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Profitability, Productivity and the Efficiency of Grain Production with Climate Impacts: A Case Study of Western Australia

Author

Listed:
  • Nhu Che
  • Tom Kompas
  • Vilaphonh Xayavong
  • David Cook

Abstract

This paper analyses productivity, profitability and efficiency by climate zone for the WA grains industry over the past 30 years. More specifically, following the studies by the Department of Agriculture and Food of Western Australia (2011) and Che, et.al (2012), this paper uses the Törnqvist formula index to measure and analyse movements in inputs, outputs, climate conditions, Total Factor Productivity (TFP), and TFP adjusted by climate impacts for WA grains farms in six climate zones over the period 1980 to 2009-10. Estimates provide a stochastic production frontier and technical efficiency model for six rainfall zones (including the High Rainfall North and South zones; the Medium Rainfall North and South zones and Low Rainfall North and South zones), which determine the relative importance of land, labour, capital, materials, fuel and energy inputs into wheat production and the effects of climate zone on farm efficiency. A construction of overall farm profiles in Medium Rainfall zones based on the efficiency rankings of grain farms is also generated.

Suggested Citation

  • Nhu Che & Tom Kompas & Vilaphonh Xayavong & David Cook, 2012. "Profitability, Productivity and the Efficiency of Grain Production with Climate Impacts: A Case Study of Western Australia," Crawford School Research Papers 1208, Crawford School of Public Policy, The Australian National University.
    • Handle: RePEc:een:crwfrp:1208
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    File URL: http://ssrn.com/abstract=2095774
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    Keywords

    productivity; profitability; Western Australia; efficiency; climate impacts; grain production;
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