Farm productivity in an Australian region affected by a changing climate

Dept of Ag and Food WA - AEGIC, NCCARF

Type: Conference Paper
Knowledge level: Advanced

What is the problem?

Since the mid-1970s the south-west of Australia has displayed a warming and drying trend in its climate.

It is often argued that in order to remain internationally competitive Australian farming
needs ongoing gains in productivity.

Given limitations to Australia’s agricultural resources of arable land and water, the future growth in agricultural production seems destined to depend largely on increases in productivity

What did the research involve?

This paper estimates the annual productivity of the same group of 250 farms over the period 2002 to 2011

The study region of south-western Australia has a Mediterranean climate and is characterised by long, hot and dry summers and cool, wet winters.

In the the northern and central parts of the study region around three-quarters of the average annual rainfall is received between April and October.

Summer rainfall is highly variable, and is more common along the south coast parts of the study region.

The region’s farming systems are mixed grain and livestock, predominantly sheep enterprises.

The grains grown are wheat, barley, canola, and lupins, although the area of lupins had decreased substantially in recent years due to poor yields and low profitability and the canola area had increased.

In the study sample, farms were segregated into three farm types:

  • Crop specialists with more than 80% of the farm used for cropping
  • Mixed enterprise 40 to 80% of farm used for cropping, and
  • Livestock specialists with less than 40% of farm used for crop.

Data describing the farm businesses in the study region were supplied by three agricultural consulting firms with farm business clients in the region

What were the key findings?

Most farms either experienced high growth and high variability in productivity or low growth and low variability in productivity.

The study shows that efficiency gain rather than technical change is the principal source of improvement in total factor productivity.

The practical implication of this finding is that farms that have experienced higher growth in their total productivity have done so by

  • ensuring the use of commonly available technologies consistently in the best possible way
  • employing a range of business strategies and tactics.

In comparison to farms that have achieved low growth in productivity, the high growth farms have

  • increased their farm size
  • become more crop dominant
  • have often operated farms in lower rainfall regions,
  • have generated more profit
  • are less exposed to debt.
  • generate more crop yield per 100mm of growing season rainfall, yet also generate more livestock income per mm of growing season rainfall.

Final comment

High growth farms are often crop specialists or mixed enterprise farms rather than livestock specialists

2014 - Australia - Dept of Ag and Food WA - AEGIC, NCCARF
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