Old MacDonald runs the farm

It is over 30 years since I was first told that Australia had a problem because our farmers are old

MOST people are aware that the median age of farmers in 2011 was 53 and rising. This is not the average - it means half of all farmers are older than 53.

In fact, farmers account for 14 per cent of all employed people aged 65 and over despite comprising just 1.7pc of the overall workforce.

This has led to all sorts of gloomy predictions about farms being run by old people on mobility scooters who can’t remember which end of a sheep to drench. Some suggest the country might run out of food or, even worse, be obliged to sell our farms to foreigners.

This is prompting various calls to spend money, invariably other people’s, on measures to bring young people into farming. These range from boosts to tertiary studies to subsidies for young farmers to buy or run properties.

It is over 30 years since I was first told that Australia had a problem because our farmers are old and getting older. Predictions of dire consequences unless “something is done” were pretty common back then too. Many of the predictions heard today are no different, and neither are most of the suggested solutions.

As far as I know, during those 30 years no farms were abandoned because their owners were too old or feeble to manage them. Nor were any abandoned because nobody was willing to take them over once the owner died. Judging by our ever rising agricultural output, not many fell into neglect and disrepair due to being owned by old farmers either.

Although the baby boomer generation contributes to the high average, in another 30 years the median age of farmers might be higher than it is now, perhaps over 55, and I expect there will still be plenty of people insisting there is a problem to be fixed. But I am also confident that our farms will be producing more than they are now, and that not a single farm will have been abandoned because there are no young farmers to take it over.

The reason for my confidence is the ability of the market to sort these things out. A lot of old farmers have younger family members who take over farming operations.

For those who haven’t the farm is invariably sold, even if it is after death, and there is never a shortage of buyer interest. A new owner, whether a family member or unrelated, will typically take on debt to acquire it.

At each point, the market determines the outcome. The sale price ultimately reflects what buyers believe it is worth. Borrowing occurs in a competitive environment against objective credit criteria. And the new owner typically has an incentive to increase production to pay off debt. Only if the farm is acquired by a hobby or lifestyle farmer is it likely to operate without regard for profitability, and that is not age-specific.

That is not to suggest the advanced age of many farmers is irrelevant. On the contrary, it is of great relevance to those seeking to communicate with farmers, whether for commercial purposes or merely to convey information.

For example, they are fairly likely to be interested in labour saving devices and equipment that saves their aching back. From padded seats on quad bikes to mechanical lifting devices, they are often the focus of attention at field days.

They are also likely to be unimpressed by fads like social media and environmental hyperbole. Farming is inherently long term anyway, but add in the perspective of a long life and there is inevitably plenty of scepticism. The reluctance of many to embrace the internet until the arrival of broadband provides a good illustration of the tendency to avoid rushing in.

And of course there is a large and growing need for contractors to undertake the work that ageing farmers might once have done themselves, whether cropping or livestock related.

I’m quite sure the median age of contractors is a lot less than 53.

  • David Leyonhjelm has been an agribusiness consultant for 25 years. He may be contacted at reclaimfreedom@gmail.com
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    David Leyonhjelm

    David Leyonhjelm

    has worked in agribusiness for 30 years and is a Senator for NSW representing the Liberal Democrats.
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    READER COMMENTS

    ftfc
    25/07/2013 7:04:24 AM

    And the median age of our farmers is younger than Canada, the US and Japan - your point being.... In my experience the father is counted as the farmer, yet the son runs the farm - control for various reasons has not be haned over to the next generation, yet they do all the work
    Jenny
    25/07/2013 8:20:19 AM

    In reply to ftfc's - That is not entirely true. There are a lot of older farmers out there, many with family working on the farm with them, that still put in a long hard days yakka. In a perfect world for the 'baby boomers' the younger generation would be doing all the hard work while the older generation sat back and enjoyed some of the fruits of their labour however many are soldiering on so the younger generation have a farm to eventually take over.
    Belle
    25/07/2013 8:26:50 AM

    I agree David. Baby boomers are fitter than their parents, young people who leave the farm and return usually have added skills to benefit the business, and company and trust structures mean that some-one who is not running the business is classified as the 'farmer'. The reality is that the real farmer is the person who deals with the bank and runs the business.
    james
    25/07/2013 9:14:22 AM

    what sort of idiot thinks a business worth 3 to 12 million dollars, with debts of in excess of 2 million dollars, should have a managing director that is younger than 53? With the structure of our modern businesses this is probably too young as a median. What do these idiots think famrers do? Sit on tractors and chew straw? bizzare
    Jacky
    25/07/2013 4:18:27 PM

    On the bad days I have thought farming is just another form of dementia?
    R
    25/07/2013 6:08:54 PM

    I am one of the over 53's more like over 63's, but thankfully fit and healthy. A few years ago we planned to sellout and retire but unfortunately labor got into power and Lehman bros fell over so we are still here. I would imagine that would be others in the same boat.
    Barcoo
    25/07/2013 7:14:26 PM

    Many years ago I read in a book named "The lonely furrow" that in Japan there is a long established tradition of men working in the factories until age 55 and then returning to run the family farm. This custom would tend to raise the median age of farmers there. For myself, 73 years old, kids have left and are not interested in work, I am committed to staying long term, until the Native Vegetation Act is repealed and I can get back to improving the place.
    BIGPEN
    26/07/2013 4:12:09 AM

    What is the problem with older people working on farms. At 64 I run the office, the grain marketing manage the sheep and cattle consult with son re crop agronomy. Wife, self and son can write cheques. Farming is a most rewarding , stimulating and enjoyable business and I would like to continue working as long as I contribute more than I take (ie create value). I certainly see that as a far better alternative than relying on pensions paid by taxing the decreasing proportion of our population actually creating wealth outside public service.
    Percy
    26/07/2013 2:37:36 PM

    A lot more farmers would have retired if laws relating to divorce settlement did not apply to farm land. Also a lot more would be on a pension because they would have handed over to the next generation. Any new Government needs to introduce a law whereby a signed agreement is required before the partner is entitled to anything and that whatever is brought into a relationship remains the property of the original party; then whatever is built up during that partnership is split equally; with provisions if kids are involved. Over time, laws relating to wills have decimated many farming families.
    mark2
    26/07/2013 3:13:30 PM

    I think you are absolutely right BIGPEN. The problem with the author of this article is that he writes from the perspective of the progressive intellectual , only they can be excused for stereotyping their subjects
    Agribuzz with David LeyonhjelmCommentary, news and analysis with agribusiness consultant David Leyonhjelm. Email David at reclaimfreedom@gmail.com

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