Rice R&D Plan 2012–2017

RIRDCShaping the future

Rice R&D Plan 2012 to 2017

July 2011

RIRDC Publication No. 11/050

ii

© 2011 Rural Industries Research and Development Corporation. All rights reserved.

ISBN 978-1-74254-234-8 ISSN 1440-6845

Rice R&D Plan 2012-2017 Publication No. 11/050 Project No. PRJ-005934

The information contained in this publication is intended for general use to assist public knowledge and discussion and to help improve the development of sustainable regions. You must not rely on any information contained in this publication without taking specialist advice relevant to your particular circumstances.

While reasonable care has been taken in preparing this publication to ensure that information is true and correct, the Commonwealth of Australia gives no assurance as to the accuracy of any information in this publication.

The Commonwealth of Australia, the Rural Industries Research and Development Corporation (RIRDC), the authors or contributors expressly disclaim, to the maximum extent permitted by law, all responsibility and liability to any person, arising directly or indirectly from any act or omission, or for any consequences of any such act or omission, made in reliance on the contents of this publication, whether or not caused by any negligence on the part of the Commonwealth of Australia, RIRDC, the authors or contributors. The Commonwealth of Australia does not necessarily endorse the views in this publication.

This publication is copyright. Apart from any use as permitted under the Copyright Act 1968, all other rights are reserved. However, wide dissemination is encouraged. Requests and inquiries concerning reproduction and rights should be addressed to the RIRDC Publications Manager on phone 02 6271 4165.

Researcher Contact Details

Michael Clarke AgEconPlus Pty Ltd 44 Barons Crescent , Hunters Hill , NSW 2110 Phone: 02 9817 5888 Fax: 02 9816 4840 Email: clarke@AgEconPlus.com.au Web: http://www.AgEconPlus.com.au

RIRDC Contact Details

Rural Industries Research and Development Corporation Level 2, 15 National Circuit BARTON ACT 2600 PO Box 4776 KINGSTON ACT 2604 Phone: 02 6271 4100 Fax: 02 6271 4199 Email: rirdc@rirdc.gov.au. Web: http://www.rirdc.gov.au

Electronically published by RIRDC in July 2011 Print-on-demand by Union Offset Printing, Canberra at www.rirdc.gov.au or phone 1300 634 313

iii

Foreword The Australian rice industry is a world leader in production efficiency, water use efficiency and environmental management. Its high quality export focussed production achieves premium prices in world medium grain rice markets. This status is directly attributable to research, development and extension. A significant share of the research, development and extension that underpins the rice industry success has been managed by the Rural Industries Research and Development Corporation through a continuous series of 5-Year R&D plans since 1991. The Australian rice industry faces a different operating environment to the one in which the last 5-year R&D plan was prepared. Production is now more likely to average 800,000 tonnes of paddy rice and be more variable than the 1.2 million tonnes per annum planned for in 2006. Climate variability and potential reductions in irrigation water will be legislated through the Murray Darling Basin Plan and other policy responses will restrict production. Grower ownership of the export supply chain is under review and new Northern Australian production areas are emerging in response to industry change. This 5-Year R&D Plan addresses the new industry realities and builds on past program success. The program retains its strong emphasis on rice variety breeding to further reduce demand for irrigation water and adapt to a climate that is hotter, drier and more variable. The 5-Year R&D Plan identifies six key objectives for the research, development and extension investment to be made on behalf of the rice industry and Australian Government. Associated with each objective is a set of strategies to be followed in pursuing each objective and a set of performance indicators to give guidance as to how the program can be assessed as it progresses. An indicative share of research, development and extension budget has also been proposed for each plan objective in order to guide investment priorities. The rice industry is strongly supportive of the research, development and extension program and its management by Rural Industries Research and Development Corporation. The 5-Year R&D Plan is consistent with the Rural Industries Research and Development Corporation Corporate Plan (2008-12) and Australian Government Research Priorities. The 5-Year R&D Plan will be implemented in accordance with the provisions of the Primary Industries and Energy Research and Development Act 1989. Craig Burns Ian Mason Managing Director Chairperson Rural Industries Research and Development Corporation RIRDC Rice R&D

Advisory Committee

iv

Snapshot of the Five-year Plan Goal To improve the productivity and sustainability of the Australian rice industry through the organisation, funding and management of a research, development and extension program that is aligned with industry reality and stakeholder needs. Objectives Objectives that drive the 2012-2017 R&D Program and the expected share of the program budget are:

1. Rice breeding - varietal and quality improvement: respond to an evolving production environment through development of stress tolerant rice varieties (cold, heat and drought) that reduce water use and maintain or enhance eating quality and yield. This objective has primacy in the plan. It is delivered through a collaboration agreement with SunRice, NSW Department of Primary Industries and RIRDC. RIRDC collaboration agreement funding will be supplemented with additional Program support to deliver the industry’s most important R&D challenge (50%).

2. Prescription farming and sustainability: precision agriculture and whole farm system research offers further opportunity for rice production efficiency gains as well as identifying options for profitable rice based farming systems in Northern Australia. Understanding spatial variation and developing prescription tools for maximising production is a priority. Rice growers, using yield loggers, report single field yields from 8t/ha to 18t/ha. The switch to Delayed Permanent Water has resulted in a new set of crop establishment challenges. Crop establishment on heavy grey self mulching clays remains problematic. Rice is a progressive industry that recognises the importance of investing in sustainability, the development of new production areas in Northern Australia and the challenge of understanding and embracing the carbon economy (15%).

3. Crop inputs, crop protection and grain receival: the cost and effectiveness of crop inputs including fertiliser and fuel shape grower profit. Protecting the crop from weeds, pests and diseases in a changing natural and regulatory environment is an ongoing challenge for growers. Expansion of the industry into northern Australia exposes production to new biosecurity threats. Receiving the best price for the quality and variety of grain produced provides important production signals for growers. This objective addresses input effectiveness and cost along with post farm gate investments in the rapid assessment of grain quality (15%).

4. Extension, communication and partnership development: this objective recognises and addresses the changing nature of public support for extension, the expansion of private sector alternatives including farmer groups (ie groups with aims similar to the Birchip Cropping Group) and the viability of new electronic communication systems. It also sets out to reinvigorate research partnerships established through the Rice CRC and nurture new collaboration opportunities (10%).

v

5. Human capital formation and succession planning: the rice R&D plan will remain a collection of good ideas without appropriate human capital to implement it. In difficult times human capital formation has been neglected in order to fund core research commitments. Now is the time to rectify underinvestment and the Program must target research, industry and grower skills (8%).

6. Blue sky research: in this plan ‘blue sky’ research is defined as including novel or unproven approaches to addressing industry issues and high risk/high reward investments that tackle industry opportunities outside the Program’s core business. For illustrative purposes blue sky might include the use of polymer films to retain soil moisture and heat, novel uses for rice hulls and stubble or the integration of new enterprises such as fresh fish production into the rice farming system. Blue sky research is characterised by creativity and the lack of immediate commercial return (2%).

Program budget allocations are flexible and will be guided by the Rice R&D Committee. The plan is consistent with RIRDC’s overriding aim of maximising the contribution its investments make to the profitability, sustainability and resilience of rural industries and communities.

vi

Contents

Foreword ......................................................................................................................... iii

Snapshot of the Five-year Plan ..................................................................................... iv

Goal.............................................................................................................................. iv

Objectives ..................................................................................................................... iv

1. Introduction ............................................................................................................. 1

Alignment with Government and Corporate R&D Priorities ........................................ 2

Structure of this Report ................................................................................................. 2

2. Rice R&D Program and Overview ........................................................................ 4

The Rice R&D System ................................................................................................... 4

Rice R&D Committee .................................................................................................... 5

3. Industry Profile and Future Directions ................................................................. 7

Location and Production............................................................................................... 7

Climate Change and Water Availability ....................................................................... 8

Reducing Greenhouse Gas Emissions ........................................................................... 9

Industry Features and Position in the Global Market................................................... 9

Products ...................................................................................................................... 11

Markets and Consumers .............................................................................................. 11

Price ............................................................................................................................ 13

Farm Businesses ......................................................................................................... 13

Crop Management ....................................................................................................... 13

Natural Resource Management ................................................................................... 14

Employment, Infrastructure, Regulation and Institutions ........................................... 16

Supply Chains ............................................................................................................. 16

RD&E Capacity .......................................................................................................... 18

Collaboration and Linkages ........................................................................................ 19

Major Trends .............................................................................................................. 19

vii

RIRDC Contribution to Major Trends ........................................................................ 20

4. Key Challenges for the Industry (SWOT) .......................................................... 23

5. R&D Program Performance Assessment ............................................................ 25

The Existing R&D Program ........................................................................................ 25

Performance Assessment – Effectiveness and Efficiency ............................................ 35

Performance Assessment – Benefit Cost Analysis of Varietal Improvement Investment ................................................................................................................... 52

6. Consultation Findings ........................................................................................... 57

Consultation Completed for the R&D Plan 2012 – 2017 ............................................ 57

Other Recent Consultation .......................................................................................... 63

7. Industry Commitment to Research ..................................................................... 65

8. The R&D Program 2012 - 2017 ........................................................................... 66

Key Themes Shaping Future Research Directions ...................................................... 66

Goal ............................................................................................................................ 66

Objectives .................................................................................................................... 66

Strategies ..................................................................................................................... 67

Key Performance Indicators ....................................................................................... 67

Budget Allocation ........................................................................................................ 67

Objective 1: Rice Breeding - Varietal and Quality Improvement ........................ 68

Objective 2: Prescription Farming and Sustainability ........................................ 69

Objective 3: Crop Protection, Crop Inputs and Grain Receival .......................... 70

Objective 4: Extension, Communication and Partnership Development ............. 71

Objective 5: Human Capital and Succession Planning ....................................... 72

Objective 6: Blue Sky Research ........................................................................... 73

9. Proposed Budget ................................................................................................... 75

10. Communication Plan ............................................................................................ 76

Purpose and Communication Objective ...................................................................... 76

Approach – Application of the Decision Tree ............................................................. 76

Target Audience for Rice R&D Outcomes .................................................................. 76

viii

Early, Late or Mainstream Adopters ........................................................................... 77

Expected Key Messages from the Outcomes of the R&D Program ............................ 77

Communication Materials in Languages Other than English ..................................... 78

Targets for Adoption ................................................................................................... 78

Known Industry Networks ........................................................................................... 78

Major Events Where the Rice Industry is Represented ............................................... 79

Key Influencers in the Rice Industry ........................................................................... 79

Key Publications, Websites and Media ....................................................................... 79

Conclusions ................................................................................................................. 79

References ...................................................................................................................... 80

Appendix 1: Contacts for the R&D Program ............................................................. 82

ix

Abbreviations

ACIAR Australian Centre for International Agricultural Research APVMA Australian Pest and Veterinary Medicines Authority AWI Australian Wool Innovation BoM Bureau of Meteorology CIE Centre for International Economics CGIAR Consultative Group on International Agricultural Research CRC Cooperative Research Centre CRDC Cotton Research and Development Corporation CIMMYT International Maze and Wheat Improvement Centre DAFF Australian Government Department of Agriculture Forestry and Fisheries DPI NSW Department of Primary Industries EMS Environmental Management System ETS Emissions Trading Scheme GI Glycaemic Index GHG Greenhouse Gas GM Genetically Modified GRDC Grains Research and Development Corporation I&I NSW Department of Industry & Investment (was NSW DPI) IREC Irrigation Research Extension Committee IRR Internal Rate of Return IRRI International Rice Research Institute Philippines MIA Murrumbidgee Irrigation Area NBIR Net Benefit Investment Ratio NIR Near Infra Red tissue test at crop emergence to test nitrogen uptake NPV Net Present Value NRM Natural Resource Management RDCs Research and Development Corporations RGA Ricegrowers Association of Australia RIRDC Rural Industries Research and Development Corporation RMB Rice Marketing Board of NSW RRAPL Rice Research Australia Pty Ltd - a company owned by SunRice, multiplies seed RRDC Rice Research and Development Committee SWOT Strengths, Weaknesses, Opportunities and Threats analysis WTO World Trade Organisation

x

Acknowledgements The Plan’s authors wish to acknowledge the assistance of RIRDC and the Rice Research and Development Committee. In particular, thanks are extended to the following individuals for their assistance with the Plan:

• Ian Mason, Chairman Rice Research and Development Committee

• Ruth Wade, Executive Director, Ricegrowers Association of Australia

• Dr John de Majnik, Rice Program Manager, RIRDC

• Peter Snell, Russell Reinke, Rachelle Ward and John Lacy, NSW DPI Yanco

• Michael Clarke of AgEconPlus Pty Ltd, plan author

1

1. Introduction This report provides a Program Review for the Rural Industries Research and Development Corporation (RIRDC) Rice Research and Development (R&D) Program for the period 2006 to 2011 and a Five-year R&D Plan for the period 2012 to 2017. The Program Review details the Rice Program’s success in achieving its objectives as set out in the previous Five-year R&D Plan and the relevance, effectiveness and efficiency of Five-year Plan project management. Results from an economic evaluation of the rice new variety breeding program are also reported (Agtrans Research 2010). The Five-year R&D Plan for the period 2012 to 2017 has four main purposes:

1. To outline the rationale for the Rice R&D program that RIRDC will manage on behalf of the Australian Government and the Australian Rice industry.

2. To provide clear signals concerning rice R&D needs and priorities for the period 2012 to 2017.

3. To encourage and support discussion between the rice industry, RIRDC and the research, development and extension (RD&E) community, that will enable the future needs of the industry to be identified and incorporated in annual and longer term planning.

4. To provide a budget framework for investment in rice that will seed R&D for the next five years.

The Program Review and Five-year R&D Plan were prepared by AgEconPlus between September 2010 and May 2011 and involved the following activities:

o Interviews with the Rice Program Manager and review of Program Manager records.

o Consultation with RIRDC Rice Research and Development Committee (RRDC) members, Ricegrowers Association of Australia (RGA) representatives and industry research and extension officers during October and November 2010.

o A two day workshop –focussing on grower RD&E requirements and researcher capacity to deliver held in Leeton 10 and 11 November 2010.

o A review of industry literature to scan past R&D investment needs, successes and gaps.

2

o An evaluation of program relevance, efficiency and effectiveness using the above data sources.

o Design of a new R&D program using program performance outcomes, consultation findings and external research directions.

A draft Program Review and Five-year R&D Plan was presented to the rice industry in Leeton in March 2011 and the RIRDC Board in May 2011. Alignment with Government and Corporate R&D Priorities The Rice R&D Program 2012 – 2017 describes six linked research objectives that relate to varietal improvement, whole farm systems, prescription farming, sustainability, crop protection, extension and human capacity building. These objectives are consistent with:

o The Australian Government’s National R&D Priorities that include an environmentally sustainable Australia; promoting and maintaining good health; frontier technologies for building and transforming Australian industries; and safeguarding Australia.

o The Australian Government’s Rural Research Priorities including productivity and value adding; supply chains and markets; natural resource management; climate variability and climate change; and biosecurity. Supporting priorities addressing innovation skills and technology.

o RIRDC’s Corporate Goals, ie developing new opportunities, adopting new technologies and systems for established industries; improving the competitiveness and sustainability of Australian agriculture; and underpinning innovation and change in Australian agriculture.

