precision agriculture depends on
the situation