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ROGER HANSON   |   May 02, 2013 12.01am OWNER of the country’s largest rural field days, Agfest, throws the spotlight on Tasmania’s agricultural sector. Rural reporter Roger Hanson talks with Tasmanian Farmers and Graziers Association chief executive Jan Davis to reveal why agriculture is the backbone of this state. Here are her no-holds-barred responses to questions by the Mercury. Why is it important to tell the story of our Tasmanian farmers to a wider audience? If you’ll forgive the pun, we should not hide our light under a bushel. Tasmania needs good news and it needs to reaffirm its strengths rather than being preoccupied with its weaknesses, or the raw deals it imagines it suffers perpetually. Tasmanian agriculture is a good news story. We produce outstanding food and fibre, which are the raw materials for industries that build upon farm production. Since settlement, our farmers have excelled at what they do. Today the farm gate gross value of production is about $1.2 billion. When you include seafood and forestry, the total exceeds $2 billion. More than 17,000 people are directly employed in farm-related activities, and when you take into account basic multiplier factors, the farm-dependent economy contributes $5 billion or 18 per cent to gross state product. That means one in six jobs. Over the past 25 years, the average annual rate of increase in farm gate gross value of production has been 2.8 per cent. Australia is closing fruit and vegetable processing facilities and importing more. Why is that? Ask Grant O’Brien, the chief executive of Woolworths. He will tell you that today the customer is king and the customer almost invariably is interested in price before quality. You might think that because you shop at a trendy corner grocer in suburban Hobart or Launceston, the rest of Australia is doing the same. It isn’t. The rest of Australia is shopping for the cheapest eggs, bananas, chickens, meat at the supermarket. For all the best will in the world, the supermarkets will source their product where it is cheapest — and Australian-grown food is not the cheapest. Our labour costs are high, our freight costs are astronomical, and the costs of regulation are out of all proportion. Added to that is the ability of food importers to bring in food from developing countries via the New Zealand back door and then sell it as produced in Australia. Where it is grown is another matter. Tasmanian farmers must back their judgment to make sound investment infrastructure decisions to improve farm productivity. Is there red tape holding any of this back? Absolutely. The cost of doing business for farmers in Tasmania is higher than anywhere else in Australia. What agricultural sectors are experiencing growth and developing their export markets? It is not so much sectors as individual businesses, and these vary too from time to time. Some dairy processors have developed strong export markets for milk products, while others have been successful in cheeses and yoghurts. Some fruit growers are doing well out of things like cherries. Some meat processors (and hence farmers) are doing well with high-value meat products. Why is freight considered one of the biggest hurdles for our agricultural industry? The cost of freight is probably our No.1 problem. The world is waiting for the food we produce, but to get it to them we have to trans-ship through Melbourne or Sydney and, to use an airline analogy, the cost of the domestic fare is just as dear as the overseas fare. It makes us uncompetitive in too many countries, so we face a double-whammy: we are price-takers in all markets, and we are prisoners of an iniquitous freight regime that all but prohibits our food from being exported. Apart from freight, what can Tasmania do to help farmers? It depends on whether you are talking about Tasmania or the Tasmanian Government. The Tasmanian Government can get off our backs for a start. Australian agriculture is one of the country’s most regulated industries. Regulation of Tasmanian agriculture is more stringent than any other state. The green tape and red tape is overbearing. It wears you down and it makes it impossible for Tasmanian farmers to compete even with mainland farmers, let alone low-price producers in other countries. The best thing Tasmania as a state can do is to tell the Government to get off the farmers’ backs and give them a fair go. We don’t want handouts. We never have. But we do from time to time need a hand-up to help through difficult times — fires, drought, market downturns and so on. What is the future of agriculture in Tasmania? If I can turn that question around, the future of agriculture is Tasmania’s future. This island is blessed with the right climate, the right mix of soils to produce the highest-quality food and fibre in our part of the world. I include timber in the term fibre. We grow trees very well. They are a natural, renewable resource. The future of agriculture in Tasmania is bright. We have the best conditions for growing things anywhere in the world: more water, more useable sunshine, a mild climate, soils good enough to eat, smart farmers, clever researchers. As the world’s population grows, there will be more and more demand for the fabulous food we produce. However, we will only achieve this potential if we can get the policy settings right. If costs are so high that farmers can’t make a living, we won’t surf that wave. Tasmanian farmers are renowned for being innovative. Which sectors are setting the pace in the way they go to market? We have the Tasmanian Institute of Agriculture, whose main goal is to improve agricultural productivity and sustainability. It does this by bringing together agricultural research with development, extension and education, and by working closely with industry. Development and extension is the basis of effective agricultural innovation. Tasmania has world-class produce, for example seafood, wine, beef and cherries. How can this be expanded and developed? We know Tasmanian consumers prefer to buy local food and beverages, but it has not always been easy to identify what is local and what is imported. We are the best in the world at what we do, so you know when you buy Tasmanian produce quality is assured. Consumers need to look and demand Tasmanian produce. The Taste