SRDC Research Project final report DPI015 Enhancing an economic way of doing business in the cane industry
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Economics is often viewed by farmers as complex and time consuming. Economic work in the Australian sugar cane industry had been undertaken in the past but the large majority of this work was not targeted towards growers and was unsuitable for extension purposes. The emphasis over many years has been on farm viability through increased production with little emphasis and support to growers on analysing whole of farm profitability. The sugar industry is currently going through a period of volatile sugar prices, rapidly rising input costs and adjustment to deregulation. The need to focus on farm profitability through the use of economic tools and grower education is critical in maintaining a sustainable sugar cane industry. To remain viable, growers must now concentrate on reducing on-farm costs as well as increasing cane production. The recent introduction of derivative cane pricing mechanisms to growers is another example of the importance in understanding production costs and business profitability over time. This project aimed at assisting growers to analyse their production costs and identify opportunities to improve profitability through the implementation of sustainable farming systems. Quantifying the economic benefits of farming system changes is instrumental to speeding up grower adoption rate. Providing economic information in an easy to understand format and participatory involvement from growers to develop real life case studies was an important component of this project. Training on economics was also delivered through several forms of media to build on the current knowledge base in the industry and support more informed decision making skills. An Agricultural Economist was appointed on the 17th of October 2005 to service the Herbert and Burdekin regions. Five grower groups were approached in the Herbert and Burdekin regions to participate in the project. A baseline survey of the grower participants identified the current knowledge gaps, potential training needs and economic topics of interest. Each grower group provided a base for the collection of data on specific economic topics and provided feedback on the presentation of the results.