The economic feasibility of a national drought reserve of grain

Abstract

In Australia, rainfall is recognized as being both low and variable. Losses, frequently severe, occur through failures in crop production and through mortality and lost production in livestock industries. Various attempts have been made to measure the effects of droughts as they occur in Australia. This effect is felt directly of course in primary industries. Estimates of the cost of sheep losses which have been made by Franklin [1] and by Davidson [2] vary considerably. Davidson uses an estimating procedure which attempts to measure the effect of drought sheep mortality on subsequent flock growth. Taking a "measuring horizon" of 20 years, he obtains an estimate of a total discounted loss over the 20 years of approximately $1,300 million. Franklin's estimate, which was not discounted, is much larger.