Oklahoma

New incentives and a subsidy program to promote the buying and selling of poultry litter have recently become available in Oklahoma, providing new opportunities for litter marketing.

"There have been many new postings by buyers and sellers on the Oklahoma Litter Market website (www.ok-littermarket.org), and sales of litter are increasing outside the state's poultry growing areas," said Mitch Fram, Oklahoma State University Cooperative Extension area water quality specialist.

A direct payment will be made to poultry producers for their litter and to service providers to offset hauling costs in the Oklahoma portions of Spavinaw Creek, Illinois River and Lake Wister watersheds. The state of Oklahoma, the Environmental Protection Agency and poultry companies fund this program cooperatively.

"This program is identical to one operated for the past year on the Arkansas side of the Spavinaw Basin," Fram said. "BMP's, Inc., a private contractor out of Farmington, Ark., manages the program."

Producers are currently paid $2 per ton for their litter. Haulers currently receive 2.6 cents per ton per loaded mile, up to $8 per ton for 308 miles or more. Any unused mileage subsidy is added to the base payment for trips less than 308 miles. "The hauling subsidy may be adjusted in the future for increased fuel cost," Fram said.

In most instances, the hauler acts as the broker, obtaining litter from the poultry operator and then setting up the deal with a buyer. "Haulers and litter sellers are free to negotiate prices for litter or transport in excess of the subsidy," Fram said. "This is rarely done at present but could become more common as litter demand increases."

Both growers and haulers must be signed up with Sheri Herron of BMP's, Inc. to be eligible for payments. In addition, litter must be applied by certified applicators on row crops, pasture, forage or forestlands outside nutrient-sensitive watersheds. BMP's, Inc. can be contacted toll-free at 866-304-2784.

"Two incentive programs are available for agricultural producers outside nutrient-sensitive watersheds," Fram said.

The Environmental Quality Incentives Program (EQIP) statewide funding pool for manure transfer is operated by the Natural Resources Conservation Service, with signup available through all local NRCS field offices. Signups are currently being accepted for the 2006 season.

"Manure must come from state-identified nutrient-limited or Scenic River watersheds in Oklahoma and must be applied to cropland or pastureland in Oklahoma outside those watersheds," Fram said.

Eligible applicants must not have purchased or applied animal manure on land they have owned or operated at any time in the past three years, and they must plan and implement a Comprehensive Nutrient Management Plan (CNMP).

"The highest priority will go to cropland application and incorporation, and to those who have never used manure fertilizers," Fram said. "Incentive payments range from $2.50 per ton to $10 per ton, depending on the distance the manure is hauled."

A second incentive program available to litter buyers this year is a tax credit against the Oklahoma income tax of $5 per ton of litter purchased and transported. If the tax credit due an individual exceeds the amount of income tax he or she owes, the unused credit may be carried over for up to five years. The tax credit program is funded by the state at $375,000 annually.

According to a draft rule developed by the Oklahoma Tax Commission, qualifying poultry litter must be purchased from a registered Oklahoma-based poultry operation located within an environmentally sensitive and nutrient-limited watershed and be used or spread in a watershed that is not environmentally sensitive and nutrient limited.

"The current draft rule indicates that anyone intending to utilize the tax credit should obtain an Animal Waste Management Plan before spreading any litter," Fram said. "The usual source of such a plan is the local NRCS office. Producers might also consider consulting with a tax adviser before purchasing litter based on this credit."

Oklahoma law requires that litter must be applied by a Certified Commercial or Private Applicator. A soil test report must be provided for all application sites. A recent litter test also should be supplied by the applicator.

"Remember that subsidies alone don't make litter a good economic or environmental choice," Fram said. "Nutrient requirements of the soil and crop must be considered, along with nutrient contents and total cost of the litter."

Fram said potential litter buyers should check with their County Extension Agriculture Educator to help evaluate the benefits of litter use. They can also use the Oklahoma Cooperative Extension Service's Soil Test Interpretation and Fertilizer Decision Support program. The program is available via the Internet at www.soiltesting.okstate.edu/Interpretation.htm.

Date: 3/24/05