Breakeven profitability targets for genetic improvement of perennial wheat and intermediate wheatgrass

Weir, A.E., S.M. Swinton and R.C. Hayes

Presented at the All Scientist Meeting (2012-03-15 to 2012-03-16 )

Perennial wheat and intermediate wheatgrass are two environmentally beneficial crops that are under development. In order for a grower to switch from an established crop to one of these crops, the profits of perennial wheat and intermediate wheatgrass must be equal to or greater than the profit of the established crop. Breakeven profitability is thus a necessary condition for the commercial viability of perennial wheat and intermediate wheatgrass. This study evaluates the profits of perennial wheat and intermediate wheatgrass compared to the profits of annual wheat. Three experimental trials were conducted in Cowra and Woodstock in New South Wales, Australia from 2008 to 2010. The gross margins of 43 varieties of perennial wheat and 2 varieties of intermediate wheatgrass were found and compared to the gross margin of 1 variety of annual wheat. At a gross margin of around Australian $400 per hectare per year, the annual wheat variety had the highest level of profitability out of every wheat variety in the three trials. Since none of the perennial wheat or intermediate wheatgrass varieties had profits equal to or greater than the profit of annual wheat, none of these varieties would be adopted as is. Changes in price, grain yield, costs or subsidy payments would be required for the perennial wheat and intermediate wheatgrass varieties to generate profit as high as that of annual wheat. So, this study discusses how the necessary changes would encourage the adoption of the Australian varieties of perennial wheat and intermediate wheatgrass.