Drought risk is one of the key risk factors facÃ©d by Australia's rangeland managers, yet is often the subject of emotive rather than objective decision making. Using RANGEPACR Herd -Econ, a whole property planning package, we examined examples of both strategic and tactical decision making as they related to the financial risks posed by drought. For cattle properties in central Australia we compared strategic management options as follows: Average (pray for rain and subsidies), High -Stock (stock heavily in good years, but destock quickly in drought) and Low -Stock (resistance to drought by low stocking rates). Both the High -Stock and Average strategies made better financial returns, but ran a high risk of causing environmental damage. The Low -Stock strategy made a more constant income, and never risked financial failure or rangeland degradation. Following the failure of winter rains on a sheep property in South Australia, we compared the destocking tactics of a 0 %, 20% and 40% destock in early summer. Destocking gave better financial returns over a wide range of product prices and climate scenarios. We recommend that similar studies be carried out for more rangeland regions throughout Australia. We highlight that the environmental effects of high risk management strategies take long periods to show an effect on production. Because of this economic analyses can ignore the run down in land capital, and show higher economic returns in the short to medium term.
GETTING AT RISK BEFORE IT GETS AT YOU
Australian Rangeland Society
6TH Australian Rangeland Society Conference