Considerable uncertainties, especially those relating to the weather, are present among Australian grazing enterprises. Existing climate prediction tools are not being used effectively in aiding farmers to decide the optimal stocking rate and the levels of other management variables on their pastures. The paper aims to link a biophysical climate simulation model, Aussie GRASS, with an economic model of farm decision making under uncertainty. This model will be used to analyse farmers’ behaviour with respect to weather risk, and to derive optimal pasture management options that result in profitable and sustainable natural resource management on a farm level.