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The Potential Cost to New Zealand Dairy Farmers from the Introduction of Nitrate-Based Stocking Rate Restrictions

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  • Neal, Mark
  • Fulkerson, William
  • Levy, Gil
  • Wastney, Meryl
  • Thorrold, Bruce S.
  • Palliser, Chris
  • Beukes, Pierre
  • Folkers, Chris

Abstract

Introducing a stocking rate restriction is one possible course of action for regulators to improve water quality where it is affected by nitrate pollution. To determine the impact of a stocking rate restriction on a range of New Zealand dairy farms, a whole-farm model was optimised with and without a maximum stocking rate of 2.5 cows per hectare. Three farm systems, which differ by their level of feed-related capital, were examined for the changes to the optimal stocking rate and optimal level of animal milk production genetics when utility was maximised. The whole-farm model was optimised through the use of an evolutionary algorithm called differential evolution. The introduction of a stocking rate restriction would have a very large impact on the optimally organised high feed-related capital farm systems, reducing their certainty equivalent by almost half. However, there was no impact on the certainty equivalent of low feed-related capital systems.

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Bibliographic Info

Paper provided by International Association of Agricultural Economists in its series 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia with number 25620.

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Date of creation: 2006
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Handle: RePEc:ags:iaae06:25620

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Keywords: environmental regulation; dairy farms; whole-farm model; evolutionary algorithm; Environmental Economics and Policy; Livestock Production/Industries; Q12; Q52; C61;

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  1. Mayer, D. G. & Kinghorn, B. P. & Archer, A. A., 2005. "Differential evolution - an easy and efficient evolutionary algorithm for model optimisation," Agricultural Systems, Elsevier, vol. 83(3), pages 315-328, March.
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