Structure of this Report Consistent with the RIRDC Evaluation Framework (RIRDC 2008) and the RIRDC Five-year Plan Template (RIRDC 2005) the report is structured on the following basis:

o Chapter 2 provides an overview of Rice R&D Program structures;

o Chapter 3 and 4 presents the industry profile, trends and SWOT analysis. Chapter 3 also assesses the contribution of the RIRDC Program to industry performance;

3

o Chapter 5 reviews the existing R&D Program including a performance assessment and a cost benefit analysis of the varietal improvement (breeding program);

o Consultation findings are reported in Chapter 6 and Chapter 7 summarises the industry’s ongoing commitment to research;

o The proposed R&D program is detailed in Chapter 8 and budgets are provided in Chapter 9; and

o A communications plan, consistent with the RIRDC Communications Strategy (Cox Inall Communications 2008) is presented in Chapter 10.

4

2. Rice R&D Program and Overview

The Rice R&D System Rice industry R&D is facilitated primarily through RIRDC. Rice growers pay a statutory levy for research, which is largely matched on a dollar for dollar basis by the Commonwealth Government (see Table 2.1) up to 0.5% of industry Gross Value of Production (GVP)1. The levy was established in 1991. Table 2.1 Levy Income Rice R&D Plan (2006-07 to 2011-12)

Rice R&D Program Income

2006-07 ($)

2007-08 ($)

2008-09 ($)

2009-10 ($)

2010-11 (forecast)

2011-12 (forecast)

Levies 3,127,611 496,023 57,499 193,811 588,000 1,764,000

Cwlth matching contributions 828,833 580,667 161,371 216,667 603,333 668,333

Total ($) 3,956,444 1,076,690 218,870 410,478 1,191,333 2,432,333 Source: Rice Program Business Case 2009 and 2010 and RIRDC Program Manager forecasts On 1 January 2006 the levy rate was increased from $2/tonne to $3/tonne for a period of three years. In 2009 the sunset clause was shifted to January 2012. Historically, the levy raised between $2 million and $3 million per annum and funded approximately 44 projects each year (Table 2.2). Two sustained periods of drought and resultant irrigation water shortage through the first decade of the 2000s saw levy income drop to less than $60,000 in 2008-09 and the R&D program ‘pull back’ to core breeding responsibilities, agronomy and limited, largely climate change adaptation, extension. By 2009-10 the number of projects supported by the Rice R&D Program had fallen to a low of eight. Table 2.2 Projects Supported by the Rice R&D Program (2006-07 to

2010-11)

Long term average

2006-07

2007-08

2008-09

2009-10

2010-11

Projects supported 44 28 18 12 8 9 Source: AgEconPlus analysis of RIRDC records

1 In September 2010 the Productivity Commission has recommended halving the maximum GVP contribution made by Government and phasing in this lower rate in 0.025% increments over ten years. The recommendation has not yet been adopted.

5

Projects are usually completed on a joint funding basis and rice industry R&D is conducted by a range of bodies including NSW Department of Primary Industries, universities and other research institutes. RIRDC managed rice R&D funding is primarily targeted at the parts of the value chain from pre-planting through to milling, and, with the exception of a few early projects, has not provided resources for marketing, milling or other commercial issues. R&D in this area has been funded by the Ricegrowers’ Limited (SunRice), which focuses on value added products, processing as well as market research. The Cooperative Research Centre (CRC) for Sustainable Rice Production, which concluded its operation 30 June 2005, was in part funded by the RIRDC Rice R&D Program and directed its investments across most aspects of the value chain. The CRC did not include marketing or market based research (CIE 2004). Outputs from the rice R&D program are quickly taken up by growers through industry workshops, extension activities and other forms of communication. Previous reviews have found that there is a close relationship between growers, the rest of the industry and researchers. Selection of R&D projects is well informed by expected pay-offs and success rates and adoption rates are high and rapid. Funding is allocated by both open call and commissioned work and a 2011 rice R&D extension review provided opportunity for the program to commission a priority project. Project funding is guided by the RIRDC Rice R&D Committee. Rice R&D Committee The RIRDC Rice R&D Committee comprises:

o A chair;

o Eight grower delegates (elected from the eight branches of the Ricegrowers' Association);

o Two delegates nominated by Ricegrowers' Limited/NSW Rice Marketing Board;

o Two independent technical experts;

o The RIRDC program manager for rice; and

o An appointee of the Central Executive of the Ricegrowers' Association. The committee is supported by two liaison groups, which play a proactive role in working with R&D agencies to develop and manage projects that meet committee and RIRDC R&D plan priorities.

6

The grower delegates report twice yearly to their Ricegrowers' Association branch meetings on the R&D program. These meetings provide a further opportunity for growers to raise any concerns that need to be considered in both annual and longer term planning.

7

3. Industry Profile and Future Directions

Location and Production Rice is currently produced under irrigation, mainly in the Riverina region of NSW, which includes the Murrumbidgee and Coleambally irrigation areas and the Murray Valley. Small volumes of rice are also produced in northern Victoria (approximately 1% of production). Successful commercial scale trial production was achieved in the Ord River Irrigation District of northern Western Australia in 2010 for the first time in a generation. In 2010 production trials were also completed in Central and Northern Queensland and Katherine in the Northern Territory. Small areas of rice have also been grown in northern NSW for niche biodynamic markets and aerobic rice has widespread potential. SunRice subsidiary Rice Research Australia Pty Ltd (RRAPL) and the RIRDC R&D Program have supported these initiatives. While diversification of production location is exciting for the industry, the scope for large scale production in Northern Australia is limited. If successful, for instance, the Ord River has the potential to produce up to 50,000 tonnes pa which is equivalent to 5% to 10% of the Riverina total. Figure 3.1

8

Production of Australian rice increased strongly throughout the 1990s and a record crop of 1.7 million tonnes was achieved 2000-01. During what was previously considered to be a ‘normal’ growing season throughout the 1990s, a crop of 0.8 to 1.2 million tonnes was typical. However, average rice production has been severely affected by water availability due to poor seasonal conditions, high water prices and temperature variability during the growing season. A sustained and unprecedented period of difficulty has constrained production through most of the first decade of the new century. A ‘1990s style’ crop of more than one million tonnes was harvested in 2005-06 (see table below). Table 3.1 Rice production and drought

Year Rice Production History 1999-00 Unconstrained crop – 1.1 million tonnes 2000-01 Record production - 1.7 million tonnes 2001-02 Unconstrained crop – 1.25 million tonnes 2002-03 Irrigation water shortage – 390,000 tonnes 2003-04 Irrigation water shortage – 528,000 tonnes 2004-05 Irrigation water shortage – 305,000 tonnes 2005-06 Rebound crop from drought – 1.05 million tonnes 2006-07 Irrigation water shortage – 167,000 tonnes 2007-08 Irrigation water shortage – 19,400 tonnes 2008-09 Irrigation water shortage – 63,000 tonnes 2009-10 Irrigation water shortage – 205,000 tonnes 2010-11 Rebound from drought crop – crop of 800,000 tonnes

anticipated Source: various industry reports. NB: harvest takes place in March Industry expectations of an annual 800,000 tonnes to 1.2 million tonne output have now been ‘factored down’ by many to something like 600,000 tonnes to 800,000 tonnes by a climate change and irrigation water constrained operating environment. Southern Australia rice industry infrastructure planning is now being completed on the basis of this sustained smaller crop (NSW DPI and RIRDC 2009, SunRice pers comm. 2010). Climate Change and Water Availability There is no more serious threat to the rice industry than drought and climate change. Consequently irrigation water availability and cost are critical issues for Australian rice growers. Growers of annual crops such as rice, wheat, soybeans etc receive ‘general security’ water which is allocated after ‘high security’ requirements (for towns, industrial uses, perennial crops, etc) and environmental needs are met.

9

‘General security’ water allocations can be highly variable. For example there was a zero allocation to general security users by the end of the summer crop planting window in 2007. CSIRO and Bureau of Meteorology (BoM) modelling indicates that under the current global warming scenario, rainfall in southern Australia could decrease by between 0-10% (depending on the model used) by 2030 and 0-20% by 2050. Projected reductions in Murray-Darling stream flows of 16-25% by 2050 and 16-48% by 2100 are likely to result in similar levels of reduction in rice production. Droughts are predicted to become more frequent (CSIRO and BoM 2007). It is also significant for the rice industry that global warming will be associated with a projected strong increase in frequency of hot days and warm nights and a moderate decrease in frost (CSIRO and BoM 2007). Warmer nights with fewer cold snaps have positive implications for rice production – increasing yield and decreasing the need for irrigation water to provide an insulating blanket for cold intolerant plants. Future water availability is also likely to be impacted by Government policy, which will focus on extending water markets and providing water for environmental purposes. The 2011 Murray Darling Plan is consistent with this policy forecast and is likely to drive production outlook over the next five years. Reducing Greenhouse Gas Emissions Like other industries, the rice industry also faces the challenge of reducing its emissions of greenhouse gases (GHG). Preliminary research completed overseas shows that methane emissions from rice paddies may actually be lower in higher yielding crops (pers comm. CSIRO). The RGA has developed a Greenhouse Strategy, and it is a member of the Australian Greenhouse Office’s Greenhouse Challenge Program, reflecting the RGA’s concern to improve the sustainability of rice production in Australia. At the centre of the industry’s strategy is a Greenhouse Scorecard that provides growers with the basis for assessing the magnitude and composition of their greenhouse gas emissions from their activities. Additional industry investment is required to ensure the rice industry is fully equipped to participate in the ‘carbon economy’. Industry Features and Position in the Global Market Table 3.2 shows the major features of the Australian rice industry, including the size, output, market orientation and position in the global market. 1993-94 is included as the benchmark year for what was considered ‘normal’ Australian rice production.

10

Table 3.2 Overview of rice production and trade Unit 1993-94 2003-04 2008-09 2009-10

World Production (a) MT 355 389 421 (b) Trade MT 21 26 30 (b) Australia Area planted ‘000 ha 133 65 8.1 19 Average yield t/ha 8.2 8.2 7.7 10.8 Production kt 1,082 535 63 205 Share of world output % 0.3 0.1 0.01

Gross value (GVP) $ m 373 162 33 Domestic consumption

kt 99 na 164

Exports Volume kt 586 108 23 Value $ m 419 68 22 Share of World Trade % 2.8 0.4 0.07 Imports kt 30 88 na Source: DAFF (2005) updated with ABARE Crop Report, June 2010 (a) Milled equivalent, (b) is 2007/08 data Key industry and global feature points include:

o 2008-09 crop was irrigation water restricted, as were crops between 2002 and 2005 and 2006 and 2010.

o The industry is export oriented – historically exports accounted for between 80% and 85% of the Australian crop. In recent irrigation water restricted years Australia has temporarily become a net importer of rice.

o Average industry rice yield of 10.8 t/ha in 2009-10 was an Australian and international record.

o Australian rice Gross Value of Production (GVP) has fluctuated due to seasonal conditions – 5 year average of $255 million (to 2008) but was only $33 million in 2008-09 (ABARE 2007).

o Prices received by rice growers are highly variable and driven by export markets with rice paddy returns averaging between $200/t and $300/t. Recent prices have been as high as $400/t.

o Closing stocks ie world production less world consumption has contracted since the historic highs of the turn of the century (Figure 3.2 below).

11

Figure 3.2

Source: ABARE 2010 Products Worldwide rice products include regular rices (white and brown long grain, calrose medium grain), specialty rices (Arborio, Basmati, Koshihikari, salad rice, organic rice and Doongara/Clever low GI rice), quick cook rices, rice foods (rice cakes, flour, breakfast cereals, sake and beer) and co-products (pet and stock foods, burnt hulls for potting mixes and straw and hulls for building materials) (Kiri-ganai Research, 2006). Australian rice production focuses on medium grain calrose (Japonica variety) rather than long grain tropical rice varieties which form the bulk of world production. Historically, Australia has provided about 20-25% of the traded world supply of medium grain rice into discerning consumer markets. SunRice produce a large number of value added rice products from Australian grown rice. Markets and Consumers The world rice trade is the most highly protected of all agricultural commodities and trade is limited due to self-sufficiency based production policies, high levels of subsidies for domestic production and high levels of tariffs on imports. The US, Japan, Korea and the EU are all protected markets. In 2008-09 only 7.1% of the world’s rice production valued at $US8.6 billion was exported. This contrasts with wheat, the other major world stable, where trade accounted for 16.7% of production. Key rice import markets are located in Asia, the Pacific

0 20 40 60 80

100 120 140 160

1990

-91

1991

-92

1992

-93

1993

-94

1994

-95

1995

-96

1996

-97

1997

-98

1998

-99

1999

-00

2000

-01

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

World Rice Closing stocks (MT)

12

and the Middle East. Major rice exporting nations include Thailand, Vietnam, India, the US, China and Pakistan. Only Australia, the US and Egypt produce significant export volumes of high value medium grain calrose rice. Even modest liberalisation of trade barriers brings substantial benefits to Australia as a highly competitive export supplier. Australian export success has been driven by R&D and a clearly differentiated value proposition based on quality, service, logistics and price. Government assistance to Australian producers is largely limited to what are currently matching grants for R&D (Kiri-ganai Research 2006). Over the medium term, international demand for Australian rice is expected to increase despite trade barriers. Demand for the quality medium grain rice of the type produced by Australia will find growing markets in places like Japan, Taiwan, Hong Kong and the Middle East as trade liberalisation occurs and incomes rise. The Australian rice industry currently has single-desk marketing arrangements for export. Sales of paddy rice and milled product are controlled by the Rice Marketing Board (RMB), which was established under NSW Government legislation. Domestic sales were deregulated in 2006 and there must be some risk of export sales deregulation when the legislation is next reviewed. Australian rice consumers demand high value products. Australia is not feeding the third world poor, but without Australian production additional pressure would be placed on alternative rice supplies. SunRice estimate that Australian rice provides more than 40 million meals worldwide each day (http://www.sunrice.com.au/education). Domestic per capita consumption of rice has increased from 2 kg per person in the late 1970s to 11kg per person in 2010. In recent years there has been strong growth in rice consumption through the food service and food processing sectors. The standard food item is a staple food differentiated by variety, packaging, quality and service elements. The rice category is being successfully diversified away from exposure to commodity markets and into meal and snack solutions and products for food service markets. Australia imports a range of rice varieties and there are no trade barriers in place except quarantine restrictions on brown and paddy rice (Spencer 2004).

13

Price Rice is a globally traded commodity. Returns to the Australian industry and therefore net farm gate returns are heavily influenced by the returns from the international market for rice. Australian farm gate returns are driven by export prices coupled with the effectiveness achieved in milling and marketing. Farm Businesses The Australian rice industry is based on commercially focussed, rather than lifestyle focussed, family farms. Over the last twenty years the number of farm businesses that have predominantly grown rice have declined as the average area of farms has increased. The trend toward fewer, larger and more sophisticated rice farms will continue. ABARE estimate that there were approximately 1,052 rice farm businesses in 2005. The mainstream rice production system in Australia is fully irrigated and is unusual in that an extended rotation system involving other crops and livestock, in contrast to the monoculture based rice systems employed elsewhere. The resultant Australian rice based system is low chemical input (eg fertiliser and herbicide). Productivity gains in the rice industry are important for industry competitiveness and for determining the farm-level allocation of resources between rice and other enterprises. In many instances rice farm businesses are too small and not equipped for enterprises other than irrigated crop production. R&D which has driven industry productivity will play a role in helping farm businesses to adjust to the more variable and less certain rice production outlook resulting from a more variable climate and resultant policy responses. Crop Management Rice yields have averaged close to 9.6 tonnes per ha over the five years to 2010 (see figure below). In 2010 industry yield was 11t/ha. Understanding and managing genetic diversity in rice is important for future productivity gains. Genetic improvement is focussed on adoption of yield improvement, grain quality attributes and cold tolerance. ‘Cracking’ cold tolerance provides the opportunity to significantly reduce the industry’s irrigation water needs.

