Cover Crop Utilization Across Nebraska and Implications for Cropland Lease Arrangements in 2024

Cornhusker Economics Aug 21, 2024
Cover Crop Utilization Across Nebraska and Implications for Cropland Lease Arrangements in 2024

By Jim Jansen

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The Nebraska Farm Real Estate Market Survey and Report 2023-2024 provides insight on recent trends in the market value of land and cash rental across the state. Each year, the special feature section covers topics on new or emerging issues related to the agricultural land industry in Nebraska. These topics reflect the interest expressed by panel members and readership of the Nebraska Farm Real Estate Market Highlights Reports. The special feature section in 2024 focuses on trends and considerations for cover crops across Nebraska and implications on lease arrangements.

Findings from the 2022 Census of Agriculture in Table 1 provide an overview of the utilization of cover crops across the state's eight districts and 93 counties (USDA-NASS, 2022a, b). Approximately 925,686 acres of cover crops were grown on about 21 million cropland acres across Nebraska in 2022. Cover crops were planted on about 4.4% of cropland acres across the state by 4,477 operators.

In 2022, about 36,351 operators across Nebraska grew crops on about 21 million acres of land. Both the number of cropland acres and the utilization of cover crops greatly varied across each region of the state. Arid areas such as the Northwest, North, and South Districts grew between 53,069 to 92,422 acres. The Northeast, East, and Southeast Districts planted around 130,000 acres or more of cover crops. The number of operators in each region planting cover crops also varied. In percentage terms, the cropland operators planting cover crops varied from a low of 8.6% in the Northwest District to a high of 15.8% in the Central District. 

When planting a cover crop across Nebraska, the motivation of the landowner or operator may vary depending on the needs of the region or management requirements. Increased interest in cover crops in recent years has come from the perceived benefits to the land and mitigation of environmental issues. Cover crops reduce soil degradation (i.e. erosion) and enhance soil quality (i.e. organic matter and nutrient content). These effects may take multiple years to fully materialize but tend to persist for several years into the future. Grazing the cover crops or harvesting for forage are perceived as viable options for generating benefits on a more immediate basis.

The underlying motivation for utilizing cover crops remains important, as the operator may incur additional establishment and termination expenses for the land while the benefits may be spread into the future (Wallander, et al. 2021). Figure 1 summarizes the major reasons for planting cover crops across Nebraska.

Panel members reported that environmental benefits such as soil health and conservation accounted for about 56% of the reasoning or motivation behind utilizing cover crops. Livestock grazing and use as a secondary forage in a rotation accounted for an additional 32% of the reason for planting a cover crop on an agricultural property. The ability to obtain cost-share funding contributed to about 12% of the motivation behind adopting this practice.

Division of cover crop establishment expenses remains a provision to consider in a cropland lease arrangement (Bowman, et. al, 2024). Benefits from utilizing a cover crop may exceed the length of the current lease. Figure 2 summarizes the dollar per acre rental discount on a cropland lease provided to a tenant when planting a cover crop.

Panel members indicated that slightly over 68% of land leases do not provide a discount to tenants for planting cover crops. About 23% of leases offered a small discount between $1 to $9 per acre. Opportunities exist in lease negotiations to increase the equitability divide to cover crop expenses. 

 Survey results shown and discussed in this report are findings from the University of Nebraska–Lincoln 2024 Nebraska Farm Real Estate Market Survey. The survey's complete results can be found on the Nebraska Farm Real Estate website: http://cap.unl.edu/realestate.

Please address questions regarding preliminary estimates from the 2024 Nebraska Farm Real Estate Survey to Jim Jansen at (402) 261-7572 or jjansen4@unl.edu.

 
Jim Jansen, 402-261-7572
Agricultural Economist
University of Nebraska-Lincoln
jjansen4@unl.edu

Jeff Stokes, 402-472-1742
Professor, Department of Agricultural Economics
University of Nebraska-Lincoln
jerffrey.stokes@unl.edu

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References

Bowman, M., Afi, M., Beenken, A., Boline, A., Drewnoski, M., Krupek, F., Parsons, J., Redfearn, D., Wallander, S., & Whitt, C. (2024, May). Cover Crops on Livestock Operations: Potential for Expansion in the United States, retrieved June 5, 2024, from the USDA-ERS. 

