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TAS Country : June 14th 2012
Friday, June 15, 2012 Tasmanian Country 23 Opinion Price of foreigners' food security CHEWS theFAT David Byard HARD RIDE: Outback farming is attracting interest, but largely unviable for our own farmers. FOREIGN ownership has been in the news for some time and clearly it is a subject with many passionate views. One side says we need foreign investments and on the other end of the scale there are people who have grave concerns about long-term food security. What we can be sure of is that the world's population is expanding at a rapid rate and is expected to hit 7 billion later this year. Feeding all those mouths will be a mammoth task, and the supply-and-demand equation is going to make all arable land and water more valuable in the future. The old saying that gold and jewels are of little value if we can't feed ourselves, has never rung more true. Ownership of Australian farms is commonly passed down from one generation to the next. The old joke in farming is that the worst form of child abuse is to hand the farm on to the kids. Farming in this country always has ups and downs and at present is going through a transition with a lot of farms finding that the costs are far outweighing the returns. As we all know, producers are the price takers, not the price setters, while those who supply farms with labour or merchandise have the luxury of being able to pass on their rising costs. At the moment, in the vegetable industry we are seeing onions being returned to the ground and potatoes are being sold at giveaway prices or used as stock feed. Why is this happening? Part of the reason is the supermarkets and others can import food cheaper than we can grow it. What puzzles me is that places like China which exports so much cheap food into Australia is now frantically buying large tracks of farmland. These are farms that Australian companies, individuals, and super funds see as not returning the sort of profit they require, or they cannot compete with the exorbitant prices the overseas buyers are paying. We need to remember it is not that we don't have the money, in many instances, to buy the land; it is that the return on investment can't be made. To me, it is a simple equation: there are more and more mouths to feed in the world, there are also more people in the world who can afford more expensive food. There is also the issue that land is in fact a dwindling resource in some parts of the world with urban expansion covering huge areas of agricultural land. What we are seeing overseas is land and food becoming scarce; we are seeing overseas Governments initiating a risk management strategy to overcome that food scarcity, by using Australian land to do that. That means we Australian farmers lose an enormous part of the supply chain and the long-term wealth generation that comes with that. With this equation some state corporations, such as those in China, may not be driven by profit and are willing to pay well over the odds for Australian farms and water rights, to give long-term protection against their own food security. The question to ask: is this fair? People will argue that in the past we have seen Australia's rural wealth built on foreign investors, and in fact large tracts of the north-east of Tasmania was opened up by foreign ownership, namely the British Tobacco Company. So what is the difference? The sort of investments that we saw in the past are not the sort of investments we are seeing now. Back in the 1950s the government was encouraging the expansion of Australian agriculture, through foreign land acquisition, the soldier settlement scheme, subsidies, links to the European Common Market and, later on, through a raft of generous taxation deductions. This was all heavily monitored and controlled with the aim of expanding agriculture. And, it worked. However, now we have, in many instances, overseas governments coming to Australia and buying up large tracts of agricultural land, at highly inflated prices, making them out of the reach of most Australian farmers. For those lucky enough to sell it is a bonanza, but does this cause some form of market failure? There are areas interstate where, if you are out of one of the so-called ''golden triangles'', the price of land is static and will not attract a bid; but over the fence the land is worth twice as much. I have recently read that the Federal Government is talking to the Chinese about investing billions of dollars to transform vast tracks of undeveloped