14

Figure 3.3

Source: NSW Department of Primary Industries Natural Resource Management Because water is a critical natural resource for rice production, the industry has worked tirelessly to improve water productivity (see figure below). Continued efficiency improvements in water usage will be integral to the future profitability and sustainability of the industry.

4.00

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

t/ha

Year

Rice Yield 1985-2010

Yield t/ha

15

Figure 3.4

Source: RIRDC 2006 updated with data from IREC 2008

Natural resource management priorities for the industry include ongoing increases in water use efficiency, reducing new recharge to water tables and preventing salinisation. Regulation restricts the type of soil in which rice is grown and porous soils are excluded. Other key issues include nutrient management (to produce high yield and marketable grain quality) and biodiversity management to protect threatened species (many of which make use of the modified aquatic habitat found on rice farms) and measures to reduce the industry’s emissions of greenhouse gases. Growers hold drainage water on-farm and nutrients do not enter the riverine system. It is worth noting that the drought and better groundwater management have impacted on depth to watertable in the rice growing areas. The industry has embraced environmental management and its Environmental Champions Program, based on Environmental Management Systems (EMS) is recognised as one of the most progressive for an Australian industry.

16

Employment, Infrastructure, Regulation and Institutions Industry information indicates that a rice crop of between 800,000 and 1.2 million tonnes provides direct employment for around 8,000 people in growing, milling and transport and a further 37,000 jobs in flow on activities. The Ricegrowers’ Association of Australia (RGA) is the peak industry organisation for growers and is represented on the Rice R&D Committee, which reports back to RGA members on a six-monthly basis. The rice industry is the most highly regulated in Australian agriculture. Controls exist on both production (soils, farm area, maximum water application, etc) and markets. The Rice Marketing Board of NSW was established to control the purchase and sale of all rice grown in NSW, effectively establishing a single-desk selling system. The board has licensed these powers to the Ricegrowers’ Limited (SunRice) who have moved from a cooperative to a grower owned company structure. SunRice operate two mills in Deniliquin and one each in Leeton and Coleambally. SunRice makes substantial cash and in-kind contributions to the RIRDC Rice R&D Program including operation of Rice Research Australia Pty Ltd (RRAPL) and core funding for the rice breeding program. Supply Chains A map of the current rice industry supply chain showing 2006-2011 R&D priorities is included as Figure 3.5.

17

Figure 3.5 Rice Supply Chain and Current R&D Priorities

18

The current rice industry supply chain is highly integrated and efficient. There is close integration between rice production, milling and marketing. Production and R&D signals flow effectively along the chain from customers to the rice breeding program. Research funded under the RIRDC Rice R&D Program has focussed on rice breeding and farm production efficiency. Post farm gate the supply chain has been has been substantially managed by SunRice. SunRice accounts for the majority of Australian rice processing capacity. Allied Mills has a single rice milling operation in Bridgewater Victoria. Rice grown in northern Australia is currently milled by SunRice in the Riverina. Increasing scale efficiency and automation in milling plants closely matches crop production. Post farm gate rice industry R&D has been funded by SunRice. In October 2010 Ebro Foods, a Spanish owned multi-national which dominates the world rice and pasta sector, has expressed interest in purchasing SunRice. Ebro Foods have provided assurance that if successful it will maintain SunRice’s level of support for R&D in perpetuity. In the longer term grower funded R&D may need greater attention on issues beyond the farm gate ie transport, receival, milling, marketing, markets and consumers. RD&E Capacity The success of the rice industry R&D program lies with its commitment to breeding water use efficient Australian rice varieties, implementing on farm practice change and effective local extension provided by NSW Department of Primary Industries. The collaborative agreement that now exists between NSW Department of Primary Industries, RIRDC and SunRice to support two plant breeders, a molecular breeder and a cereal chemist secures the Yanco Agricultural Institute breeding program’s success over the life of the 2012-2017 R&D plan. On farm rice research capacity is stretched. The industry has limited access to agronomy, crop protection and physiology specialists. Furthermore, since the 2007-11 plan was prepared, the role of the private (‘retail’) agronomist has continued to expand to fill the space being progressively vacated by public sector extension provided by NSW Department of Primary Industries. Farmer groups, modelled on successful organisations like the Birchip Cropping Group, are also starting to emerge. It is likely that over the course of this plan, public sector agronomists will continue to fill their generalist role, albeit with diminished capacity, will work increasingly with researchers to provide an improved conduit for R&D outputs and expand their role in coordinating farmer groups and groups of retail agronomists.

19

Collaboration and Linkages As a result of the increasing variability and continued reduction of income into the rice program, increased collaboration and linkages with other research organisations and funding bodies is a key aim of the rice program. Collaboration and linkages also provides opportunity for additional research efficiencies. Over the course of the 2006-11 R&D plan successful joint projects were completed between Australian rice research scientists and the rice industries of South East Asia. These projects were funded by the Australian Centre for International Agricultural Research (ACIAR) and helped to retain Australian rice research capacity when a shortage of irrigation water forced the RIRDC Program to contract. Greater collaboration and linkages with the Grains Research and Development Corporation (GRDC) has already been initiated and a collaboration agreement with SunRice and NSW I&I to secure plant breeding will be finalised in 2010-11. The collaboration agreement will provide a measure of insulation from future income fluctuations and better use of shared resources. Collaboration and linkages will also provide economies of scale in research activities and the opportunity to share knowledge through international research organisations including the Philippines based International Rice Research Institute (IRRI). IRRI is currently refocussing and increasing its investments in rice breeding and additional emphasis is expected to be placed on cold tolerance research. Integration of Australian and IRRI programs is a priority for 2012-2017. Areas where additional partnerships could be formed include the CRC for Irrigation Futures, IREC, ICF, VICC, MRDC, MLA, AWI, Farming Systems Groups, CSU and the Graham Centre. Major Trends Major trends in the Australian rice industry have included:

o Production – constrained by a lack of irrigation water resulting from sustained drought

o Production – increased water use efficiency and production per hectare

o Location - exploration of production outside the Riverina

o Markets – some ongoing reduction in world rice stocks

20

o Markets – value added / convenience focussed rice products more important

o Markets – potential for deregulation and loss of single desk export arrangements

o Markets – SunRice may cease to be a rice grower owned company

o Markets – sophisticated and differentiated products required

o Farm businesses – adapting to climate change / drought affected production

o Supply chain – short and efficient now but what if production increases in other areas

o R&D capacity – plant breeding resource protected for the life of the next plan

o Collaboration and linkages – initiatives under way to achieve common goals

RIRDC Contribution to Major Trends Table 3.3 describes links industry trends and their possible causes.

21

Table 3.3 Rice Industry Change Since 2006

Description of Change

Factors Influencing Change

Possible Influence of R&D Program on the Change

Changes in Production

Production – constrained by lack of irrigation water.

Sustained drought. RIRDC investment has delivered more water efficient rice varieties and extension assistance.

Production – increased water use efficiency and production per hectare.

Improved plant genetics and supporting agronomy.

RIRDC investment has delivered more water efficient rice varieties and extension assistance.

Location – exploration of production outside the Riverina.

Drought and lack of irrigation water in the Riverina.

Commercial decisions not R&D linked. R&D Program has assisted with some research projects.

Changes in Markets

Markets – some ongoing reduction in world stocks.

World demand outstripping supply.

Not linked to RIRDC R&D but yield improvements generated by the program are a ‘positive’.

Markets – sophisticated and differentiated products required.

Increased incomes. RIRDC R&D does not target the rice market.

Markets – potential for deregulation and loss of single desk export arrangements.

Broader Government policy objectives.

RIRDC R&D does not target the rice market.

Markets – SunRice may cease to be a grower owned company.

Broader commercial objectives. RIRDC R&D has invested funds to clarify growers’ and SunRice’s rights in relation to Intellectual Property (IP).

Changes in Industry Structures

Farm businesses – adapting to climate change affected production.

Sustained drought. RIRDC investment has delivered extension targeting adjustment strategies

Production chain – new chains forming.

Limited new chains in response to new production areas.

Not linked to RIRDC R&D

R&D Capacity. Withdrawal of state agency support.

RIRDC facilitated agreement with SunRice and NSW I&I for ongoing breeding program.

Collaboration and linkages. Government policy, efficiencies and synergies.

RIRDC is in dialogue with GRDC and other potential research partners.

Source: Industry analysis

22

Strong links exist between RIRDC Rice R&D Program outcomes and positive industry production trends ie increased water use efficiency and rice production per hectare. High take up rates for R&D project outcomes support this linkage. Industry support for the RIRDC Rice R&D Program is strong (see Chapter 6 Consultation Findings and Chapter 7 Industry Commitment to Research).

23

4. Key Challenges for the Industry (SWOT)

The following rice Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis was developed from a review of the literature and industry consultation. It focuses on major issues relevant to an R&D plan.

Strengths

Skilled and adaptable growers Low levels of disease and pest problems Industry driven leading environmental management Vertical integration through the supply chain Successful RD&E program – varieties, yields, use water

efficiency, extension, etc High uptake of research via industry extension Cooperative institutions, committed leaders and a unified

industry

Weaknesses

Highly susceptible to climate change and water use restrictions

Reliant on varieties that are susceptible to cold weather (and require a water blanket)

Slowing in the rate of yield increase - breeding program addressing other priorities

Lack of options for farmers to grow their businesses or ensure successful exit

Research gap in relation to whole farm system and its optimisation

Diminishing and aging population of future growers and leaders

24

Opportunities Favourable market outlook Some capacity to respond to worldwide food security

concerns Industry expansion into new Australian states and regions Partnerships including those with other industries and other

RDCs Potential for R&D to achieve further yield and water use

efficiency improvements Capacity to develop greater flexibility in the rice farming

system Achieve theoretical on-farm yield potential via management

and extension Improve harvesting, storage, handling and transport

Threats

Loss of RD&E capacity Reduction in government funding for rural industry R&D as

recommended by the PC Climate variability critically limiting production More variable production impacting milling and marketing

operations Loss of geographic concentration efficiencies if industry

expands into new area Loss of single desk may impact export returns which drive

industry profitability Possible long term divergence between grower and SunRice

interests State government withdrawal from extension services Impact of production variability on funds for R&D Other environmental issues – salinity, biodiversity, stubble

burning, etc Exotic pest / disease threats, herbicide resistance Farm input cost increases – fertiliser, fuel, chemicals

25

5. R&D Program Performance Assessment

The Rice R&D Program review has been informed by:

o R&D Plan for the Rice Program 2006-2011 (RIRDC 2006);

o R&D Plan for the Rice Program 2006-2011 Revised (RIRDC 2008);

o RIRDC Research in Progress Reports for the Rice Industry;

o Annual Rice Program Business Cases prepared by the RIRDC Program Manager; and

o A Performance Assessment completed using the RIRDC Evaluation Framework.

The Existing R&D Program The most recent RIRDC Five-year R&D plan for the rice industry (2006-2011 revised) addressed six major research objectives:

Objective 1: Varietal and rice quality improvement

Objective 2: Crop establishment, agronomy, cop physiology, nutrient management and precision agriculture

Objective 3: Crop protection

Objective 4: Farming systems – whole farm management, profit and sustainability

Objective 5: Technology transfer, communications, policy and communities

Objective 6: Human capital formation. When the most recent R&D plan was revised in July 2008 a seventh objective (Market Access and Marketing Arrangements) was removed. Objective 7 was not funded during the 2006-11 plan period. Details on the nature of the six research objectives and the types of investments made under each associated strategy are provided below. Commentary on the extent that strategies have been achieved is drawn from RIRDC Annual Program Business Cases, consultation with the RIRDC Program Manager and industry.

26

Objective 1: Varietal and rice quality improvement Objective 1 was to provide new rice varieties with enhanced yield, acceptable quality and improved cold tolerance; to provide varieties which require less irrigation water and are better able to cope with climate variability; to deliver a better understanding of the basis of rice quality, to aid variety selection and to maintain quality in the light of climate change. Objective 1 received 61% of the Program’s drought reduced budget. Objective 1 was driven by ten strategies:

o Focus breeding efforts on yield increases, quality, cold tolerance and water productivity. With a much reduced R&D budget the program has been successful in maintaining key activities in the rice breeding and quality evaluation program ie a cold tolerance, yield and quality focus. In 2009 cold tolerance breeding separation was observed in an early analysis of experiments and progression of recombinant inbred lines for precision breeding of cold tolerance achieved. Further advancement toward cold tolerant rice varieties is expected. Trials of two new rice varieties generated by the Program have delivered yield improvements of 10% against Amaroo, the industry standard.

o Focus resources on core products rather than niches such as basmati or fragrant rice. No investments in new niche products have been made.

o Continually improve the efficiency of the rice breeding program/quality evaluation program by evaluating and adopting appropriate biotechnology. Key biotechnology outputs have included improved microspore culture technology to improve breeding efficiency and evaluation of germplasm and development of key markers for cold tolerance.

o Evolve the breeding program to integrate the new paradigm of molecular breeding e.g. marker assessment for selection of traits such as cold tolerance. Molecular breeding integrated into the program.

o Continue to develop improved rice grain quality evaluation techniques. Current techniques applied to the program.

o Leverage scarce resources in a small domestic breeding program through collaboration with international rice breeders. Collaboration has been restricted due to drought reduced research funds.

o Continue to collaborate with the Rice Industry Variety Evaluation Committee to ensure market signals are passed back to breeders. Ongoing and regular collaboration was achieved.

o Maintain an adequate district-testing program for promising lines in the breeding program. Activities have included evaluation of over 7,000 breeding lines for physical and cooking qualities important to rice.

27

o Develop an understanding of the impacts of climate change (evaluated carbon dioxide and temperature) on rice quality attributes. This strategy was added to the revised 2008 plan and has not yet been addressed.

o Ensure pure seed of new and existing varieties is made available quickly to growers through sound seed production strategies. The efficient and effective RRAPL system has been maintained.

Objective 1 has been addressed. Progress toward cold tolerant rice varieties has been realised and retention of research staff, and therefore the viability of the rice breeding program, achieved through a major drought induced funding downturn.

Objective 2: Crop establishment, agronomy/crop physiology, nutrient management and precision agriculture

Objective 2 was to increase average yields through understanding and reducing in-field variability, to develop a better understanding of plant/soil/environment interactions including impact on greenhouse gas emissions, to provide nutrient management systems for profitable and sustainable rice production, and to improve the uniformity, reliability and cost effectiveness of rice establishment. Objective 2 received 16% of available budget and was driven by six strategies:

o Address in-field variation in crop yield using precision agriculture techniques including identifying and acting on factors limiting rice yields. Four projects were funded to tackle this strategy. Projects resulted in an improved understanding of rice quality and the spatial variability of rice growth. The variability of rice growth and yield within the rice field was related to cut and fill depths and land forming strategies. Cut areas require additional nitrogen fertiliser to improve crop performance. Other projects included an evaluation of Near Infrared (NIR) technologies to enhance precision management of rice crops, in particular precision of variable crop fertilisation, leading to higher returns and improved water efficiency. The relevant KPI for this strategy was to increase average rice yield from 9t/ha to 11t/ha by 2011 and it is noted that average industry yield, on limited plantings, was 10.8t/ha in 2010.

o Develop better nutrient prediction tools to maximise nutrient use efficiency. In addition to Strategy One projects the maNage rice CD (a farmer decision tool) was enhanced and recommendations from application of the tool were successfully adopted by farmers.

o Better understand significant nutrients including nitrogen, sulphur, phosphorus and zinc, soil physical changes, soil acidity changes and straighthead impact on rice productivity. A single project developed management options to mitigate straighthead occurrence in rice, the

28

outcome of which was a technique for evaluation of new rice genotypes for straighthead tolerance. The relevant KPI was an increase in average industry rice yield.

o Develop a better understanding of management impact on greenhouse gas emissions from different production systems. No projects funded.

o Develop flexible rice management solutions to fit better into whole farm management. No projects funded.

o Improve the reliability of seedling establishment. Projects addressing this strategy resulted in better practice knowledge for dry sown rice.

