Rising costs lead farmers to go high tech

"When they first came out with them and we first looked at it, it seemed like a fancy gadget," said Barbre, a 53-year-old who grows corn and soybeans in southern Illinois.

But with the cost of fuel, seeds, fertilizer and just about everything else it takes to grow his crops rising fast, Barbre quickly came around after he started using the global positioning system to drive his tractor a year and a half ago. "As soon as we used it, we realized the benefits," he said.

American grain farmers are enjoying the highest crop prices of their lives, but they don't expect that to last forever. As a hedge against the inevitable downturn, owners of mid-size farms like Barbre's--and even some smaller-scale farmers--are investing that cash in technology that's increasingly integrated.

"These new economics have changed the whole landscape," said Dan Davidson, an agronomist with agricultural-data company DTN in Omaha, Neb. "They've got the money to spend; they're going to update. They know the (profit) margins we have today are not going to be around forever."

Large-scale farmers have used GPS-based automated steering for tractors, sensors that probe soil for nutrients and moisture and other gadgets since the late 1990s to cut their expenses and increase their production. It wasn't until the past five years or so, however, that the savings owners of smaller and mid-size farms could realize from using high-end technology would significantly offset their rising costs, said Davidson.

Sure, there were environmental benefits: spraying less fertilizer and fewer herbicides; not overwatering; cutting fuel costs and reducing soil compaction. And farmers could take the data that high-tech gear gathered in the field, download it to their computers and use it in planning.

But now fertilizer used by corn and soybean farms costs almost double what it did two years ago, while seeds and fuel cost almost 50 percent more, according to the U.S. Department of Agriculture.

Meanwhile, the cost of auto-steering systems--among the most popular high-tech products--has remained relatively flat the past few years, and in some cases it has fallen. Systems that now typically cost from a few thousand dollars to $25,000 used to run as high as $40,000.

Look no further than Barbre's farm, he said, for examples of technology's payoff in the current farming economy--and of how important it may be if costs continue rising.