Agri Labour Australia becomes one of the first companies to achieve StaffSure certification

Agri Labour Australia has become one of the first Australian companies to secure a place on the StaffSure registry as a certified workforce service provider.

One of only a handful of firms to have made it into the registry so far, Agri Labour Australia submitted to a full audit of its business practices to ensure everything was up to StaffSure standards.

StaffSure is a proactive and industry-led initiative which rewards those firms who have invested in systems and processes to protect clients and workers.

This certification makes it simple for business, government and workers to check that Workforce Service Providers (such as labour hire companies and agricultural recruitment firms) are reputable and adhere to strict codes of conduct.

Certification by StaffSure will also reduce joint-liability risk for business and government that engage certified providers.

StaffSure was developed by RCSA to help operators prove their business integrity when providing workforce services for the agriculture industry. As the peak body, RCSA knew that the problem of poor business practice was wider than traditional ‘labour hire’ and that a scheme was needed to validate all forms of workforce services.

In developing StaffSure, RCSA worked in consultation with industries that use Workforce Service Providers, regulatory government bodies, unions that employ workers and certification experts with global experience.

To become certified, Agri Labour Australia was required to submit to an independent audit against the StaffSure Standard of these six core principles:

  1. Fit & Proper Persons own and run the business
  2. Work Status & Remuneration to ensure workers receive minimum employment Entitlements
  3. Financial Assurance to operate the business sustainably
  4. Safe Work for all workers
  5. Immigration and visa laws are complied with
  6. Accommodation supplied by employers or clients is suitable and rent is fair

Of the firms who made it through the certification process, StaffSure chief executive officer Charles Cameron says: “Through your leadership and belief, we have taken a massive step forward in cleaning up our industry and in the promotion of professionals.” 

We’re in the finals

Agri Labour Australia recognised at the Telstra Business Awards.

This week was a proud week for Agri Labour Australia. We are officially a Queensland finalist in the Telstra Business Awards Small Business category. For the past 25 years, the awards have recognised, rewarded and empowered Australia’s best SMEs and more recently, charities.

The awards recognise that it takes something special to set up and sustain a business like ours and we couldn’t be more thrilled with our nomination.

Judges were no doubt impressed by the idea of a recruitment consultancy that is tailored to Australia’s agriculture industry, which historically has experienced a labour shortfall.

Another deciding factor may have been Agri Labour Australia’s unique point of difference. That is, our founders’ deep understanding of how farm projects operate and our knowledge of the diverse and ever-changing recruitment needs of rural Australia.

Given the Telstra Business Awards’ recent focus on corporate social responsibility (CSR), what may have also helped secure our nomination is the Agri Veterans program – a runaway success that benefits both the community and our economy.

Our demonstrated creativity and innovation will hopefully get Agri Labour Australia over the line this year! We were a finalist once before in 2015 and this time we’re confident that the final judging panel will be impressed by our persistence and resilience in overcoming obstacles.

CASEY BROWN SAYS:

“We’re incredibly proud to be a finalist for the second time but not at all surprised. This goes to show that Agri Labour Australia is continuing to make great strides and wow the industry. Judges are clearly impressed by how our niche recruitment and HR consultancy solves workforce problems for farmers and other agricultural employers, providing the industry with a steady stream of casual, seasonal and permanent employees.”

Stay tuned for the winner’s announcement later this month and keep updated on Twitter @TelstraAwards #telstrabizawards

Agri Veterans wins coveted CSR award at RI Awards Australia

Agri Veterans has taken out the hotly contested ‘Best Corporate Social Responsibility (CSR) Initiative’ award at the RI Awards Australia by Recruitment International.

The CSR Award honours our pioneering program, which has gone from strength to strength since launching in 2015.

Judges were clearly impressed by Agri Veterans’ achievements in helping ex-Defence personnel transition to civilian life via placements in meaningful, gainful employment in Australia’s agriculture industry.

With more than 200 recruitment firms competing for the top honours, the 2017 RI Award winners were announced at a black tie gala dinner in Sydney on May 10 at the swanky Ivy Ballroom on George Street.

About the awards

RI Awards Australia is part of Recruitment International – the world’s biggest recruitment industry awards programme.