Objective 2 has been appropriately addressed and significant progress toward the pre-eminent KPI of increased average industry yield was achieved.

Objective 3: Crop protection Objective 3 was to provide effective and sustainable control of major rice weeds, pests and diseases, taking account of possible impacts of climate change on their incidence; to address herbicide resistance in rice weeds (highest priority); and to minimise the risk of exotic weeds, pests and diseases. Objective 3 received 9% of available budget and was driven by twelve strategies:

o Identify chemical solutions to potential and existing grass and broadleaf resistance. A project funded to address this strategy showed Saflufenacil was a new protox inhibitor herbicide that is an excellent broadleaf and sedge weed control. The relevant KPI was ‘viable chemical solutions to counter current and potential resistance problems – identification of one new chemical by 2011’ and this was achieved.

o Adopt a ‘weed systems’ approach that relies on environmentally sustainable chemical use, links to other rice industries to create chemical company interest in new products, work on the biology of weed management and rotation of chemicals. This strategy was delivered through two phases of the Weed Management in Australian Rice Production project which also tackled weed control in direct drilling systems.

o Invest in longer-term strategies to increase the effectiveness of non-chemical integrated weed and pest management programs (lower priority). Strategy addressed by ‘Weed Management in Australian Rice Production’ project.

o Weeds of economic significance to be addressed through the program include barnyard, dirty dora, starfruit, alisma, water couch and silvertop. Strategy addressed through ‘Weed Management in Australian Rice Production’ project.

29

o Pests of economic significance to be addressed through the program include bloodworm, aquatic worms, leaf miner, aquatic snails, armyworm, native waterfowl and rodents. Strategy addressed through ‘Management and Ecology of Key Rice Pests’ project. Niclosamide was found to be a replacement for copper sulphate for use against aquatic snails. Key results available have included studies in the invertebrate pests affecting the establishment of aerially sown crops: bloodworms, snails and aquatic earthworms. Research has concentrated on expanding the options available to rice growers for controlling these pests, and on developing strategies that minimise the use of synthetic pesticides.

o Minimise the introduction of exotic rice pests, weeds and diseases through the Rice Biosecurity Plan and other measures. No new exotics identified during the plan period.

o Minimise the introduction of exotic rice pests, weeds and diseases by educating ricegrowers and other regional stakeholders in the recognition of threatening species. The strategy remains relevant and no new exotics identified during the plan period.

o Minimise off target drift from agricultural chemicals by developing improved formulations and application technology. Strategy was not addressed.

o Develop objective data on the relative performance of weed control programs. Strategy was not addressed.

o Support the Rice Crop Protection Working Group and use their resources to guide crop protection investment. Rice Crop Production Working Group was supported.

o Educate commercial and public agronomists to improve expertise in crop protection. Strategy was not addressed.

o Ensure that on-farm crop protection measures comply with appropriate Food Safety standards. No specific projects were funded to address this strategy.

Objective 3 has been delivered through better control of invertebrate pests affecting rice establishment and improved weed control knowledge.

30

Objective 4: Farming systems for whole farm management, profit and sustainability

Objective 4 was to ensure the profitability and environmental sustainability of the whole rice farm in a situation of greater climate uncertainty. Objective 4 received 4% of available budget and was driven by sixteen strategies:

o Establish a strategy for the use or development of decision support tools or processes to assist rice growers to address the multiple objectives of profitability and environmental sustainability. Projects funded are expected to increase the measurability and understanding of new farming techniques.

o Revisit financial benchmarking for rice and secure grower support and funding. Investigate whole farm/irrigation layout/crop rotation/weed biology system that can respond to projected reductions, and increased variability, in water supplies. Funded projects successfully determined that the use of raised bed, irrigation layouts for the efficient production of rice and other crops in rotation achieved rice yields equivalent to those of conventional flat irrigation layouts. Implications include increased range of cropping opportunities, productivity increases and improved water efficiency.

o Develop tools for better water accounting and measurement through the system but especially on farm. Tools to assist integration of water allocation decisions and crop planting requirements. Research included cooperative efforts with international, Commonwealth, state and industry based agencies to improve water management and the changing climatic landscape.

o Investigate the impacts on Australian rice production of the changed temperature ranges and frequencies expected to accompany global warming. Strategy not addressed.

o Identify a range of management options available to growers to mitigate greenhouse gas emissions from rice farming systems and revise the current RGA scorecard for measuring greenhouse gas emissions from rice based farming systems to better reflect Australian production methods. Strategy not addressed.

o Develop a better understanding of crop responses to environmental and management factors such as soil types, farm layout, crop density, water depth, and air and water temperatures. Strategy not addressed.

o Investigate opportunities for joint grain/graze/rice R&D with other Research and Development Corporations to leverage program funds and better address whole farm issues associated with climate change.

31

Strategy addressed through dialogue with GRDC and a ‘foundation’ project has been scoped.

o Establish objective measures of soil health in rice farming systems and identify management practices and rotations that optimise soil health. Studies into the impacts of pesticides on soil biological health were completed.

o Identify indicators and management options that will assist growers to preserve and enhance biodiversity on rice farms and lessen negative impacts. Projects have addressed farm biodiversity including vertebrate biodiversity and management of waterfowl.

o Investigate the impact on biodiversity of reduced water use in the rice industry. Strategy not addressed.

o Ensure other key sustainability issues remain in focus for the industry i.e. soil productivity, salinisation, acidification, water table recharge and surface drainage. Projects have addressed this strategy.

o Generate objective data on environmental performance and status to better inform the community. Increased consultation with the Environmental Champions Program was completed to identify new environmental tests to assess sensitivity and to create tools available in detecting organophosphates and carbamate pesticides in water samples.

o Support and work closely with the industry’s EMS program – Environmental Champions. Increased consultation with the Environmental Champions program was completed to identify new environmental checks for RiceCheck2 and promote existing on-farm vertebrate biodiversity.

o Investigate stubble use strategies managed through action research/demonstration projects on a cost benefit basis (minor). Strategy not addressed.

o Continue to appraise the potential of aerobic rice systems (long term industry opportunity). Single project funded by the Rice R&D Program.

As a consequence of budget reductions Objective 4 was underfunded. Nevertheless, ten of sixteen strategies were at least partially addressed.

2 RiceCheck is the NSW DPI rice management package aimed at increasing yields, profit and water productivity, established in 1987.

32

Objective 5: Technology transfer, communication, policy and communities

Objective 5 was to facilitate industry awareness and rapid adoption of new and improved technology; to ensure communication channels are appropriate for changing operating conditions; to contribute to informed policy debate on key issues such as water, climate variability and market access; to ensure appropriate community linkages and an understanding of the role rice plays in maintaining the social fabric of the region. Objective 5 received 8% of available funding and was supported by seven strategies:

o Access better ways to communicate and transfer technology with farmers and service providers (technology transfer).

o Build additional links between agribusiness agronomists and public sector service providers (technology transfer).

o Develop and support proactive extension programs that emphasise both specific and holistic approaches. Coordinate the flow of information and ideas between multiple parties (technology transfer).

o Ensure communication systems, including the transfer of market information, are appropriate for twenty-first century operating conditions (communications).

o Research institutional structures to manage changing external and internal industry environment (policy).

o Clarify ownership in relation to intellectual property (policy). o Invest in rice community/social research (communities).

Objective 5 technology transfer investments have been successful in increasing the adoption of improved production practices and hence, delivering improved rice yields and water use efficiency. Also, the Program supported communication and dissemination activities including the Farmer’s Newsletter, rice field days and the RiceCheck publication. A project was also commissioned to clarify ownership of rice variety intellectual property.

Objective 6: Human capital formation Objective 6 was to ensure ongoing Australian rice research and extension capacity; to optimise participation of people and develop their potential to contribute to the industry; and to proactively develop linkages with other rice researchers and leverage a small R&D program into a worldwide pool of knowledge generation. The objective received 3% of available funding and was supported with eight strategies:

33

o Seek and establish NSW Government ongoing commitment to rice research. In the absence of ongoing commitment ensure the provision of alternative research capacity. This strategy was achieved.

o Encourage training and development of growers, the Rice R&D Committee, research and extension officers. This strategy was addressed and partially achieved.

o Encourage participation by under-represented groups – women, youth, ethnic and Indigenous groups. This strategy was addressed and partially achieved through the funding of a Nuffield Scholar.

o Encourage capacity to address succession planning for all parts of the industry. This strategy was not addressed.

o Encourage active participation in programs like the Australian Rural Leadership Program, Environmental Champions Human Resource Capacity Building, Nuffield Scholarships, Churchill Fellowships, Women in Agriculture forums, study tours, etc. This strategy was addressed and partially achieved through the funding of a Nuffield Scholar.

o Develop training programs to meet the needs of industry. Strategy achieved through the ‘Capacity building for a productive and sustainable rice farming system’ project.

o Build capacity in the Rice R&D Committee including corporate governance, meeting procedures, etc. Strategy achieved through training. In addition representatives from the Rice R&D Committee attended the 4th International Temperate Rice Conference in Italy June 2007.

o Ensure annually that at least one significant research/extension officer is invited to Australia and one Australian officer views, first hand, an overseas facility with appropriate learning opportunities. One Australian rice breeder travelled to Japan. The strategy was partially achieved.

A key outcome of this objective was support for a Nuffield Scholar in the rice industry. Investments made as part of this objective also provided support and encouragement of rice networks, confidence building and improved leadership skills. Delivery of the objective supported critical Australian rice research and extension capacity. While the human capital objective was underfunded, seven of eight strategies were wither achieved or partially achieved.

34

Resource Allocation under the Current and Previous Plans R&D resource allocation by 2006-2011 R&D plan objective is summarised in Table 5.1 below. Table 5.1 Expenditure by Rice R&D Plan Objective (2006-07 to 2010-

11)

2006-07 ($)

2007-08 ($)

2008-09 ($)

2009-10 ($)

2010-11 ($)

% of total

Obj 1: Varietal Improvement 1,200,460 1,004,274 695,744 684,966 510,000 61 Obj 2: Crop est, Agronomy, etc 461,080 247,212 127,736 132,644 100,000 16 Obj 3: Crop Protection 261,898 143,190 115,291 12,000 40,000 9 Obj 4: Whole Farm Management 130,620 117,198 9,090 0 0 4 Obj 5: Technology Transfer 247,638 95,013 58,000 16,000 110,000 8 Obj 6: Human Capital 158,230 47,329 0 0 5,657 3 Total Expenditure ($) 2,459,926 1,654,216 1,005,861 845,610 765,657 100 Source: AgEconPlus analysis of RIRDC records. The following observations are offered after review of the Rice R&D Plan 2006-2011:

o Total program expenditure over five years will be $6.7 million against a plan budget of $12 million ie 56% of budget.

o The program was affected by exceptional circumstances. For example there was no open call for research proposals in 2008-09, the Program used its funding reserves to meet project commitments, RIRDC provided supplementary allocations from its core Australian Government allocations and SunRice supported rice breeding.

o Importantly core research capacity for the variety improvement program was maintained and an agreement with NSW Department of Primary Industries Yanco Agricultural Institute put in place.

35

Performance Assessment – Effectiveness and Efficiency

This Performance Assessment is completed in accordance with the RIRDC Evaluation Framework (May 2008) Part 1, Performance Assessment. This part of the program review addresses Rice R&D Program:

o Relevance; o Effectiveness; o Management effectiveness; o Efficiency; and o Lessons.

The Performance Assessment was completed through a series of interviews with the RIRDC Program Manager, interrogation of RIRDC Program Manager records and consultation with members of the Rice R&D Committee. Relevance

Quality of analysis and priority setting at Plan development and throughout the Program period Were the priorities set and revised in response to rice industry needs? Comprehensive analysis and consultation was completed with rice growers, researchers, marketers and natural resource managers in 2006 to develop priorities for the Five-year Plan. An independent consultant prepared an industry R&D issues paper, the paper was circulated for comment, individual interviews were completed and a workshop held to set Five-year Plan priorities. An R&D priority setting survey was also distributed by the Rice R&D Committee and more than one hundred completed questionnaires were returned. Plan research was managed in tandem with and informed by, a Department of Agriculture, Fisheries and Forestry (DAFF) funded Rice Industry ‘Taking Stock and Setting Directions’ project. The plan was subsequently revised in 2008 to reflect changing environment conditions and the new policy climate. Throughout the life of the Five-year Plan, the Program Manager and the Rice R&D Committee have received advice from industry and other sources to ensure research priorities remain relevant. The Rice R&D Advisory Committee, and through the committee the industry, has a role in shaping the terms of reference of all Program projects.

36

Annual Rice Program Business Cases completed in 2008, 2009 and 2010 also helped to ensure ongoing Program relevance and responsiveness to emerging industry needs. Have current Five-year Plan strategies and priorities proved to be relevant? Five-year Plan strategies have proved relevant. In total, the 2006 to 2011 Plan identified 58 strategies and in light of much reduced funding, 38 of these were addressed through rice industry R&D projects. Table 5.2 Strategies Identified and Addressed (Number)

Identified in Plan

06-11 Funded under Plan

06-11 Obj 1: Varietal Improvement 10 6

Obj 2: Crop establishment, Agronomy, etc 6 4

Obj 3: Crop Protection 12 8

Obj 4: Whole Farm Management 15 10

Obj 5: Technology Transfer 7 3

Obj 6: Human Capital Formation 8 7

Total 58 38 Source: AgEconPlus analysis of RIRDC records. Lack of funds rather than lack of relevance explains the shortfall in strategies addressed. A second measure of the Program’s relevance is adoption of project outcomes. When the Program is able to fund a project and results are made available, the effective rice extension network usually ensures its rapid implementation. The Rice R&D Committee is strongly linked to, and representative of, the Riverina based industry. Industry consultation completed as part of this Performance Assessment found agreement with the sentiment that ‘objectives set in the Five-year R&D Plan have proved to be relevant’.

Quality of strategies developed Were strategies based on realistic expectations, given the funding available and the available R&D capacity? Strategies were based on realistic expectations. The 2006-2011 plan built on foundations laid in the 2001 and 1996 plans and was consistent with an annual R&D budget of $2.4 million. However, long term drought meant that the annual

37

budget averaged only $1.3 million. R&D capacity was available to deliver a $2.4 million pa rice R&D program.

