1. A Stochastic Bioeconomic Model to Demonstrate the Benefits of Pest Exclusion The Case of the Varroa Bee Mite
International Plant Health Risk Analysis Workshop Niagara Falls, Canada, October 2005
David Cook

2. Outline Introduction - Cost sharing arrangements for invasive species
- The role of economics in risk assessment
- The Varroa Bee Mite
The model
- Framework
- Assumptions
- Outputs & Interpretation
Results
- Implications for cost sharing arrangements
Conclusions

3. Biosecurity Service Provision in Australia
Two “emergency response” cost sharing agreements:
Emergency Animal Disease Response Agreement (EADRA)
Emergency Plant Pest Response Deed (EPPRD)
Cost share categories, public vs. private benefit of eradication:
Public Private
Category % 0%
Category 2 80% 20%
Category 3 50% 50%
Category % 80%
Varroa (EADRA)

4. Varroa Mite
V. destructor is a parasitic mite that attacks adult honeybees and their developing larvae;
Infestations result in the production of deformed bees, reduced longevity of individuals and slow death of the colony;
Present throughout much of the world, but has yet to be detected in Australia;
Spread between colonies usually high;
Can be controlled in the beekeeping industry (at considerable cost), but wild European honeybees are severely affected.
D. Anderson, CSIRO Entomology
S. Bauer, ARS/USDA

5. Previous Estimates Industries Assistance Commission (1985)
<A$160 million
Gill (1989), Gibbs and Muirhead (1998)
Between A$0.6 billion and $1.2 billion
Gordon and Davis (2003)
A$1.7 billion
Robinson et al (1989) - US$9.3 billion
Morse and Calderone (2000) - US$14.6 billion
Muth and Thurman (1995) - US$600 million.
Pollination benefits ≠ expected Varroa damage.

6. The Model NATIONAL BOUNDARY
Total area summed across all satellites increases until reaching Amax, at which point it remains constant
NATIONAL BOUNDARY
New satellite population
Established population
Parameters:
Parr - Arrival probability
Pest - Establishment probability
D Diffusion coefficient
r Intrinsic rate of density increase
K Carrying capacity
N - Local population density
µ Rate of new satellite generation
Amax - Total host area
Amin - Initial area affected
g - Rate of spread

7. Interpretation
Framework provides a base-case entry scenario where spread and impact are severe
In the event of a ‘real’ incursion, results represent the benefits of eradication over time
i.e. one half on a benefit cost analysis
The model says nothing of efficiency in managing risk over time.

8. Cost & Revenue Implications
25 crops used in the analysis
Crops used were placed in one of four categories roughly proportional to pollinator reliance
Low (0-5% yield loss)
Moderate (0-10%)
High (0-20%)
Very High (10-30%)
Number of additional commercial hives required varied between 0 and 5 per hectare, depending on the crop
Additional costs per hive estimated between A$90-120/yr.

9. Expected Economic Impact (A$/Yr) – 30 Year Average

10. Cost/time Relationship Over 30 Years

11. Pollination Benefits by Industry

12. Sensitivity Analysis Probability of entry
Prevention better than cure?
Intrinsic rate of population growth
Implies high returns to investment in R&D activities concerning the control of inter-colony spread
Yield Loss
Discount rate

13. Conclusions
Estimate that annual benefits of exclusion to Australian plant industries of between A$21.9 million and A$51.4 million;
Results far less than previous estimates, but are nonetheless indicative of an extremely destructive pest;
Cost sharing arrangements in Australia relating to the eradication of Varroa may be inappropriate.

14. Thank You Contact Name David Cook Title Research Economist
Phone
Web
Contact CSIRO
Phone
Web