The aim of the awards is to recognise innovation and best practice in the Australian recruitment industry.

A panel assesses and rewards the best recruitment companies and their people, and the ceremony is a chance to celebrate the collective successes of our great profession.

Agri Labour Australia’s Liam Palmer and Seppi Mohsenian were in attendance on the night in Sydney to accept the award on behalf of Agri Veterans.

“We are thrilled and humbled by our win, but not at all surprised given all the hard work that’s gone into the program. From the beginning we knew we were onto a brilliant concept that could really help all stakeholders – the ex-Defence staff benefit and so do the agriculture employers of Australia. Plus, we’ve got the most passionate, devoted team in the business and couldn’t wait to share the news with, they deserve it.”
Program Co-Founder, Casey Brown

© COPYRIGHT. 2017. Dragon Papillon Photography. All Rights Reserved.

A winning formula

Coming under the CSR category the Agri Veterans program has enjoyed great success in placing eligible veterans in stable, rewarding roles around Australia where they can learn new skills, gain financial security and regain a sense of purpose.

For more information on Agri Veterans, visit www.agriveterans.com.au or call 1300 247 823.

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Australian agriculture and foreign ownership

The highly politicised, emotionally charged concept of ‘Big foreign conglomerates buying up our land and putting Aussie farmers out of business’ is certainly nothing new – but is it true? For many years, the reality has been somewhat obscured.

Depending on which political party is dominating the conversation, the stats and facts tend to be presented differently.

As far as the general public goes, we really didn’t know who owned Australia’s agricultural land. We knew that some land was controlled by ‘foreign’ interests, but their origin and purpose was unclear.

Between July 2015 and June 2016, the ATO compiled the first Register of Foreign Ownership of Agricultural Land. While authorities are unable to disclose personal details and identities of owners, they can tell us about nationalities. Here’s a region-by-region breakdown:

What proportion of land is held by foreign interests?

As you can see, the percentage varies substantially depending on where you are in Australia.

The figures are relatively high in sparsely-populated areas such as The Northern Territory and Tasmania, and comparatively low in New South Wales and Victoria.

 infographics_01

Where are the foreign owners from?

Here is a visual representation of the Top 10 foreign owners by country. At a glance, it’s clear that UK foreign interests are by far the most prevalent, followed distantly by the USA, the Netherlands, Singapore, China and others. This may come as a surprise to some, but there you have it. We didn’t realise Jersey was a major player!infographics_02

What are they using the land for?

In regards to what this foreign-owned land is producing, for the vast majority, the answer is livestock. Crops and forestry are other recorded purposed.

infographics_04

Officials say that Annual Reports from the Register will now be compiled each financial year, allowing us to see how these figures changes. Watch this space.

Year in review: new FTAs and what they spell for the agriculture industry

It’s all over bar the shouting, and 2015 will go down in history as a big year for landmark FTAs – one signalling unprecedented access to the biggest consumer market on Earth.

We wouldn’t go so far to say it’s been a victory across the board for Australian agriculture, but June’s Australia-China Free Trade Agreement (ChaFTA for short) and October’s Trans-Pacific Partnership (TPP) are set to usher in a new era of prosperity and growth in many key sectors. It looks likely that agriculture’s great white hope, sugar, will stay where it is for now, but who knows what the future will hold?

China-Australia Free Trade Agreement

After 10 years and much negotiation, ancient trade barriers finally buckled when then-PM Tony Abbott and China’s commerce minister Gao Hucheng signed on the dotted line in Canberra.

Demand for food in middle-class China is off the charts and Australia has the means to feed them. The only thing in the way were tariffs. Big ones. ChAFTA goes a long way to opening up the market for agriculture and processed foods, with equal or better access to China than any other FTA partner. Tariffs on some exports will be reduced by up to 30%. Let’s take a look at what’s going down and by how much:

And the winners are:

