AgForce has released a series of polices it believes are required at state and federal Government level to restore profitability to rural enterprises currently being battered by a storm of simultaneous seasonal and market pressures.
AgForce Queensland General President, Ian Burnett, said the factors contributing to the current market climate, and to the broader profitability of the sector, had been gaining momentum over recent years and were now concurrently bearing down on profit margins.
Longer term factors included the strong Australian dollar, high debt levels as a result of borrowing to purchase property at elevated prices followed by a correction of the market over the past five years, the Australian Government failing to secure Free Trade Agreements with key Asian trading partners, the two-month shut down of live export to Indonesia in June 2011 and continuously rising input costs including fuel and electricity.
For some producers the combined impact of each of these elements had been compounded by bushfires, consecutive flood events and now drought across more than a third of the state.
Mr Burnett said the alignment of so many profitability limiting factors at one time was damaging even the most proactive and sustainable of rural enterprises.
“There is no doubt short term assistance measures are urgently required to help our beef producers, as well as other struggling agricultural commodity producers, through the present challenges they face,” Mr Burnett said.
“However it is imperative we focus on the development of flexible policy approaches that will restore productivity and profitability to the sector not just in the immediate term but for the security of primary production into the medium and long term as well.”
Mr Burnett said AgForce had invested significant resources into the ongoing development of achievable and realistic strategies to address declining profit margins and difficult operating conditions.
Key policies for both the short and longer term include, but are not exclusive to:
- Facilitation of professional, cost neutral debt mediation services;
- Government commitment to in-event business support for droughted producers who have demonstrated reasonable preparedness measures. AgForce and the National Farmers’ Federation have continually communicated the need for this to Minister Ludwig and his Department throughout the last three years of the drought reform process;
- Reform of the Vegetation Management Act (1999). AgForce has lobbied for more realistic vegetation management frameworks for more than a decade on behalf of the State’s landholders which has culminated in Minister for Natural Resources and Mines, Andrew Cripps, now progressively rolling out this reform. We have also advocated for the removal of the Wild Rivers legislation and further reductions in other rural red tape;
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Continuation of the existing uniform electricity tariff policy and community service obligation to provide equity regardless of geographic location and a continuation of agricultural electricity tariffs including improvements in time of use charging. AgForce is currently awaiting finalisation of electricity price paths and is discussing these items with Minister for Energy and Water Supply, Mark McArdle, today. The organisation has also continually provided information to the Queensland Competition Authority on primary production realities;
- A halt on further leasehold rental increases until an affordable free holding methodology is finalised and an alternate rental methodology is made available to landholders who do not embark upon tenure upgrades. Given current circumstances AgForce presented a proposal for a rental holding pattern in January to Minister Cripps and Deputy Premier, Jeff Seeney and are awaiting feedback.
- Prioritisation of a range of Free Trade Agreements, in particular with Korea, China and Japan. FTAs are tangible outcomes governments can deliver and this should be a priority to help support profitability of the entire beef industry. Furthermore, AgForce is working with Government, Meat and Livestock Australia, Cattle Council of Australia and other industry stakeholders to revitalise the live export trade to Indonesia and restore that much needed outlet for northern Queensland cattle;
- Removal of stamp duty to inter-generational sales. AgForce presented a proposal for this to Queensland Treasury last year and is awaiting an official response;
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Establishment of a new visa category or, alternatively, introduction of concessions to the 457 visa category to allow sponsorship of semi-skilled agricultural workers. AgForce and NFF have been in active discussion with the current Federal Government on this issue however are yet to see an effective Government or Coalition policy dealing with rural labour constraints;
- A relaxation of a range of transport requirements for drought-affected producers to enable stock to get to sale. AgForce has worked to make the Drought Assistance Package available to drought-declared individuals and shires. We are also working on a case-by-case basis on additional concessions on certain routes.
“The current pressures on profitability in the beef sector particularly, but also across other commodities, did not develop overnight and there is certainly no single silver bullet solution to alleviating the weight of these problems,” Mr Burnett said.
“However, we are the best suppliers of premium primary produce in the world and this will underpin our longer term ability to remain a viable and vibrant industry.
“The storm of events currently hurting us only further emphasises the value of the work AgForce is doing in policy creation and advocacy and our ongoing efforts to ensure the security of the sector for generations to come.”
Source: AgForce Queensland
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