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LOW ADOPTION OF LUPINS IN SOUTHERN NSW - INSIGHTS FROM PRISM

K.Y. Faour, B.J. Scott and E.L. Armstrong

NSW Agriculture, Wagga Wagga Agricultural Institute, PMB, Wagga Wagga NSW 2650

Abstract

Lupins have a valuable role in mixed farming systems, due to their capacity to improve soil N and provide a high protein feed grain for livestock.. Despite this, their adoption in high rainfall NSW has been slow. PRISM-Wagga indicated that under some circumstances, lupins gave poor economic returns compared to other crop enterprises, and this may have limited adoption. Additional farmer concerns with management and perceived vulnerability of lupins to disease may have also inhibited their use.

Key words: Bioeconomic, lupin, MIDAS, modelling, PRISM-Wagga, rotations, whole-farm

Prior to the 1970?s, farming practice relied on wheat/sheep enterprises with cereals and legume based pastures grown in rotation. After Australian authorities introduced wheat delivery quotas in 1969, pulse crops gradually became accepted and more widely grown in rotation with cereals. They were regarded as contributing to more sustainable and profitable farming systems (2). However, the adoption of pulses in NSW has been slow, with lupins being the dominant pulse crop in the south and centre of the state.

PRISM-Wagga (Profitable Resource Integration Southern MIDAS; 1) is concerned with allocating available farm resources to a range of related enterprises in order to maximise whole-farm profit. The model was used here to conduct a sensitivity analysis where the farm gate price of lupins was varied from $100 to $300/t and its yield from 1.0 to 3.5 t/ha, while keeping those for other crops unaltered. For each price/yield combination PRISM identified rotations, from 37 in the model, which maximised the whole-farm operating cash surplus. Only some of the rotations included lupins. PRISM included the benefits from lupins to following crops and animal enterprises on the farm via stubble grazing and grain feeding.

Results

The area of lupins in NSW has varied erratically from 44,000 to 99,000 ha over the last ten years. In the high rainfall zone, the area of lupins has increased and has been less volatile than the state figures,

Table 1: Area (?000 ha) and yield (t/ha) of lupins, peas and canola over 13 years in the high rainfall wheatbelt1 of southern and central NSW.

 

Lupins

 

Peas

 

Canola

Year

Area

% crop area

Yield

 

Area

Yield

 

Area

Yield

1983

5.62

1.1%

1.13

 

0.08

1.37

 

1.84

1.02

1984

6.93

1.7%

1.19

 

0.82

0.77

 

3.06

1.28

1985

9.28

2.3%

1.41

 

1.15

1.11

 

5.62

1.31

1986

9.36

2.5%

1.30

 

2.78

1.43

 

7.09

1.33

1987

13.35

4.2%

1.36

 

6.32

1.73

 

5.68

1.34

1988

13.23

4.7%

1.31

 

8.73

1.41

 

4.73

1.55

1989

12.05

5.0%

1.75

 

3.92

1.66

 

7.85

1.89

1990

14.06

5.7%

1.40

 

4.25

1.40

 

10.98

1.59

1991

15.92

6.5%

1.42

 

6.32

1.36

 

16.06

1.43

1992

23.17

8.6%

1.97

 

3.72

1.84

 

15.59

2.06

1993

24.89

9.2%

1.72

 

3.33

2.02

 

23.23

1.98

1994

25.98

9.8%

0.17

 

3.64

0.46

 

34.92

0.54

1995

21.35

6.9%

1.62

 

1.69

1.81

 

32.57

1.88

1983-95

15.01

5.2%

1.37

 

3.60

1.41

 

13.02

1.48

1990-952

19.88

7.4%

1.63

 

3.86

1.69

 

19.69

1.79

1 For 7 shires (Cootamundra, Cowra, Culcairn, Hume, Junee, Wagga Wagga and Young).
2 Excluding the drought year of 1994.

although not exceeding 10% of the area of crop (Table 1). State yields averaged 1.23 t/ha (1983-95); in the high rainfall areas yield was higher at 1.37 t/ha. However, in more recent years (1990 to 1995, excluding the drought year of 1994) yields in the high rainfall shires have increased to average 1.63 t/ha.

