Where to from Brahmans in the Northern Australian herd? Maintaining the economic benefit of earlier infusions of Bos indicus.

The economic performance of a terminal crossbreeding system based on Brahman cows and a tropically adapted composite herd were compared to a straightbred Brahman herd. All systems were targeted to meet specifications of the grass-finished Japanese market. The production system modelled represented a typical individual central Queensland integrated breeding/finishing enterprise or a northern Australian vertically integrated enterprise with separate breeding and finishing properties. Due mainly to a reduced age of turnoff of Crossbred and Composite sale animals and an improved weaning rate in the Composite herd, Crossbred and Composite herds returned a gross margin of $7 and $24 per Adult Equivalent (AE) respectively above that of the Brahman herd. The benefits of changing 25% of the existing 85% of Brahmans in the northern Australian herd to either Crossbreds or Composites over a 10-year period were also examined. With no premium for carcass quality in Crossbred and Composite sale animals, annual benefits were $16 M and $61 M for Crossbreds and Composites in 2013. The cumulative Present Value (PV) of this shift over the 10-year period was $88 M and $342 M respectively, discounted at 7%. When a 5c per kg premium for carcass quality was included, differences in annual benefits rose to $30 M and $75 M and cumulative PVs to $168 M and $421 M for Crossbreds and Composites respectively.

Wet season resting - economic insights from scenario modelling

Pasture degradation, particularly that attributable to overgrazing, is a significant problem across the northern Australian rangelands. Although grazing studies have identified the scope for wet season resting strategies to be used to rehabilitate degraded pastures, the economic outcome of these strategies has not been extensively demonstrated. An exploratory study of the prospective economic value of wet season resting is presented using an economic simulation model of a 28000 ha beef enterprise located in the Charters Towers region of north-eastern Australia to explore seven hypothetical scenarios centred on the projected performance of a wet season resting strategy. A series of 20-year simulations for a range of pasture recovery profiles, stocking capacity, animal productivity responses, beef prices and agistment options are compared with a baseline scenario of taking no action. Estimates of the net present value of the 20-year difference in total enterprise gross margins between the various resting options and the 'do nothing' option identify that wet season resting can offer a positive economic return for the range of scenarios examined, although this is contingent on the assumptions that are made concerning the trajectories of change in carrying capacity and animal productivity. Some implications for management and policy making to support the practical implementation of wet season resting strategies are discussed.

Economic case study of ABCD cane management practices in the Burdekin River Irrigation Area (BRIA) region

A case study was undertaken to determine the economic impact of a change in management class as detailed in the A, B, C and D management class framework. This document focuses on the implications of changing from D to C, C to B and B to A class management in the Burdekin River irrigation area (BRIA) and if the change is worthwhile from an economic perspective. This report provides a guide to the economic impact that may be expected when undertaking a particular change in farming practices and will ultimately lead to more informed decisions being made by key industry stakeholders. It is recognised that these management classes have certain limitations and in many cases the grouping of practices may not be reflective of the real situation. The economic case study is based on the A, B, C and D management class framework for water quality improvement developed in 2007/2008 for the Burdekin natural resource management region. The framework for the Burdekin is currently being updated to clarify some issues and incorporate new knowledge since the earlier version of the framework. However, this updated version is not yet complete and so the Paddock to Reef project has used the most current available version of the framework for the modelling and economics. As part of the project specification, sugarcane crop production data for the BRIA was provided by the APSIM model. The information obtained from the APSIM crop modelling programme included sugarcane yields and legume grain yield (legume grain yield only applies to A class management practice). Because of the complexity involved in the economic calculations, a combination of the FEAT, PiRisk and a custom made spreadsheet was used for the economic analysis. Figures calculated in the FEAT program were transferred to the custom made spreadsheet to develop a discounted cash flow analysis. The marginal cash flow differences for each farming system were simulated over a 5-year and 10-year planning horizon to determine the net present value of changing across different management practices. PiRisk was used to test uncertain parameters in the economic analysis and the potential risk associated with a change in value.

Economic case study of ABCD cane management practices in the Burdekin Delta region.

