Brooke Edwards1 and Megan Star1
1 Queensland Department of Agriculture, Fisheries and Forestry
The impact of excessive sediment loads entering into the Great Barrier Reef lagoon from terrestrial runoff has led to increased awareness of improving land condition in extensive grazing lands. Improved ground cover and land condition have been identified as two important factors in reducing sediment loads. However there is currently limited information regarding the economic implications for landholders to adopt practices that influence these factors.
This report explores the economic viability of regenerating land using wet season spelling for four land types in the Burdekin and Herbert catchments, from land that was classified "C" condition to "B" condition in accordance with the ABCD land condition framework. A partial budget analysis was employed to estimate the private benefits and costs of land regeneration using wet season spelling over ten and twenty year periods. The land types selected were Black basalt, Goldfields, Narrow-leaved ironbark, and Red basalt. Due to the locations where each land type was modelled and the subsequent rainfall, the regeneration time period for all land types was estimated to be two years. Sensitivity testing was conducted to consider the effect of extending the required spelling time, as well as increasing and decreasing the discount rate and price used in the analysis.
The results demonstrate that if wet season spelling for two years can regenerate land condition to "B" condition, investing in land regeneration is profitable, on each of the four modelled land types. In general, land regeneration is more profitable for large areas of land, and when analysed over longer time periods. On the other hand, land regeneration is less profitable for smaller properties, for poorer land types, and when longer periods of wet season spelling are required to regenerate land condition.
The results provide insights into targeting sediment reductions and the implications for policy and programs, with education and extension able to be focused towards landholders with more productive land types and large property sizes with large areas to be regenerated. Financial incentives are likely to be required for smaller properties and those with small areas requiring regeneration.
These results focus on the investment in land regeneration, without taking cash flow implications into consideration. These cash flow implications at the beginning of a land regeneration project may be substantial, and may hinder landholders from regenerating land, even when the investment is expected to yield a positive return. Therefore, incentives may still be required to target sediment reductions even when there are private benefits to landholders from the land regeneration.