OCCASIONAL PAPER: Regenerative agriculture – quantifying the cost

Published 22 May 2020

Regenerative agriculture describes a set of practices and principles which aim to increase biodiversity, enrich soils, improve watersheds, and enhance ecosystem services. These are goals which are obviously desirable and are understandably generating significant interest in regenerative agriculture methods amongst farmers and the wider community more generally.

Proper assessment of the viability of regenerative agriculture systems is important so that farmers can make informed decisions about whether they wish to adopt such practices. However, what is viable may mean different things to different people depending on their attitude to risk, their existing practices, and their philosophies.

This occasional paper by John Francis of Holmes Sackett examines the findings of a National Environmental Science Program report published in 2018 by Sue Ogilvy, Mark Gardner, Dr Thilak Mallawaarachchi, Dr Jacki Schirmer, Kimberly Brown and Dr Elizabeth Heagney, titled Graziers with better profitability, biodiversity and wellbeingThe Ogilvy et al. paper reported that a cohort of regenerative agriculture graziers who contributed to the project were often more profitable than comparable contributors to the ABARES[1] Farm Survey. In his paper, Francis contends that the measure of profitability used in the Ogilvy analysis is inappropriate compared to how most farmers would understand profitability and that when using a more widely accepted measure of profitability, the regenerative agriculture cohort is shown to be less profitable.

This paper is published in the spirit of continuing a constructive, robust and factual discussion about regenerative agriculture. It specifically addresses one measure of viability, that being profitability, and examines how even that measure can have different interpretations depending on how viability is assessed within individual farm business operations.

[1] Australian Bureau of Agricultural and Resource Economics and Sciences

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