Publication Date

10-2003

Series Number

Miscellaneous Publication 26/2003

Publisher

Department of Agriculture, Western Australia

City

Perth

ISSN

1447-4980

Abstract

The program of publicly funded soil acidity RD&E' conducted in Western Australia from 1992-93 to 2001-02 is expected to deliver benefits to the farm sector over future years. Benefit-cost analysis indicates that these industry benefits should outweigh the public cost of the RD&E several times over.

Using a 20-year analysis period, the RD&E is estimated to have a net present value (NPV) of $84 million, and a benefit-cost ratio (BCR) of 5.8. Extending the analysis to 30 years results in an NPV of $135 million and a BCR of 8.7. These large returns are due to a combination of factors:

  • The high uptake of liming by farmers since the commencement of intensive RD&E in the mid-1990s.
  • The long-term benefits that liming provides to crops and pastures.
  • The relatively low costs of applying lime.

The actual value of the RD&E is sensitive to several assumptions about which there is uncertainty. Despite this, it is expected to deliver a net benefit under most scenarios examined. There is a high degree of confidence in this conclusion because considerable adoption has already occurred, thereby locking in future benefits.

In addition to the future benefits already locked in, the analysis highlights considerable potential that could be realised by future projects through research and development on methods that further increase the profitability of managing soil acidity.

Number of Pages

16

Keywords

Soil acidity, Western Australia, Cost- benefit, Farming

Disciplines

Agricultural Economics | Agricultural Science | Agronomy and Crop Sciences | Natural Resources Management and Policy | Soil Science

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