Quality of project proposals submitted and funded What proportion of those proposals submitted directly addressed the strategies? The table below was completed following analysis of RIRDC Program records and data supplied by the Program Manager on rejected proposals. Table 5.3 Quality of Project Proposals

Objective Proposals Received

Proposals Directly

Addressing FYP Strategies

Proposals Funded

Obj 1: Varietal Improvement

12 10 6

Obj 2: Crop est, Agronomy, etc

7 5 1

Obj 3: Crop Protection 6 4 5 Obj 4: Whole Farm Management

16 12 6

Obj 5: Technology Transfer

8 8 3

Obj 6: Human Capital Formation

2 2 1

Total 51 41 22 Source: AgEconPlus analysis of RIRDC Program data

The Program Manager and the Rice R&D Committee have performed well in communicating the Five-year Plan to researchers – 80% of proposals directly addressed Five-year Plan strategies. Proposals rejected were due to a shortage of R&D funds. What proportion of those funded did not relate directly to any of the strategies in the Five-year Plan? Two of twenty two funded projects did not relate directly to any of the strategies in the Five-year Plan. Objective 3, Crop Protection, funded a project outside of documented Five-year Plan strategies when a new issue of significance (‘pecky rice’) was identified. Likewise, the Program funded an aerobic rice R&D project under Objective 4, Whole Farm Management, when the significance of this emerging industry was realised post plan development.

38

Allocation of Program resources Did the shares of expenditure over the five years align with the intended allocations across the different objectives/strategies? The history of resource allocation, by current plan objective is shown in Table 5.4. Table 5.4 Historical Analysis of Expenditure (Expressed as a % of

total)

1992-99

1999-05

2006-11 Planned

2006-11 Actual

Obj 1: Varietal Improvement 71 41 50 61

Obj 2: Crop est, Agronomy, etc Included above 14 10 16

Obj 3: Crop Protection Included above 9 10 9

Obj 4: Whole Farm Management 16 20 10 4

Obj 5: Technology Transfer 10 11 10 8

Obj 6: Human Capital 1.3 3 7 3

Other 1.7 2 3 0

Total 100 100 100 100 Source: AgEconPlus analysis of RIRDC records. Resource allocation 2006-2011 broadly coincided with intended allocations across plan objectives. The need to maintain the core breeding program (Objective 1 Varietal Improvement) during drought exceptional circumstances necessitated allocation of a minimum of $510,000 in 2010-11 when total expenditures were only $766,000. Overall, Objective 1 received 61% of Five-year Plan allocations rather than the 50% budgeted. Objective 2 also received an additional percentage share but less than the quantum budgeted. Consequently a lesser share of resources were directed to each of whole farm management, technology transfer and human capital formation objectives.

39

Effectiveness of the R&D

Program Goal The program goal was to:

‘To improve the profitability and sustainability of the Australian rice industry through the organisation, funding and management of research, development and extension program that is both market and stakeholder driven’

Stakeholder consultation completed as part of this evaluation revealed agreement with the statement that investment in R&D through the current Five-year plan had improved the sustainability and profitability of the rice industry for the longer term.

Key Performance Indicators What share of R&D Program KPIs have been realised? Given the full five years of R&D investment, what proportion of Program KPIs are expected to be realised within the next five years? The table below was completed in consultation with the Program Manager. Table 5.5 Realisation of Rice R&D Program KPIs

R&D Program KPIs Achievement Objective 1: Varietal and rice quality improvement Release of new varieties. o KPI realised.

o YRM69 has been commercially released and all available seed was taken up by the industry in 2010. It offers significantly greater cold tolerance while maintaining eating quality. YRM69 performed well during field trials in 2009.

Improved varieties account for 30% of industry production.

o Not yet achieved. o New variety constrained by seed supply.

Isolation of promising lines to ensure future new varieties.

o KPI realised. o Screening of over 7,000 new breeding lines and

promising lines isolated. Increasing water use productivity.

o KPI realised. o Progress toward 1.0t/ML made.

Markers identified with capacity to increase cold tolerance.

o KPI realised. o Progress toward increasing cold tolerance by 4oC

made.

40

Increase average rice yield. o KPI realised. o Industry average of 9t/ha in 2006 lifted to 10.8t/ha

in 2010. Small production base noted. Increased collaboration with international plant breeding organisations.

o Not achieved. o Links with International Rice Research Institute

(IRRI), Philippines maintained but increase in visits by plant breeder personnel restricted by limited RIRDC and IRRI funds.

Incorporation of quality traits in new varieties.

o KPI realised. o YRM69 offers significantly greater cold tolerance

while maintaining eating quality. Continued provision of pure seed of new varieties

o KPI realised. o New variety seed made available by RRAPL.

RRAPL system continues to function in an efficient and effective manner.

41

Objective 2: Crop establishment, agronomy, physiology, nutrients and precision agriculture Increase average rice yield. o KPI realised.

o Industry average of 9t/ha in 2006 lifted to 10.8t/ha in 2010. Small production base noted.

Increasing water use productivity.

o KPI realised. o Progress toward 1.0t/ML made.

Precision agriculture breakthroughs to provide a suite of tools for rice growers by 2011.

o KPI realised. o Further development of NIR and application to

solving variable yield issues.

Nutrient tests used by 80% of growers to improve nitrogen use efficiency.

o KPI not realised. o Project addressing nitrogen use efficiency to

maximise yield was completed. Accurate information available on GHG emissions to enable growers to better complete and use the greenhouse scorecard.

o KPI not realised.

More uniform crop establishment

o KPI not realised – goal of average plant stands of between 200 and 300 plants per square metre remains outstanding.

Objective 3: Crop protection Viable chemical solutions to counter current and potential weed resistance problems.

o KPI of one new chemical by 2011 will not be achieved.

Grower adoption of recommended best practice in weeds, pests and disease management strategies.

o KPI partially realised. Extension, rather than new research has facilitated progress with this KPI.

Maintain current levels of weeds, pests and diseases in current rice crops.

o KPI achieved. Incursions no worse in 2010 than 2006.

Reduced weed, pest and disease management costs on a per tonne of production basis.

o KPI not achieved. No change in weed, pest and disease management costs.

Objective 4: Whole farm management, profit and sustainability Development of a whole farm model and its use by early adopters.

o KPI not realised.

Financial benchmarking. o KPI not realised. Improved understanding of whole farm system and options for managing the impact of climate change.

o KPI realised through grower workshop and option development report.

42

Reduced GHG emissions from rice production.

o KPI not addressed. Further work on RGA scorecard held over due to exceptional circumstances drought.

Sustainability indicators continue to be met.

o KPI realised. Industry continues to meet Land and Water Management Plan sustainability indicators.

Elevate sustainability to the point where the industry is able to manage reasonable community and government decision maker concern – measured through the number of negative press reports in 2011.

o KPI somewhat achieved. For example Google searches of ‘rice, water, environmental, concern/damage, Australia’ turn up RGA, CRC and SunRice sites and a neutral report by the Wentworth Group of Concerned Scientists rather than damaging environmental claims.

Objective 5: Technology transfer, communications, policy and communities Increase average rice yield. o KPI realised.

o Industry average of 9t/ha in 2006 lifted to 10.8t/ha in 2010. Small production base noted.

Adoption rate of technology and change in farmer practices.

o KPI not achieved. Drought exceptional circumstances has prevented widespread adoption of new technology and practices.

Feedback from rice growers on success of technology transfer, communication, policy and communities.

o KPI achieved. Growers indicate ongoing support for extension and communication components of Rice R&D Program.

Objective 6: Human capital formation New capacity added to Australian rice research and extension.

o KPI not achieved. With reduced budgets, focus switched to maintaining existing capacity rather than developing new capacity. Potential addition of a molecular marker specialist to the rice breeding team noted.

Number of women actively participating in activities.

o KPI not achieved. Female contribution is the same as 2006 and includes research and industry representation roles.

Number of training programs. o KPI not realised. Training programs restricted by reduced R&D budget.

Number of visiting scientists and overseas study tours completed.

o KPI not realised. Investment in international linkages restricted by reduced R&D budget.

Source: Analysis of Program Records

In summary, fifty-nine strategies with thirty-two KPIs resulted in: o The delivery of fifteen KPIs in 2010 with the highest number of successful

KPIs being recorded in Objective 1 (Varietal improvement), Objective 2 (Crop establishment, agronomy, etc) and Objective 5 (Technology transfer and communication). While human capital formation strategies were addressed, no Objective 6 KPIs were achieved. The human capital

43

formation budget was drought reduced. Human capital formation needs attention in the next Five-year Plan.

Projects Of the completed projects, what proportion delivered substantially on the expected outputs? Twenty eight projects were completed between 2006 and 2010. Twenty six of these projects (93%) substantially delivered on expected outputs (Source: AgEconPlus analysis of Program Records and Research in Progress reports).

Risk/return mix What share of projects (by level of investment) were assessed at proposal stage to be high risk? Table 5.6 High Risk Projects

High Risk project Total Project Cost Delivery of Expected Outputs

Biotechnology approach for precision-breeding of cold-tolerant rice

$1,056,977 No

Developing high quality cold tolerant rice varieties using molecular marker

$138,154

No

Total $1,195,131 Source: Program Manager advice

Two projects were assessed as being high risk, a total investment of $1.2 million in a five-year investment program of $11.9 million (including all contributions), around 10% of projects. This allocation to high risk is similar to other RIRDC programs (eg Chicken Meat R&D Program).

44

Effectiveness of Management Participatory approaches Were the approaches to developing and delivering the Five-year Plan sufficiently inclusive to capture all relevant views, and gain ownership of the R&D outputs by a large share of the industry (and other relevant stakeholders)? Industry consultation completed as part of the Performance Review found agreement with the statement that ‘industry involvement in developing and delivering the Five-year Plan was representative of the full range of industry participants’. Non-stakeholder observers of the Program have questioned whether the fledgling rice industry outside the Riverina has been supported by the Program. It is noted that the industry in other areas is linked to the Riverina through, for example, the supply of varieties and milling capacity and that the Program funded at least one R&D project in a new production area. The Rice R&D Committee which administers the R&D plan is drawn from all major rice stakeholder groups.

Financial support What share of the total project funding and resources was provided by industry? Figure 5.1 below shows that industry provides approximately twenty five percent of total project funding and resources and this is typical of other levied industries managed by RIRDC (eg Chicken Meat Program). Atypically, the largest single share of funding is drawn from research partners who deliver R&D projects. Government matching contributions account for fourteen percent of total project funding and resources. Table 2.1 (above) shows that over the life of the plan Commonwealth ‘matching contributions’ have been less than half those supplied by grower levies due to the impact of drought and contribution calculations based on Five-year rolling averages.

45

Figure 5.1 Share of Total Project Funding by Stakeholder 2006-11

Source: AgEconPlus analysis of RIRDC Program data.

R&D capacity Has the program enabled the maintenance of, or enhanced the capacity for, undertaking R&D for the industry and related industries (researchers, skills, and research infrastructure)? Industry consultation completed as part of the Performance Assessment found agreement with the statement that ‘the Program has enabled the maintenance of capacity for undertaking R&D in the rice industry – researchers, skills and research infrastructure’. A major achievement of the Program over the life of the current Five-year Plan has been the securing of core rice breeding capacity at the Yanco Agricultural Institute. RIRDC and the Rice R&D Committee have secured critical R&D capacity at a time when state agencies are being forced to withdraw resources from agricultural research. This was achieved in the first instance by drawing down Rice R&D Program financial reserves, securing funding from RIRDC ‘core allocations’, and substantial funding support from SunRice. A long term and substantial funding agreement between the Program and SunRice has assured the retention of rice breeding R&D capacity. R&D capacity to address other Five-year Plan objectives has been at ‘maintenance levels’ throughout the life of the current Five-year Plan. Plan funded projects have contributed to the maintenance of rice R&D capacity.

Industry

Govt Matching

Research Org

Other

46

Rice breeding R&D capacity is sufficient for the foreseeable future. Agronomy, crop protection and physiology will require augmentation. There is some residual retention of R&D capacity created through the Rice CRC. Extension capacity has been maintained through Program and NSW Department of Primary Industries support. Planned retirement of a key rice extension officer over the life of the next Five-year Plan will need to be addressed through plan objectives and strategies.

Communications

Has the Program provided good communications channels between researchers and industry members and potential members? Industry consultation completed as part of this Performance Assessment found agreement with the statement that ‘the Program has provided good communication channels between researchers and industry members and potential industry members’. The Rice R&D Committee includes a delegate from each branch of the RGA ie there are grower representatives from each of Berriquin, Coleambally, Deniliquin, Echuca, Hay, Mirrool, Wakool and Yanco. Grower representatives, as part of the Rice R&D Committee, shape project selection, terms of reference and receive resultant reports in draft and final format. Grower representatives are ‘linked in’ to the Riverina production base and provide twice yearly reports on R&D progress at RGA branch meetings. Other industry members represented on the Rice R&D Committee include the NSW Rice Marketing Board, SunRice and RRAPL as an observer. Communication between researchers and industry members is facilitated by an annual rice field day, research presentations to the annual rice growers’ conference, regular contact made by NSW Department of Primary Industries extension staff and articles placed in both the IREC Farmers Newsletter and the Riverina media. In most cases uptake of research results is both rapid and widespread. Communication channels may need to be adjusted if the fledgling production base outside the Riverina becomes more substantial. A communication plan for the Program is articulated in Chapter 10 of this document.

47

Efficiency Timeliness

What proportion of projects was completed on time? For current projects, what proportion has met their milestones on time? Results for completed and current projects, for which data is available on timeliness is summarised in the table below. Table 5.7 Projects Completed and Milestones Met On Time

Projects completed on time or milestone met for current project

Projects

Yes 42 Project terminated – inputs not available 1 Late final report 1

Total 44 Source: Program Manager advice

Some 95% of projects met timeliness requirements.

Reducing duplication

Is the Advisory Committee aware of R&D being undertaken outside of the RIRDC Rice program in making decisions about Program investments? The table below provides a list of other rice R&D initiatives and Rice R&D Committee awareness with regards to research status and avoiding duplication. Table 5.8 Advisory Committee Efforts to Avoid R&D Duplication

Research Sector Advisory Committee Linkages RRAPL – produces and bulks up seed of commercial varieties via its Pure Seed Scheme. Completes R&D in relation to the commercialisation requirements of new varieties and provides growers with supporting whole farm system RD&E.

o RRAPL is an observer at Rice R&D Committee meetings.

SunRice – responsible for single desk export marketing and holds a significant share of domestic market sales. Completes market, milling and processing research.

o SunRice is a member of the Rice R&D Committee. SunRice market and milling research informs, for instance, the rice breeding program.

Input suppliers – including agronomists and research teams employed by chemical and fertiliser companies.

o Informal linkages exist. Inputs suppliers more concerned with extension than completing R&D in Australia that competes with RIRDC.

Higher education institutions, CSIRO o Coordination through conferences,

48

and state agencies. workshops, etc and use of researchers from these organisations on RIRDC Rice R&D projects.

Overseas research. o Regular communication and joint projects with IRRI and dialogue with the Californian Cooperative Rice Research Centre along with attendance at international temperate rice conferences ensures collaboration (funds permitting) rather than duplication.

Rice CRC – concluded operations in 2005

o Project completed during the life of this plan to ensure communication of findings from the CRC and prevent replication of CRC research.

GRDC – completes grain industry RD&E including farming systems research. Rice growers are almost always grain growers and GRDC levy payers.

o Dialogue occurs between RIRDC Rice Program and GRDC aimed at avoiding duplication, achieving joint goals and preparing collaborative projects.

