Optimising farm scale returns from irrigated grains: maximising dollar return per megalitre of water: Final Report

Profitability of irrigated farming systems is a function of manifold factors. Some of these include crop type, water use, grain price and water costs, grain yields, markets, crop rotation, overhead costs and seasonal climatic conditions. In attempt to dissect the influence of such factors on enterprise-level profit, we conducted people-centric research with grains industry stakeholders from 2019 to 2023 and, based on participatory feedback, built a digital framework for allowing scenario analysis. In collaboration with partners in concurrent GRDC investments, a new calculator called WaterCan Profit (WCP) was piloted then iteratively refined, underpinned by feedback from case study farmers, grower groups, and other stakeholders to ensure the product was credible, legitimate and fit-for-purpose. This dialogue indicated that practitioners made crop choice decisions based on markets, grain yields and crop rotations, while industry leaders suggested that growers should also be cognisant of implications associated with changing irrigation infrastructure. To encapsulate such commentary, we developed three applications within WCP: (1) a Water Price app, to allow rapid contrasting of gross margins in cropping systems as a function of water costs, wherein users elicit water costs in which irrigation becomes economically inviable (breakeven costs), as well as the impact of grain prices, variable costs, yields and crop water use on gross margins, (2) an Optimiser app, which optimises enterprise-level profit by modifying crop types, sowing areas and agronomic management across the whole farm, either on a per unit water or per unit area basis, and (3) an Investment app, which facilitates insight into relative economic returns associated with crop rotation and other profit drivers over the expected lifetime of irrigation infrastructure. The project published six scholarly studies in top-quartile journals, with a further two studies under peer review at the time of writing. Key insights from these scholarly publications include:

Application, adoption and opportunities for improving decision support systems in irrigated agriculture: an authoritative review showed that (i) previous development of decision-support systems (DSS) has proceeded via a technology push, rather than end-user pull, (ii) few DSS allow strategic (long-term) decision making, or account for uncertainty in their outputs, (iii) declining DSS use or uptake may mean that DSS heuristics have been successfully adopted; A longitudinal analysis showed that increasingly volatile weather and market conditions have caused yield gains of Australian irrigated grain crops to stall; this analysis also revealed the irony wherein times with which irrigation water is most needed (e.g. drought) often coincide with extreme water costs, such that times of greatest need for supplementary water are often those times wherein irrigation costs are prohibitive; An economic analysis of how cropping system simplification, diversification or intensification and irrigation infrastructure influenced economic downside risk showed that accrued benefits of intensification were realised from larger gains in crop gross margins that (more than) offset costs associated with capital investment and additional water use under intensification. Diversification was superior in mitigating economic risk due to higher returns per megalitre (ML) of irrigated water and more diverse sources of income; A agronomic-engineering scenario analysis with WCP showed that (1) when assessing profit, metrics matter: diversified systems generally had higher profitability than intensified systems per unit water, but not per unit land area; (2) gravity-based (surface) irrigation infrastructure used the most water, followed by sprinkler systems, whereas drip irrigation used the least water; (3) adaptation through management and crop genotype had greater impact on productivity compared with changes in irrigation infrastructure; and (4) only intensification was able to raise profitability under future climates. Earlier crop flowering evoked by global warming can be alleviated by irrigation. This seminal study that concluded that (i) use of irrigation broadens optimal flowering periods (OFPs), providing greater sowing time flexibility and likelihood of realising potential yields compared with dryland conditions, and (ii), more preferable maturity durations for irrigated winter and summer crops to realise potential yields are early-sown long-season (late) and later-sown short-season (early) maturity types, respectively. Whole farm planning raises profit despite declining yields due to climate change with a key insight that future work on drought adaptation must consider genetic selection criteria more diverse than phenology and yield alone. Crop types with (1) higher value per unit grain weight and (2) higher water-use efficiency are more likely to engender sustainable, prosperous outcomes for irrigated cropping systems under future climates. A review of the problems, premises and promises associated with Artificial Intelligence (AI) in agriculture showed that AI-guided human-machine interplay can allow customisation towards situational approaches, with ‘transfer learning’ holding promise in terms of contextualising AI to production systems or enterprise mixes. We also found that recent rates of AI evolution have outpaced development of adequate legal and institutional regulations, as well as social and ethical licence to operate, uncovering end-user issues associated with data ownership, legitimacy and trust. An analysis showed that (1) management interventions primarily impacted soil organic carbon (SOC) in the surface and had de minimus impact on deep SOC stocks, (2) rotations including wheat and canola were more conducive to improvement in SOC stocks, (3) scenarios with high SOC had little impact on crop productivity and greenhouse gas (GHG) emissions intensity, (4) productivity and GHG emissions intensity were more related to nitrogenous fertiliser, rather than SOC stocks, and (5) aspirations for improving SOC are likely to be futile if antecedent SOC stocks are already high (4-5%). Extensive people-centric design through 64 events facilitated the direct engagement – through webinars, workshops and field visits - of more than 58% of irrigated growers and advisors, and over 6,700 farm businesses, with the knowledge, skills and/or confidence required to make informed decisions regarding crop choice, irrigation type, and crop water use to optimise farm scale returns. Conservative estimates suggest that the present investment has impacted productivity over 186,000 hectares, improving cumulative farm profit at full equity by over $39.7M. It is likely that impact - through diffusion of innovation and knowledge dissemination – will ensue, however such adoption is not accounted for in estimates shown here.