A case study was undertaken to determine the economic impact of a change in management class as detailed in the A, B, C and D management class framework. This document focuses on the implications of changing from D to C, C to B and B to A class management in the Burdekin Delta region and if the change is worthwhile from an economic perspective. This report provides a guide to the economic impact that may be expected when undertaking a particular change in farming practices and will ultimately lead to more informed decisions being made by key industry stakeholders. It is recognised that these management classes have certain limitations and in many cases the grouping of practices may not be reflective of the real situation. The economic case study is based on the A, B, C and D management class framework for water quality improvement developed in 2007/2008 for the Burdekin natural resource management region. The framework for the Burdekin is currently being updated to clarify some issues and incorporate new knowledge since the earlier version of the framework. However, this updated version is not yet complete and so the Paddock to Reef project has used the most current available version of the framework for the modelling and economics. As part of the project specification, sugarcane crop production data for the Burdekin Delta region was provided by the APSIM model. The information obtained from the APSIM crop modelling programme included sugarcane yields and legume grain yield (legume grain yield only applies to A class management practice). Because of the complexity involved in the economic calculations, a combination of the FEAT, PiRisk and a custom made spreadsheet was used for the economic analysis. Figures calculated in the FEAT program were transferred to the custom made spreadsheet to develop a discounted cash flow analysis. The marginal cash flow differences for each farming system were simulated over a 5-year and 10-year planning horizon to determine the Net Present Value of changing across different management practices. PiRisk was used to test uncertain parameters in the economic analysis and the potential risk associated with a change in value.

Economic case study of ABCD cane management practices in the Tully region

A case study was undertaken to determine the economic impact of a change in management class as detailed in the A, B, C and D management class framework. This document focuses on the implications of changing from D to C, C to B and B to A class management in the Tully region and if the change is worthwhile from an economic perspective. This report provides a guide to the economic impact that may be expected when undertaking a particular change in farming practices and will ultimately lead to more informed decisions being made by key industry stakeholders. It is recognised that these management classes have certain limitations and in many cases the grouping of practices may not be reflective of the real situation. The economic case study is based on the A, B, C and D management class framework for water quality improvement developed in 2007/2008 by the wet tropics natural resource management region. The framework for wet tropics is currently being updated to clarify some issues and incorporate new knowledge since the earlier version of the framework. However, this updated version is not yet complete and so the Paddock to Reef project has used the most current available version of the framework for the modelling and economics. As part of the project specification, sugarcane crop production data for the Tully region was provided by the APSIM model. Because of the complexity involved in the economic calculations, a combination of the FEAT, PiRisk and a custom made spreadsheet was used for the economic analysis. Figures calculated in the FEAT program were transferred to the custom made spreadsheet to develop a discounted cash flow analysis. The marginal cash flow differences for each farming system were simulated over a 5-year and 10-year planning horizon to determine the Net Present Value of changing across different management practices. PiRisk was used to test uncertain parameters in the economic analysis and the potential risk associated with a change in value.

Economic Analysis of Sugarcane Farming Systems for Water Quality Improvement in the Great Barrier Reef Catchments.

In this report we analyse the private financial-economic impacts of transitioning to improved sugarcane management in the National Resource Management regions of the Wet Tropics, Burdekin Dry Tropics and Mackay Whitsundays. In order to do so, we: 1) compare farm GMs; 2) present information on capital investment associated with the transition; 3) perform a net present value analysis of the investments and; 4) undertake a risk analysis for cane and legume yields and prices. It must be noted that transaction costs are not captured within this project.

Bioeconomic modelling of woody regrowth carbon offset options in productive grazing systems

Agricultural land has been identified as a potential source of greenhouse gas emissions offsets through biosequestration in vegetation and soil. In the extensive grazing land of Australia, landholders may participate in the Australian Government’s Emissions Reduction Fund and create offsets by reducing woody vegetation clearing and allowing native woody plant regrowth to grow. This study used bioeconomic modelling to evaluate the trade-offs between an existing central Queensland grazing operation, which has been using repeated tree clearing to maintain pasture growth, and an alternative carbon and grazing enterprise in which tree clearing is reduced and the additional carbon sequestered in trees is sold. The results showed that ceasing clearing in favour of producing offsets produces a higher net present value over 20 years than the existing cattle enterprise at carbon prices, which are close to current (2015) market levels (~$13 t–1 CO2-e). However, by modifying key variables, relative profitability did change. Sensitivity analysis evaluated key variables, which determine the relative profitability of carbon and cattle. In order of importance these were: the carbon price, the gross margin of cattle production, the severity of the tree–grass relationship, the area of regrowth retained, the age of regrowth at the start of the project, and to a lesser extent the cost of carbon project administration, compliance and monitoring. Based on the analysis, retaining regrowth to generate carbon income may be worthwhile for cattle producers in Australia, but careful consideration needs to be given to the opportunity cost of reduced cattle income.