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Learn more via the APPLIED RISK ANALYTICS series, covering the application of RightRisk Analytics risk analysis tools, available for download at: RightRisk.org/appliedriskanalytics.
RANCHERS ADAM AND JILL TOMZAK are considering their fertilizer needs for the coming year, specifically for their irrigated grass hay crop. They know they need to apply at least some fertilizer for growth/maintenance. The Tomzaks are concerned, however, about the high prices for nitrogen. They are worried that if they apply nitrogen at the normal rate, their yield response may not be sufficient to cover the cost of the fertilizer. Their analysis takes a closer look at what the optimum rate of fertilizer might be and the risk management implications of their decision. The How Much Fertilizer Can You Afford to Apply tool tool uses the concept of diminishing marginal returns: the benefits, in the form of additional yield, decline as the quantity of applied fertilizer increases. The tool can help producers discover the most economical level of fertilizer to apply for a variety of example crops, based on previous research.