land in the north of Australia (around the Ord River) for farming. It appears that Canberra is talking to Beijing about a joint study to examine the policy changes needed to enable a massive investment from China. This is policy on the run. Where is the strategic plan, who has been consulted, why is the Government talking to overseas investors before it talks to Australian investors? If all of this was part of a plan that we all knew about, and it had some finish point, it would be easier to understand. If we want to get this land opened up and used productively, and to lower the risk for Australian farmers, why can't we use taxation, subsidies and R&D funding to help? What I do know, is that there needs to be a planned approach. At present, Australia has a policy in place that allows anyone to buy land without approval as long as the price is not $230 million or above. Clearly this is open to abuse as an investor can buy a lot of land in separate transactions as long as they are under the limit, and not disclose it. It seems the Government's figures, which come from the ABS, suggest that there is 10 per cent foreign investment in Australian land and water, but I am not sure that the Government is fully aware of how much land is in foreign ownership, because as long as purchases were under the $230 million no one has to know. If a foreign country like China has enough land in Australia it can bring its own machinery in, as well as fertilisers and chemicals, and send the produce back to their own country. If, indeed, this was to happen how would this affect Australia's wealth. Whether or not this can happen is open for debate, but one of the most pressing issues for Australia at present is food security. Yes, our food security can be affected by disease, weeds, climate change and government policy. However, could Australia's own food security be impacted by having a large percentage of our land taken by foreign ownership? Elders Killafaddy TRADE CATTLE: BD & DR Templar, str, 188c/kg- $902; B & K Enno, str, 208c/kg-$852, 182c/kg-$628, hfrs, 200c/kg-$ 660; CM & T M Best, strs, 183c/kg-$915; Melrose Dairy, 175c/kg- $831; Melton Vale Ent, 183c/kg-$887; PW & J Beat- tie, str, 185c/kg-$1150. COWS: S Whiting, 138c/kg-$779; M J Symonds, 138c/kg-$ 765; H M Kidd, 137c/kg-$746; P Whiting, 137c/kg-$630; B & K Enno, 136c/kg-$564; DJ & VK Rice, 147c/g-$893. STORES: B & K Enno, strs, $435-$465; P. Whiting, hfr, $420. LAMBS: MF & KM Wilson $113, KD & MN Beattie $103-$111, DJ & DK Rice $98-$99, John Watson $75-$99, HM Kidd $80-$90. TWO-TOOTHS: FM&AM Wilson $84, Hatherley Ltd $36-$43. MUTTON: S Flack $80, Hatherley Pastoral $45-$57, AJ Spencer $53-$55. Roberts Killafaddy TRADE CATTLE: D Saw- rey, hfr, 201c-$663, hfr, 199c-$676; Heathfield Farm, hfr, 195c-$721; CN Hall, hfr, 193c-$791; M & M Partridge, hfr, 185c-$925; P J Sattler, hfr, 182c-$750; Heathfield Farm, hfr, 182c-$746; M & M Par- tridge, hfr, 180c-$765; Heathfield, hfr, 180c-$693. COWS/BULLS: PO Hazell, c, 151c-$928, b, 137c-$897, b, 120c-$576, c, 115c-$609; P J Sattler, c, 148c-$939, c, 125c-$546; Pisa Estate, c, 147c-$988; RJ & PJ Burns, c, 147c-$968, c, 143c-$775; M & M Par- tridge, c, 137c-$678. LAMBS: KJ Rice $115, SA & RL Beattie $111, Archer Landfall $102, NH Ritchie 98, EG & EA Murfett $94, EE & GM Cresswell $92, D & J Piscioneri $89, RC & BC Sturzaker $89, R Rigby $88. MUTTON: PO Hazell, w, $69; R Lowry, e, $66; Pisa Estate, e, $60; PR Allan, e, $58. Tassie lamb rate up From Page 19 The big numbers are be- ing killed at Swift's Longford plant where heavy lambs are pro- cessed and TQM's Cressy works where light export lambs are processed. Australian lamb ex- ports to South East Asia in May reached their highest monthly total so far this year, which is 8 per cent higher than the corresponding period last year. China continues to dominate market share, accounting for 62 per cent of the total during May. Shipments to China in- creased 19 per cent on May last year with strong demand for breast and flap underpinning the higher volumes. The Horsham sheep and lamb sale was re- ported by the NLRS for the first time last week. Horsham is the fourth largest selling centre in Victoria with an annual throughput of 570,000 head last year. The MLA said that the addition of the sale data will enhance NLRS's mar- ket analysis capability due to greater throughput and geographical vari- ation. This region typically has an earlier lambing season and as a result will provide earlier indi- cations of market trends of young lambs.
June 7th 2012
June 21st 2012