Economic optimization of irrigation decisions using water productivity for crop selection in western Transdanubia

Abstract Despite decades of research on irrigation efficiency and water productivity, the integration of market volatility into irrigation decision-support models remains limited. This study presents a decision-support framework to optimise irrigation water allocation by integrating Irrigation Water Productivity (IWP) with economic profitability. While conventional water-productivity indicators focus primarily on physical crop output, our model incorporates fluctuating irrigation costs and market prices to calculate Net Irrigation Profit per cubic metre of irrigation water. The present study aims to address the critical gap between biophysical water use and financial viability by introducing a hydro-economic profitability framework. In contrast to static models, our approach integrates deterministic market-volatility scenarios with primary farm-level data, thereby enabling the quantification of the specific thresholds at which irrigation transitions from a yield-enhancing practice to an economically challenging investment. The irrigation-cost component of the framework was calibrated using primary data collected from 12 commercial farms in Western Transdanubia (2022–2024). The results show that maize exhibited the highest IWP (2.690 kg m⁻³) among the analysed crops and the highest NIP in 2022 (+ 0.299 EUR m⁻³). However, irrigation was not profitable in 2024 primarily due to lower crop prices. Wheat irrigation was economically non-viable in both benchmark years, whereas soybean shifted from a positive NIP in 2022 (+ 0.072 EUR m⁻³) to a negative NIP in 2024 (− 0.054 EUR m⁻³). Sensitivity analysis demonstrated the response of the framework to realistic market-volatility scenarios. The proposed tool facilitates the prioritisation of irrigation based on direct economic efficiency, thereby providing a scalable solution for water-scarce agricultural regions. To reach the break-even point in 2024, the maize market price would need to increase by approximately 28.5%, from 0.165 to 0.212 EUR kg⁻¹, or the irrigation cost would need to decrease from 0.375 to approximately 0.248 EUR m⁻³. For soybean, the market price would need to increase by approximately 9.1%, from 0.429 to 0.468 EUR kg⁻¹, to reach the break-even threshold under 2024 conditions.