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Determinants of land use in wheat production: The Australian wheat-sheep zone

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  • Culas, Richard J.

Abstract

The Australian wheat industry is an important contributor to the Australian economy and farm sector. This paper investigates the determinants of land use in wheat production for the Australian wheat-sheep zone. Land allocation between the wheat and the wool enterprises are considered in view of maximizing the expected farm profit. Wheat area supply response, is estimated across the wheat-sheep zone using data for the period 1990-2004. The statistical results indicate that the wheat growers in the Western Australia are more (relative expected) price responsive than the growers in the eastern states. Current wheat area is highly depended on the previous year’s wheat area and the area adjustment is also not significantly different between the regions. Estimates for the wheat own-price and the cross-price elasticities are with the expected signs and all less than unity, though the cross-price elasticities are more inelastic. Wheat yield is positively influenced by the area sown. Rainfall also has positive influence on the wheat yield but the time-related exogenous factors had only minor influence on the yield. The results are discussed in view of providing guidance for the decision on the land use. The paper also discusses the econometric approaches for analysing larger sample size (data).

Suggested Citation

  • Culas, Richard J., 2014. "Determinants of land use in wheat production: The Australian wheat-sheep zone," 2014 Conference (58th), February 4-7, 2014, Port Macquarie, Australia 165815, Australian Agricultural and Resource Economics Society.
  • Handle: RePEc:ags:aare14:165815
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    References listed on IDEAS

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    1. Brian S. Fisher & Charles A. Wall, 1990. "Supply Response In The Australian Sheep Industry: A Profit Function Approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 34(2), pages 147-166, August.
    2. Adams, Philip D., 1988. "Some Comparisons of Recent Estimates of Agricultural Supply Elasticities for the Australian Economy," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 0(Number 03), pages 1-9, December.
    3. Hall, Nigel H. & Fraser, L. & Purtill, A., 1988. "Supply Response in Broadacre Agriculture," 1988 Conference (32nd), February 8-11, 1988, Melbourne, Australia 144033, Australian Agricultural and Resource Economics Society.
    4. B. A. Sanderson & J. J. Quilkey & J. W. Freebairn, 1980. "Supply Response Of Australian Wheat Growers," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 24(2), pages 129-140, August.
    5. Griffin, Ronald C. & Montgomery, John M. & Rister, M. Edward, 1987. "Selecting Functional Form In Production Function Analysis," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 0(Number 2), pages 1-12, December.
    6. Fisher, Brian S. & Wall, Charles A., 1990. "Supply Response In The Australian Sheep Industry: A Profit Function Approach," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 0(Number 2), pages 1-20, August.
    7. Hall, Nigel H. & Fraser, L. & Purtill, A., 1988. "Supply Response in Broadacre Agriculture," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 0(Number 03), pages 1-14, December.
    8. Eddie Oczkowski & Yapa Bandara, 2013. "Modelling agricultural land use allocation in regional Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 57(3), pages 422-440, July.
    9. Kingwell, Ross S., 2006. "Climate change in Australia: agricultural impacts and adaptation," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 0.
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    Keywords

    Agricultural Finance; International Relations/Trade;

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