USDA-National Agricultural Statistics Service (2022). Census Volume 1, Chapter 2: County Level Data, Nebraska, Table 41. Land Use Practices: 2022 and 2017, retrieved June 4, 2024. 

USDA-National Agricultural Statistics Service (2022). Census Volume 1, Chapter 2: County Level Data, Nebraska, Table 45. Selected Operation and Producer Characteristics: 2022, retrieved June 4, 2024. 

Wallander, S., Smith, D., Bowman, M., & Claassen, R. (2021, February). Cover Crop Trends, Programs, and Practices in the United States, retrieved June 7, 2024.

Table 1: Cover Crop Practices for Cropland and Operators in 2022, by Agricultural Statistics District in Nebraskaa
Agricultural Statistics DistrictPlanted AcresCropland Acres Planted to Cover CropsNumber of OperatorsCropland Operators Planted Cover Crops
Cover Crops Cropland Planted Cover Crops Planted Cropland
Acres Percent Numbers Percent
Banner 2,335 184,737 1.3 7 179 3.9
Box butte 11,070 407,540 2.7 44 356 12.4
Cheyenne 816 546,240 0.1 13 537 2.4
Dawes 2,545 192,650 1.3 14 291 4.8
Deuel 410 191,547 0.2 11 168 6.5
Garden 961 160,334 0.6 12 192 6.3
Kimball 1,515 374,138 0.4 10 363 2.8
Morrill 9,235 268,449 3.4 46 374 12.3
Scotts bluff 12,692 216,092 5.9 107 564 19.0
Sheridan 11,020 293,604 3.8 37 404 9.2
Sioux 470 76,698 0.6 7 169 4.1
Northwest 53,069 2,912,029 1.8 308 3,597 8.6
Arthur 942 31,747 3.0 5 50 10.0
Blaine b 21,181 0.0 1 50 2.0
Boyd 4,402 87,509 5.0 30 163 18.4
Brown 7,721 103,175 7.5 30 196 15.3
Cherry 6,790 435,881 1.6 19 390 4.9
Garfield 1,186 58,729 2.0 12 105 11.4
Grant b 43,651 - 1 44 2.3
Holt 53,666 649,518 8.3 170 929 18.3
Hooker b 8,526 - 1 18 5.6
Keya paha 4,671 108,625 4.3 26 131 19.8
Logan 2,930 30,406 9.6 8 54 14.8
Loup 1,926 20,272 9.5 14 60 23.3
Mcpherson 1,130 23,069 4.9 9 53 17.0
Rock 1,535 157,266 1.0 6 146 4.1
Thomas b 7,981 - 2 35 5.7
Wheeler 5,523 97,537 5.7 22 127 17.3
North 92,422 1,885,073 4.9 356 2,551 14.0
Antelope 42,469 395,148 10.7 149 553 26.9
Boone 12,333 313,409 3.9 60 435 13.8
Burt 3,108 223,434 1.4 28 505 5.5
Cedar 7,825 376,702 2.1 98 721 13.6
Cuming 12,298 316,217 3.9 72 712 10.1
Dakota 1,405 153,895 0.9 8 203 3.9
Dixon 5,624 202,873 2.8 40 442 9.0
Knox 11,908 283,896 4.2 116 787 14.7
Madison 11,062 268,060 4.1 74 608 12.2
Pierce 16,463 211,550 7.8 68 437 15.6
Stanton 3,901 165,944 2.4 58 452 12.8
Thurston 5,221 142,379 3.7 22 222 9.9
Wayne 9,390 236,676 4.0 55 357 15.4
Northeast 143,007 3,290,183 4.3 848 6,434 13.2
Buffalo 19,730 382,339 5.2 99 799 12.4
Custer 27,864 576,202 4.8 133 795 16.7
Dawson 25,933 349,710 7.4 115 507 22.7