Beef: tariffs of 12-25 per cent will be wiped out within 9 years of entry into force.
Dairy: all tariffs (currently up to 20 per cent) will be eliminated within 4-11 years. *Translation: we predict big things for infant formula (Aussie brands are in hot demand in China) and ice cream in particular.
Horticulture: tariffs of up to 30% on fruit, vegetables and nuts will be eliminated, most within 4 years. *Translation: macadamias, almonds, walnuts and pistachios will shed their 10-25% tariff. The 11-30% tariff on oranges, mandarins, lemons and all other citrus fruits will also be peeled off.
Sheep and goat meat: tariffs of 12-23 per cent will be gone within 8 years.
Pork: all tariffs (up to 20 per cent) will be scratched within 4 years.
Hides and skins: tariffs of 5-14 per cent will be eliminated within 2-7 years.
Wine and spirits: in four years, tariffs of 14-20 per cent on wine and up to 65 per cent on alcoholic beverages and spirits will be a thing of the past. *Translation: wine imports are booming in China, which could well be a boon for our esteemed Aussie winemakers.
Seafood: tariffs on all seafood exports will be eliminated within 4 years. Including tariffs of up to 15% on fresh abalone and rock lobster within 4 years.
Honourable mentions: barley and sorghum, a range of processed foods and wool also secured victories.

Better luck next time:

Hopes were high, but no inroads were made for sugar or rice growers. The chairman of Canegrowers Queensland told news.com.au: “It’s disappointing given that it’s a huge market. We only wanted to fill in the gap between their domestic production and consumption, but we didn’t gain much traction except a framework for further reviews.”

Trans-Pacific Partnership (TPP)

TPR

Eight years of debate was finally put to bed last month when 12 Pacific Rim nations signed the biggest free-trade agreement in history, covering 40% of the global economy. We now have agreements in place with countries where previously there were none – Peru, Mexico and Canada. What does this mean for agriculture? Thousands of tariffs will be removed. Not quite as many as hoped, but nothing to be sniffed at.

And the winners are:

Dairy: The TPP clinched victories for Aussie cheese – the deal spells the end of tariffs on some products and paves the way for tariff reductions and new quota allocations for others.
Grains: The TPP will create new quota volumes for wheat and barley exports to Japan (worth approximately $481 million in 2014). Tariffs on exports of Australian wheat and barley will be no more, and the TPP also means new quota access for roasted malt exports.
Rice: It was a no-go zone in ChaFTA, but the TPP will see a new 6000-tonne quota access to Japan, plus reduced tariffs on rice preparation products, plus an amendment to the WTO quota of an extra 60,000 tonnes of medium grain rice for processing use.
Wool and cotton: All remaining tariffs on Australian raw wool and cotton exports to TPP countries will be removed. The TPP will also deliver improved rules of origin for textiles, potentially upping demand for Australian fibre products.

Better luck next time:

Dairy: They say it’s best to shoot for the Moon, but some were disappointed in the dairy deal – saying it failed to live up to its full potential of total tariff elimination.

Did you know?

Australia currently has 9 FTAs up and running and 7 more under discussion

*NB: ChaFTA’s status is ‘signed’ and TPP’s is ‘negotiations concluded’.

Proposed WHV Income Tax Changes

Rural employers and Working Holiday Visa holders are concerned about proposed Working Holiday Visa income tax changes. 

Proposed changes to the income tax rules for the Working Holiday Visa (WHV) announced in the last Federal Budget sparked outcry among both Working Holiday Visa holders and the sectors who employ them the most – Tourism and Agriculture.

As the 1st of July 2016 approaches, we outline the changes, the expected effects, and the potential outlook for rural employers.

THE CHANGES: A SUMMARY

No more tax-free threshold

Previously, backpackers who were residents for tax purposes (they lived and worked in Australia for more than 183 days) weren’t required to pay tax for the first $18,200 they earned.

Higher tax rates

Once they’d earned $18,200 or more, they paid 19 cents on every dollar above this figure, following standard resident-status tax rules. If the proposed changes are passed, from 1st July 2016 they will be paying 32.5 cents from the very first dollar they earn.

No more resident status

Because they will be taxed as non-residents regardless of how long they stay, backpackers will no longer benefit from trying to reach the 183-day requirement.

Agri Labour Workers

WHAT WORKING HOLIDAY VISA MAKERS CURRENTLY CONTRIBUTE

As noted by ATEC Managing Director Peter Shelley and others, backpackers visiting Australia on 417 visas spend $13,000 during their time here. Annually, this equates to around $2.6 billion in economic injection.

