McRae Trust Farm was used to examine how hill country fanning policies and management affected the quantity of livestock greenhouse gas (GHG) emissions, profitability, and risk. Land use decisions were subject to the opportunities and constraints inherent in the natural soil capital of the farm.Analysis was undertaken using FARMAX~R and OVERSEER~R. Features of the pastoral farming system in 2009 were compared with 1990, and data around livestock GHG emissions was compared with the methodology proposed in the Climate Change (Agriculture Sector)Regulations 2010 which is intended to be the basis for calculating farmers' liability in 2015.Changing livestock policies can potentially change livestock GHG emissions by around 10%. Reduced emission intensity (kg CO_2-e/kg meat & fibre) is achievable, but total GHG emissions may be increased over the baseline. Profitability, as measured by Economic Farm Surplus, may be increased or decreased with no relationship with the level of GHG emissions. Between 1990 and 2009, intensity of GHG emissions has been reduced by about 5% on this farm. An area of 12 ha of forestry will assist in reducing GHG liability in the initial period of agriculture's inclusion in the Emissions Trading Scheme (ETS).
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