The bio-physical assets held by the industry – primarily the natural capital residing in land.

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This component currently focuses on land, the most obvious bio-physical asset held by the industry. The natural capital associated with the land held by the industry is part of Australia’s natural capital. If the value of this natural capital increases, then Australia’s natural capital increases. The value of the land is evaluated in terms of its capacity to provide a mix of ecosystem services. For land held by an agricultural industry, the dominant ecosystem service is likely to be the provision of food and fibre. However, land held by an agricultural industry can also provide a number of other services including biodiversity conservation, carbon sequestration and cultural or non-material services. Other components can be added to the framework as needed.

This component refers to all land held by the industry irrespective of whether it is used for the production of food and fibre. ‘Held’ implies that the industry is considered accountable for the condition of the land. It does not imply any particular form of ownership.

Physical infrastructure (buildings, tracks, dams, etc) is another category of bio-physical assets that can be held by the industry. Physical infrastructure is part of Australia’s produced capital. Components explicitly addressing physical infrastructure are not presently in the Signposts for Australian Agriculture (Signposts) framework, but will be incorporated in the future.

Desired outcome

Maintain or increase the capacity of land held by the industry to provide a mix of ecosystem services.

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The desired mix of ecosystem services will vary from place to place and over time reflecting changes in society’s understanding of its wants and needs. For example, past requirements to clear land reflected a desire to increase production of food and fibre. Recent restrictions on land clearing reflect a desire to increase the provision of biodiversity conservation services.

Indicator

A composite of the results for each sub-component.

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Other possible indicators:

Land value in dollars per hectare could be used as a surrogate for natural capital. Land value would be expected to be more responsive to components such as ‘capacity to produce food and fibre’ than to components such as ‘capacity to provide biodiversity conservation services.’ In some locations, land value could be dominated by the possibility for alternative uses such as urban development.

Summary measure

To be developed.

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One possibility is a multivariate summary measure in which individual summary measures from the sub-components are displayed as a kite diagram as shown in Figure 1.

                     Figure 1: Example of kite diagram.