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Assessing costs of soil carbon sequestration by crop-livestock farmers in Western Australia

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  • Kragt, Marit E.
  • Pannell, David J.
  • Robertson, Michael J.
  • Thamo, Tas

Abstract

Carbon sequestration in agricultural soil has been identified as a potential strategy to offset greenhouse gas emissions. Within the public debate, it has been claimed that provision of positive incentives for farmers to change their land management will result in substantial carbon sequestration in agricultural soils at a low carbon price. However, there is little information about the costs or benefits of carbon sequestration in agricultural soils to test these claims. In this study, the costeffectiveness of alternative land-use and land-management practices that can increase soil carbon sequestration is analysed by integrating biophysical modelling of carbon sequestration with wholefarm economic modelling. Results suggest that, for a case study model of a crop-livestock farm in the Western Australian wheatbelt, sequestering higher levels of soil carbon by changing rotations (to include longer pasture phases) incur considerable opportunity costs. Under current commodity prices, farmers would forego more than $80 in profit for every additional tonne of CO2-e stored in soil, depending on their adoption of crop residue retention practices. This is much higher than the initial carbon price of $23t−1 in Australia’s recently legislated carbon tax. This analysis does not incorporate the possibility that greenhouse gas emissions may increase as a result of including longer pasture phases. Accounting for emissions may substantially reduce the potential for net carbon sequestration at low carbon prices.

Suggested Citation

  • Kragt, Marit E. & Pannell, David J. & Robertson, Michael J. & Thamo, Tas, 2012. "Assessing costs of soil carbon sequestration by crop-livestock farmers in Western Australia," Agricultural Systems, Elsevier, vol. 112(C), pages 27-37.
    • Handle: RePEc:eee:agisys:v:112:y:2012:i:c:p:27-37
    DOI: 10.1016/j.agsy.2012.06.005
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    1. Tas Thamo & David J. Pannell & Marit E. Kragt & Michael J. Robertson & Maksym Polyakov, 2017. "Dynamics and the economics of carbon sequestration: common oversights and their implications," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 22(7), pages 1095-1111, October.
    2. Kragt, M.E. & Gibson, F.L. & Maseyk, F. & Wilson, K.A., 2016. "Public willingness to pay for carbon farming and its co-benefits," Ecological Economics, Elsevier, vol. 126(C), pages 125-131.
    3. Thamo, Tas & Addai, Donkor & Kragt, Marit E. & Kingwell, Ross S. & Pannell, David J. & Robertson, Michael J., 2019. "Climate change reduces the mitigation obtainable from sequestration in an Australian farming system," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 63(4), October.
    4. Thamo, Tas & Addai, Donkor & Pannell, David J. & Robertson, Michael J. & Thomas, Dean T. & Young, John M., 2017. "Climate change impacts and farm-level adaptation: Economic analysis of a mixed cropping–livestock system," Agricultural Systems, Elsevier, vol. 150(C), pages 99-108.
    5. Xiuquan Huang & Xiaocang Xu & Qingqing Wang & Lu Zhang & Xin Gao & Linhong Chen, 2019. "Assessment of Agricultural Carbon Emissions and Their Spatiotemporal Changes in China, 1997–2016," IJERPH, MDPI, vol. 16(17), pages 1-15, August.
    6. Dumbrell, Nikki P. & Kragt, Marit E. & Biggs, Jody & Meier, Elizabeth & Thorburn, Peter, 2015. "Climate change abatement and farm profitability analyses across agricultural environments," Working Papers 225674, University of Western Australia, School of Agricultural and Resource Economics.
    7. Ross Kingwell, 2021. "Making Agriculture Carbon Neutral Amid a Changing Climate: The Case of South-Western Australia," Land, MDPI, vol. 10(11), pages 1-20, November.
    8. Tas Thamo & Ross S. Kingwell & David J. Pannell, 2013. "Measurement of greenhouse gas emissions from agriculture: economic implications for policy and agricultural producers," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 57(2), pages 234-252, April.
    9. Amanda Silva‐Parra & Juan Manuel Trujillo‐González & Eric C. Brevik, 2021. "Greenhouse gas balance and mitigation potential of agricultural systems in Colombia: A systematic analysis," Greenhouse Gases: Science and Technology, Blackwell Publishing, vol. 11(3), pages 554-572, June.
    10. Kragt, M.E. & Pannell, D.J. & McVittie, A. & Stott, A.W. & Vosough Ahmadi, B. & Wilson, P., 2016. "Improving interdisciplinary collaboration in bio-economic modelling for agricultural systems," Agricultural Systems, Elsevier, vol. 143(C), pages 217-224.
    11. Kharel, S. & d'Abbadie, C. & Abadi, A. & Kingwell, R., 2022. "Reducing farming system emissions via spatial application of payoff functions," Agricultural Systems, Elsevier, vol. 203(C).
    12. Alcock, Douglas J. & Harrison, Matthew T. & Rawnsley, Richard P. & Eckard, Richard J., 2015. "Can animal genetics and flock management be used to reduce greenhouse gas emissions but also maintain productivity of wool-producing enterprises?," Agricultural Systems, Elsevier, vol. 132(C), pages 25-34.
    13. Chuanhe Xiong & Degang Yang & Jinwei Huo, 2016. "Spatial-Temporal Characteristics and LMDI-Based Impact Factor Decomposition of Agricultural Carbon Emissions in Hotan Prefecture, China," Sustainability, MDPI, vol. 8(3), pages 1-14, March.
    14. Tang, Kai & Hailu, Atakelty, 2020. "Smallholder farms’ adaptation to the impacts of climate change: Evidence from China’s Loess Plateau," Land Use Policy, Elsevier, vol. 91(C).
    15. Laure Bamière & Pierre‐Alain Jayet & Salomé Kahindo & Elsa Martin, 2021. "Carbon sequestration in French agricultural soils: A spatial economic evaluation," Agricultural Economics, International Association of Agricultural Economists, vol. 52(2), pages 301-316, March.
    16. Tang, Kai & Hailu, Atakelty & Kragt, Marit E. & Ma, Chunbo, 2018. "The response of broadacre mixed crop-livestock farmers to agricultural greenhouse gas abatement incentives," Agricultural Systems, Elsevier, vol. 160(C), pages 11-20.
    17. Ross Kingwell, 2021. "Agriculture’s carbon‐neutral challenge: The case of Western Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(3), pages 566-595, July.
    18. Lokuge, Nimanthika & Anders, Sven, 2022. "Carbon-Credit Systems in Agriculture: A Review of Literature," SPP Technical Papers, The School of Public Policy, University of Calgary, vol. 15(12), April.
    19. Kragt, Marit Ellen & Blackmore, Louise & Capon, Timothy & Robinson, Cathy J. & Torabi, Nooshin & Wilson, Kerrie A., 2014. "What are the barriers to adopting carbon farming practices?," Working Papers 195776, University of Western Australia, School of Agricultural and Resource Economics.
    20. Kragt, Marit E. & Robertson, Michael J., 2014. "Quantifying ecosystem services trade-offs from agricultural practices," Ecological Economics, Elsevier, vol. 102(C), pages 147-157.

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