Tasmania campaign is an example of identifying locally made products, so we can build on that. Forestry debate rages through the community. Where are farmers in this discussion? The short answer is that we have been on the outside, looking in. Many of our farmers are private foresters. They manage trees on their property for shelter, for firewood, for timber production, for aesthetics. In some cases, they have been doing this for seven generations. Private forests cover more than 880,000ha. That is26 per cent of the total forest cover on the island. Yet we were deliberately omitted from the so-called peace talks between the vested interests that wanted to divide up the public forests between them while closing down the remaining processing industry. If it were not for the Legislative Council, we would have had no say whatsoever in this debate, and that is just plain wrong. The so-called peace deal is about publicly owned forests. If the impacts spread across into the private sector, then the Government will need to commit resources to recompensing farmers for these added costs. What is farmers’ message to governments to allow Tasmania to act as a food bowl and catch the opportunity that comes with the growth in Asia? It is somewhat ironic that the Tasmanian Government recently declared that it has discovered the economic potential of Asia, as if the rest of us had been quietly asleep at the wheel, oblivious to what is going on in China, India and all points northwest of us. The Government’s White Paper on the subject says that these new markets open up “huge opportunities for Tasmania in areas such as agriculture, wine, dairy, tourism, education and high-value manufacturing”. Well, hello. This is just another example of the widespread contagion of what we call the Government’s SBOs — “statements of the bleeding obvious”. Despite all the obstacles of freight and price, our farmers have been trading successfully with Asia for decades. Many of them do not need to be told that the future of trade for Tasmanian agriculture is in Asia because they are well ahead of the game. We export more than $120 million of produce a year to Asia — that’s a quarter of all exports from the state to ASEAN countries. Dairy alone accounts for $43 million of that. We have told the Government time and time again that Asia has more degraded forest land than anywhere else in the world and there is little spare land for agriculture. This creates opportunities for both agricultural and forestry products into those markets. What has been the response? To shut down our forests to appease a blinkered local environmental lobby; and continue to restrict farmers’ ability to produce cost-effectively. Tasmania needs a strategic approach to identify and develop new high-value and high-growth export markets. We also need to recognise that not everything can be high-value: we need to have to produce sausages as well as eye fillet! Tasmania has a rich wool industry tradition, but superfine wool prices have fluctuated recently. Do you see Tasmanian wool still having a presence on the international market? Of course. We will always be key players in the high-priced superfine wool market because buyers love our products. Companies such as Zegna continually reinforce that. Irrigation schemes are a huge infrastructure development. Do you think the broader Tasmanian community understands the schemes? In a word, no — and that is an indictment of the system. Irrigation is actually pretty easy to understand, even the public/private nature of the current system of schemes is easy to understand, but nobody has really taken it upon themselves to give the public a simple explanation. After all, it is they who own the rivers and lakes that supply the water. This is not something this Government does very well, tell the people what is going on. With the forest peace deal, where were the public information sessions across the state to explain where the new reserves were proposed? Where were the published maps? Why were we not given this information? This season about 30,000ha of poppies were grown in the state. Can we further develop this valuable industry? Yes. The poppy and pyrethrum industries are expanding. Our farmers produce half of the world’s legally grown poppies and the Tasmanian industry is worth $100 million at the farm gate. Is foreign investment important to the state’s agri industry, for example the growing dairy industry? Should Tasmanians fear foreign investment? TFGA has no problem with foreign investment in Tasmanian agriculture. On the contrary, it welcomes it. Australian agriculture, and that includes Tasmanian enterprises, has been built off the back of foreign investment. The expansion of Tasmanian agriculture requires funds and Australians are often not taking up these investment opportunities. For instance, Australian farms may be returning 10 per cent on investment, but Australian superannuation fund managers want more than that. To have viable farming businesses, we must have viable value-adding industries in Australia to process what they produce. Without foreign investment, we will not have those processors. Why should farmers not be free to sell their land to foreign interests? Other people can, so why not farmers? If you take the position that farmers can’t sell their land or their businesses to foreign interests, you are depriving them of an option for which they have to be compensated. If that is the national interest position, then every Australian has to contribute to compensate the farmer who has every right to expect the best price for their lifetime’s investment. That is a matter of equity and justice. Our role in life is to help feed the world. By allowing foreign investment in our land and processing enterprises we are helping to achieve just that. The land does not move, it is still here. If Australians don’t value our farms and our farmers as much as some others do, that’s easy fixed with a bigger cheque book. If you could say one thing to urban-living Tasmanians and their relationship to the rural sector, what would that be? If you had a meal today, thank a farmer. If you are concerned about sustainability, thank a farmer. If you love Tasmania’s countryside, thank a farmer. If you love our lifestyle and our community, thank a farmer. Farmers are the backbone of this state. Continue reading →