These working holidaymakers also provide much-needed labour to remote Australia, particularly to the agricultural and hospitality sectors.

Thanks in no small part to the 88-day rural requirement (to qualify for a second year on their visa, they must do at least this much rural work), backpackers have proven to be an appreciated source of motivated labour for the rural, hospitality and tourism sectors.

THE DEBATE

The response to these tax changes – from both the public and the stakeholders – has been largely pessimistic.

That’s not to say that the potential contributions from working holidaymakers won’t contribute much-needed tax dollars, but many still see the changes as a short-term solution with long-term ramifications.

Tourism & Transport Forum CEO Margy Osmond called the move a “backward step” and an “own goal”, saying it would “damage Australia’s international reputation.”

The general sentiment elsewhere is similar, with many commenters and even politicians complaining that this policy is effectively penalising backpackers for not being residents.

Some have called the proposal a short-sighted money grab that doesn’t consider the long-term detriment to Australia’s international appeal as a working holiday destination.

We must note that 417 visa holders are working holidaymakers – not just workers. The idea of the visa is to enable them to supplement their travel funds while experiencing Australia. While some suggest that taxing them at a non-resident rate is simply a reflection of the fact that they are indeed visitors, others suggest that it will impact their desire to come to Australia in the first place.

The actual effects of this policy change remain to be seen – and with a new treasurer now in office, who knows if things will revert to the way they previously were.

Agri Labour Workers

THE IMPACT ON RURAL AUSTRALIA

As mentioned before, the 88-day requirement has been a boon to the agricultural industry.

We are lucky to live in a country where travellers are so in love with it that they will happily spend three months (or more) living out in remote areas, performing often difficult and strenuous work.

Along with the ongoing exodus of working-age Australians from rural areas, these travellers have helped to revitalise rural communities while offering affordable labour to our understaffed agricultural producers.

It has been suggested that a reduction in these WHV staff will cause a reduction in labour availability, which will in turn impact farmers and farming communities.

This theory makes sense on the surface, but we simply won’t know until we get the figures back from Immigration and the ATO next year.

Anecdotal reports do however show that backpacker-focused online forums and social networks immediately latched onto news of the ex-Treasurer’s proposed changes, but again, we can’t comment on the real-world consequences until they occur.

The Agri Labour Australia team are more than aware of the current rural labour shortage, so it concerns us when things like this come up. But that doesn’t mean there are no solutions.

No matter what happens in the halls of Canberra, we will continue to work on and develop new opportunities and alternatives for remedying the agricultural labour shortage.

Agri Veterans: Connecting Veterans with Ag

From field deployment to farm employment: The Agri Veterans Program

As you may be aware, Agri Labour Australia has recently partnered with veteran-run charity Walking Wounded to help place returned military personnel in agricultural careers.

Through the Agri Veterans Program, our mutual aim is to help ex-Defence Force members make the transition back to civilian life, and to provide a framework on which to build not just a job, but a new career, purpose and path.

The benefit for returning troops comes in the form of stable, rewarding employment opportunities that match their existing skill sets. And for the agricultural industry, it means a source of skilled and dedicated staff helping to counteract the ever-worsening labour shortage.

More than just a job

At the core of the Agri Veteran Program is the idea that the majority of ex-ADF jobseekers don’t just want a job – they want a career with a sense of purpose.

Every time we speak to a veteran, one thing comes through loud and clear: the transition back to civilian life is tough on many levels – especially when looking for employment.

When you factor in physical and psychological wounds, it is clear that some careers are more suitable than others.

It occurred to us that agriculture fit the bill better than many other options. Farming could provide veterans with real-life career opportunities in peaceful surroundings and with a sense of purpose.

Embracing rehabilitation

It is a sad fact that some veterans suffer disadvantages – especially when looking for work – due to the stigmas attached to the physical and psychological traumas they may have suffered during and after their deployments.

It’s therefore important to place ex-service people in roles with understanding employers who are willing to help them through the difficulties they may be experiencing. This is central to Walking Wounded’s purpose as an organisation, and with a recruitment company like Agri Labour Australia by its side, it can better achieve this goal.

