Economic feasibility of conversion to mobile drip irrigation in the Central Ogallala region

Authors: REYNOLDS, SYDNEY - West Texas A & M University; GUERRERO, BRIDGET - West Texas A & M University; GOLDEN, BILL - Kansas State University Agricultural Research Center-Hays; AMOSSON, STEVE - Texas A&M Agrilife; MAREK, THOMAS - Texas A&M Agrilife; BELL, JOURDAN - Texas A&M Agrilife

Submitted to: Irrigation Science
Publication Type: Peer Reviewed Journal
Publication Acceptance Date: 2/11/2020
Publication Date: 3/2/2020
Citation: Reynolds, S., Guerrero, B., Golden, B., Amosson, S., Marek, T., Bell, J.M. 2020. Economic feasibility of conversion to mobile drip irrigation in the Central Ogallala region. Irrigation Science. 38:569-575. https://doi.org/10.1007/s00271-020-00667-2.
DOI: https://doi.org/10.1007/s00271-020-00667-2

Interpretive Summary: As the Ogallala Aquifer declines, stakeholders, policymakers, and producers encourage the adoption of new irrigation technology to conserve groundwater, extend the economic life of the aquifer, and enhance profitability. One such technology is the mobile drip irrigation (MDI) application system. Working in a project funded by the USDA ARS Ogallala Aquifer Program, scientists from Kansas State University, Texas A&M AgriLife and West Texas A&M University evaluated the changes in variable cost to calculate the payback period for a MDI system under three levels of investment cost for grain and fiber crops. Under the medium level of investment cost ($150 per acre), a payback period of 4.9, 9.0, and 6.3 years is required for corn, cotton, and sorghum/wheat, respectively. As the cost per acre to convert an existing center pivot drops to $75 per acre, the payback period also drops to 2.3, 4.2, and 3.0 years for corn, cotton, and sorghum/wheat, respectively. Thus, producers growing higher water use crops can recover the costs of the conversion to MDI quicker than producers growing medium and lower water use crops.

Technical Abstract: As groundwater levels continue to decline in the Ogallala Aquifer, stakeholders, policymakers, and producers encourage the adoption of new irrigation technology in an effort to conserve groundwater, extend the economic life of the aquifer, and enhance profitability. One such technology currently receiving attention in the Central Ogallala region is the mobile drip irrigation (MDI) application system. This study compares MDI to low elevation spray application irrigation by evaluating the changes in variable cost per hectare to calculate the payback period for a MDI system under three levels of investment cost for grain and fiber crops representing three levels of water use while holding yield constant. Using a 3% discount rate, under the medium level of investment cost ($371 per hectare), a discounted payback period of 4.9, 9.0, and 6.3 years is required for corn, cotton, and sorghum/wheat, respectively. As the cost per hectare to convert an existing center pivot drops to $185 per hectare, the payback period also drops to 2.3, 4.2, and 3.0 years, respectively. Thus, producers growing higher water use crops are able to recover the costs of the conversion to MDI through increased water use efficiency quicker than producers growing medium and lower water use crops.