The Economics of Integrated Insect Pest Management in Stored Corn

Abstract

Insects can cause substantial damage to stored grain. In addition, consumers and therefore food processors are increasingly interested in chemical-free products. Integrated pest management may increase farmer’s profits while reducing their use of pesticides. This paper uses a stochastic dynamic programming framework to model the economics of optimal insect control in stored grains with multiple controls conditional on the biophysical conditions of the grain in the onfarm bin. We find that for farmers who have a contract with a food processor, where there are quality premiums, the optimal management strategy depends on monitoring the biophysical conditions of the grain and the time period under consideration. For farmers who deliver to the commodity market, their current practices are optimal.