18 Apr 2012

Pasture renewal 'could reduce drought losses'

8:38 am on 18 April 2012

A director of Business and Economic Research Limited (BERL) says pasture renewal could reduce farmers' production losses from drought.

Kel Sanderson says a report he produced for a group of 14 agribusiness companies shows replacing pasture more regularly may lift farmers' incomes by as much as 20%.

He says it could also help with drought recovery.

Mr Sanderson says he looked at farm productivity over the last 40 - 50 years in terms of milk solids per cow and it shows a regular pattern of four or five years of strong growth and then a drop associated with a period of drought.

He says he is interested in the potential economic benefits of mitigating losses in drought years by pasture renewal.

Mr Sanderson calculates that if the losses from droughts since 1986 could have been halved in this way, the farm gate value at the moment of dairying would be an extra $2.5 billion.