Biosecurity adds to grain profits
A recent study estimating the benefit of Australia’s biosecurity system to growers found that for grain growers, its main contribution is to keep markets open and to maintain relatively high prices for Australian grain.
The report, 'The value of Australia’s biosecurity system at the farm gate', was produced by the Australian Bureau of Agricultural and Resource Economics and Sciences to examine the benefits of an effective biosecurity system for different kinds of broadacre growers.
The report concluded that efforts to keep out weeds, pests and diseases such as Karnal bunt, Mexican feather grass and foot-and-mouth disease translated to $12,000 to $17,500 more profit each year, depending on the farm type. The researchers did not include the costs of growers’ own on-farm biosecurity efforts. They evaluated the pre-border, border and incursion response aspects of the biosecurity system undertaken by government and industry.
Plant Health Australia’s national manager for broadacre cropping, Dr Sharyn Taylor, welcomed the findings, saying it was the first time researchers had looked at the benefits of biosecurity to individual growers.
“Hardly any work has been done on the benefits of biosecurity activities at the farm level, compared with, say, the benefits of agricultural research, development and extension,” Dr Taylor says.
“It isn’t an easy task to estimate what’s been saved by not having these pests. Many assumptions have to be made in the modelling. But it’s important to try to reveal the importance of efforts to keep out exotic pests.”
The research looked at savings made in production and potential impact on grain sales for six biosecurity threats including Karnal bunt (Tilletia indica) – an exotic fungal disease of wheat, durum and triticale that would seriously affect market access for Australian grain.
Karnal bunt significantly reduces grain quality, causing discolouration and a dead-fish-like odour that makes the product unpalatable. It has very little effect on yield, however, and can survive in soil for up to five years.
For long-fallow wheat cropping systems in New South Wales, the value of keeping Australia free from Karnal bunt through biosecurity equated to $30 to $50 per hectare each year. For short fallow wheat this ranged from $23 to $32/ha.
Given the negligible effect on yield, 91 to 95 per cent of the reduction in gross margin would arise from the reduction of price for the wheat due to loss of export markets and downgrading.
The report identified that a Karnal bunt incursion would lead to a change in land use and crop rotations to control the spread of the disease.
It was estimated that wheat plantings would be reduced by 40 per cent, with an increase in non-host crops – a 40 per cent rise in legume plantings and 30 per cent in oilseeds – on those farms predominantly cropped.
Even if the production impact of a pest or disease could be mitigated at relatively low cost – as would be the case with Karnal bunt – losses arising from trade bans and lower farmgate prices could be significant and make some farm activities unprofitable.
Karnal bunt would cause disruptions to trade, resulting in market closures on a temporary basis while the extent of an incursion was determined.
According to the report, the biosecurity system makes a huge difference to the likelihood of Karnal bunt entering Australia. With biosecurity in place, an incursion of the disease is considered likely to occur less than once in 100 years. Without biosecurity it is considered likely to occur once every two years.
Dr Taylor says it was important not to take for granted the benefits of farming in a country relatively free from pests, diseases and weeds. “Markets are maintained because we are free of many pests, diseases and weeds,” she says. “It’s worth the cost and effort to guard this advantage.”