Economics of Drip Irrigation for Apple Orchards in New York State

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In an average growing season in the Northeast, rainfall is somewhat less than is required for optimal performance of fruit crops. The shortage of moisture during critical periods of crop growth and fruit development affects both yields and sizing of produce, thus affecting receipts through both volume of production and average price. Seasons in which moisture is a severe limiting factor affecting profitability occur perhaps two or three years in ten for individual growers in the Northeast. Today’s apple growers need investment and cost guidelines to determine the economics of getting trees into production as soon as possible and to avoid periods of drought during the productive life of orchards. Research was undertaken to determine drip irrigation investment and costs in an apple orchard. This project was designed to assist growers in determining the investment, fixed and variable costs and expected returns from drip irrigation. Irrigation suppliers provided typical equipment needs and investment costs for various drip irrigation designs. Economic worksheets were developed to assist growers in estimating fixed and variable costs of drip irrigation. The economics of yield data were applied to replicated multi-year irrigation studies to assist growers in determining yield response from drip irrigation. Net present value (NPV) methodology was used to determine the discounted break-even investment results from published responses to drip irrigation. Growers with typical drip irrigation systems and various water sources can expect investments in drip irrigation of $464 to $880 per acre with 10 acre blocks of trees. Based upon seven years of data from the New York State Agricultural Experiment Station average yield increases due to irrigation were 117 bushels per acre, resulting in a break-even investment of around $2,000 per acre. Growers who were interviewed were unable to quantify the benefits and costs of drip irrigation but were convinced of positive yield and quality responses from drip irrigation. This analysis has proved the economic rational for the investment in microirrigation.
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E.B. 98-07
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Charles H. Dyson School of Applied Economics and Management, Cornell University
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