Regional Australia – a perfect environment?

Agri Labour

When we talk about finding appropriate employment for our ex-military jobseekers, it is clear that regional Australia is well suited in many ways.

Upon their return from service, the majority of ADF personnel remain in the towns and cities where their barracks are located. Feedback suggests that this isn’t an ideal situation as the pace of the city life is difficult to adjust to on return from deployment.

Regional and rural areas, on the other hand, offer a tranquillity and sense of community that is lacking in built-up areas; the peace and community spirit of the country makes it a nice place to be, and the outdoor lifestyle appears to fit many veterans well.

Giving veterans the opportunity to live, work and build a life in regional Australia is therefore a logical solution to their employment concerns.

The only thing to do now is to find them rural jobs that match their skills. Fortunately, this isn’t an issue.

Matching skills with opportunities and openings

cotton-spraying

Agriculture and related industries offer a wide range of appropriate jobs that closely match veterans’ existing skills.

From un-skilled and semi-skilled roles to technical and supervisory positions, agriculture features a large number of opportunities that veterans can almost walk straight into.

These roles could include machinery operation and maintenance, logistics and transport, livestock, storage & handling, among others. Ex-military personnel are already familiar with deadlines, discipline, checks and balances, teamwork, shared goals, and so on – all of which make them a fitting choice for rural employers.

The good news for farmers is that this solves a problem that has been plaguing them for years: the labour shortage.

The continuing exodus of rural youth to the cities and mines has caused a drought of skills and manpower that our troops are perfect to fill, whether their background is in engineering or electronics.

Agri Labour Australia has therefore decided to team up with Walking Wounded to identify jobseekers, match them to appropriate roles, and help them on the path to a new life and career in the country.

We hope that this initiative will help to breathe new life into our agricultural industry while giving new opportunity to our returned soldiers.

Get involved with the Agri Veteran Program

Employers – If you’re an employer who would like to know more about the Agri Veteran Program, please get in touch with us on 1800 247 823

Veterans – For more information on the program, please contact one of our recruitment specialists on 1300 247 823, or for other support please get in touch with Walking Wounded on 0432 398 827.

Robots in Agriculture: Rise of the Machines?

Humans learned how to cultivate crops around 10,000 years ago. This massive step brought us from being primitive hunter-gatherers to being able to reliably grow food and textiles, live in villages and towns, and create lifestyles that involved a lot more than foraging.

From those early days until the mid-1700s, farming remained more or less the same. But thanks to the last two centuries of technological development, we now have everything from pesticides to GM crops – and of course robots.

These machines, whether we like it or not, play an ever-increasing role in food and fibre production. In the US,the agricultural workforce has already fallen from 40% to 2% of total employment over the last century.

Now imagine what it’ll be like in another hundred years.

Agriculture’s shrinking workforce

If history is anything to go by, we’re going to see a lot fewer people doing unskilled agricultural work over the coming decades.

And as their numbers decline, we’re going to see a movement of campaigners and lobby groups trying to prevent jobs from disappearing. This has already happened in the automobile industry.

You’d expect that agricultural labour hire and recruitment companies like Agri Labour Australia would be worried about what the future holds; after all, if there are no jobs, there’s no need for candidates or recruiters.

But actually, that’s not quite the case. We are of course concerned, but we’re more optimistic than worried.

This might surprise you, so let us explain.

Agri Labour Blog - Robots

Productivity means profit

First, let’s take a look at why we use machines and robots in the first place.

There’s one main reason: productivity. The most obvious reason to use machines is that they work faster and more reliably than people, which in turn makes them more profitable over the long term.

For example, poultry farming hasn’t seen much of a downside. Dedicated egg-collecting machines have brought automation to this traditionally labour-intensive role, which has helped free up farmers’ time and increase their margins.

Profitable farmers mean a healthy agricultural industry, and that’s a good thing. But at what cost?

Machines do replace workers, but not always for the reason you think.

Profit and productivity aren’t the only reason machines are replacing people – in Australia, many farming businesses use machines because the access to labour simply isn’t there, for example in fruit picking. There’s also the fact that in some agricultural roles, human hands bring the best results.

