April 6th 2019


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Articles from this issue:

COVER STORY The NSW election and our incredible shrinking farming sector

SOCIETY The pervasive and pernicious online porn epidemic

CANBERRA OBSERVED Coffers are full but Treasurer will take spending cautiously

OPINION Judge treats Cardinal Pell to a spot of 'open justice'

NATIONAL AFFAIRS NSW Liberals re-election gives a boost to Morrison

ECONOMICS The Great Dragon uncoils all around the globe

INTERNATIONAL AFFAIRS President Donald Trump: an unlikely promise keeper Part 2

REFLECTION On the conviction of Cardinal Pell

FICTION Orange Years: The Japie Greyling Story

TERRORISM Lessons from Christchurch

ASIAN AFFAIRS Xi's imperious play prompts U.S. to repair Asian friendships

YPAT Getting with the program: one young person's story

MUSIC To market, to market, to sell a good song

CINEMA The LEGO Movie 2: Building a world

BOOK REVIEW A template for living alongside the world

BOOK REVIEW Catholic Maryland and early tolerance

LETTERS

POETRY

THE BUDGET Take your tax cuts and be merry, for tomorrow ... is another day

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COVER STORY The NSW election and our incredible shrinking farming sector

by Patrick J. Byrne

News Weekly, April 6, 2019

The loss of long-time National Party seats in the New South Wales election begs the question: what is going on in the rural sector?

The Shooters, Fishers and Farmers Party (SFFP) won the National Party strongholds of Murray (taking in a major irrigation districts in southern NSW) and Barwon (which covers 44 per cent of NSW west to the South Australian border and north to the Queensland border).

The Nationals may still hold Barwon’s nearby seat of Dubbo, but it suffered a 20 per cent swing in Dubbo to an independent.

Wagga Wagga went from Liberal to independent Joe McGirr in a 2018 by-election. McGirr has retained the seat with a further 28 per cent swing.

These areas are home to major agricultural industries that feed into the local economy. Farmers buy fuel, equipment, seed, fertilisers and household needs while supplying products for processing and sale into domestic and foreign markets. Historically, every dollar of product at the farm gate generates another $4 into the economy.

But farmers have long suffered from a range of adverse federal and state policies.

Rural industries have been affected not just by drought (and recent floods in Queensland), but by hardline free-trade policies that started in the 1980s. Other nations treat agriculture as a strategic industry.

Then deregulation of rural industries under federal and state-agreed National Competition Policy started in the 1990s. The federal government paid the states billions of dollars to abolish marketing arrangements for wheat, dairy, barley, sugar and other smaller sectors – oats, sorghum, maize and oil seeds (canola/rape seed, safflower, sunflower, linseed).

Other farm supports were wound back. What the Organisation for Economic Cooperation and Development (OECD) calls General Support Services (for example, private or public services, institutions and infrastructure, but not direct payments to farmers), are all that remain for farmers.

Today, Australia (and similarly in New Zealand) has the lowest support levels for farmers in the developed world, while the prices for their products are set by the world market prices that are deflated by subsidies and other supports. This in a country where two major super­markets have dominated the domestic grocery market.

Also under National Competition Policy, water trading was widened. This has allowed the Murray-Darling Basin Plan to remove so much water from irrigation farming and be redirected to environmental flows that the Basin’s reservoirs no longer drought-proof this vast region known as “Australia’s food bowl”.

Further, as the banking royal commission has demonstrated, the deregulated banking system no longer caters to farm sector needs, while the rising cost of electricity has hit farmers hard and states have neglected rural infrastructure.

Many farmers have battled against policy changes that have seen many farm sectors suffer, and caused a population exit from many rural areas.

Meanwhile, there have been those saying that farmers have a bright future supplying food and fibre to Asia. What is the state of Australia’s agriculture?

It is a diverse industry, but this table compiled from Australian Bureau of Agricultural and Resource Economics and Sciences data indicates how various sectors have fared since the mid 1970s. So, how has farm production fared as the Australian population grew 75 per cent from 1975 to 2016?

 

Source: All agricultural production data from ABARES Agricultural commodity statistics 2018.

Despite major investments to expand the dairy and sugar industries, both are about 20 per cent below Australia’s population growth. Both declined when they were deregulated under National Competition Policy after 2000. Milk production continues to decline as dairy farms shut down.The cattle herd and sheep flock are lower than they were in 1975. Indeed, the sheep flock peaked at about 170 million in 1989–90, then declined by over 100 million. Red meat production (beef and sheep) has increased 52.6 per cent (partly due to heavier cattle going to market), but has not kept pace with population growth. Production has only marginally increased since 2000.

Rice production is highly variable, so two 10-year average production figures appear in the table. Production has not increased since the ’70s, despite Australia’s population growing 75 per cent.

Production of wheat is 11 per cent above population growth, coarse grains 40 per cent above, and timber 59 per cent above. Similarly for wine grapes (110 per cent above), although there has been only a small increase in production since 2003.

There has been a major increase in cotton production since the mid 1970s.

Statistics for other industries have been kept only since 1990. Harvest of seafood has been declining since at least 2000. Overall production has only increased marginally because of the big increase in salmon fish and to a lesser extent oysters.

There have been big increases in horticulture (fruit, nuts and vegetables) and pulses (peas, chickpeas, beans and lentils). Pork production has declined, while chicken meat has increased substantially.

Today the drought has brought to a head the major problems created by experimental agricultural policies that began in the 1980s. These policies have taken their toll and the NSW election indicates that many regional voters want new policies for the rural sector.




























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