School of Agriculture, Food and Ecosystem Sciences - Theses
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ItemThe economic evaluation of forage research results( 2004)Three economic analyses were conducted on the results of dairy forage production experiments undertaken in Victoria. The first analysis investigated the level of pasture production increases that would have to be achieved to warrant the investment in different soil modification options. This analysis took pasture production data and using a computer program "UDDER" (Larcombe 1990) generated farm data which was then applied to development budgets. The increase in pasture growth rate required was such that it is unlikely that investment in the soil modification systems tested here will produce a satisfactory return on investment. The second analysis investigated the use of different pasture species combinations on a dairy farm in northern Victoria. A linear programming model was developed that balanced the energy requirements of the milking herd with the energy supplied from pasture and supplements. The results showed that the most profitable mix of pasture depended on the energy supply profile of the pasture and the requirements of the herd. The proportion of autumn and spring calving cows in the herd in part determined the most profitable pasture mix. The effect of grazing management on profit was the subject of the third study. A farm model was constructed that balanced the energy, protein and neutral detergent fibre requirements of the milking herd with that supplied by pasture and supplements and optimised operating profit. The results of a grazing trial conducted in south-west Victoria were entered into the model and the operating profits for each treatment compared. The results suggested that while Operating profit was related to total pasture consumption, the timing of the pasture consumption impacted on operating profit. The results also suggested that grazing frequency may have affected operating profit more than grazing intensity.
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ItemEconomic evaluation of vegetable crop production in the Goulburn Valley region : using profit maximisation and optimal crop combination approaches( 2002)The vegetable industry in the Goulburn Valley Region has strengths, including the availability of technology and expertise, growing markets, a clean production environment, water availability and the relatively low cost of energy resources. Availability of the use of developed methods, techniques and equipment from transplanting machinery to post-harvest handling and storage facilities are also strengths of the vegetable industry in the Region. These advantages could enable the growers to readily incorporate other vegetable crops into their cropping practices. This type of diversification may well be beneficial both from economic and agronomic standpoints. The overall aim in this thesis is to make recommendations on optimal crop combinations, which can maintain farm profitability of vegetable growers in the Region. Incorporated within this overall objective, three major methods were undertaken in this study to find out options to better farm management. First, the economic aspects of some major vegetable crops are analysed and their economics and productivity are compared. The gross margin analysis of five selected vegetable crops are used to compare the different management practices, timing of operations and different returns. The gross margins per hectare of each crop were also estimated to provide decision-makers with a tool for comparative analysis of activities in a similar environment on their farm. The advantages and disadvantages of single cropping with multi cropping practices, by identifying practical possibilities that could enable growers to better utilise their farm and equipment by crop diversification, was also compared in this part. Second, to investigate economic rationality of growers production practices, using a Cobb-Douglas production function. The production function provides ideas about relationships between production inputs and output. Decision-makers can use the production function analysis to investigate returns to scale, which can show how the scale of production (output) will change when the decision-makers change the factors (inputs) of production. The gross margin technique assumes a linear relationship as an activity is expanded, ie. If the area of crop is doubled, it is assumed that the gross margin for the extra hectares will be the same as for the original area. This is not always so, as there can be a diminishing returns effect as the activity is expanded. While in many cases it is reasonable to assume a linear relationship when planning to increase the area, the grower and his decision-maker should keep the possibility of diminishing returns in mind as the activity is expanded (Makeham and Malcolm, 1986). This information can be obtained from the production function analysis. Third, a linear programming model was developed in this thesis and it was used to solve a particular planning problem (profit maximisation) in a hypothetical situation. Growers must repeatedly make decisions about what crops to produce, by what method, in which season or time periods, and in what quantities in any multiple cropping system. They have to make these decisions subject to the existing farm physical and financial constraints to get the best or "optimal" solution to their problems. The linear programming model's results were also related to production and price functions. This was done to provide the decision-makers with a logical structure for understanding the farm profit related problems and finding how crop quantity and price can be affected. In order to assess the objectives the following two hypotheses were also tested. 1. As an alternative crops whether the production of capsicum, zucchini, broccoli and cabbage were satisfactory crops according to tomato in the Region, and 2. Whether there were any new practices, which could be used by growers to adjust to producing those vegetables. The results show that the vegetable industry has potential to achieve better utilisation of the farm resources and thus increase the farm profitability. Growers should be aware of the production factors that will enable them to increase their competitiveness, and must structure themselves to better utilise them. Therefore, some new practices such as diversification or double cropping practices, using the same growing materials in the same paddock continuously, should be considered. Diversified systems or multi cropping would reduce financial risk and provide protection against drought, pest infestation or other natural factors that can limit the farm production and profitability. However, diversification may increase risk for various reasons including capital costs of highly specialised equipment, associated economy of scale issues and possible lack of expertise required for increasingly specialised production systems. In addition, the possibility that related products such as summer or winter vegetables may be in ample or scarce supply at the same time, and subject to the same price cycle. The major outcome from this research is that there are possibilities and opportunities for the growers to sustain their farm profitability and productivity in the Region. This could be achieved by identifying potential objectives (minimise or maximise something) to find the optimal solution to their farm problems.