Without the required workforce available to them, farmers are forced to invest in machines. These machines might not give the same quality results, but they have no other choice.

What’s more, this equipment is prohibitively expensive for many smaller-scale producers, although they do reduce labour overheads in the long term. So we see family-run farms going out of business or being forced into costly equipment hire agreements that eat away at their margins.

A tough choice for farmers

To stay in the game, farmers therefore have a decision to make. Do they protect their human workers, or do they spend the money upfront and invest in technology?

One thing is for certain: as technology develops, the face of the agricultural workforce will have to change. There’s no use in fighting automation, so the only option is to embrace it, and to try to put ourselves on the right side of history.

Agri Labour Blog - Robots

Focus on what robots can’t do

There will always be roles that robots can’t fill. We may one day have machines that can hand-pick berries without damaging them, or that can pick the ripe fruit from the branch while leaving the unripe ones.

To meet the needs of farmers and the consumers they feed, the workforce will have to change what part of the supply chain it services. We may see more skilled workers who, instead of doing the actual picking, are operating the picking machines or grading the produce.

What we would like to see is an increase in semi-skilled and skilled roles, which will be great for the industry and the regions in which they operate. We are already suffering from a dire shortage of unskilled and semi-skilled staff, so any influx of better-qualified people will be great for rural communities.

We have to look at the future as an opportunity. We must invest in training and education for our producers and agricultural workers, and we must give them the knowledge and tools to embrace technology and meet the new demand for technically proficient staff.

An opportunity for change and growth

If you’d asked a 1960s office-job recruiter about computers, they would’ve told you that clerks were an indispensible part of the professional workforce. It’s true – they were.

But since then, we haven’t seen a generation of clerks go hungry because there’s no work for them. They up-skilled, learned how to use computers, and helped contribute to the further growth and evolution of clerical roles.

What about the human cost?

On the other side of the coin, we might take the example of the car industry replacing factory staff with robots. The loss of thousands of jobs is a real and painful truth, but we have to also consider that consumer trends and competitive performance rely on getting the most of out our manufacturing. Fighting these hard truths won’t make them untrue – it’s time that could be spent more productively.

Agriculture mustn’t follow this example. We need to be able to compete with other nations and continue making the best food and fibre we can – and we need to be able to sell it at a competitive price.

If this means that some of our manual roles become obsolete, there’s nothing we can do to fight it. Instead, let’s look at helping to further train and educate our unskilled staff so that their passion and skills can be put to use elsewhere in the supply chain.

The future is bright!

We see a future where robots and humans work in harmony. We mustn’t allow ourselves to fight progress in our industry. We should be at the forefront, providing the manpower that will drive Australian agriculture into the next era.

Foreign Investment in Aus Ag – One step forward, one step back

Foreign investment in Australian agriculture is a polarizing issue. Much more than just a debate among the agricultural community, it is now a high-stakes political one too.

At the centre of the furore is the government’s recent changes to the way the Foreign Investment Review Board is now looking at foreign entries into land and business interests, which is either going too far, or not doing enough, depending on which camp you listen to.

The second major change is the introduction of a comprehensive register of all foreign-owned land assets. This is generally praised as a step in the right direction, as it gives the industry a better understanding of who owns what, and in what proportions.

So why all the debate? Surely the government has Australian farmers’ best interests at heart?

To shed a little light on the situation, we’d like to share our own experiences of what the farmers on the land are actually doing and saying.

When times are tough, any opportunity is better than none

The Agri Labour Australia team spend a lot of time talking to primary producers about their businesses. In the course of our dealings with them, a pattern has emerged, and it speaks directly to the issue of investment – to be precise, where this investment is coming from.

To put in bluntly, there is an overwhelming majority of farmers (especially smaller, family-run operations) that are feeling the pinch, and in the absence of local Aussie investment injections, they’re turning to foreign investors.

We’ve seen a noticeable rise in farmers – often 3rd, 4th or 5th generation farmers – banding together to form consortiums. They want to increase their land size and portfolio, giving them a better chance of securing foreign investment.

The old notion of the co-operative is alive and well. Where agricultural operators have been struggling to pay down their debt and remain profitable, foreign investment now gives them the breathing space they need. It’s a second chance: a fresh start.

