Cost Comparison between Digital Management and Traditional Management of Cotton Fields—Evidence from Cotton Fields in Xinjiang, China

Abstract

Cotton, as an important cash crop and strategic material, is widely planted in Xinjiang, China. In the traditional way, the management of the cotton field is extensive and the cost is huge. This paper analyzed the economic benefits and the related influence factors of cotton field management digitalization by collecting costs from 2020 of four major tasks in field management in Xinjiang, China. These four main tasks included field scouting, plant protection, topping and irrigation. By analyzing the intersection of the average cost curves of each major task in field management, we obtained the critical size of digital agriculture replacing traditional agriculture. Then, we used sensitivity analysis to find the main factors affecting the promotion and application of digital agricultural equipment. The results show: (1) at a certain critical size, the use of digital agricultural equipment can reduce the cost of production compared to traditional agriculture. However, the critical size varies for different management segments. (2) Fixed equipment costs, labor costs, water costs and energy costs have a large impact on the critical size. On large-scale cotton farms, digital agriculture tends to be more economical than traditional agriculture. In the future, as the cost of fixed equipment decreases, and labor costs and water costs rise, the critical size of digital agriculture replacing traditional agriculture will get smaller, and the scope of the economic benefits of digital cotton field management will increase further.

Keywords

• technological progress in agriculture
• digital agriculture
• cotton field
• cost analysis
• sensitivity analysis