Source: AgEconPlus analysis

The Rice R&D Committee is well informed of other research in the rice industry and is all too aware of the need to avoid replication and duplication. Industry consultation completed as part of this Performance Assessment found agreement with the statement that ‘the Rice R&D Committee is aware of R&D being undertaken outside of the RIRDC Rice Program in making decisions about Program investments’. How many projects have been amended to reflect other known research? Data is not available on the number of projects that were amended to reflect other known research. However, discussions with members of the Rice R&D Committee reveal that research proposals are routinely amended prior to contracting and following Committee feedback. The Rice R&D Committee is active in tailoring projects to meet industry needs.

Promoting partnerships

How many new partnerships have been formed as a result of the program bringing together researchers and industry members? Review of RIRDC Program records with the Program Manager revealed that projects within the portfolio have resulted in new researcher and industry partnerships. Details of a sample of these projects and resultant partnerships are provided in the table below.

49

Table 5.9 New Partnerships Formed by the Program

Project or Objective Nature of the Partnership Variety improvement and pure seed maintenance objective

o The abundant need for new projects to address this objective has resulted in the formalisation of a partnership between SunRice, RIRDC and NSW Department of Primary Industries.

Continuing on-farm yield improvement based on agronomy, crop modelling and rice physiology

o New dialogue with GRDC to manage rotations, yield growth and nutrient management.

Using raised beds for sustainable cropping systems on rice farms

o As above.

Efficacy and water column persistence of copper sulphate applied to control snails

o New cooperative partnership developed between APVMA, chemical manufacturers, researchers and industry.

Maintaining and enhancing collaboration and linkages with organisations and personnel involved in rice research

o Renewal of old linkages and alliances formed during the CRC which completed its work in 2005.

Source: Program Manager advice

The program has been successful in establishing industry and researcher partnerships.

Management resources In Full Time Equivalents (FTE) what is the estimated time spent by RIRDC program management staff on the program (annual average over the program life)? Estimated average annual FTE commitment to the Program by RIRDC is summarised in the table below. Table 5.10 Program Management Resources

Role FTE Per Year 2006-09

FTE in 2010

General Manager Established Rural Industries (Canberra)

0.05 0.1

Program Coordinator RIRDC (Canberra) 0.25 0.1 Total 0.30 0.2

Source: AgEconPlus analysis. # It is noted that the Program Development and Communication Coordinator role is newly created and was not part of the Program for four of the five years being reviewed.

50

Program management resources currently total 0.2 FTE per annum but were 0.3 FTE per annum for most of the current FYP period. Management resources are appropriate, if somewhat modest, for a program of this size. Aggregation of Performance Assessment Results In order to reduce the biases inherent in subjective analysis the aim was to elicit responses from stakeholders representing at least three different perspectives to the questions (triangulation). AgEconPlus has triangulated subjective data wherever possible. For example the Program Review (PR) consultation targeted growers, researchers, policy makers and others and requested strongly disagree (-2), disagree (-1), neutral (0), agree (1), strongly agree (2) with key statements. Table 5.11 Rice Performance Assessment Results

Indicator Measurement Score

Relevance Priorities set and revised based on industry needs PR Consultation 2 – strongly

agree Plan objectives proved relevant PR Consultation 2 – strongly

agree Strategies were realistic given funding and research capabilities

PR Consultation 1 – agree

Share of project proposals directly addressing strategies

PM records 80%

Alignment of expenditure with Program indicative allocations

PM records Yes – broadly

align

Effectiveness of the R&D Share of KPIs realised or expected to be realised within 5 years

PM records 47%

Share of completed and current projects delivering expected outputs

PM records 93%

Share of projects assessed ex-ante as high risk PM records 10% Share of these projects delivering expected outputs (potentially)

PM records 0%

Effectiveness of management Industry involvement in Program is representative of full range of industry participants

PR Consultation 1 – agree

Share of total project funding provided by industry (cash and in-kind)

PM records 25%

51

The R&D investments helped to maintain R&D capacity in critical areas of industry/stakeholder need

PR Consultation 2 – strongly agree

The Rice Program has direct communication channels to industry members through newsletters, web sites, other media

PR Consultation 2 – strongly agree

Efficiency Proportion of projects completed on time PM records 95% R&D undertaken outside the Rice Program is known and taken into consideration in selecting and advising on proposals

PR Consultation 1 – agree

Number of partnerships formed as a result of the Program – researcher, industry and other (measured in project numbers)

PR Consultation 4*

FTEs required for RIRDC program management (annual)

PM records 0.3

Source: RIRDC Evaluation Framework (2008) page 13.

PR= Program Review, PM = Program Manager, FTE = Full Time equivalent

* Low number of new partnerships due to the established and mature nature of industry research relationships

52

Overview or Summary Relevance

o Priorities were set and revised with industry, plan objectives were relevant and should drive the new Five-year Plan, delivery of realistic strategies was only limited by an exceptional circumstances drought, proposals received addressed plan strategies and expenditure broadly aligned with Program indicative allocations.

Effectiveness of the R&D o Delivery of KPIs was limited by drought exceptional circumstances. The

limited projects that were funded have either delivered or are expected to deliver planned outputs. The number and value of high risk projects was similar to other RIRDC R&D Programs.

Effectiveness of management o Industry involvement with the plan is currently representative of the all

participants. Effort will need to be expended to ensure this is true in the future as the industry expands into new remote production areas. The industry has achieved strong leverage on its R&D funding. R&D investments have maintained critical capacity in industry priority areas. The program has established effective two way communication between researchers and industry.

Efficiency o Projects completed met timeliness requirements. The Rice R&D

Committee is aware of relevant research being completed outside the Program. Partnerships have been formed and maintained as a result of Program investments and the Program has been modest in its requirements for human resources.

Performance assessment results inform the RIRDC Rice R&D Plan 2012 to 2017. Performance Assessment – Benefit Cost Analysis of Varietal Improvement Investment An economic evaluation of the rice industry’s varietal improvement investment is reported in this section. To set the economic evaluation in context the following analysis of all Program projects is provided:

• Alignment with Australian Government Rural Research Priorities • Stage of R&D • Generation of benefits across the triple bottom line • Likelihood of funding in the absence of a statutory levy.

53

Program Alignment with Australian Government Rural Research Priorities Table 5.12 Program Alignment with Government Priorities

Australian Government Rural Research Priorities Projects Productivity and adding value 21 Supply chain and markets 0 Natural resource management 4 Climate variability and climate change 0 Biosecurity 0 Supporting Priorities Innovation skills 0 Technology 19

Total 44 Source: Program Manager advice The Program was strongly directed towards investments in productivity and adding value and promoting the development of new and existing technology. Almost ten percent of investments addressed natural resource management.

Stage of R&D R&D can be thought of as a three-stage process:

• Stage 1: Fundamental or basic research, the outputs of which are inputs to further research – the RIRDC Rice Program has invested 3% of available funds into stage 1 between 2006 and 2011.

• Stage 2: Specific outcome driven research that can be used in some type of production – the rice R&D program has invested 86% of available funds into stage 2 research.

• Stage 3: Promoting the adoption of research outcomes – some 11% of funds have been invested in stage 3.

Less investment has been made in fundamental research and extension than under the previous Five-year Plan and this highlights RIRDC and the Rice R&D Committees decision to ‘pull back’ to support the rice breeding program, a stage 2 investment.

54

Generation of benefits across the triple bottom line Table 5.13 Anticipated Benefits Profile

Generation of benefits across the triple bottom line Project Count Levy payer economic benefits 44 Community social benefits 8 Community environmental benefits 12 Total 64

Source: Program Manager advice. NB ‘Project Count’ includes projects that generate multiple benefit types Program benefits are spread across the triple bottom line. The RIRDC Program Manager anticipates that all projects will result in economic benefits for levy payers and a subset of these will result in social and environmental benefits for the community.

Likelihood of funding in the absence of a statutory levy The Program Manager was also asked to comment on the likelihood of project funding in the absence of a statutory levy supported by government funding – a little over half the projects (23 of 44) would have gone ahead in the absence of current levy arrangements. Pure research and much extension would have been excised from the portfolio.

Economic evaluation of rice breeding program Agtrans Research 2010 completed an economic impact assessment of the rice breeding program. The economic impact assessment considered ten projects associated with varietal improvement completed or near completion in the five years to June 2010. These projects were:

• USC-6A New markers for the Australian rice industry. • PRJ-000490 How does molecular architecture of

starch determine viscosity of rice? • PRJ-000499 Rice improvement 2. • PRJ-000482 Rice grain quality 4. • PRJ-000493 Rice cold tolerance for yield stability

and water-use efficiency. • PRJ-000646 Developing high quality cold tolerant rice. • PRJ-000547 Biotechnology approach for precision

breeding of cold tolerant rice. • PRJ-002927 Rice cold tolerance for yield stability

and water-use efficiency. • PRJ-002942 Rice improvement 3. • PRJ-003019 Rice quality 5.

55

In total the RIRDC Rice Program invested $5.9 million while others, mainly research organisations invested a further $6.8 million in these ten projects. Benefits forecast from the investment are spread across the triple bottom line and include: Economic benefits

• Higher yields and water savings from released varieties (actual and potential).

• Maintenance or improvement in rice quality with premium price retention.

• Improved genetic capital for future breeding and varietal release (eg water productivity, cold tolerance).

• Increased rate of genetic gain from molecular markers and higher efficiency and refinements in Quality Improvement Program.

• Cost reduction in Quality Improvement Program. • Maintenance of market prices due to maintaining genetic purity of

commercial seed. Environmental benefits

• Reduction in irrigation water use (actual and potential). Social benefits

• Potential for maintenance of industry viability, and subsequent social and economic benefits for some regions.

Benefits valued in the economic assessment included increased yields from actual and potential new variety releases, increased water productivity from actual and potential variety releases and maintenance of quality premiums in the market place. Overall return from these investments is summarised in the table below for both the RIRDC Rice Program investment and total investment (including contribution by others). Table 5.14 Investment Criteria for Total Investment and Program

Investment

Criterion RIRDC Rice Program Investment only

Total Investment

Present value of benefits ($m) 59.97 128.70 Present value of costs ($m) 7.55 16.04 Net present value ($m) 52.42 112.65 Benefit cost ratio 7.94 8.02 Internal rate of return (%) 24.1 24.6 Source: Agtrans Research 2010

56

The investment criteria estimated were quite favourable and certainly comparable to returns achieved for Australian cereal breeding programs. The investment can be considered to have more than paid for itself with quantified benefits estimated at a present value of $129 million from an investment of $16 million, producing a net present value of $113 million (over 40 years from the first year of investment in 2002-03) using a discount rate of 5%. The benefit cost ratio was 8 to 1 and the internal rate of return was over 24%.

57

6. Consultation Findings Consultation Completed for the R&D Plan 2012 – 2017 Consultation was completed to identify future research directions and secure broad ownership for the plan. A situation analysis and strategic fore-sighting paper was prepared and circulated to industry and researchers for comment. Meetings were held in Leeton in November 2010. Consultation results are summarised under relevant headings.

Climate Change and Water • Addressing climate change is an agreed priority for the new Five-year

Plan. Climate change R&D should manifest itself in the Five-year Plan through a crystal clear focus on stress tolerance breeding to reduce grower water requirements.

• In practical terms, climate change will manifest itself over the life of the 2012-2017 Five-year Plan through the Murray Darling Basin Plan – Sustainable Diversion Limits (SDLs). The industry will address climate change through the Murray Darling Basin Plan.

• New tools are available for growers to manage their irrigation water. However, there may be scope for additional packaging of BoM and CSIRO data to assist grower decision making. Multi-year water optimisation tools and Decision Support Systems (DSS) are the domain of private consultants.

• The high cost of electricity and diesel will made alternative water supplies unprofitable. Demonstration projects comparing spray and flood based irrigation systems may have merit.

• The R&D Plan should not incorporate strategies to address structural adjustment or the social dimension of climate change – other agencies have carriage of this responsibility.

Industry Location and Aerobic Production • The Riverina will remain the focus of the Rice R&D Program’s

investments. At best the Ord Irrigation Area Stages 1 and 2 is capable of producing a 50,000 t crop of rice, 5% to 10% of the Riverina’s total. Production in Lismore is biodynamic and totals 2,000 t, yielding 2t/ha. Other areas are niche and/or experimental.

• The RIRDC Rice R&D Program and SunRice will support investment in production in areas outside the Riverina.

• Investment in northern Australian rice production but only to a maximum of 5-10% of the budget for a single objectives total ie $10,000 to $20,000 per year.

58

• Northern Australia research priorities include raised bed irrigation system research, locally adapted varieties, ideal planting dates, seeding rate, fertiliser requirements, viability of a wet season crop, ratooning and hybrid price.

• Rice can be grown aerobically in a range of areas including the north and the Riverina (away from heavy clay soils). Aerobic rices have qualities sought by the market eg Hong Kong prefers soft aerobic style rices. It is important that we breed rice varieties suited to northern Australia along with agronomy to support them.

International Developments and Food Security • Food security was not a mainstream issue when the last 5YP was

framed. World rice stocks are low but Australia has limited capacity for additional production areas and must in turn rely on yield and productivity increases.

• There is potential for a grain deficit in the future, there has been a research deficit for 20 years. The Consultative Group on International Agricultural Research (CGIAR) has reorganised IRRI and CIMMYT into fewer much larger research projects and cold tolerance will be a focus at IRRI. The IRRI will produce new cold tolerance molecular markers. There are opportunities for the RIRDC program to link in with this initiative.

Regulation, Markets and SunRice • The rice industry is represented on the National Farmers Federation

Trade Taskforce which was ‘at the table’ during the Doha Round of trade negotiations. Market access is an issue for RGA rather than RIRDC.

• Market research is not a priority, it would add value if there were lots of Australian marketers but not under the current ‘single desk ’situation. Reregulation is not a major threat to SunRice with its strong supply chain and quality systems advantage.

• A change in ownership of SunRice may hasten removal of ‘single desk’ export legislation.

• Post farm gate R&D is not an issue for this 5YP. If the Committees view on this changes, the plan is a ‘living document’ and can be refined as required.

Rice Breeding – Varietal Improvement • SunRice’s financial commitment to the breeding program does not free

up resources for other R&D priorities – the breeding program has been long term underfunded.

• Breeding for cold tolerance, heat, drought and less water without loss in eating quality should remain the focus of the rice breeding program.

59

• The new variety, YRM69 is a major step forward but is not the end point for cold tolerance. It offers additional cold tolerance (2oC) and yield. It is quick maturing which means it requires less water. It has a flexible sowing window. On the negative side its grain size is a bit small. Reiziq offers grain size the market demands but is cold sensitive.

• It has taken 20 years for the rice breeding program to crack 2oC of cold tolerance – how long to get the next 2oC? There are likely to be better gains in on improved farm practices.

• We need short season varieties that allow a wheat crop to be harvested in the same year. We also need long season varieties that suit aerobic production. Pairing farming systems with germplasm is a worthwhile strategy for the industry.

• Tropical rice breeding is not relevant to this program. Production in the Ord is using temperate varieties. Production of tropical rice means that we are competing against the rice production powerhouses of Thailand and Vietnam. The Burdekin produced tropical rice and could not compete with South East Asia.

Rice Breeding – Quality Improvement • Drive the Quality Evaluation Program that runs alongside the breeding

program through more efficient and data based decision making – improve the timeliness of data delivery to breeders, provide objective quality data in earlier generations, maximise the use of current equipment and expand the range of quality traits that can be reasonably predicted by use of appropriate markers. Invest in quality improvement infrastructure including upgraded equipment, facilities, staff and biometrician support. Enhance the nutritional benefits of milled rice and promote the health benefits of brown rice. Correlate objective rice quality data with consumer preferences – understand whether consumers will buy healthy rice if it is yellow. Participate in development of international quality assessment methods to ensure researchers and export customers speak the same language. Research post harvest handling including storage (silo) issues and retro-gradation (rice hardening after cooking). When completing research on whole farm system changes incorporate rice quality testing.

