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30 Nov 2009 WEEKLY BULLETIN NOVEMBER 30 2009

REDUCTION OF EMISSIONS NEEDS TO OCCUR ACROSS ALL SECTORS - QFF
Agriculture faces uneven costs challenges and unknown offset opportunities if the amended CPRS is passed by the senate, according to the Queensland Farmers’ Federation (QFF). President Gary Sansom said that reducing greenhouse gas emissions needs to occur across all sectors of the economy and increasing the cost of food production without clear gains in reducing carbon and nitrogen emissions is not good policy.
“Agriculture can be part of solution if we have the right policy setting. In the current rules they preclude at least some of the offset mechanisms,” Mr Sansom said. Mr Sansom went on to say that it is important that government puts their commitment into action to encourage offsets and alternative energy sources that have low carbon footprints. “Farmers can cut greenhouse gasses but may not be able to afford best strategies as costs rise through the economy wide effects of the CPRS on fuel, fertilisers, electricity, transport etc,” he said. Mr Sansom continued by saying that farmers are concerned that even though agriculture is excluded from the CPRS, they will still face a large increase in costs because around 40 per cent of farm inputs are emissions-intensive and will increase.“Although there will be some relief in the short term with proposed assistance packages and rebates, these cost increases will dramatically impact on the competitiveness of Australian agriculture by 2020.
Mr Sansom said farmers need access to viable alternatives including carbon sequestration options from day one or Australia will lose agricultural markets to countries without a CPRS. “That would be a negative outcome for the global mitigation effort and for the Australian economy.
“Nor would it do much to help Australia play its part in addressing projected global food shortages, which can only get worse as demand continues to exceed supply for food. Mr Sansom noted that the additional transitional compensation of $150 million for food processors and $50 million for sequestration research are small amounts in relation to the total farm sector impacts of the CPRS.”

QCA REVIEW OF ELECTRICITY TARIFFS
The Queensland Competition Authority (QCA) has recommended the removal of four of the five farm and irrigation tariffs as part of its review of electricity pricing and tariff structures. There has been limited time to consult widely on the proposals; however the Queensland Farmers’ Federation is very concerned that a one tariff structure could have major cost implications for farms as well as impeding the implementation of water use efficiency and other important water reform measures. QFF has written to the Minister for Natural Resources, Mines and Energy highlighting the following concerns:
1. The proposal removes the choice that farmers have to select the tariff that best suits their needs. Farmers outside south east Queensland will be particularly affected as they are unable to take advantage of electricity competition.
2. Growers that have geared their systems to take advantage of off peak tariffs will have to make significant capital investments to change their farming systems. This will also discourage off peak use of water which could be yielding significant savings in water use.
3. Farmers may need assistance to adjust to removal of any subsidies between high and low usage customers.
4. The proposal could impact adversely on growers who are billed for each meter and could face different tariffs on each.
5. The proposals will increase the costs of water providers who will pass the added costs directly to customers.
QFF expects the proposal to have serious implications for the viability of irrigation farming in many parts of the state. QCA must give attention to the difficulties farmers will face implementing the proposals and engage with QFF to see how these implementation issues might be addressed.

PRIMARY PODUCTION FORECAST UP 5.4 PER CENT
The annual QPIF Prospects report for Queensland’s primary industries has been released and shows department officials expect the gross value of primary production to rise 5.4 percent in 2009-10 to $11.1billion. The biggest changes are expected in sugar and cotton with production and/or price increases in those sectors offsetting some declines elsewhere especially in the grains sector. Details can be found on the department’s website here. Key forecasts and revisions are summarised below.

QPI&F ESTIMATE PRIMARY PRODUCTION VALUE $m
	2007/08	2008/09	2009/10	% Change
Beef	3,315	3,460	3,435	99
Dairy	252	280	295	105
Fruit & Vegetable	2,088	2,018	2,135	106
Nursery	898	979	974	99
Sugar	799	920	1340	146
Cotton	79	340	420	124
Fisheries	360	358	437	122
Other	2,546	2,143	2,028	95
All Primary Industries	10,337	10,498	11,064	105
Processing	2, 176	2,221	2, 760	124

LONG-TERM METEOROLOGICAL FORECASTS FOR AUSTRALIANS
The House of Representatives Science Committee last week tabled a Seasonal Forecasting in Australia report which provides a comprehensive review of progress in improving the reliability of weather and seasonal condition forecasts in the 10 to 180 day range. The 120 page report includes eight recommendations basically designed to improve climate modelling here in Australia. It seems that professional and institutional jealousies, along with limited resourcing has seen Australia fall well behind in climate research and the “quality” of weather and climate forecasts in Australia has dropped relative to many northern hemisphere countries. There is evidence that new funding and the BOM/CSIRO joint venture, the Centre for Australian Weather and Climate Research (CAWCR) may help improve things and the next generation of dynamic models will be producing more accurate seasonal forecasts very soon. The new ACCESS weather, climate and earth simulator is already improving short-term weather forecasts and new and better seasonal forecasts from POAMA2 will be available as soon as the Bureau’s new supercomputer is brought on line before year end. Many Australians will gain from better seasonal to inter-annual climate predictions including farmers, water managers, energy generators, tourism, construction and emergency services providers. The report can be accessed through the Australian Parliament website here.

