The last few weeks, I've talked about the lime and litter we've been applying as well as drain tile we've been installing.
While we've been plowing ahead, the dollars seem to be flowing out like a river! I'll admit, the storage building project and the conclusion of our year-long kitchen project has added to the strain. Now, with some time to reflect, the question comes: how much money can we afford to spend on land improvements while grain prices are down? Justification can be made for to stop the insanity or to keep on going.
Related: Our budget-cutting plan for 2016
Here is my perspective: Unfortunately, we can't control the weather. (If we could, farming would be easy!) When the ground is fit, the work must happen. Sometimes this may stretch us more than we like. I recall this was especially true when I was just starting out. I can remember counting the length of planned tile to the foot, and weighing out fertilizer by pounds instead of tons. The last few years have spoiled us, and perhaps left us a bit loose.
As I mentioned last week, we had a folder full of VRT maps for lime applications. Some of those maps had been in the file for 2 or 3 years. Much of the lime was stockpiled here, but with harvest stretching into late November and December the last two years, coordinating the application didn't work out. This fall we were able to get completely caught up. It hit the financials on lime last week.
As far as the drainage goes, you can tie up a lot of money in a hurry. To system ditch an acre on 60-foot centers it takes 775 feet of tile. 4-inch sock tile comes in around $0.45; 6-inch with sock, just over $1. Installation can double that price depending on whether a plow or wheel machine is used and how much 'research' is needed. Doing the math, best case is about $750 an acre! However, this year alone, well drained fields earned back one quarter to one half of that expense.
Related: Wading through farm paperwork
You could certainly justify borrowing a little money to do the installation. I can cite some fields/spots where drainage would have had a one year pay back this year. I fully expect tile to be a 50+ year investment. The sooner the tile goes in, the faster it starts adding to the bottom line.
Bottom line is this: both of these processes will add to the value of the land as well as improve the productivity. It is cheaper to improve land you already own than it is to buy more land. We'll find out how much cheaper on Monday as 250 acres is at auction a few miles away.
More importantly, maximizing productivity on each field may make or break an operation in the next few years. It comes down to weighing cost savings against benefits of increasing soil health.