Greeley 10,009 80,639 12.4 41 183 22.4
Hall 9,178 234,815 3.9 48 454 10.6
Howard 12,591 141,653 8.9 74 400 18.5
Sherman 2,857 138,831 2.1 24 242 9.9
Valley 5,022 116,359 4.3 35 214 16.4
Central 113,184 2,020,548 5.6 569 3,594 15.8
Butler 25,851 315,127 8.2 100 618 16.2
Cass 11,248 275,446 4.1 69 609 11.3
Colfax 8,049 191,468 4.2 46 371 12.4
Dodge 6,326 312,885 2.0 45 622 7.2
Douglas 2,824 46,026 6.1 35 264 13.3
Hamilton 8,218 279,433 2.9 37 437 8.5
Lancaster 11,945 352,208 3.4 175 1,535 11.4
Merrick 9,882 164,234 6.0 43 388 11.1
Nance 7,002 90,151 7.8 35 214 16.4
Platte 12,629 377,553 3.3 71 782 9.1
Polk 5,472 193,724 2.8 44 392 11.2
Sarpy 1,553 52,414 3.0 19 272 7.0
Saunders 22,259 425,334 5.2 134 1,037 12.9
Seward 48,263 311,793 15.5 104 857 12.1
Washington 8,294 188,824 4.4 60 551 10.9
York 20,111 327,970 6.1 80 437 18.3
East 209,926 3,904,590 5.4 1,097 9,386 11.7
Chase 7,776 288,319 2.7 19 228 8.3
Dundy 8,613 180,904 4.8 19 195 9.7
Frontier 3,217 223,250 1.4 20 224 8.9
Hayes 2,357 162,198 1.5 13 206 6.3
Hitchcock 1,340 204,358 0.7 5 221 2.3
Keith 14,906 193,886 7.7 43 233 18.5
Lincoln 52,896 447,462 11.8 126 667 18.9
Perkins 7,584 443,531 1.7 36 324 11.1
Red willow 1,476 213,583 0.7 11 224 4.9
Southwest 100,165 2,357,491 4.2 292 2,522 11.6
Adams 9,434 296,355 3.2 48 399 12.0
Franklin 9,089 152,785 5.9 37 237 15.6
Furnas 5,691 287,435 2.0 19 316 6.0
Gosper 7,487 138,722 5.4 41 164 25.0
Harlan 3,928 169,819 2.3 29 242 12.0
Kearney 17,185 272,879 6.3 68 282 24.1
Phelps 15,194 243,469 6.2 54 295 18.3
Webster 13,797 222,111 6.2 52 277 18.8
South 81,805 1,783,575 4.6 348 2,212 15.7
Clay 23,447 302,950 7.7 63 399 15.8
Fillmore 17,103 335,849 5.1 50 438 11.4
Gage 23,955 458,558 5.2 127 1,020 12.5
Jefferson 6,555 225,103 2.9 45 476 9.5
Johnson 4,231 87,249 4.8 26 335 7.8
Nemaha 14,596 209,452 7.0 68 354 19.2
Nuckolls 3,960 220,855 1.8 35 301 11.6
Otoe 8,271 310,308 2.7 80 775 10.3
Pawnee 3,424 146,578 2.3 19 316 6.0
Richardson 11,987 256,485 4.7 62 648 9.6
Saline 5,291 248,656 2.1 39 602 6.5
Thayer 8,646 261,987 3.3 45 391 11.5
Southeast 131,466 3,064,030 4.3 659 6,055 10.9
Statec 925,686 21,217,519 4.4 4,477 36,351 12.3

Source:
a 2022 Census of Agriculture, National Agricultural Statistical Service, USDA.
b Value not released due to county-level disclosure.
c District values may not sum to state totals due to county-level disclosure.

Figure 1.  Reasons for Planting Cover Crops on Cropland in Nebraska

 Figure 2.  Rental Discount in Dollars per Acre on Land Lease When Tenant Plants Cover Crops in Nebraska