Senate Rural and Regional Affairs and Transport Legislation Committee, , 8:11:02 to 8:16:57
The committee debates the impact of carbon sequestration on national food security, comparing agricultural revenue loss to other industry shutdowns like live sheep exports.
Topics: Food security, Agricultural productivity
Speakers: Speaker 14, Speaker 21, Speaker 5
>> wow Dr. Granville because it's the most productive areas >> but but it's a small amount of the most productive areas. Um
>> no no it's a
>> 8 million hectares. >> Australia doesn't have that much productive land. Correct. like it's about four or five, not even three or 4% of Australia is actually productive for cropping and for intensive agriculture. And that's a bit you've just taken out a hu a really significant portion of and these are all the little farms that grow the food that we all eat. Australia's a food bowl for the
>> When you say it's modest, I mean if I were to come if I were to propose a 2% reduction in all public service salaries to fix the budget, >> what do you reckon? Would that be seen as modest? >> Sounds good. >> Probably not. >> I can imagine the reaction.
>> But but in the sense that it's also offset by additional revenue.
>> You and I both remember when they introduced paid parking in Bel Connor, that was going to be a riot. >> We saw some maladaptive behavior as well at that time. Um um all right. >> Yeah, I think because any well let's do this comparison. Um it's a $2.8 billion hit on your sums. >> I think live sheep exports is around $50 million or something of exports a year. So this is 60 or is that right? >> I'd have to check. >> It's about 60 times that. >> Um >> so because anybody can make these comparisons and government reports to this whole it's only modest because our economy is 2 trillion. >> Yeah. So >> all right. Well, okay. >> Look at the look at the look at everything we're having to do >> to shut down the live sheep industry >> and everything all the adjustment packages we need and here we've got an impact that's many multiples of that many multiples of that and there's zero assistance or adjustment being provided to these rural communities that will be
affected >> and and I don't want to downplay the idea that there are trade-offs because you know we're all aware that there are trade-offs but we also know that the agriculture sector is going to grow so incomes and returns in rural areas and so forth is still going to grow. We're expecting productivity growth to continue and farm profitability will you know a large part rest on how future
productivity goes. >> So can I just question that assumption given that the costs of production fuel wages insurance uh land taxes are all increasing and uh we've just done less vegetation management opportunities. with, you know, government is leaning into farm productivity at every corner and yet you think profitability is going to grow. >> Yes, >> that's not what farmers are saying.
>> Um uh but I think we're on solid ground with that. So we are still seeing productivity growth in the agriculture sector and while I acknowledge that productivity growth is slowing.
>> I think Senator said profitability though, didn't you? So
>> yeah, well I'll come to that but also profitability is growing. So far profitability has grown over the last 20 years about 3%. We've had a pretty good terms of trade though. That's the problem. The risk is whether >> and also with and like where the sector is outperforming the market sector in terms of productivity growth hands down and so there are a number of positive things despite you know I don't don't disagree that there's challenges in the sector and there's there's these other changes and so forth. So so I think it's not an unreasonable assumption to think that the sector could continue in what it's doing in terms of overcoming those challenges and experiencing some growth. we've got these, you know, significant investments we were talking about earlier in our R&D system which are paying off and so forth. So there are positives in that sense. I don't think that's an un unreasonable assumption to expect that the sector will continue to grow and profitability will continue to to to improve or at least be maintained which is effectively where where we're looking at. Um and in that sense you know we can talk about you know big or small modest or whatever but I think it it does lay out that there are there is an opportunity space here. Um, we can acknowledge that there's an opportunity cost, but in terms of the opportunity for some of those areas, it adds a diversification element to a farming system, which as we kind of discussed doesn't really exist. And as markets become more variable, and we're dealing with geopolitical structures and the like, the a diversification option is a good good thing for for land holders and for farmers. Um, and in other areas it will change the production mix around and and we will get some some balanced
kind of impacts. But >> I feel like I'm sorry. I feel like we live in two different worlds. So in Queensland, 40% of of farmers growing fruit and vegetables have said they want to exit the market because of supermarket monopolies, price pressures, both costs going up and prices from monopolistic practices from supermarkets going pushing prices down. Um these are in the areas with the high rainfall and the most productive lands. And yet we're proposing that this is will be a terrific idea that we should plant some trees, give them a subsidy, and they should just grow less. Like this will be a massive impact and and it means that Coohl's and Worth continue to buy their fruit and veggies from offshore. Um so Australians won't even notice until the boats stop or there's some problem and we have we have a problem with food security.
>> So just to qualify, so we've looked at the impacts on broad acre land. So we haven't looked into the impacts on horiculture production. So this is a broad acre story. So cattle and cropping and sheep um and so that impact as well is is on on that that amount of foregone agricultural activity is foregone broadacre activity not on horicultural and and so forth. So given given what
the the >> it'll be fine for the veggie farmers. So
the fruit vegetable farmers and those issues um you know are separate too I think the pressures that we're talking about and the opportunity cost and the loss production in this space that we've
modeled.