September 29, 2020

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New Water Accounting Tool to Save Australian Farmers From Hidden Costs

Australia Water Accounting Tool

Australia’s farmers are recognised as being among the most efficient in the world as they are able to produce more with less.

However, a new study has found that only 25% are accurately tracking their water-related costs.

The Problem

The lack of an integrated system to link financial, soil and climate information has stymied the irrigators for years, according to the University of South Australia researcher Dr Joanne Tingey-Holyoak, but this is set to change.

As reported, the researcher is leading a world-first project with a sensing company to develop a farm water accounting tool that links water-related costs to soil moisture and climate data.

Not only are water prices skyrocketing, but there are a lot of non-water costs involved in irrigating, including pumping and labour.

Add to that other hidden water-related costs such as owner time, quality treatment, interest and insurance.

Most are not being captured due to the inability of accounting systems to integrate this data. These costs end up eroding profits without farmers being aware of it.

Although farmers are embracing technology and becoming more efficient, the existing accounting systems are not sophisticated enough to allow growers to analyse water use, loss and productivity.

Currently, there are several soil moisture tools and climate forecasting technology to help farmers but these need to be integrated with the full suite of water-related costs to get a true picture of how a producer is faring.

The Solution

The water accounting and management expert based in the University’s School of Business is trialling a tool called WaterLink, with three South Australian producers: a potato farmer in the Murraylands and viticulturists in the Adelaide Hills and McLaren Vale.

They discovered that while factors such as the effects of plant stress, disease and frost can be visually detected, the damage has often been done.

By linking sensing, climate and financial information, the farmer can be alerted to plant stress much earlier and take the necessary action to save a crop.

The WaterLink tool was able to identify hidden water-related costs of 20% in the case of a 28-hectare Lower Murray potato crop and 40% across a seven-hectare shiraz block.

Soil moisture, drainage, evapotranspiration, rainfall, and forecasting information were integrated with the full costs of irrigation in both case studies.

Benefits of the Water Accounting Tool

  • This tool offers several benefits such as exposing the full cost of irrigating to identify areas where costs can be shaved and productivity improved.
  • It can also integrate energy market costs and weather forecasting to provide cost-informed alerts and forecasting.
  • The researchers are working to refine the software, which will soon be commercialised through the sensing company.
  • With farmers facing a prolonged drought and increased costs and pressures, there has never been a greater need for better-informed irrigation decision-making than right now.
  • This tool enables irrigators to be acutely aware of their costs, where improvements can be made, whether to diversify their crop, to forego a season on a particular area of land or to invest in different infrastructure which could improve their bottom line.
  • An unexpected bonus is that the new generation of farmers and farm managers coming through, who do not have years of experience behind them, can rely on this tool to make better-informed irrigation decisions.
  • Details of the case studies and the water accounting tool have been published in Outlook on Agriculture.