Highlights Complex economic interaction between soil acidity, nitrogen fertility, and GHG emissions  Nitrogen fertilizer emits GHGs directly, and via higher lime rates to treat acidity  Rates of nitrogen and lime affected by type of fertilizer, legume rotation, and rainfall  Carbon pricing reduces GHG emissions from lime and nitrogen but only modestly

Soil acidification due to crop removal and the use of acidifying fertilisers reduce land productivity in many agricultural systems worldwide. The most common remedy is to apply lime to the soil surface. An alternative approach is to incorporate lime into the sub-soil. This is a more expensive option, but it substantially reduces the time required to reduce acidity in the sub-soil horizons. This paper presents a dynamic optimisation model to determine optimal rates, frequency and methods of lime application for a wheat monoculture system in the northern part of the Western Australian wheatbelt. Results show that optimal application rates depend on rainfall levels and soil-acidity conditions. The net present value of profit is not sensitive to the frequency of lime application. Incorporating lime into the sub-soil increases the net present value of profit, but only by a small amount: two to four per cent in most scenarios modelled. In the process, sub-soil lime application reduces both the optimal lime application rate and the time required for the soil pH to increase to a target level.

Many agricultural soils are naturally acidic, and agricultural production can acidify soil through processes such as nitrogen (N) fixation by legumes and application of N fertiliser. This means that decisions about mitigation of soil acidity (e.g. through application of lime), crop rotation and N fertiliser application are interdependent. This paper presents a dynamic model to determine jointly the optimal lime application strategies and N application rates in a rainfed cropping system in Western Australia. The model accounts for two crop rotations (with and without a legume break crop), for the acid tolerance of different crop types, and for differences in the acidifying effect of different N fertilisers. Results show that liming is a profitable strategy to treat acidic soils in the study region, but that there are interactions between N and acidity management. Choice of fertiliser affects optimal lime rates substantially, with the use of a more acidifying ammonium-based fertiliser leading to higher lime rates. The optimal liming strategy is also sensitive to inclusion of a legume crop in the rotation, because its fixed N can be less acidifying than fertiliser, and it allows a reduction in fertiliser rates. Higher rainfall zones have greater N leaching, which contributes to a higher optimal rate of lime. We find that injection of lime into the subsoil increases profit. Optimal lime rates in the absence of subsoil incorporation are higher than usual current practice, although the economic gains from increasing rates are small.

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