Assessment of the benefits of an enhanced weather information service for the cotton industry in Australia

✍ Scribed by Kwabena A Anaman; Stephen C Lellyett

• Publisher: John Wiley and Sons
• Year: 2007
• Tongue: English
• Weight: 977 KB
• Volume: 3
• Category: Article
• ISSN: 1350-4827
• DOI: 10.1002/met.5060030203

✦ Synopsis

The benefits derived from using an enhanced weather information service, the Cottonfields Weather Service, produced by the Australian Bureau of Meteorology were determined via a survey of producers of the Namoi Cotton Co-operative. The economic benefits were estimated using two methods: (a) the change in aggregate gross producer benefits (producers' surplus) due to reduction of unit costs of production from use of the service, and (b) the maximum amounts of money users would be willing to pay (WTP) for use of the service. Results indicated that the average annual WTP for the service was about 223 Australian dollars (A$). The WTP value was modestly higher than the average annual phone facsimile charges of A$190. The change in aggregate gross producer benefits derived were based on the estimated average 1 % cost reduction in the production of raw cotton from using the service based on elicited survey data. The annual aggregate gross benefits were about A$397 150 for cotton production only. The total annual costs incurred by cotton producers for use of the service were A$31 590. Hence the benefit-cost ratio (for cotton production only) was about 12.6. Reported indirect benefits included time savings for producers and use of the service to plan household and social activities.