NEW REGIONAL DEVELOPMENT GROUPS
Queensland now has over 120 volunteers operating as 12 Regional Development Australia (RDA) committees. These committees are now becoming operational as key office holders complete induction training. They are designed to pull together Australian state, territory and local government, private sector and local community interests to build sustainable regions. They have evolved from the former Area Consultative Committees and regional economic development bodies and may prove influential in progressing regional priorities. Details of the Queensland committees can be found here.

MEMBER NEWS

CANE SAYS AG OUT, BUT STILL PAYING PRICE OF CPRS
Exclusion from a future CPRS doesn’t mean there will be no impact on farmers, peak sugarcane group CANEGROWERS said recently, following the announcement that agriculture will not be included in the Government’s latest revision of its Carbon Pollution Reduction Scheme. The group has welcomed agriculture’s exclusion, but has pointed out that it will still experience rises in input costs, including fuel, electricity, and fertiliser, just as will the rest of the community. CANEGROWERS CEO Ian Ballantyne has said the announcement reduces some of the uncertainty, however there are still questions. He says the decision backs lobbying by the National Farmers Federation (NFF) which called for the permanent exclusion of direct agricultural emissions from the CPRS cap. CANEGROWERS has been a major contributor to NFF policy on this issue.

OTHER NEWS

PRIMARY INDUSTRIES FORECAST TO REACH $13.82 BILLION
Record prices and world demand for sugar and cotton are expected to help boost the total value of Queensland's primary industries commodities and first-stage processing by 9 per cent to $13.82 billion in 2009-2010, according to Queensland Primary Industries & Fisheries. Minister for Primary Industries, Fisheries and Rural and Regional Queensland Tim Mulherin today released the annual Prospects report for primary industries and said the forecasts were encouraging. "The forecasts for our crop sectors are particularly impressive, with sugarcane production expected to exceed last year's expectations by 46 per cent to $1.34 billion," Mr Mulherin said. "Queensland cotton is also expected to similarly benefit from reviving world demand and tight supply, to boost the indicator price for cotton to around US$0.725 per pound. Our cotton production is forecast to increase by 24 per cent to $420 million, with the area sown to irrigated cotton expected to increase by over 10 000 hectares in the Darling Downs, Border Rivers and Central Queensland.
"Other crops expected to do well are avocados at $80 million (up 23 per cent), mandarins at $70 million (up 17 per cent), tomatoes at $240 million (up 20 per cent) and sweet potatoes at $55 million (up 22 per cent) thanks to greater production on farm. Milk, pig and poultry industries are expected to modestly increase. "With a growing population in Queensland our primary industries will continue to be central to the state's development providing food, jobs and exports." For a copy of Prospects for Queensland's primary industries 2009-10, visit www.dpi.qld.gov.au.

QLD ‘MOOVES’ TO BETTER DAIRY HEALTH
After more than 25 years of effort by the dairy industry, Queensland dairy herds are now free of the viral disease Enzootic Bovine Leucosis (EBL), which can kill infected cattle. Biosecurity Queensland principal veterinary officer Janet Berry said EBL was once widespread in Queensland with 70 percent of the dairy herd infected, so eradication was a huge achievement for Biosecurity Queensland and the dairy industry. Dr Berry said milk producers and processors have successfully worked together to sample herds and eradicate the disease by culling infected animals from all dairies. “Queensland’s success brings the Australian dairy herd one step closer to achieving its target of being EBL-free by December 2012,” Dr Berry said. “EBL freedom will safeguard the competitiveness of Australia’s $2.5 billion dairy export industry and will bring cost savings to producers and processors by reducing the need for ongoing EBL testing and control measures. For more information on EBL, visit the Queensland Primary Industries and Fisheries website at www.dpi.qld.gov.au or call the Business Information Centre on 13 25 23.

THE GLOBAL FINANCIAL CRISIS AND REGIONAL AUSTRALIA
The House of Representatives Standing Committee on Infrastructure, Transport, Regional Development and Local Government has last week tabled its report into the impact of the global financial crisis on regional Australia in parliament. The evidence gathered by the Committee for its Global Financial Crisis and regional Australia report was gathered in regional centres throughout Australia during the height of the crisis this year. The report therefore provides a brief picture of the crisis as it unfolded in Australia’s regions and ways in which the Commonwealth Government has been responding. The report makes several specific recommendations before concluding with a discussion about regional development policy in Australia. For more information, click here.

MONITORING FARMS BY SATELLITE
Governments are increasingly monitoring properties by satellite to check for compliance with legislation. Satellites are already currently being used in some Australian states to verify that farmers are complying with vegetation clearance legislation. Over the next decade, the detail of what can be seen by satellites will improve; hence, the ‘spy in the sky’ is likely to become ever more attractive to those monitoring farmers’ compliance with numerous different laws. Because of these likely future developments, University College is carrying out an independent survey of Australian farmers’ attitudes towards satellite monitoring. The survey hopes to establish an understanding of the benefits there might be to farmers and their concerns. The survey takes 15 minutes to complete and can be accessed by clicking here. For more information, contact Ray Purdy on 0402609401.

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