No one can argue that farmers aren’t within their rights to source funding from wherever they can. And yet this is where the political debate is occurring.

Some say it’s great to inject foreign capital and breathe new life into our agricultural industry, while others say we’re selling the farm.

Foreign Investment in Aussie Ag – One step forward, one step back

Are we ‘selling the farm’?

The term ‘selling the farm’ is an extremely simplistic way of looking at this issue. In some cases, yes, farmers are selling portions of their land or business holdings to keep cash flowing.

This has been happening forever, and so has foreign investment in Australian agriculture. It seems that the root of the uproar isn’t because farmers are selling assets – it’s because they aren’t selling them to Australians.

Maybe some of them are ‘selling the farm’. But if buyers aren’t coming from within Australia, where are our farmers to turn?

The bigger political picture

Once we start talking about large swathes of our economy, it’s inevitable that politicians get involved.

For example, Bob Katter has put himself in the middle of the debate, stating that this is now a political issue and that the only solution is political.

Katter criticises the Sino-Australian Free Trade Agreement, saying that Chinese workers are allowed into Australia to work at unregistered Chinese-owned farms. He says that neither major party is standing up for Aussie farmers.

This is where it gets confusing. If farmers are themselves choosing to accept foreign investment, aren’t they standing up for themselves already? Aren’t they aware of the benefits and risks involved in bringing large-scale foreign interests into Australia’s food bowl?

Aside from our little guys teaming up to secure investment, what about huge companies like S. Kidman & Co also hunting foreign buyers? What about their portfolio of 11 cattle stations, including the 23,000 square km Anna Creek Station (the largest in the world) going to a Chinese buyer?

When this amount of money and food security is involved, it’s no wonder that this has become such a politicised issue.

Foreign Investment in Aussie Ag – One step forward, one step back

Is foreign ownership such a big deal?

Much of Australian agriculture’s recent success has come from new markets such as Indonesia, and elsewhere in South East Asia. Net export means revenue, and this is what we’ve seen.

However, some are fearful that we’re giving too much of our assets away. They’re worried that everything will be snapped up by foreign money, and all those profits will start being funnelled out of Australia.

This is a legitimate concern, and it’s why the ATO’s land register has been implemented. Until the final figures come back, all we have to go on is the ABS.

In it’s last Agricultural Land and Water survey (which was criticised by some), the ABS reported that just under 90% of all farmland is owned by Australians, while 99% of businesses were fully Australian owned. No statistically significant number of Aussie farmers have water access issues either.

At the moment, most Aussie farms are still Aussie-owned and Aussie-run, but this isn’t necessarily a good or bad thing – it’s just the current state of the industry. And it varies from sector to sector, from grain to dairy, from fruit to cattle.

When you get to the bottom of this issue, it becomes clear that the arguments are more about economic protectionism than about protecting farmers’ ability to make ends meet.

Let’s not forget about the farmers

If a farmer sells off some of his assets to a foreign buyer (and getting to that stage is within itself an achievement) then he’ll have to take their interests into account.

He’ll need to have all his books together, he’ll need tighter budgeting and cashflow planning, he’ll need measurable marketing, and the list goes on. In short, he’ll need to operate at the business-oriented level that his investors demand.

In the long run, this can only be a good thing, at least operationally. But the price he’ll pay is that he’ll see less share in the profits, and he’ll have less control over the decision making.

Again, it comes down to the source of the money. If it cannot be found in Australia – then he has no choice but to look overseas unless he wants to go broke and shut up shop.

From a bank’s perspective, having a foreign investor is a form of mitigating risk. It means they aren’t the only one with equity at stake. Some say that the injection of foreign money is a shot in the arm that’ll help our farmers stay afloat – and they seem to agree.

Which is more important: the farmer or the industry?

Perhaps we’re looking at this from the wrong angle. Perhaps the government should be doing more to protect farmers from making short-term decisions with long-term ramifications.

What we do know is that the future for Australian agriculture is going to be busy. As the food bowl for Asia and beyond, we’re going to have to meet an increasing level of demand.

The introduction of the foreign land ownership register is a good step towards finding out where we stand right now, but the decisions it helps make in the future need to account for not just the industry, but the farmers too.

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