Scenario analysis: risk and return of aluminum tolerant lucerne

C.D. Lewis, J.L. Jacobs, K.F. Smith, G. Spangenberg, B. Malcolm - Analysis paper in Understanding stress physiology of grasses and forages pages 155-156

Type: Research Paper
Knowledge level: Advanced

Farm Table says:

This research article focuses on a scenario analysis of the risk and return of aluminum tolerant lucerne. The experimental data for 2007-2009 seasons was used for the Lucerne DM accumulation rates and estimated metabolizable energy figures.

What is the problem?

Lucerne yield is limited by aluminum stress associated with acid soils. With the aid of transgenic technologies, the development of aluminum tolerant lucerne is proposed. Modelled scenario analysis was conducted to explore the potential net benefits of Al Tol lucerne as part of a grazing system for a sheep production system in the high rainfall zone of south-west Victoria.

What did the research involve?

As there are currently no data available on the performance of Al Tol lucerne in the soils of south-west Victoria, the following assumptions were made:

• current common cultivars of lucerne do not grow on the representative farm due to acid soils and aluminum stress, which cannot be easily amended (e.g. acidic subsoils);

• 10% of the farm area was suitable to grow Al Tol lucerne with no other likely limitations to Lucerne performance present (e.g. waterlogging);

• Al Tol lucerne grown in acid soils with aluminum stress would match the performance of the current common cultivar of Lucerne with moderate winter activity grown without acid soil limitations; and

• establishment costs were the same as for a current common lucerne cultivar, minus lime application costs.

What were the key findings?

Based on the assumptions used, the investment in Al Tol lucerne over 10% of the farm area returned positive mean annuity of NPV values under the seasonal conditions tested, ranging from an extra $6-19/ha/year across the whole farm for the 9 year period. This was due to savings in supplementary feed for both options
compared to the ‘Base Case’ system.

Final Comment

A lamb price of $4.50 – $5.00 each year for the 9-year period was required for the two scenarios to perform equally under the seasonal conditions tested. Producers will make tactical decisions dependent on seasonal and price conditions that cannot be captured sufficiently in these modeling exercises, which may alter
these outcomes.

2013 - Australia - C.D. Lewis, J.L. Jacobs, K.F. Smith, G. Spangenberg, B. Malcolm - Analysis paper in Understanding stress physiology of grasses and forages pages 155-156
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