The scope of salinity economics research in

NSW DPI

Bob Farquharson & Andrew Bathgate

University of NSW Workshop

1 December 2005

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Importance of salinity research

Substantial effort and resources committed by NSW DPI to salinity economics research in NSW

Driven by political & funding priorities at Federal and State level

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Background

Recharge increases from clearing Water table rises Salt mobilised by water Salt discharged to soil surface and directly

to streams

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Background

Land salinisation– reduction in arable area– negative environmental impact – threat to

biodiversity Steam salinisation

– urban and industrial infrastructure– changed ecosystems– decreases irrigated crop yields

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Funding history

Salinity Strategy Salinity CRC NAPSWQ Phase 1

– priority projects NAPSWQ Phase 2

– State level projects– CMAs

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Salinity management

Main focus is on recharge management Less focus on discharge management Few options profitable NAPSWQ aims to pay farmers to adopt Salinity CRC aims to improve

profitability of perennial plant species

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Aim of economics work in NSW DPI

Quantifying the private and public benefits of salinity management– research and extension– farmer action– policy and regulation

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Approach

Bio-economic analysis– economics/agric. production/hydrology models– work across disciplines– farm and catchment levels

Optimisation and simulation approaches Extend focus beyond salinity to other NMR

issues– 2 years funding at present

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Objective

Address a component of information problem– explain/predict cause and effect relationships in

eco-systems– investigate the economic consequences of NRM

change Estimate opportunity costs arising from

salinity issues– first on-farm costs– then downstream costs

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Issues

If possible, incorporate estimates of benefits from dealing with environmental issues through policy measures

The value to society on environmental changes including non-market values

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Clients

Researchers– Salinity CRC– other CRCs

Policy makers– CMAs– bureaucrats (Federal)– State agencies

Farmers/extension

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Linkages

Farm level– pasture/animal production

Catchment level– hydrology

Decision support– quantify trade-offs

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Issues for catchment modelling

Farm is the fundamental unit for decision making Catchment plans must account for economic reality

confronting farmers and the spatially variable catchment characteristics

Analysis tools must account for the impacts of land use change on a range of catchment objectives– salinity, streamflow, carbon sequestration, turbidity,

biodiversity– eg decreasing salinity may lead to significant costs in terms of

reduced stream flow, biodiversity plantings may lead to increased salinity

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Associated Projects

Salinity CRC– EVERGRAZE– Grain & Graze– SGSL Economics Theme– SGSL Producer Network– Companion cropping– Farm Forestry– Lucerne prospects

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State-level Projects

NAP– TOOLS2– Key Sites– Planted Forests– Extension and Education

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Partners and Collaborators NSW DPI Divisions NSW DNR Victorian DPI CSIRO SARDI CSU Wagga Wagga/Albury WADA WWARI NSW DEC