Fall is barter time for two Iowa farmers. Kevin Fluit, a cattle producer from Rock Rapids, IA, and his neighbor, cash grain farmer John Friedrichsen, are swapping corn stalks and manure.

Trading preserves their cash and saves them both money. Fluit cuts his bedding and manure-hauling costs. Friedrichsen spends less for fertilizer and gets the soil carbon benefits of manure. Removing corn residue also allows him to reduce tillage — another savings.

Manure exchanges between livestock and crop farms have really taken off in the last couple of years, says Kevin Erb, University of Wisconsin Extension Environmental Resources Center. Erb works with livestock producers and manure applicators in six Upper Midwest states. Driving the trend are higher transportation costs, volatile commercial fertilizer prices, expansion and increasing specialization of livestock production and need for a larger land base to apply manure, he says.

MANURE EXCHANGES CAN take many forms, Erb says, from cash sales to barter agreements that trade manure for feed, bedding or farm services. Kevin Fluit and John Friedrichsen have traded manure and corn stalks for the last two years.

Fluit grows corn and soybeans and custom feeds 1,600 beef cattle in three cement-floored bedding barns. Ground corn stalks keep the confined animals comfortable year round. “We have 40 sq. ft./head, totally under roof,” he says. “We put on a lot of corn stalks,” consuming 3,000-4,000 large round bales a year.

This fairly new beef production method protects cattle from the elements and eliminates runoff risk, Fluit says. The corn-stalk bedding pack is sloped to the feed bunks. About twice a week, Fluit scrapes a 16-foot alley and blows in more corn stalks to keep cattle dry. He stockpiles the manure over the summer and spreads it on cropland in the fall and winter.

In 2008, as fertilizer prices climbed, Fluit asked several close neighbors if they would be interested in trading corn stalks for manure. He would harvest and haul the crop residue and in return spread enough cattle manure to replace the nutrients and organic matter he'd removed.

“I thought it sounded like a good idea,” says John Friedrichsen, who lives across the section from Fluit and raises corn and soybeans in a 50-50 rotation. “Cattle manure is good fertilizer. And it's an advantage for me to get the corn stalks off.”

Last fall, Fluit collected about four bales/acre from Friedrichsen's 75-acre cornfield, removing 75% of the total residue cover. “We don't want the ground black,” Fluit says. “We leave the stalks standing to hold snow and stop erosion.”

With less residue, Friedrichsen eliminated fall disking, which saves him about $11/acre, according to the 2009 Iowa State University custom rates survey.

Continuous-corn producers see another benefit of removing residue, says Jeff Coulter, University of Minnesota corn agronomist. His research in 2006 and 2007 in northern and central Illinois showed that the N fertilizer rate for the subsequent corn crop can be reduced by about 13% when half or more of the residue is removed. That's because less soil N is tied up by microorganisms breaking down the residue.

However, removing crop residue can lower long-term soil productivity by depleting carbon, Coulter says. Adding back livestock manure helps maintain soil organic matter and carbon levels, he says, making corn residue harvesting more sustainable.

A 1,200-lb. bale of corn residue contains about 3.5 lbs. P₂O₅ and about 19 lbs. K₂O, Coulter says, plus 11 lbs. N, which becomes available slowly as the residue breaks down in the soil.

In exchange for his corn stalks, Friedrichsen receives an equal amount of replacement nutrients in the form of cattle manure. “We know what we're taking off for nutrients,” Fluit says. “And we sample and weigh the manure so I can guarantee replacement.”

Friedrichsen also bought extra manure, beyond the replacement rate. In 2009, Fluit spread about 13 tons/acre on a harvested soybean field, which is going into corn in 2010. Fluit uses a Meyer's manure spreader with vertical beaters and GPS. The manure goes on “very fine in a 40-ft. swath with no lumps,” Fluit says.

FRIEDRICHSEN ESTIMATES that the barter arrangement cuts his fertilizer bill by about 25%, compared to buying commercial fertilizer. On the extra manure, he pays Fluit only for the P and K content. There's no charge for the N. In 2009, they set the nutrient value in April, when gyrating fertilizer prices happened to be up, so Friedrichsen didn't save quite as much money. “I still came out ahead,” he adds.

In 2010, the two growers are experimenting with an alternative valuation strategy. Friedrichsen can lock in a nutrient unit price any time between fall application and April, based on the local co-op price.

Another common manure valuation method is to price half the nutrients as of the delivery date and the other half on a date of the recipient's choosing during a specified window, Erb says. “That gives both parties some upside and downside protection.”

Keep in mind that the value of manure to cash grain farmers depends on soil nutrient test levels and the needs of your current and future crops, Erb adds. Manure may contain nutrients you don't need for optimal crop production. So depending on where it's applied, manure's value can range from zero to more than $100/acre, he says.

Fluit has barter agreements with three close neighbors, so he never has to haul corn stalks or manure farther than 1.5 miles. Two of the crop producers buy extra manure; the third takes only replacement nutrients, because his P and K soil levels are already high. Fluit is also on the opposite end of a corn stalk-manure swap with a new cattle feedlot six miles away, near an-other of his farms.

Fluit and his neighbors have handshake agreements. That's pretty typical, says Andrew Nesseth, a crop and manure management consultant with Extended Ag Services, Lakefield, MN, who helps arrange and value manure exchanges.

Nesseth likes to “have everybody sit down together at the table” and go over all the details of the exchange. On a corn stalk-manure swap, agree on how you'll set the per-pound price of the nutrients in the manure, nutrient removal rates for corn residue harvest, who is responsible for soil and manure tests, and what happens if field conditions aren't fit for residue harvest or manure application.

Also be aware that barter deals may have income-tax implications, Erb adds, so it's a good idea to run the arrangements by your accountant or attorney.

With “mutual trust and understanding, ” Nesseth says, manure swaps can be “a win-win for everybody.”

IF YOU BUY OR TRADE MANURE…

It's smart to have a written agreement with the manure provider, says Kevin Erb, University of Wisconsin Extension. Your agreement should spell out: