Nutrients from livestock and poultry manure are key sources of water pollution. Ever-growing numbers of animals per farm and per acre have increased the risk of water pollution. New Clean Water Act regulations compel the largest confined animal producers to meet nutrient application standards when applying manure to the land, and USDA encourages all animal feeding operations to do the same. The additional costs for managing manure (such as hauling manure off the farm) have implications for feedgrain producers and consumers as well. This report's farmlevel analysis examines onfarm technical choice and producer costs across major U.S. production areas for hauling manure to the minimum amount of land needed to assimilate manure nutrients. A regional analysis then focuses on off-farm competition for land to spread surplus manure, using the Chesapeake Bay region as a case study. Finally, a sectorwide analysis addresses potential long-term structural adjustments at the national level and ultimate costs to consumers and producers.

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The discharge of manure nutrients into area waters from confined animal feeding operations is considered a leading contributor to U.S. water quality impairments. An option to mitigate these impairments is to constrain land application of manure. When these constraints are particularly binding, due to minimal acceptance of manure as a substitute for commercial fertilizer, potentially large and unanticipated changes in returns to agricultural production and water quality may occur. Moreover, some of the cost of meeting the constraints is passed on to consumers through higher prices and to a portion of rural economies through lower production rates and labor expenditures. Copyright 2004, Oxford University Press.