APSRU PROJECT SUMMARY NO. 36
Project Title: Evaluating the role of seasonal climate forecasting in tactical management of cropping systems in north-east Australia.
Project Supervisor: Dr R C Stone
Funding Body: RIRDC/ GRDC
Admin Contact: N E Delaney, DPI Brisbane
Commencement Date: 01/01/96 Completion Date: 30/12/98
Aims:
To evaluate (in terms of profit and sustainability) the implications of seasonal forecasting on key cropping system decisions such as crop choice and cropping sequence. This will be achieved by:
1. Incorporating tested, objectively derived, seasonal climate forecast systems into cropping systems models (eg. the Agricultural Production System Simulation Model, APSIM),
2. Evaluating tactical decisions such as crop choice and cropping systems options using simulation analysis,
3. Incorporating estimates of price risk in evaluations by consideration of domestic demand patterns and forward international price.
4. Collaborating with growers ‘on-farm’ on appropriate use of simulation analysis results and through provision of grower/extension workshops.
Research Proposal Summary:
Agricultural producers in north-east Australia operate in an uncertain and highly variable environment. Skill in objectively derived seasonal forecast systems offers the potential to take advantage of the likely good seasons and minimise risk in the potentially poor seasons. Substantial gains in profit and reduction in risks have been quantified for the wheat and sorghum industries through application of seasonal forecasts. Average improvement in gross margins of $10-$20/ha are likely when seasonal forecast systems are integrated into key decision options at planting. Yet, work so far has only concentrated on two grower-decision areas (Nitrogen application and cultivar selection) and the implications of application of seasonal forecast systems to the whole range of more complex farming operations have not been evaluated. The objective of this project is to evaluate implications of seasonal forecast systems on key cropping system decisions such as crop choice and cropping sequence. More substantive tactical manipulation of either the cropping system or the whole farm offers potential for substantially improved management of farming risk and greater economic benefit. The project will run for 3 years and have distinct components:
· Evaluation of a tactical approach to farm management will be made through simulation and economic analysis. Recently improved and tested seasonal forecast systems will be integrated as appropriate into cropping systems models (such as APSIM) which will be used for simulation studies. The following crops will be available for simulation of a cropping sequence: wheat, barley, a fodder crop, chickpea, cotton, grain sorghum, and sunflower. Models will be parameterised for the soil and climatic conditions which represent farming collaborator’s properties. Economic analysis at the whole farm scale will be employed to evaluate potential tactical decisions such as crop choice and crop sequence. Aspects of price risk will be incorporated into the whole-farm economic analysis. Close liaison with those involved in modelling pastures and climate variability will be maintained throughout the project.
· Collaboration with farmers will be paramount in order to test approaches on their farms. The seasonal forecast techniques and modelling capabilities will be used with collaborators to gain improved insight into the longer-term consequences of possible decisions through the course of the project.
· Workshops and field days will evaluate project outcomes and discuss results. A key component of the project will be thorough discussions and meetings with growers in north-east Australia detailing the methods used and outcomes derived from the project. Our recent research outcomes in this field have resulted in considerable support form rural industry leaders and growers for enhanced research into the key issues outlined here.
Potential Outcomes:
Clear economic benefits have already been demonstrated for tactical management of single crops using a seasonal forecast system, based on SOI phases. The project relates directly to dryland farming systems in north-east Australia, with a major focus on cropping systems. However, the methods developed could be applied more generally to farming systems.
The recently completed GRDC project investigating single crop issues can be expected to be ‘highly profitable’ (Antony, 1994). The report found that the project would deliver substantial benefits well in excess of the social opportunity costs of funds used in it. The wheat-SOI project is estimated to produce a Benefit - Cost ratio (BCR) of 34. If the benefits due to research are halved the BCR still achieves a value of 17.
The proposed project, incorporating much larger decision systems is expected to achieve a conservative BCR of 32, providing a net value of increase in value of production of $8m annually by the year 2000 and $12m annually by 2004. The grain and cotton industries in Queensland are worth $800m annually in production. Research outcomes from this project would be expected to provide a 2% best estimated of potential improvement.
Strong linkages have already been made with key industry leaders and groups (e.g. Ian McFarlane of Grains Council and QGGA; certain agribusiness leaders). Support for this type of research has been strong from grower groups who have made representation to industry and government leaders over the past two years. As an example, the Central and Northern Zone Graingrowers Group have written to their State Headquarters and funding bodies seeking assurance the type of research proposed here is maintained. The project leader (Dr Stone ) has been invited to speak to 150 farming groups over the past 3 years to discuss the type of research inputs relevant here. There has been strong support at these meetings for continued relevant research in this area. As substantial improvement in income in the ‘good years’ is more probable following adoption of the proposed research outcomes, it is likely this research will provide much needed aid to sustain farming operations, with resulting carry-on social and environmental benefits.
Project Publications: