Farming - is it a viable industry?
January 12th 2007 05:23
Wide brown land
Every day on Country radio we hear that either the sheep industry and for some, the cattle industry are no longer viable. There are complaints regarding the duopoly of Coles and Woolworths who dictate market prices in many products and world markets who “kick up” when Australia occasionally succeeds on the world stage. Globally, there are complaints of the Chemical companies that are making all farmers throughout the world more and more dependent on their products. And then there is the horror of seed companies that produce seed for farmers in India and other countries in which there is no ability of the farmers to keep seed for the following year’s crop, making them wholly dependent on the Seed company – the most disgusting and lowest form of exploitation I have heard for a long time.
Perhaps better, more informed people than I have written articles about such things but it is obvious, even to this little farmer that there are great discrepancies in the price rises and prices we get for product and that the standard of living for the average farmer is taking a nose-dive.
So, I thought I would give you a few of the prices of product (average in that year) that we, as the average farmer have seen in the past few years. Then you can make up your own mind.
Item.......... 1999............. 2003............. 2006
Wool............. $2.94/kg....... $5.58/kg....... $5.96/kg*
Sheep...........$21.00each.. $46.00 each. $24.08 each**
Costs:
Shearing...... $2.94 each... $2.06 each... $4.34 each
Drenches..... $16.75/litre... $21/litre........ $30/litre
Fertilizers***.. $171/t........... $164/t........... $210/t
Diesel........... $0.76/litre..... $0.84/litre..... $1.25/litre
*Remember this is a year when there is a distinct shortage of wool and a likelihood of even greater shortages in the coming year. Perhaps it is not so much a comparison with the 1999 rate but more the fact that wool has only gone up 7% - if that, in four years. And shearing costs and drenches have almost doubled, as has diesel.
In 1999, the wool industry was still in the grip of selling the enormous stockpile of wool that kept prices down for over ten years.In 1989 , the best prices we ever had were $11.60/kg. Stockpile or no stockpile, we are still being taken to the cleaners and not getting value for product -cf prices of woollen clothes in 1999 and today.
**These are prices in the drought - but even before the droughts $50/sheep was a good price in WA.
*** Fertilizers- both for pasture and cropping are one of the biggest cost for many farmers. These figure are probably not terribly accurate as the type of fertilizers vary each year depending on what the soils needs. However there is no doubt they have risen by over 20% in six years.
Perhaps the other thing to note from these brief statistics is, as I have mentioned previously in “Farm budget a work of fiction”, there is no stability in the pricing, so predicting prices and planning and budgeting accordingly is almost impossible.
One could argue that the land value has improved, but, like all land owners everywhere, this is only useful when the land is sold. The question is how is the farmer anywhere in this wide brown land expected to live from day to day and meet the needs of his family, remaining environmentally sustainable, while fair pricing – both in the selling of product and in the expenses incurred are so far off the mark?
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