An economic assessment of the impact of grazing land condition on livestock performance in tropical woodlands

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Beef cattle grazing is the dominant economic use of the tropical woodlands of northern Australia. Land condition has declined over a large part of the region as a result of over-utilisation of pastures through poor management of grazing, fire and vegetation. While often assumed to be the case, there is little empirical evidence to support a link between deteriorating land condition and reduced economic outcomes for livestock production. A model of a representative livestock enterprise near Charters Towers in northern Queensland is used in conjunction with a simulation of 100 trials that is consistent with long-term rainfall in the region to examine the relationship between stocking rates, animal production and economic outcomes. The present study supports a view that ecological and economic outcomes of grazing management do have some general linkages. However, the linkages are less direct than suggested by common definitions of resource degradation and simple stocking rate models. Key economic parameters include the reproductive performance of breeding herds, the level and duration of supplementary feeding required to meet seasonal feed shortages under different land condition and stocking rate regimes, and additional capital invested in larger herds when stocking rates are increased. An overgrazing spiral is hypothesised whereby there is a short-term economic incentive to exploit the natural capital of land in good condition by grazing at relatively high stocking rates. Should land condition deteriorate, a much lower stocking rate is warranted. In an extreme case of a shift to very poor land condition, there is limited scope for profitable production. The 100 year mean values of many production variables for good and moderate condition land for the range of stocking rates trialled are similar. The inherent variation in climatic conditions in the woodlands region and the ability and skills of managers may lead to the actual differences in these measures passing un-noticed before major land resource problems become apparent.