We need to put the guesswork back into agriculture

Australian agriculture is in for a good year ahead, with a 47 per cent increase in income leading to $85 billion in national revenue. And the Australian Grains Research and Development Corporation wants to help farmers maximise their result.

Wild weather put something of a dampener on the past year’s results.

But improving seasonal conditions are expected to produce better crop values alongside a recovery in livestock prices.

The Australian Bureau of Agricultural and Resource Economics says in its Agricultural Overview released this week that it expects average farm production to bounce back some 6 per cent over 2022-23.

But are weather-shy agriculturalists holding back?

“In the past, we’ve often written off risk in farming with a general sense that bad things can happen — a sort of ‘don’t run with scissors’ type advice,” says Peter Hayman of South Australian Research & Development Institute (SARDI).

But industry advisors insist agriculturalists must learn how to balance risk with potential rewards to “make practical agronomic decisions”.

Put simply, make better educated guesses.

It’s the bottom line for agriculture

A new Water Smart Farming Manual seeks to offer a step-by-step guide to agricultural risk analysis, showing farmers how to make better educated guesses.

“We put numbers to risks in order to demonstrate how growers can use seasonal climate forecasts in decision-making, even though the forecast is uncertain,” says Hayman.

A crop farm’s greatest single expense is fertiliser. Its most pivotal decisions are based on how much to apply, and when.

An animal farmer must judge how to optimise the crossover between the quality of their stock’s condition against the prices available at any given time.

And change means the “rules of thumb” developed over generations of experience are becoming less applicable year by year.

The Grains Research and Development Corporation says a lot of effort has been put into improving seasonal climate forecasts – such as the one indicating an improvement over the next 12 months. And an equal amount of effort has been made to ensure those forecasts are relevant to growers. But it’s not an exact science.

“Seasonal forecasts will remain as shifts in probabilities with information based on an educated guess, which is challenging to use in decision-making,” it states.

That’s where applying a simple decision analysis technique can map out where each season’s risks and opportunities are likely to lie.

“Most of us struggle to juggle four futures in our head, but this is easy to do on paper or

a spreadsheet,” the report explains.

A decision tree identifies an individual grower’s options, defines the source of uncertainties, measures the costs involved, and balances the probabilities of different outcomes against potential rewards.

“A key aspect of the decision is to accept that regret is unavoidable when making decisions in an uncertain world,” it reads. “(But) it can be useful to mentally weigh the regret of caution (missing out on an opportunity) against the regret of optimism (applying more nitrogen than was needed that year).”

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The Greenlight Project is a year-long look at how regional Australia is preparing for and adapting to climate change.

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