Policy incentives for reduction in nitrogen application in cropping systems for southeast Nebraska

The environmental consequences of farming have become increasingly important to policymakers, producers and the public. The Environmental Protection Agency has identified agriculture as the largest nonpoint source of water pollution in the U.S. Nitrates have been found in the groundwater of most states. Nebraska is currently faced with decisions as to how to best manage its water resource to prevent further degradation of surface and ground water.;Data from several crop rotation studies at the University of Nebraska were evaluated to estimate the effect of applied nitrogen on the expected yield of rainfed crops grown in rotation and continuously in southeast Nebraska. From the predictive equations, the impact on yield that resulted from reduction in nitrogen application rates was assessed. This information was used to estimate possible financial incentives for producers to use less nitrogen fertilizer. A price subsidy was estimated to cover the difference, if any, between the profit that the producer might receive by using a conventional nitrogen fertilizer rate and the profit from using a reduced nitrogen rate.;The corn/corn and corn/sorghum rotations produced the greatest reduction in profits when nitrogen application rate was reduced, ranging from ;Because most research regarding the nitrogen effect on yield assumes nitrogen is the first variable in the equation, the possibility exists that researchers overestimate the nitrogen requirement by crops. The results shown here suggest that other variables may be more appropriately included before nitrogen in attempts to estimate the yield response function. Since the estimate can vary depending upon the order of variable entry, soil water conditions need to be evaluated as part of the process of nitrogen rate assessment. Nitrogen usage in agriculture and the environmental impact of such use continues to gain attention. It will be necessary to design policy to enhance the benefits and minimize the costs of nitrogen use on crops.