Whole Farm Systems • Whole farm system R&D is driven by RRAPL, the RIRDC Program

provides a relatively modest fillip. There are opportunities for joint effort with GRDC to address Rice Based Farming System R&D priorities. Also joint work with MLA and AWI makes sense.

• Research on the rice farming system is needed – research to support high value soft biscuit wheats grown after rice in partnership with GRDC.

60

• Research to support the switch to direct drilling and delayed permanent water is required. R&D to assist with crop establishment on heavy grey self mulching soils and sodic soils is needed.

• Research is required to develop strategies to improve water use efficiency including nitrogen management and the role of NIR. Research to understand the interplay between water, nitrogen and greenhouse gases is important. Research to support the adoption of new innovations in precision agriculture is also a priority.

• Strategies are needed to manage big crop stubbles especially in light of likely restrictions on stubble burning.

• Opportunistic irrigation R&D has been well covered through practical decade long experience; there is no need for additional or new investment. Spray irrigation is about demonstration projects rather than research. His can be funded from other programs.

• Enterprise benchmarking is done well by the private sector no need to invest in this area. There may be additional scope for investment in Farm Pack, Water Works and MaNage Rice.

• Agronomy, farm input and farm system research is needed for Northern Australia

Crop Inputs and Post Farm Gate Tools • Efficiency and cost efficiency in the use of current inputs is a priority for

research. • Fossil fuel alternatives is something we could participate in ie a cross

RDC project. • Addressing spray regulation and weed chemical resistance are priority

issues. New weed management tools, strategies, herbicides and herbicide delivery techniques are needed.

• Weeds – management of herbicide resistance, new herbicide registration, weed control in delayed permanent water, weed management in northern Australia are all priorities.

• Herbicide research hampered by small size of the Australian rice industry.

• Pest R&D priorities include new chemicals for stored grain management, addressing ‘pecky’ grain, bloodworm, army worm, snail and leaf minor controls. Snail is the highest priority.

• Post farm gate tools are required for rapid assessment of grain quality at receival and rice DNA fingerprinting to ensure rice imported into Australia meets the claims it makes.

61

Sustainability, the Environment and ETS • Sustainability, biodiversity and demonstrating environmental credentials

remain priorities for the industry. Life cycle analysis along with preparedness for an ETS is prudent.

• Understanding water and carbon foot printing is a priority for the rice industry before the relevant policies are put in place. Current methodology based on water scarcity leaves much to be desired.

• Methane emissions from rice has been studied and shown to be low for the Australian situation, CSIRO are interested in revisiting this now dated work.

Supply Chain • The RIRDC R&D Program has not addressed industry supply chain

issues, preferring to leave this suite of research questions to SunRice. Over the longer term and outside the current 5YP period, the program may need to address the supply chain as grower interests and SunRice interests may diverge.

• In the medium term, SunRice will engage wherever new production emerges in the north.

• Northern production is an economic proposition when there is no crop in the south and prices are $400 t but not at a long term average price of $250 t. Transport south for milling adds $100 t to cost of production.

• Rice grown in the Ord River region of WA is shipped via Wyndham and Darwin to PNG.

Extension, Communication, Policy and Social Research • Rice R&D Committee currently considering response to planned

retirement of key industry extension officer. Expect a stow attrition of NSW Department of Primary Industries extension capacity, including district agronomists over the next 5-10 years. In response growers will switch to using retail agronomists and create farmer groups. NSW Department of Primary Industries provide a coordinating service for retail agronomists and do this well. Public extension is independent of commercial bias/moral hazard.

• Farmer Groups such as Birchip offer a more efficient and effective way of delivering extension

• Environmental Champions Program (ECP) and extension groups need to be merged – to improve efficiency and secure ongoing ECP funding.

• Social research will be funded by other agencies. • Communication hubs would ad little value on top of our current

extension activities. • Online data bases and blogs offer potential, especially for younger

growers.

62

Human Capital Formation and Succession Planning • The rice breeding team is professionally isolated and this needs to be

addressed through exchanges and travel in the new Five-year Plan. Succession planning for the rice breeding team, including recruitment of ‘bright young things’ should also be a priority.

• There is a lack of researchers delivering farming systems including agronomy, physiology and crop protection.

• Human resources needs attention right through the industry, we need leadership training, a succession plan for key researchers, famers need risk management skills.

• We need funding support for our team – key research positions are secure but what about technical officers and biometricians.

• The program should be mindful of research capacity outside Yanco eg NT DPI, UQ, DEEDI, Southern Cross Uni. The rice breeding program needs access to a physiologist and there is one at DEEDI, UQ have a genetic marker specialist we also like to use.

• The program should not invest in developing dryland skills for growers – they have them already. Skills in precision agriculture are a priority; we need to stay at the cutting edge. Model use skills are important as are emissions trading, leadership and succession planning (although some progress with leadership training has been made). Water trading, marketing, business management are already in place.

• Skills in marketing winter crops could be better and I disagree that dryland farming skills are ‘up to scratch’.

Emerging Opportunities and Blue Sky Research • Set aside a small sum of money for emerging issues and blue sky

research. • SunRice and the industry have made a conscious decision not to develop

GM products. This decision is unlikely to be revised over the life of the current 5YP. Nevertheless a monitoring brief should be maintained on this and other cutting edge research issues.

• Making beneficial use of rice stubble – carbon capture, co-generation and ethanol production – may fit within this area.

• May include a watching brief on post farm gate developments including the implications of any change in SunRice ownership.

• Blue sky research should be addressed with its own (small) budget. Emerging issues can be funded from R&D Program reserves.

Leverage Other Funding Sources and Partnerships • GRDC has an interest in joint investment in farming systems research

including agronomy, the transition from rice to winter cereals, impact of flood irrigation on subsequent cereal crops, irrigation layout and design.

• ACIAR is a very valuable R&D partner. There are opportunities for the R&D program to leverage the WA Government’s investment in the Ord.

63

• A new CRC for the rice industry is simply too hard at this point in time.

Scenarios Planning and RIRDC Rice R&D Program Risk • Future average crop will be 700,000 t with additional variability around

this average. When the last plan was formed industry average production was 1.2 million tonnes. An annual RIRDC Rice R&D Program budget of approximately $1.7 million pa is now appropriate for planning purposes.

• Other scenarios to consider for planning purposes include revision to a $2/t levy after 2011 (currently $3/tonne) and reduction in Commonwealth matching funds for R&D as per the draft Productivity Commission (PC) Inquiry Report (October 2010).

• The PC Inquiry draft report also recommends changes to RDC structures with one agency specialising in new rural industries (Rural Research Australia) and potentially the centralisation of all grains within another organisation (GRDC). The rice industry may need to consider the current plan within an alternative administrative framework in the longer term.

• The current plan (2006-11) remains valid. It was simply not implemented as a result of drought.

Other Recent Consultation Consultation completed for this plan builds on a NSW Department of Primary Industries and RIRDC workshop held in Griffith in March 2009 which explored Options for Rice-Based Farming Systems to Adapt to Climate Change. The workshop re-endorsed the Rice R&D Plan 2006-11 with additional emphasis on extension and communication support. The workshop acknowledgement that:

o The rice-based farming systems of the Riverina are forever changed by the current drought. Variability is the key word for the future.

o The people of the Riverina are resilient and are already responding to the challenges posed by current circumstances.

o The term ‘agile farmers’ was coined and resounded well with the room as an aspirational goal for the rice-based farming community.

o Long term there will be a Riverina rice industry producing between 600,000 and 800,000 tonnes of paddy per annum. Crops above one million tonnes will still occur.

o Future rice based farm systems will be opportunistic and flexible incorporating new enterprises, technologies and solutions.

o R, D and particularly E is vital to respond to the challenges of climate change and to drive farm productivity.

64

o Up-skilling growers and their service providers is the key to ongoing success. Skills and capacity are needed to develop flexibility and instil confidence.

Consultation findings drive the development of the new R&D plan.

65

7. Industry Commitment to Research

The Australian Rice industry is committed to R&D and the current RIRDC Program. For example, the RGA submission to the PC Inquiry into RDCs supports the RDC model and the current program: ‘The RGA believes the RDC model serves the rice industry well. It provides incentive to invest in research, direct pathways between producers, researchers and government as well as administrative efficiencies. This has enabled technological advancements that have made the Australian rice industry the most efficient in the world. The current model has also enabled the Australian Government to leverage industry activity in the pursuit of its economic, social and environmental goals. For example, rice research undertaken through the RDC model delivers a public benefit through water use efficiency improvements’ (RGA 2010). The decision to levy an industry for R&D purposes is not taken lightly. The fact that the Australian rice industry has managed to increase and extend its levy rate during the worst drought on record should send a message about the importance of, and support for, R&D at an industry level (RGA 2010). Support for the program has also shaped the proposed new R&D plan.

66

8. The R&D Program 2012 - 2017

Key Themes Shaping Future Research Directions

Key themes emerging from the analysis of the industry profile and future directions, the SWOT, the review of R&D performance and consultation are:

o Breeding new rice varieties with stress tolerance, acceptable quality and improving yield remains the number one objective of the RIRDC Rice R&D Program.

o While breeding is central, there are important production and water use efficiency gains to be had from improvements in the rice farming system.

o Crop protection is a constant challenge and consequent research priority for rice growers.

o Extension must recognise the new realities of public funding, new technology and mushrooming private farmer groups.

o Investment in rice industry human capital has been neglected and this needs urgent redress.

o It is prudent to allocate a small share of the Program’s resources to high risk high return projects that fall outside core business and the research strategies described in the plan.

Goal To improve the productivity and sustainability of the Australian rice industry through the organisation, funding and management of a research, development and extension program that is aligned with industry reality and stakeholder needs. Objectives Six objectives drive the 2012-2017 R&D Program:

1. Rice breeding – varietal and quality improvement 2. Prescription farming and sustainability 3. Crop inputs, crop protection and grain receival 4. Extension, communication and partnership development 5. Human capital formation and succession planning 6. Blue sky research

67

Objectives should be regarded as complementary, with flexible boundaries to enable key issues to be addressed either simultaneously or sequentially through several components of the Program. Strategies Strategies indicate specific research areas that will contribute to achieving the six objectives. Strategies have been defined at a level that gives research providers guidance on where RIRDC is intending to target its investments over the period 2012-2017 and are intended to contribute to the longer term planning requirements of those providers. Strategies will be complemented with more specific research priorities published annually that provide more detailed guidance about the project areas that RIRDC is seeking to fund in the coming year. Key Performance Indicators Key performance indicators (KPIs) are provided to assess whether the research strategies have contributed to the R&D objectives. Where possible, performance indicators have been linked to benchmarks for previous rice industry performance. KPIs are SMART - that is they are Specific, Measurable, Achievable, Realistic and Time based. Budget Allocation Budget allocation has been prepared following analysis of historical allocations and consultation with the Rice R&D Committee. A summary of allocations is provided in Table 8.1. Chapter 9 of this document provides a consolidated plan based on a best estimate scenario prepared in consultation with RIRDC for levy rate and collection. Table 8.1 Suggested Resource Allocation by Plan Objective (%)

Objective

Proposed Allocation (2012-

17)

Objective 1: Rice breeding – varietal and quality improvement 50 Objective 2: Prescription farming and sustainability 15 Objective 3: Crop inputs, crop protection and grain receival 15 Objective 4: Extension, communication and partnership development 10 Objective 5: Human capital formation and succession planning 8 Objective 6: Blue sky research 2

Total 100 Source: AgEconPlus analysis of 11 November 2010 Rice R&D Committee meeting outcomes

68

Objective 1: Rice Breeding - Varietal and Quality Improvement

Objectives Respond to an evolving production environment through development of stress tolerant rice varieties (cold, heat and drought) that reduce water use and maintain or enhance eating quality and yield. This objective has primacy in the plan. It is delivered through a collaboration agreement with SunRice, NSW Department of Primary Industries and RIRDC. RIRDC collaboration agreement funding will be supplemented with additional Program support to deliver the industry’s most important R&D challenge. Strategies

o Support the breeding program with its focus on cold and other stress tolerances.

o Encourage Yanco Agricultural Institute to modernise the breeding program through, for example, greater use of molecular markers.

o Integrate world’s best practice into the breeding program through close integration with work at IRRI.

o Augment stress tolerance breeding with the search for shorter season varieties. Shorter season varieties offer water productivity gains and the potential for three crops in two years.

o Partner with other research funders to support aerobic rice research.

o Develop and apply improved rice grain quality evaluation techniques. Support grain quality research with appropriate skills and equipment.

Performance Indicators and Related Measures

o Advanced germplasm with 4oC cold tolerance by 2017.

Indicative Share of R&D Budget

o 50% of budget will be allocated to objective 1.

69

Objective 2: Prescription Farming and Sustainability

Objectives Precision agriculture and whole farm system research offers further opportunity for rice production efficiency gains as well as identifying options for profitable rice based farming systems in Northern Australia. Understanding spatial variation and developing prescription tools for maximising production is a priority. Rice growers, using yield loggers, report single field yields from 8t/ha to 18t/ha. The switch to Delayed Permanent Water3 has resulted in a new set of crop establishment challenges. Crop establishment on heavy grey self mulching clays remains problematic. Rice is a progressive industry that recognises the importance of investing in sustainability, the development of new production areas in Northern Australia and the challenge of understanding and embracing the carbon economy. Strategies

o Partner with other RDCs to support whole farm systems research that integrates cereal/pulse and livestock production.

o Understand the causes of infield yield variability and build on ‘cut and fill’ research outcomes. Research gene-environment interactions to deliver consistently high yielding rice crops.

o Achieve reliable crop establishment.

o Address priority sustainability issues including understanding and managing carbon and water footprints and environmentally benign ways of managing large crop stubbles.

Performance Indicators and Related Measures

o Improved production efficiency – a 3 year industry average of 11t/ha in 2017.

o Improved water use efficiency – a 3 year industry average of 0.9t/ML in 2017.

o Progress towards 2 crops, rice plus a winter cereal, totalling 20t/ha every 12 months.

3 Delayed permanent water – drilling into ‘watered up’ paddy, paddy ‘greens up’ with young rice plants and then permanent water is added. Previously rice was aerially sown into permanent water. A delayed permanent water strategy assists with water use efficiency

70

o Support for a more viable rice based farming system for Northern Australia.

Indicative Share of R&D Budget

o 15% of budget will be allocated to objective 2. Objective 3: Crop Protection, Crop Inputs and

Grain Receival Objectives The cost and effectiveness of crop inputs including fertiliser and fuel shape grower profit. Protecting the crop from weeds, pests and diseases in a changing natural and regulatory environment is an ongoing challenge for growers. Expansion of the industry into northern Australia exposes production to new biosecurity threats. Receiving the best price for the quality and variety of grain produced provides important production signals for growers. This objective addresses input effectiveness and cost along with post farm gate investments in the rapid assessment of grain quality. Strategies

o Develop new weed management tools including herbicide regimes and delivery technologies to counter herbicide resistance, manage delayed permanent water planting and anticipated regulatory restrictions associated with spray drift. Support herbicide blend research.

o Assess new and two recently released rice varieties to ensure they are tolerant to current mainstream herbicides.

o Better understand the role of major crop nutrients including nitrogen, phosphorus, zinc, iron and sulphur in determining grain yield and quality. Understand and communicate the role of nitrogen in cold tolerance.

o Investigate use of remote sensing technologies for application in precision management of crop inputs.

o Ensure cost effective controls are available for invertebrate pests of economic significance including but not limited to snails, bloodworms and armyworms.

o Maintain industry biosecurity and disease control as the industry expands in Northern Australia and production is exposed to new pathogens. Monitor entomology and pathology capacity available to the industry and ensure it is adequate to address a biosecurity breach.

