This case study demonstrates some of the issues surrounding perennial pasture establishment, using lucerne as an example. A representative farm in the central wheatbelt is used to examine the profitability of lucerne and to gain insights about its role in the farming system.
The average annual rainfall is 370 mm with 80% falling between April and October. Soil types include deep sands, deep and shallow duplex soils with red and grey medium- to fine-textured soils on the valley floors.
Lucerne is assumed to grow on all soil types, albeit at different levels of productivity. In this example, lucerne is established alone, not with a cover crop.
The value of lucerne is analysed for three different livestock systems (Table 2): (i) a wool producing flock only (Wool); (ii) a wool-producing, self- replacing flock using surplus ewes for carryover crossbred lambs (SRF XB); and (iii) a specialist crossbred flock with Merino ewes producing crossbred carryover lambs with replacement ewes bought in (XB). For the wool flock, the value of lucerne is compared when lambing either in May and July.
Results:
Including lucerne in the farming system increases farm profit for all three livestock systems, however the increase in profit depends on the characteristics of the livestock enterprise. The value and optimal area of lucerne changes with the chosen livestock system (Tables 3, 4).
Lucerne is more valuable when lambing occurs during July ($16/ha) than in May ($3/ha) (Table 3). This occurs because including lucerne with a July lambing gives a better match of feed demand and supply and consequently the optimal area of lucerne is larger, 12% of the total farm area compared with 4% for a May lambing.
Lucerne is more valuable when used for growing meat rather than wool, so the value of lucerne increases as the focus of the livestock system shifts progressively toward meat production (Table 4). Lucerne is particularly valuable for finishing prime lambs in summer.
The demand for high quality summer feed is greater with a prime lamb enterprise, so a larger area of lucerne can be incorporated profitably into the farming system. There is a different optimum area of lucerne for three livestock enterprises (Tables 3 and 4).
For all enterprises the value of each additional area of perennial pasture declines gradually as the feed niche is filled. This is illustrated in Figure 1, which shows the proportion of the farm under lucerne against pro?t for the SRF XB livestock system.
To maximise profit for this system 12% of the total farm area needs to be under lucerne (Table 4), however increasing the area of lucerne to 20% causes only a slight drop in farm profit. Even when lucerne is increased to 30% of the farm’s area, profit is still within 90% of the maximum.
Hence, if there are reasons to include a larger area of lucerne, e.g. to reduce groundwater recharge or control herbicide resistant weeds this can be achieved with minimal impact on farm profit, provided the required adjustments are made to flock size and enterprise management.
Summary:
- Lucerne improves farm profitability under all the scenarios examined. However, under some scenarios (e.g. a wool-only flock with May lambing) the small increase in profit is unlikely to warrant the time and risk of establishing lucerne.
- The value and optimal area of lucerne increase as the production focus shifts towards meat production.
- The economic benefits of lucerne can include:
- reduced need for supplementary feeding
- higher stocking rate enabling better weed control and pasture use
- ability to finish a higher proportion of lambs/ha
- increased water use.
- For each of the scenarios examined there is a range where profit is relatively insensitive to the area of lucerne, which means other objectives (e.g. water management) can be taken into account with little or no penalty.
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