For some years now, Ian McLean and I have been advocating the need for concurrent financial and environmental sustainability in Australian agriculture.
Our focus has been primarily on rangeland pastoralism because that is our main field of expertise, but that is not to diminish the importance of the principles being extended to all areas of broadacre agricultural production, grazing and cropping.
With the benefit of hindsight, I don’t think we have done a good enough job to explain the thinking and logic that support this position.
The literature on sustainability theory describes five areas needing to be addressed in agriculture if overall sustainability is the goal.
Financial and environmental are arguably the two most important as they are predominantly under the control of the producer.
The main issue here is that both of them have to be shown to be sustainable concurrently.
Getting one or the other right is a relatively easy task, But concurrently is not so easy because at least some of the time, the separate goals are antagonistic. Put simply, you cannot rob the environmental bank to prop up the financial bank as in the long run, you will send both of them bankrupt.
We would argue that the sustainability of rangeland pastoralism is the biggest challenge of all, for two main reasons.
Firstly, in the rangelands, you are managing a natural resource base; you cannot replace it using a tractor and seeder and you need to nurse it back to full health if it is degraded, which can take a long time and much expense.
In this case, the expense is usually foregone income when the degraded areas are in hospital, whilst in more intensive regions, it takes less time to repair a damaged landscape and the expense is mostly a cash cost.
Secondly, rangeland landscape productivity, even landscapes in good condition, is usually less than the productivity of the more intensive country. This means the financial capacity to repair vast areas can be a constraint.
To either maintain rangeland landscapes in good condition, or repair them if degraded, requires a major mindset change.
In short, you need to walk away from playing the ‘numbers game’ and think productivity per animal unit (per head, AE or DSE).
Southern graziers have the opportunity to play a more sophisticated version of the ‘numbers game’ because they have more climatic certainty combined with the opportunity to use stocking rate as a management tool and profit driver, up to a point.
The fundamental unit of measurement in these regions is performance per hectare and a plethora of improved pasture species and fertiliser options aid this task.
Of course, overstocking and landscape degradation happen in southern regions as well.
As a broad statement, many of the southern Australia intensive landscapes are under-grazed whilst many of the northern rangeland landscapes are over-grazed.
There is ample evidence for this statement.
The ‘numbers game’ in the rangelands enjoys significant popularity, possibly because its most appealing feature is that you do not need to think too much.
All you need to do is just keep stacking them on, usually without much consideration of the carrying capacity limit of the landscape.
You can get away with this for some time and the early financial outcomes often seductively support your strategy.
Eventually, the chickens come home to roost and both the environmental and financial outcomes start heading downhill (Wambiana Trial, QLD).
We are not talking just about extremes here, where the landscapes are being pillaged.
Even if you are only 10 per cent overstocked long-term (effects not visible to the naked eye in the short term), the end result is inevitable, it is just that it will take longer.
On the other hand, stocking to prescribed carrying capacity and focussing on per unit animal performance as the primary profit driver requires knowledge, management skill and significant thought.
As an aside, it does not matter which grazing management system you choose to employ, if there are too many mouths, there are too many mouths and fancy grazing management will not save you!
Simple really, and again supported by a mountain of evidence.
The good news for northern rangeland producers is that when they transition to a per head mentality, some very attractive options become available for use, not the least of which is quantitative genetics.
The ‘numbers game’ approach generally does not permit this for a whole range of reasons, one of which is that bulls are just treated as more numbers and the cheaper they are the better.
Overstocking also suppresses the phenotypic aspects of selection pressure, which adds a layer of unwanted difficulty.
Turn the corner and suddenly you can entertain ideas like control mating heifers, selecting bulls for more fertility, carcase merit, or whatever, having more control over market options as your turn-off weights are more predictable. A tad daunting for those not used to that way of thinking.
The good news for southern intensive producers is that when they realise that stocking rate is a tool that can be used to increase profit, a whole new world of matching feed supply to demand opens up and efficient pasture utilisation starts to add value.
More numbers can be run without any additional impost on landscapes.
The main problem in the south is that the effects are often pernicious because they are largely happening below the soil surface.
Phil Holmes
A classic example is calving in the autumn or winter often mandating hay production for feeding.
Not only does this compromise the feed supply/demand necessity, but hay production sucks nutrients out of the soil like there is no tomorrow.
Throw in a sub-optimal fertiliser program and poorly buffered soils and suddenly you have rampant environmental degradation in the top ten to twenty centimetres of your paddocks, well out of sight.
Alarmist? No, not if you look at the evidence.
It depends entirely on how seriously you want to take all this. I am very fortunate because everybody with whom I work is deadly serious on this issue.
Sitting on their office bookshelf is a binder, a work in progress, with Operational Sustainability Manual appearing on the spine.
Each time we meet, it grows like a jigsaw as it is gradually filled in.
The assumption here is that anybody could turn up at any time with a direct complaint about the sustainability of operations, be it specific or generic.
Instead of a back-foot mumble/grunt response, the manual is pulled off the shelf, shoved under their nose in order to able to say ‘This is what we do and why.
Find anything in this manual that cannot be supported by empirical evidence and we will gladly change if you can supply better empirical evidence’.
It is an absolute winner, based on the experience of the odd skirmish or two.
There is no conflict between sustainable profit and environmental integrity, it just needs a change of mindset, more knowledge and an upgraded skillset; a first-class professional approach.
In the 2017 Australian Beef Report, we described the benchmarks for financial sustainability along with some advice on how to achieve them.
In the 2020 Australian Beef Report, three contributing authors have done the same on the environmental side.
It all makes for good reading, as does anything else that can concurrently improve the bank balance and landscape condition and most importantly, is based on empirical evidence.
Phil Holmes completed a PhD on the financial and environmental sustainability of pastoralism in the arid rangelands. He is an Adjunct Professor at the University of New England and co-author of The Australian Beef Report: 2020 Vision.