Optimal Levels of Irrigation in Corn Production in the Southeast Coastal Plain

Abstract

ABSTRACT Water is a precious resource and is used in many competing industries. To use water efficiently in crop production, knowledge about crop responses to irrigation water, or the production function, is essential. In this paper, we estimated six production functions, two N-fertilizer treatments for each year in 1999, 2000, and 2001, for corn production using the data from experimental plots in Florence, South Carolina, USA. Optimal levels of irrigation and gross margins under profit-maximizing and yield-maximizing strategies were computed. The results indicate that at the current prices of corn and water in South Carolina, the profit-maximizing strategy conserved more irrigation water and produced larger gross margins than the yield-maximizing strategy. The differences in optimal levels of irrigation water and gross margins between the two strategies became even more significant when the relative water/corn price ratios increased. To find out how demand for irrigation water responds to changes in water prices, demand functions for water were derived and demand elasticities of water were computed. At the current prices of water and corn, the demand elasticities were inelastic, which means that irrigation is not very responsive to changes in the price of water. As the price of water increased, demand for irrigation became more responsive to changes in water prices.