Using a two-price market value method to value extra pasture DM in different seasons.

• The value of extra pasture DM for livestock production can be estimated using several different methods. • The two-price market value method can be an efficient way to estimate the value of extra seasonal dry matter yield of pasture grown and used. • To demonstrate its application, the method is used to value the seasonal yield of 19 perennial ryegrass cultivars grown in temperate Australia. • The value of extra pasture estimated using the two-price market value method can be easily generalised across a range of farming systems. The challenges of estimating the value of growing and using extra pasture to the farm business often necessitates using complex systems modelling of individual farms. In this paper, a straightforward market value method is outlined, where technical substitutes for which there is a defined market price are used as proxies to estimate an equivalent value for extra pasture used in a farm system. The method can be useful for all grazed livestock production systems where substitutes for pasture are purchased and sold. The two-price approach presented advances on previous applications of using market values by accounting for differences in the value of extra pasture DM used on farm in different seasons. The value per extra kg DM harvested in seasons when pasture typically limits livestock production, for example during summer/autumn in temperate environments, and used on farm equates to the market price of the replacement cost as purchased supplementary feed. This is the maximum the extra pasture DM could be worth when used in the farm system. Conversely, the value per extra kg DM harvested in spring when extra pasture is likely to be in surplus of livestock requirements, equates to its market price if sold, as standing hay for example, termed the salvage value. This two-price approach was applied to value the previously published seasonal DM yield differences of 19 perennial ryegrass cultivars, compared to an industry standard cultivar, grown in three regions of Victoria, Australia. Results were then compared to the value of extra pasture DM previously estimated using system simulation analyses of three farms and applied to the same perennial ryegrass data set. The difference in the value of extra pasture DM estimated using the two methods ranged from $0.01/kg DM to $0.24/kg DM. Overall, the two-price method estimated an extra $24 to $200/ha.year benefit over the industry standard cultivar for the 19 cultivars across the three regions, similar to the extra $0 to ∼ $180/ha.year estimated by the previous system simulation analysis. The two-price market value method can be an efficient way to estimate the value of extra seasonal DM yield of pasture, with results easily generalised across a range of farming systems. [ABSTRACT FROM AUTHOR]