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Using seasonal forecast information and tools to manage risk and increase profitability in the Southern Region
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The Grains Research and Development Corporation (GRDC) is a statutory corporation established under the Primary Industries Research and Development Act 1989. It is subject to accountability and reporting obligations set out in the Public Governance, Performance and Accountability Act 2013. It is responsible for planning, investing in and overseeing research and development, and delivering improvements in production, sustainability and profitability across the Australian grains industry.
Climate remains the single most important driver of farm productivity and profitability. While it is important that growers and advisors take a strategic approach and have robust farming systems that allow them to manage our variable climate, there may be an opportunity for more appropriate use of seasonal climate forecast information to inform tactical decisions by limiting downside risk and maximising upside opportunity. The skill and accuracy of forecasts continue to improve and the Bureau of Meteorology plan to release 2 to 8 week weather forecast in the near future which have the potential to significantly improve tactical decisions such as fertiliser and crop protection applications and develop strategic operational plans. Furthermore, there is an opportunity for the grains industry to collaborate with the Bureau to test experimental products and influence the design and function of new products.
It is essential to recognise that the skill of seasonal forecasts varies throughout the season and across regions. Even at locations and times of the year where the skill is high (e.g. spring period in southern Australian) forecasts are never perfect and are best represented as a shift in probabilities of the season being wetter or drier, and warmer or cooler than average. Despite recent improvements, the relatively low skill of seasonal climate forecasts means that many growers and advisors believe they are unreliable and of limited value. Nevertheless, recent 2015 and 2016 seasons demonstrated that a seasonal forecast is often “too good to ignore but not good enough to rely upon”. At present seasonal forecasts are mainly used for in-crop nitrogen fertiliser decisions which generally provide a modest level of value. Identifying the value proposition of seasonal forecasts for more complex decisions, such as enterprise mix and crop selection is still the major challenge given that the implications of getting it wrong could have significant consequences for farm profit. Growers and advisors want to know what information is useful and when the seasonal forecast is reliable. A greater emphasis on the skill of information contained in a seasonal forecast is required as opposed to a commentary on the drivers of climate. For example, it is important that growers and advisors recognise that the accuracy of autumn-early winter predictions are usually low, and not to over-react to forecasts during this period.
Understanding the probabilities of rainfall and temperatures (i.e. very much below, below, average, above or very much above average) is essential to use seasonal forecasts to effectively inform farm decisions. Identifying any past years which are similar to the forecast outlook can provide users with a reference to understand the likely outcomes based on past experiences and learnings. However, it is recognised that for some forecasts it is either not possible or too simplistic to identify previous years which are similar. In addition to weather forecasts, measurable or predictable factors such as soil moisture or agronomic constraints are a major consideration for growers and advisors. A functional tool that provides a summary forecast and “expert” interpretation of rainfall and temperature outlook and the impact on soil moisture and other relevant information would provide growers and advisors with a practical resource to make better informed decisions. Delivering customised and targeted information rather than prescriptive advice would allow growers and advisors to make decisions based on their individual situations, past experience and personal attitude to risk. Where possible, locally relevant ‘rules of thumb’ would assist users to use forecast information more effectively. Agriculture Victoria has developed ‘The Break’ email (and videos) which is widely recognised as a practical communication that incorporates much of the content described above and is distributed to a large number of farmers and stakeholders in Victoria. A similar communication is needed for other areas across the Southern Region.
The GRDC seeks to establish a participatory pilot program to develop and promote tools to better use Bureau of Meteorology weather data and seasonal outlook forecasts. A small group of advisors will be up-skilled and their knowledge and experiences used to better understand the implications of seasonal forecasts and strategies to manage risk and increase profitability. The information generated from the program will enable the development of guidelines and “rules of thumb”. It is expected that this investment will draw upon and add value to existing related investments including the outcomes of the Managing Climate Variability R&D Program and the Forewarned is forearmed: equipping farmers and agricultural value chains to proactively manage the impacts of extreme climate events Rural R&D for Profit investment.
By February 2020, all growers, advisors and industry stakeholders in the GRDC Southern Region will have regular access to improved seasonal forecast information, emphasising the skill of the forecast and implications for farm management. A pilot program will up-skill a small group of advisors to identify, test and develop a framework to use seasonal forecast information to better manage risk and increase enduring profitability of grain growers.
A budget of up to $400,000 is indicated for this investment dependent upon the quality of the application, expected outcomes and the ability to leverage GRDC funds through additional in-kind and cash co-contribution. The GRDC is focused on delivering value to Australian grain growers; therefore, your application must demonstrate fair market value.
Applying for GRDC investments is now done using the GRDC Grains Investment Portal. Once registered, users can visit the Portal anytime.
To register as a user, please visit https://access.grdc.com.au/
• Click on the register button at the top right side
• Complete the Registration Form. Fill in all the fields: your email address, a password and the captcha. Your password must be alphanumeric with at least one special character (i.e. not a letter or number. Click register to continue the process.
• Registration is confirmed by the system sending an email to you, with details to complete the registration process.
• Once the registration process is complete, you can sign in and review all investments open for tender.
Once you have located this investment, you can commence the application process by completing the details for each field available, until you reach “Submit Application” on the last page.
If you have any questions or concerns please feel free to contact Denni Greenslade – Business Support Team Leader via email email@example.com or use the online support function available.
1. The Applicant must be a single legal entity or recognised firm of partners.
2. The Applicant must be financially viable. For the purposes of this condition, “financially viable” means that the Tenderer has not had any of the following events occur in respect of it:
a. a meeting of creditors being called or held within the past five years;
b. the appointment of a liquidator, provisional liquidator or administrator within the past five years;
c. the appointment of a controller (as defined in section 9 of the Corporations Act (2001)), or analogous person appointed, including in respect of any of its property within the past five years;
d. a failure to comply with a statutory demand in respect of the payment of any debt;
e. an inability to pay debts as they fall due or otherwise becoming insolvent;
f. becoming incapable of managing its own affairs for any reason;
g. taking any step resulting in insolvency under administration (as defined in section 9 of the Corporations Act 2001);
h. entering into a compromise or arrangement with, or assignment for the benefit of, any of its creditors, or any analogous event.
3. The Applicant and any proposed subcontractor must be compliant with the Workplace Gender Equality Act 2012.
4. The Applicant must include in its application details of any known circumstances that may give rise to an actual or potential conflict of interest with GRDC in responding to this procurement. The Applicant's response will be taken into account in the evaluation.
1 March 2018 to 29 February 2020
By portal submission only at https://access.grdc.com.au/