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Economic modelling in Irrigation Insight

For each day within the economic model, the economic implications of the soil moisture levels (as influenced by rainfall and irrigation) are captured. These economic impacts are focused on two key areas; direct and indirect costs.

The economics component of the programme uses modelled and actual data to understand the economic impact of changes in management of our pilot farms in response to improved soil moisture and weather forecast information.

It has two key aims:

  • to understand the economic and drainage impacts or various irrigation scheduling and management decisions
  • to understand the economic impact of real farms changing their irrigation practices.

We have built the first draft of the hydrological and economic model and are looking to test it with actual data from our case study farms. We are also finalising our ‘pre’ data for our case study farms, this will be contrasted with data collected as we provide information that may influence the farmers’ irrigation scheduling decisions. 

How it works

The hydrological and economic model looks at 18 seasons of daily data across up to three soil types and uses a water balance model to understand what drainage occurs each day. Inputs that affect irrigation scheduling such as return periods, application depth and, if forecasts are used, can be varied.

For each day, the economic implications of the soil moisture levels (as influenced by rainfall and irrigation) are captured. These economic impacts are focused on two key areas; direct and indirect costs. Direct costs are measured for each mm applied (cost of water and pumping costs) or by each day irrigation is used (maintenance and labour). Indirect costs are reflected in changes in the pasture that is available to be offered to cows each season. Changes in pasture growth are calculated based on the relationship of actual evapotranspiration to potential evapotranspiration. Wastage is calculated based on feed offered but not eaten due to soil moisture levels. Pugging is calculated as reduced pasture growth and is based on stocking density and grazing duration.

Several of the economic inputs can be changed in the model, e.g. labour costs and the state needed for pugging to occur, allowing the model to be tailored to a particular farm to a degree.

Where to next?

Our aim is to help farmers understand the potential costs (economic and drainage components) of how they schedule irrigation. Ideally the hydrological and economic model will help them improve irrigation decision making from the perspective of economic return and lost resources (water). It may also encourage discussions around infrastructure e.g. irrigation types that have more flexible returns.

At this stage the model is a first version run by ‘experts’ due to the complexity of the tool. Alongside the aim to incorporate the economic impacts of nutrient lost through the soil profile because of drainage and mapping components, the model will continue to be tested and refined. Our objective is to provide farmers with a useful economic tool they can manage themselves.

About the author

NIWA Environmental Economist

About Irrigation Insight

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