Estimating the economic value of soil organic carbon for grains cropping systems in Western Australia

Soil organic carbon (SOC) has the potential to benefit soil function and fertility, and in agricultural production systems, it is considered integral to sustainable farming. We analyse the value of SOC in cropping systems of the southwest of Western Australia in terms of agronomic benefits from increasing productivity (through increased plant-available water-holding capacity) and reducing fertiliser use (due to increased mineralisation of nitrogen). We also present the potential value of SOC in terms of sequestration benefit if landholders were able to participate in a carbon-sequestration program. We estimate the marginal value of SOC (the value of a soil with more SOC, by 1 t C/ha, than a standard soil) to be AU$7.1-8.7/tC. ha. year, depending on rainfall zone and crop type. Approximately 75% of this value is the estimated sequestration value, 20% is the nitrogen-replacement value, and 5% is the estimated productivity improvement value. Over 50 years, this equates $130-160/t C. ha depending on the rainfall zone. These values are sensitive to variations in fertiliser and carbon prices. Our results imply this it is unlikely that the SOC benefits will drive practice change in the south-west of Western Australia.