Lupins are sold on an unregulated market, and price varies seasonally. It is usually lowest at harvest and reaches a maximum in autumn/winter. In each of the three seasons 1995-97, the price range has been $177 to $262, $175 to $230 and $205 to $265/t, respectively (farm gate price Wagga, from The Land).

Where yields for lupins were 2 t/ha, a price of ≥ $160/t was required before PRISM included rotations with lupins (Table 2). At a higher yield of 3 t/ha, the minimum price required to include lupins in the solution was $110/t. PRISM suggested "full" adoption of lupins (i.e. 33% of crop) with yields at 2 t/ha, when price was ≥ $270/t, or with yields of 3 t/ha at ≥ $180/t.

Table 2: PRISM-Wagga estimates1 of price of lupins ($/t farm gate) required for three levels of adoption of lupins (% of cropped area2) at varying yields (t/ha).

Lupin area

   

Lupin Yield

   

(% of crop)

1.0 t/ha

1.5 t/ha

2.0 t/ha

2.5 t/ha

3.0 t/ha

3.5 t/ha

nil

$100 - $300

$100 - $210

$100 - $150

$100 - $120

$100

<$100

25%

>$300

$220 - $300

$160 - $260

$130 - $210

$110 - $170

$100 - $150

33%

>$300

>$300

$270

$220

$180

$160

1Assumed wheat at $140/t (farm gate), barley at $130/t, canola at $290/t, oats at $100/t, wool at $3.7/kg and lambs at $40/head.
2 The PRISM model could select only rotations available in the model, and this imposed a limitation that these rotations included either nil, 25% or 33% of the crop area as lupins.

Discussion

A decision to include lupins in a cropping program will be dependent on anticipated yield and price. If yield is 1.6 t/ha (the recent achieved yields) and price at harvest is low ($170 to $175 /t), lupins are financially less attractive than alternative enterprises. Despite their rotational benefits, lupins will be displaced by other production options. However, if a grower can be confident of higher yields (2 t/ha) or can achieve a higher price (approx. $220/t), lupins emerge as a viable component of the farming system.

If a grower has the capacity to store on farm, a price increase above harvest prices could be anticipated of up to $55 to $85/t based on 1995 to 97 experience. Therefore on-farm storage becomes important for lupin growers as this gives greater control over price received. The combination of good yield and a managed sale price, makes lupins an attractive pulse choice, but the combination of poor yield with harvest prices preclude lupins from the rotation.

Other reasons for non-adoption of lupins include negative farmer perceptions and attitudes. Many find pulses and other broadleaf crops more risky and more demanding in terms of management than cereals. Deterring factors include greater dependence on pesticides, and higher costs of establishment compared to cereals, a requirement for early sowing and vulnerability to diseases. Farmers also view canola as a ?break crop? and an alternative to lupins in the rotation although they do not compete directly for the same place in the rotation. The area sown to canola has continued to increase and now occupies an area greater than that of lupins and peas combined (Table 1).

Conclusions

Given current commercial yields of 1.6 t/ha the PRISM model suggests that lupins would only be included in crop rotations in the high rainfall wheatbelt when prices were ≥ $220/t. Many growers would not be able to achieve these yield and price targets, and this is reflected in the fact that lupins have been <10% of the crop area (Table 1). In this mixed farming system, other crop enterprises are often more economically rewarding. In order to viably produce lupins, farmers need to target higher yield by adopting sound agronomic practices, and manage sale price of their lupins through on-farm storage.

References

1. Faour, K.Y., Butler, G.J., Robinson, J.B., Wall, L.M., Brennan, J.P. and Scott, B.J. 1997. PRISM-Wagga Manual, Version 1.0, 1997. NSW Agriculture, Wagga Agricultural Research Institute.

2. Hamblin, J. 1987. Grain legumes in Australia. Proc. 4th Aust. Agron. Conf., Melbourne, pp. 65- 82.

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