Economics of monoculture cereal and mixed oilseed-cereal rotations in west-central Saskatchewan

Abstract

The effects of product price and input cost on the economic performance and riskiness of nine cropping systems were assessed over a 12-yr period on a Dark Brown Chernozemic loam to clay loam soil at Scott, Saskatchewan. The rotations included two 2-yr fallow (F)-crop systems with hard red spring wheat (W) (Triticum aestivum L.) and canola (C) (Brassica campestris L.), four 3-yr fallow-containing rotations with combinations of wheat, canola and barley (B) (Hordeum vulgare L.), a 4-yr and a 6-yr rotation that included alfalfa (Medicago sativa L.) hay, and continuous wheat. All crops were fertilized with rates of N and P based on general guidelines for the region, except for forage hay which was unfertilized. Four rotations (F-C, F-C-W, F-C-B, and F-W-W) showed good economic and risk performance under most price scenarios. The F-W and F-W-B rotations generally ranked intermediate, averaging about 11% lower in net return than the best systems at 1994 commodity price levels; however, at grain prices lower than 75% of these values, net returns were highest with F-W and F-C. It was profitable to substitute canola for wheat grown on fallow when the ratio of canola price to wheat price exceeded 1.8, and to substitute barley for wheat grown on stubble when the barley/wheat price ratio exceeded 0.75. Including alfalfa hay in the rotation was profitable only when the hay/wheat price ratio exceeded 0.8. The unit cost of producing wheat averaged $91 t−1 when grown on fallow, $106 t−1 when grown on canola stubble, $116 t−1 when grown on wheat stubble in fallow-containing rotations and $133 t−1 when grown on continuous wheat stubble. Similarly, the cost of producing barley averaged $74 t−1 when grown on canola stubble and $83 t−1 on wheat stubble. We concluded that producers in the Dark Brown soil zone of west-central Saskatchewan have a strong economic incentive to diversify crop rotations away from traditional monoculture cereal to mixed oilseed-cereal systems. Key words: Wheat, canola, barley, hay, production costs, net returns, riskiness

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