Pay-offs to zone management in a variable climate: an example of nitrogen fertiliser on wheat

Abstract

Temporal variability affects the profitability of zone management of nitrogen, particularly in the north-eastern grain-growing region of Australia. This paper presents a framework for systematically investigating the effect of the interaction between spatial and temporal variability on economic performance, their relative importance, and the value of spatially variable nitrogen management to a farmer with and without knowledge about the coming season. The paper also addresses the degree to which economic performance is influenced by the relative sizes of management zones for fertiliser inputs, prices, and the shape of the biophysical response to fertiliser in each zone. The analysis was based on a single field exhibiting spatial variability. Scenario analysis of seasonally and/or spatially adjusted nitrogen management strategies was based on response functions generated by the cropping systems model APSIM. The analysis shows that seasonal and spatial interactions in nitrogen management are significant issues for decision makers. In this case, knowledge of the coming season is worth more than knowledge of spatial variability, but knowledge of both creates the greatest value. The functional relationship between yields and fertiliser levels for a given crop also determines the economic value of variable-rate nitrogen. A field may exhibit yield variability but this does not automatically present a case for spatially variable nitrogen management. If economic optima of different payoff curves are aligned then returns to zone management will be limited, despite significant differences in yield between different zones.