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ItemA farm management economic analysis of future dairy systems in the Goulburn Valley( 2002)Case studies were used to analyse the organisation and management of two irrigated dairy farm businesses. In particular, the focus was to . identify the economic' aspects of current and future farming systems in the Goulburn Valley. The approach involved focusing on farmers, the farm business, and the specific details of the farm system that farmers were managing. A whole-farm perspective was relevant as it provided details of the farm system and farmer characteristics that substantially influence how they respond to market changes. The economic 'analyses revealed that theoretical concepts often match the practical management of irrigated. dairy businesses. Also, relatively simple farm management budgets, which capture the full effect on management of the whole farm system from development, have a useful role in providing farmers with effective information about the medium-term growth opportunities on irrigated dairy farms in the Goulburn Valley. From these results it can be concluded that 'it is not what you do, but how you do it' that primarily determines the level of success in achieving goals.
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ItemPotential impact of a farm forestry industry on the Goulburn regional economy( 1996)Transactions for a hypothetical farm forestry industry in the Goulburn region were constructed from the output of the FARMTREE model. Eleven different regimes were simulated, including hardwood and softwood, woodlots, timberbelts and wide-spaced agroforestry. This output included estimates of annual cash flows of costs and revenues per hectare. These were transformed to regional aggregated cash flows projected forward over one hundred years. A regional input-output table without farm forestry was constructed using the national input-output table and GRIT and adjusted for future growth. For certain years or 'snapshots' the farm forestry industry transactions were inserted into the future projected input-output table for the Goulburn regional economy. The new balanced input-output table summarizes the inter-sectoral flows and describes the regional structure with the new farm forestry industry inserted. Three snapshots were taken representing different stages of the development of the farm forestry industry: i 2004, the establishment phase: when the cost of plantation formation is greater than the predicted returns from wood sales. ii 2019, the transition phase: when the returns from wood sales have begun to swell whilst new sites are still being planted. iii the steady state phase: when harvesting is equal to replanting, no new sites are being planted, a full range of plantations exist at different stages of formulation and returns from wood sales have trebled since the previous transition year. Two methods were used to analyse the input-output tables constructed and the associated impacts. The first method was the analysis of the difference between the input-output table with farm forestry inserted compared to the input-output table without farm forestry inserted. This method allowed the estimation of the effects of farm forestry industry and the value-added processing of farm forestry products on the other sectors in the regional economy and hence the economy as a whole. The second was with conventional multiplier analysis used to estimate the changes in a given year resulting from an increase in demand for the farm forestry industry, wood manufacturing and other sectors. In the year 2034, the introduction and integration of a farm forestry industry in the Goulburn regional economy potentially generates, using multiplier analysis: $53 million worth of output; $13 million worth of income; and provides for up to 234 jobs. The farm forestry industry, using the difference method of analysis, produced a change in the economy of: $1,268 million in total output, a change of 6 per cent; $302 million in total income, a change of 5 per cent; and 5,750 jobs, a change of 4 per cent. The industry that experiences the single largest increase was the wood manufacturing industry through its value adding of the product purchased from the farm forestry industry.
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ItemEconomic incentives for private softwood plantations in Victoria( 1987)More than 90 per cent of the privately-owned softwood plantations in Victoria are owned by a small number of companies involved in the further processing of softwood timber. This study examines the economic factors influencing the establishment of softwood plantations by other private landholders (i.e. those that do not own softwood processing facilities) and evaluates the economic incentives currently offered to encourage these landholders to establish their own plantations. A number of economic factors contribute to the current low level of planting by private landholders that are not directly involved in the further processing of softwood. These include the structure of the market for softwood in Victoria, the price private growers can expect to receive for their wood, and the long term nature of the investment. The current taxation arrangements for private forestry offer a number of incentives for the establishment of softwood plantations. However they also contain a number of anomalies and disincentives to private forest investment. Various proposals to reform the income tax legislation have been put forward by private grower organizations and by the Commonwealth Government and this study critically evaluates these proposals. The Farm Forestry Agreement Scheme is an incentive scheme that has been offered by the Victorian Government since 1967 to encourage the establishment of private plantations. It offers low-interest loans with repayments deferred for the first 12 years. After more than 15 years operation the total plantings under the Scheme are approximately 8,300 hectares or less than four per cent of the total Victorian softwood resource. Inflation has seriously eroded the incentive value of the Scheme and it is also a very costly and cumbersome scheme to administer. Many Agreement holders are experiencing difficulties in selling wood from their plantations to meet loan repayments and interest in the Scheme has steadily declined in recent years. A number of softwood processing companies operating in Victoria also offer assistance schemes to encourage private landholders to establish their own plantations. The schemes offered by Softwood Holdings Ltd. and APM Forests Ltd. provide private growers with an assured outlet for their timber and have assisted a number of private growers in marketing wood from their plantations. In addition Australian Newsprint Mills Ltd. have recently introduced a scheme known as the Joint Venture Agreement Scheme which offers assistance in the establishment, management and marketing of wood from plantations established jointly by the company and private landholders. The formation of co-operatives of private forest growers offers a number of potential benefits to the owners of private plantations. Of these increased bargaining strength in the marketing of wood and a mechanism for better communication between private growers and softwood processing companies appear to be the most important. The existing incentives and assistance schemes offered by the Government have not been particularly successful in encouraging the establishment of softwood plantations by private landholders. New economic incentives are therefore required if these landholders are to supply an increased proportion of Victoria's future softwood requirements.