Letter to the editor
As a beef producer south of Hughenden in central western Queensland, I know only too well the effects of extended severe drought on our agricultural businesses, our livestock, rural land, wildlife and on the people. This also includes the rural and regional communities within the drought effected areas.
It would be a fair assumption that beef producers subsidised the cost of beef to consumers through most of the first decade of the 2000s. During this period debt levels and land prices rose significantly. Banks were eager to sign up rural customers.
Then we had the 2011 live export debacle and the drought began in 2012. Cattle prices crashed on an oversupplied market. Processors cashed in as slaughter numbers reached record levels. Producers were forced to sell as agistment was almost impossible to find.
In contrast, 2016 saw prices reach record levels on the back of a supply shortage. Unfortunately many producers had reduced their stock numbers, in some cases totally. In many cases they have not been able to take advantage of the great prices.
I read with surprise about Minister Joyce's 2016 election promise of the introduction of the Regional Investment Corporation. It appears that this concept hasn't been given much consideration by politicians, the media, our farming organisations and our wider community. I suppose one could say that it is a typical election promise.
I am however aggrieved that politicians and our farmer organisations consider the Australian Reconstruction and Development Board concept is "off the table". Why is it "off the table"? Who says that economic dries within Liberal Party ranks know what is best for the prosperity and longevity of Australian family owned agriculture in Australia?
I would suggest that the introduction of Dairy Industry Deregulation by the Coalition Govt in 1999 was driven by the economic dries within the Coalition Government. What a disaster that decision has been for an industry, its farming families and regional communities. The dairy industry in Queensland is still shrinking. Deregulation is not always the answer!
The reason the ARDB needs to be back "on the table" is because agriculture is an essential industry. This industry has to produce food and fibre under all conditions.
These conditions include floods, droughts, fires and at times, a high Australian dollar and anti-agricultural government policies. Farming families have to survive all this, while coping with high production costs including excessive electricity and water charges.
Keeping in mind that food production is an essential industry, Australian farmers, in times of distress, should be able to operate their businesses and borrow funds at interest rates only marginally greater than the rate set by the RBA.
Farmers should be supported after times of hardship, with borrowing costs that do not include margins as high as those set by commercial banking institutions whose main priority is 'shareholder return'.
I believe the primary reason the ARDB concept was rejected in the Agricultural Competitiveness White Paper delivered in 2015 was because it was introduced into parliament by Bob Katter. Had the ARDB been introduced by a member of the LNP, it would be up and running by now. At a state level, Robbie Katter and Shane Knuth have been working hard to try and get a similar concept up in Queensland.
The problem for the ARDB concept in Queensland is that the ALP members in Queensland have virtually no understanding of the challenges in agriculture and at a Federal level, there is political vindictiveness against Katter.
All the while, Rome burns. The political parties currently in power, State and Federal, need to grow up and put their constituents first and not some hair-brained, politically correct ideology.
As we all know, the interest subsidies that once existed under Exceptional Circumstances provisions have been abolished. Current government support through water infrastructure, fodder and livestock freight subsidies and low interest loans have been helpful during this drought for some producers, but certainly not all. In fact I would suggest a minority.
This is a fact because the $1M maximum loan on offer to viable producers is dwarfed by industry average debt loads.
Due to the fact that the banking industry no longer publishes industry debt levels, the only indication of average debt loads is a survey conducted by the Gulf Cattlemen's Association back in 2012/13.
This survey indicated that average debt for family owned beef operations north of the Flinders Highway was between 4 and 5 million dollars. Many years of drought have been endured since that survey and most producers have drastically reduced stock numbers.
We need a structure that works for all family based farming businesses who need assistance. The ARDB may well be that structure. Sure it may need a tweek here or there, but I urge politicians and farming organisations to reconsider the appropriateness of this scheme.
Drought and other natural disasters have always been and will always be part of Agricultural production in Australia. Farmers need a structure in place that will allow them to recover when Exceptional Circumstances arise.
It needs to be remembered that this drought and the effects of it are not over yet. In many parts of Queensland, Rome is still burning.
Other positive aspects of the ARDB could include a revamped drought subsidy scheme which may be financially attractive to both levels of Government.
Some discussion around environmental constraints could also be considered.
- Rob Atkinson, Katandra, Hughenden
