University of Minnesota nutrient management team members have developed a new Web-based calculator to help determine the economic value of manure based on factors such as crop nutrient needs for a specific field and crop rotation, fertilizer prices, manure hauling costs, manure type and application method.
The calculator can help with management decisions for current livestock and crop operations as well as playing a role in “what if” situations, such as budgeting new facilities, evaluating contract production options and estimating the effect of manure and manure management on cash flow. The calculator can also assist crop and livestock producers estimate the value of manure transferred or sold from one entity to another.
Jose Hernandez, University of Minnesota Extension educator, says the increase in commercial fertilizer prices since 2009 has heightened interest in the use of livestock manure to supply crop nutrients and has significantly increased the value of manure as a nutrient source.
“Determining the economic value of the nutrients in livestock manure can be tricky,” Hernandez says. “Nutrients in commercial fertilizer are acquired by paying for the nutrients and a small application charge. With manure, in effect, you ‘acquire’ nutrients by paying for the cost of application even if you already have ownership of the manure in a storage structure.”
Hernandez points out that commercial fertilizer supplies the amount and ratio of nutrients that a producer needs. “With manure, you get the amount and ratio of nutrients that the manure contains, which complicates the determination of a value,” he says. Even when the correct amount of nitrogen is applied, the amount of phosphorous and potash applied may not match what a producer would have purchased commercially. Manure applied above crop needs essentially have no value, he adds.
In the past, manure application costs often exceeded the value of the nutrients applied. Now, the nutrient value in the manure often exceeds the cost of application.
In recent years, more livestock producers factor in the contribution of manure value to cash flow in livestock operation budgets and seek an appropriate market value in exchanges between producers and crop farmers. Hernandez says more crop producers are seeking manure as a major nutrient source, either by purchasing the manure from livestock producers or by adding livestock to their operations, particularly swine finishing.
The new calculator was developed by William Lazarus, University of Minnesota Extension economist and professor in the Department of Applied Economics. The calculator is available online at http://www1.extension.umn.edu/manure/manure-value/.