ECONOMIC-EVALUATION OF TOPSOIL LOSS IN SPRING WHEAT PRODUCTION IN THENORTHERN GREAT-PLAINS, USA

Relationships among topsoil removal treatments and additions of nitrog en and phosphorus fertilizer on dryland spring wheat yields in a wheat -fallow rotation were used to determine the on-site effects of topsoil loss and fertilizer applications on net returns and to estimate the v alue of soil. Yields estimated from a production function and correspo nding net returns for spring wheat under alternative soil loss levels and fertilization rates were examined. A numerical optimization routin e was used to determine the most efficient levels of fertilizer applic ations for farm managers at various levels of soil loss. The value of soil in spring wheat production was derived by estimating the accumula ted discounted values of production from land without soil loss versus land with soil loss over various planning horizons. Production functi on estimates indicated that, when all variables were at their mean val ues and soil loss was varied, the first centimeter of soil loss reduce d wheat yield from 1719 kg ha(-1) to 1709 kg ha(-1), whereas the last centimeter of loss reduced yield from 1362 kg ha(-1) to 1331 kg ha(-1) . Each additional centimeter of soil loss increased the yield loss. Th e economic analysis indicates that the optimum amount of N and P that should be applied increases with each increment of soil loss. Fertiliz er reduces yield loss to some extent, but net returns continue to decl ine as soil loss increases. This result confirms that N and P fertiliz ers are imperfect economic substitutes for soil, Estimated soil values are a function of the farm manager's planning horizon and the natural soil erosion rate. If erosion is occurring at a rate of 44.8 Mg ha(-1 ) year(-1), the value of soil ranges from $59.33 ha(-1) for a planning horizon of 20 years to $305.48 ha(-1) for a planning horizon of 68 ye ars. The equivalent level annuity values of these estimates are $3.99 ha(-1) year(-1) and $10.58 ha(-1) year(-1), respectively.