Effects of no-tillage on agricultural land values in Brazil

Agricultural land prices may be determined by both productive and speculative factors. Among productive factors, investment in soil conservation in areas destined for agricultural activity is recognized as a positive contributor to land value. No-tillage, or no-till, is a farming system that integrates fundamentals of conservation agriculture and offers a number of advantages in agricultural production. No-tillage systems are associated with a range of positive impacts on land prices, leading this type of soil management system to predominate in Brazil. The object of this study is to verify whether no-tillage systems increase agricultural land prices in Brazil. To this end, data are drawn from the 2006 Agricultural Census, administered by the Brazilian Institute of Geography and Statistics (IBGE), including data on soil management systems (no-tillage, minimum tillage, and conventional tillage), as well as state, regional, and national land prices in Brazil. Results indicate that agricultural lands under temporary crop cultivation that are planted using no-tillage systems are of greater value than lands planted under other soil management systems. This increase in value associated with no-tillage may be observed in the Brazilian States with the highest levels of agricultural production, including Parana, Rio Grande do Sul, Sao Paulo, Mato Grosso do Sul, Mato Grosso, Goias, and Bahia. These results should constitute an important factor in agricultural producers' decision-making regarding the adoption practices proposed by conservation agriculture.