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Unit 1 - What's in it for me?
Unit 2 - Saltland Basics
Unit 3 - Can I trust the technology?
Unit 4 - Plant and animal performance
Unit 5 - Sheep, cattle and conservation
Unit 6 - Do the $$$'s stack up?
Unit 7 - The saltland toolbox
Site Assessment
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Solution 2: Volunteer pasture
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UNIT 6

Do the $$$’s stack up?

 

6.3  Low cost option

SGSL conclusions on profitability
Performance of the SGSL ‘control’ sites
Whole Farm Profitability Modelling

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SGSL conclusions on profitability

The Sustainable Grazing on Saline Land (SGSL) initiative undertook a considerable number of economic analyses of establishing saltland pastures across all the southern states. The final report from the SGSL economics theme included the following summary:

Introducing improved pasture species to salt-affected land to increase the feed value for livestock is profitable across a broad range of environments, production conditions and commodity price assumptions, according to the results of this study.

The extent to which farmers can achieve the increases in profit suggested by this study will depend critically on their ability to manage the livestock enterprise to achieve the production levels assumed. Pasture quality and growth were shown to have a major effect on the profitability of improved pastures. Maintaining pasture quality of perennial species requires good grazing management, as long periods of deferment will lead to substantial reductions in feed value. The models used in this study typically selected high stocking rates to increase farm profit when improved pastures on saltland were introduced. This was accompanied by increases in the amount of supplementary feeding in some cases.

In other words, an on-farm investment in saltland pastures was profitable across a wide range of assumptions if the investing farmer got the whole ‘package’ right. However, establishing and managing saltland pastures can be difficult and lower cost options make it much easier to achieve a profitable outcome.

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Performance of the SGSL ‘control’ sites

Anecdotally, across the SGSL research and on-farm sites, it was the ‘control’ treatments (untreated saline land) that often surprised. Salty patches often produce very little usable feed when part of a larger paddock, because animals (sheep especially) graze them bare and often camp on the sites over summer because the soil is moist and cool. However, fencing off the control sites and managing the grazing resulted in surprisingly good production from these salty areas. Indeed, the SGSL theme examining the Performance and Utilisation of Saltland Pastures concluded that across a fairly wide range of sites, the fenced off “control” areas produced about 60% of the feed that would be expected from adjacent, non-salty land.

In the NSW whole farm Case Study in section 6.2, the landholder had some saline sites that had been rehabilitated through rotational grazing management, rather than being sown to saltland pastures. Results from this managed approach to grazing show, in paddocks previously with significant areas of scalding, bare ground has been revegetated and species diversity has improved to a level equal to elsewhere on the property. In particular, these areas now contain more species of native perennial grasses than are present on other areas of the farm. The landholder considers the main benefit from this approach is the positive environmental outcomes achieved at a relatively low cost

The main SGSL/CRC Salinity research site in NSW monitored the effect of fencing and improved pasture management on ground cover and economic returns. and the results showed (see Table 6.1) that while both the control plot and the sown plot began in 2003 with ~44% bare ground, by June 2006 both sown and unsown plots had only low levels of bare ground, despite going through the most severe drought in recorded history.

Table 6.1 Changes in groundcover on the control (fenced and rotationally grazed) and sown plots from the NSW SGSL site.

Sampling Time 

 % Bare Ground

'Sown'

'Control'

Spring 03

 43.6

43.6 

Spring 04

 30.3

36.7

Spring 05

 9.4

20.2

June 06

 12.8

14.7

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Whole Farm Profitability Modelling

Because of the observations from the control sites in SGSL, a re-examination of the data was commissioned to more formally examine the economics of this option and most likely situations where fencing and volunteer pasture might be not only ‘an’ option, but also ‘the best’ option.

Using whole farm economic modelling this option was examined for sites in WA, SA and NSW as described in Table 6.2, different conclusions emerged for the wheat belt of WA, compared to the eastern states.

Table 6.2: Comparative increases in profit per hectare of saltland, stocking rate and supplementary feed for different scenarios at each of the SGSL research sites comparing an untreated control, fence and volunteer pasture, and the saltland pasture established at the SGSL site.  

Site 

 

Saltland 
area
(ha) 

Pasture area
(ha) 

Sheep
(dse) 

Average farm stocking rate
(dse/ha) 

Feed supplement
(kg/dse) 

Increase in profit
($/ha)
 

WA 

Untreated 

200

1,000 

4,940 

5.0 

25 

 

Fence and volunteer 

200 

985

5,007 

5.1 

22 

12 

 

Fence plus saltbush and understorey

200

915

5,559 

6.1

25 

37

SA

Untreated 

800

2,000 

10,241 

5.1

20 

 

Fence and volunteer 

800 

2,000 

13,008 

6.5

18 

60 

 

Fence and puccinellia with balansa clover 

800 

2,000 

16,085 

8.0 

16 

51

 

Fence and puccinellia 

800 

2,000 

14,850 

7.4 

15 

21

NSW   

Untreated

20

640

8,837

13.8

6

-

 

Fence and volunteer

20

660

8,966

13.5

7

90

 

Fence and shotgun pasture mix

20

660

9,023

13.6

7

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In the more temperate and summer rainfall areas from SA through to NSW, the modelling showed that simply fencing off saltland and allowing a volunteer pasture to establish gave significant increases in whole farm profit. While in the examples given in Table 6.2, there was additional profit to be gained from establishing a sown saltland pasture, the marginal returns were significantly lower than for the volunteer pasture.

However, in the summer dry areas of WA the reverse was true - there was a small increase in whole farm profit from simply fencing the saltland but a large profit was generated by the saltbush and under-storey pasture. This was because the volunteer pasture was annual species that hay off in summer and provide little benefit in the late summer/autumn period when farm feed supplies are lowest. On the other hand, saltbush based pastures can impact significantly on this major feed gap – a benefit that declined with increasing areas of saltbush as the autumn feed gap was filled.

This analysis suggests that the fence and volunteer pasture option is suited to:

  • farms where the areas of saltland are too small to make a significant contribution to the farm feed supply even if a more productive saltland pasture could be easily and cheaply established. In these cases, other non-grazing options should also be considered;
  • climatic zones where perennials rather than annuals are likely to establish – ie less Mediterranean climates – as the annuals will have a lesser impact on feed gaps;
  • larger areas of saltland in WA, or smaller areas of saltland in eastern Australia;
  • any sites where risk of failure is thought to be high;
  • sites where available funds allow fencing but not pasture improvement;
  • sites where the farmer does not have the time or skills to establish a saltland pasture.
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