71

o Support the development of rapid quality assessment tools for use at point of grain receival.

Performance Indicators and Related Measures

o Maintain our control options for all major weed classes.

o All rice varieties tested for chemical tolerance by 2017.

o Elimination of nitrogen as a cause of yield loss during production cold snaps.

o All rice pests covered with a cost effective, APVMA compliant, control strategy.

o Maintenance of the industry’s low disease status across its Riverina production base.

o Growers recognised and rewarded for quality at point of receival.

Indicative Share of R&D Budget

o 15% of budget will be allocated to objective 3.

Objective 4: Extension, Communication and

Partnership Development Objectives This objective recognises and addresses the changing nature of public support for extension, the expansion of private sector alternatives including farmer groups (ie groups with aims similar to the Birchip Cropping Group) and the viability of new electronic communication systems. It also sets out to reinvigorate research partnerships established through the Rice CRC and nurture new collaboration opportunities. Strategies

o Complete a review of rice extension that draws on previous reviews and looks, amongst other things, at the potential of merging farmer groups, the future of RiceCheck, the potential of an Industry Development Officer and the need for an Extension Management Group.

o Support the retention of current public extension capacity within the rice industry while encouraging the growth of private farmer groups and the capacity of agribusiness agronomists.

72

o Work with NSW Department of Primary Industries on their strategy to further embed extension into rice research projects.

o Subject to extension review findings, implement electronic communications and research databases. Ensure these systems have a sustainable update and funding plan.

o Service links between agribusiness agronomists, rice researchers, and public extension to ensure up to date and consistent messages.

o Foster partnerships with stakeholders including RDCs, industry, researchers infrequently employed by the Program, international institutions/researchers and others.

Performance Indicators and Related Measures

o Retention of the rice industry’s reputation for rapid adoption of new varieties and production technologies – established by a formal grower survey at the end of the plan period and measured against benchmarks generated during the planned review of extension.

o An annual allocation of resources dedicated to partnership development. Resources to be used for travel, workshops, staff exchange and other worthwhile cooperative endeavours.

Indicative Share of R&D Budget

o 10% of budget will be allocated to objective 4.

Objective 5: Human Capital and Succession

Planning Objectives The rice R&D plan will remain a collection of good ideas without appropriate human capital to implement it. In difficult times human capital formation has been neglected in order to fund core research commitments. Now is the time to rectify underinvestment and the Program must target research, industry and grower skills. Strategies

o Address the professional isolation of the rice breeding program through ongoing travel and staff exchange. In addition to support for travel this strategy proposes to add to this base with placement of staff in the Philippines to participate in the IRRI work program. The focus of this opportunity should be on early and mid career professionals in order to provide long term industry return.

73

o Rebuild and renew on farm research capacity (eg agronomy, crop protection and physiology) through rice industry and other scholarships (eg McCaughey Trust). Give consideration, as other industries have, to part funding a farm research position in CSU, NSW Department of Primary Industries, etc.

o Ensure researchers are backed with appropriate technical officers and equipment.

o Support the development of grower production and decision making skills (eg use of new developments in precision agriculture, whole farm planning and the marketing of winter cereals).

o Develop industry leadership through up-skilling the Rice R&D Committee and use of the Committee to ‘blood’ future industry leaders. Develop skills through participation in appropriate short courses. Support relevant scholarships such as Nuffield and Australian Rural Leadership.

o Continue to support industry and committee attendance at international Temperate Rice Conferences. This conference provides valuable knowledge to the industry.

Performance Indicators and Related Measures

o Yanco rice researcher embedded in IRRI cold tolerance research, PhD students with meaningful rice research projects, rice industry Nuffield Scholars and Australian Rural Leadership Program graduates, successful travel applications and a lowering of the average age of members on the Rice R&D Committee.

Indicative Share of R&D Budget o 8% of budget will be allocated to objective 5.

Objective 6: Blue Sky Research Objectives In this plan ‘blue sky’ research is defined as including novel or unproven approaches to addressing industry issues and high risk/high reward investments that tackle industry opportunities outside the Program’s core business. For illustrative purposes blue sky might include the use of polymer films to retain soil moisture and heat, novel uses for rice hulls and stubble or the integration of new enterprises such as fresh fish production into the rice farming system. Blue sky research is characterised by creativity and the lack of immediate commercial return.

74

Strategies o Rice R&D Committee to keep an open mind through the project call

process for long shots with manageable risk and potential for high industry payback.

Performance Indicators and Related Measures

o One substantial blue sky research project funded between 2012 and 2017.

Indicative Share of R&D Budget

o 2% of budget will be allocated to objective 6 over the life of the plan ie it is likely that some years there will be no investment and in others a more substantive outlay will be required.

75

9. Proposed Budget A Five-year R&D plan budget has been prepared for the Five-year plan in consultation with RIRDC. Estimates are based on projections made in November 2010. The budget is presented in Table 9.1. Table 9.1 Rice R&D Budget 2012 – 2017

Objective

% 2011-12

2012-13 2013-14 2014-15 2015-16

Obj 1: Rice breeding 50 485,000 950,000 950,000 950,000 950,000 Obj 2: Prescription farming, sustainability

15

145,500 285,000 285,000 285,000 285,000 Obj 3: Crop inputs, protection, receival

15 145,500 285,000 285,000 285,000 285,000

Obj 4: Extension 10 97,000 190,000 190,000 190,000 190,000 Obj 5: Human capital

8 77,600 152,000 152,000 152,000 152,000

Obj 6: Blue sky research

2 19,400 38,000 38,000 38,000 38,000

Total 100 970,000 1,900,000 1,900,000 1,900,000 1,900,000 Source: AgEconPlus analysis of RIRDC data The budget allows for average annual project expenditure of $1.7 million per year.

76

10. Communication Plan Purpose and Communication Objective This communication plan was prepared in accordance with the RIRDC Communications Strategy (Cox Inall Communications, September 2008). Its aim, consistent with RIRDC’s corporate mission, is to maximise the knowledge outcomes from Rice R&D investments. Approach – Application of the Decision Tree The communication plan was prepared after working through the Cox Inall developed RIRDC Communications Decision Tree. The Decision Tree provides for a review of audiences and the best way to communicate with them, stakeholders who need to be informed of rice program research, industry and other networks that could be used to help disseminate information, and the best methods of extension and adoption. Target Audience for Rice R&D Outcomes The target audience for R&D outcomes, in priority order, is:

1. Rice growers in the Riverina– the Program continues to be focussed on rice growing and levy payers are anticipated to be the major beneficiaries of research outputs.

2. Key influencers – see list below, including influential growers, members of the Rice R&D Committee, public and private extension officers, emerging farmer groups and representatives from RGA.

3. Rice growers in other areas – also paying levies and a limited number of projects relevant to new production areas are anticipated.

4. Other parts of the supply chain – including RRAPL, SunRice and the NSW Rice Marketing Board. Potentially supply chain partners will be required to deliver R&D outputs eg seed production, distribution, milling and marketing of new rice varieties.

5. Other R&D Program managers – including GRDC, the livestock producing industries that are part of the rice based farming system (ie MLA and AWI), relevant CRCs (including the CRC for Irrigation Futures) and international rice research programs (including IRRI and the California Cooperative Rice Research Centre).

77

6. Policy makers – especially relevant to an input and output regulated industry such as rice. Relevant policy makers will include those in the primary industries, environment and climate change portfolios. The NSW Government (through state based single desk legislation) and the Australian Government (through levy contributions) are major stakeholders. The WA, NT and Qld Governments also have emerging rice industries within their jurisdictions.

Early, Late or Mainstream Adopters Communication activities differ on the basis of whether the target audience is dominated by early, late or mainstream adopters.

o Early adopters – leading Riverina growers, growers in new areas and other key influencers (eg extension agronomists).

o Mainstream adopters – most Riverina growers.

o Late adopters – smaller Riverina growers. All three groups make up the target audience but given limited resources and the status of the industry (strongly focussed on irrigated production in the Riverina), most effort should be placed on early and mainstream adopters. Therefore, according to Cox Inall (2008), communication activities should focus on:

o ‘Technology development’ - workshops and field days to demonstrate research.

o Information distributed through industry networks, using case studies, key influencers and champions.

o Information available from a source (eg report, website) when required. Expected Key Messages from the Outcomes of the R&D Program Key messages from the Rice R&D 2012-2017 are expected to include:

1. New varieties originating from the Program offer additional cold tolerance, lower production risk and increased water use efficiency.

2. Additional productivity can be gleaned from implementing prescription farming recommendations emanating from the Program.

3. Crop protection costs less if growers adopt weed and pest management recommendations developed over the next five years.

78

4. There are advantages in sourcing extension advice from traditional sources, farmer groups and online using program developed blogs and databases.

5. Our investments in human capital have secured research capacity for the next Five-year plan.

Communication Materials in Languages Other than English None envisaged, industry players are long established in the Australian community. Targets for Adoption The target adoption rate for successful research outcomes is 80% given the industry’s history of successful R&D adoption, its concentration in the Riverina, the quality linkages available through the Rice R&D Committee and the availability of extension staff, farmer groups and online tools. Known Industry Networks Known industry networks – associations, grower groups etc in the Australian rice industry that would be effective in communicating R&D Program results include:

o Rice grower meetings and regular contact by NSW Department of Primary Industries as part of extension projects. These include pre-season rice technology meetings in all rice producing districts and rice discussion groups throughout the production season. Field days and publications (on the web, RiceCheck, Prime Facts production guide and the Rice Variety Guide) are also relevant.

o SunRice grower services (www.sunrice.com.au)

o IREC – Irrigation Research Extension Committee (http://www.irec.org.au)

o RGA – Ricegrowers Australia (www.rga.org.au/)

o NSW Irrigators Council (www.nswic.org.au/)

o RiceCheck and Environmental Champions Program grower groups

79

Major Events Where the Rice Industry is Represented Major events, conferences, field days, etc where the rice industry is represented and where R&D Program outcomes are effectively profiled include:

o Rice Field Day held in February or March each year

o Annual RGA Rice Growers Conference

o two annual Irrigated Farm Competitions to improve water use efficiency

o regular planning and review meetings to ensure the relevance of irrigation R&D

Key Influencers in the Rice Industry Key influencers in the rice industry that could be targeted by the R&D Program as champions for research findings include:

o Rice R&D Committee members (proven effective communication network); and

o RGA branches throughout the Riverina. Key Publications, Websites and Media Key publications, websites and media appropriate for communicating R&D outcomes include, in addition to those listed above:

o Specialty press – IREC Farmers Newsletter which is highly regarded;

o Groundcover magazine; and

o Riverina media including local newspapers. Conclusions Further refinement of the communication plan will be appropriate when the R&D Plan has been adopted.

80

References ABARE (2010) Crop Report http://www.abare.gov.au/publications_html/data/data/data.html Agtrans Research (2010) Rice Breeding Program Return on Investment Australian Bureau of Agricultural and Resource Economics (2009) ‘Australian Commodities’ March quarter 09.1) CIE (2004) Evaluation of the Rice Program: An Overview of Projects – Stage 1 CIE (2004a) Evaluation of the Rice Program: An Assessment of Investment Returns – Stage 2 Cox Inall Communications (September 2008) RIRDC Communications Strategy CSIRO and BoM (2007) Climate Change in Australia: Technical Report 2007, CSIRO Melbourne Cutler & Company (September 2008) Venturous Australia: Building Strength in Innovation DAFF (2005) Australian Agriculture and Food Stocktake Gaydon, D, Beecher, HG, Reinke, R Crimp, P Howden, SM (2008) RICE. ‘An overview of climate change adaptation in Australian primary industries – impacts, options and priorities’. Report prepared for the National Climate Change Research Strategy for Primary Industries. CSIRO. IREC (2008) Farmers’ Newsletter – Large Area No 179: Spring 2008 Kiri-ganai Research (2006) Taking Stock and Setting Directions, report prepared for Department of Agriculture, Fisheries and Forestry NSW DPI and RIRDC (2009) Options for Rice Based Farms to Adapt to Climate Change. Productivity Commission (September 2010) Inquiry into the Rural Research and Development Corporations, Draft Report. Spencer (2004) Price Determination in the Australian Food Industry, prepared for Department of Agriculture, Fisheries and Forestry

81

RIRDC Rice Program Business Case 2008, 2009 and 2010 RIRDC (2006) Rice R&D Plan 2006-2011 RIRDC (2008) Rice R&D Plan 2006-2011 (Revised) RIRDC (November 2005) Template for RIRDC Five-year R&D Plans RIRDC (2007) RIRDC Corporate Plan 2007-2012 RIRDC (2008) RIRDC Evaluation Framework, Version 1.0, 7 May 2008 RGA (2010) Submission to the Productivity Commission Inquiry The Australian Government Research and Development Corporations Model Whitworth, R with contributions from Cole, G, Grieve, A, Hedditch M and Lewin, L (2009) ‘Options for rice-based farming systems to adapt to Climate Change’. Discussion Paper for scoping the workshop.

82

Appendix 1: Contacts for the R&D Program Dr John de Majnik Senior Program Manager Established Industries Rural Industries Research and Development Corporation Phone : (02) 6271 4138 Fax : (02) 6271 4199 Email : john.demajnik@rirdc.gov.au Web : www.rirdc.gov.au Mr Ian Mason Chairperson Rice R&D Committee Phone: (03) 5883 9454 Fax: (03) 5883 9465 Email: irmason@dragnet.com.au Mrs Ruth Wade Rice R&D Committee Ricegrowers’ Association of Australia Inc Phone: (02) 6953 0433 Fax: (02) 6953 3823 Email: rga@rga.org.au

The Australian rice industry is a world leader in production efficiency, water use efficiency and environmental management. Its high quality export focussed production achieves premium prices in world medium grain rice markets. This status is directly attributable to research, development and extension.

The industry faces a different operating environment to the one in which the last Five Year R&D plan was prepared. Production is now more likely to average 800,000 tonnes of paddy rice and be more variable than the 1.2 million tonnes per annum planned for in 2006.

This Five Year R&D Plan addresses the new industry realities and builds on past program success. The program retains its strong emphasis on rice variety breeding to further reduce demand for irrigation water and adapt to a climate that is hotter, drier and more variable.

Outputs from this program will contribute to RIRDC’s diverse range of over 2,000 research publications. Most of our publications are available for viewing, downloading or purchasing online through our website www.rirdc.gov.au. Purchases can also be made by phoning 1300 634 313.

Rice R&D Plan 2012 – 2017Pub. No. 11/050

Rural Industries Research & Development CorporationPO Box 4776KINGSTON ACT 2600

Level 2, 15 National CircuitBARTON ACT 2600

Phone: 02 6271 4100Fax: 02 6271 4199Email: rirdc@rirdc.gov.auWeb: www.rirdc.gov.auBookshop: 1300 634 313

rirdc.gov.au

RIRDCShaping the future