Farmers feel pinch as oil prices skyrocket

28 May, 2008 10:56 AM

Both the Pastoralists and Graziers Association (PGA) and WAFarmers are aware that fuel and fertiliser costs are posing serious imposts to farming systems in WA and have called on both the federal and WA governments to show some initiative to try and find alternative solutions.

The PGA has attacked the Federal Government and the opposition’s response to rapidly increasing fuels costs.

PGA president Rob Gillam said tampering with either the fuel excise or the GST "tax on tax" is a poor response by both parties to the problem of Australia’s rapidly rising fuel costs.

"It is laughable that the Prime Minister and the opposition leader are attacking each other for promising to return billions of tax dollars to their rightful owners," Mr Gillam said.

"Both appear to have forgotten that the fuel excise was originally raised to pay for better roads and transport systems.

"Now we have a new multi-billion dollar future fund, taxed from mining windfalls, to pay for new roads, ports and infrastructure.

"Removing the 38.4c/litre fuel excise is the only honest way for the government to admit that it is no longer using this excise in the way it was originally intended.

"A fuel price without excise is the only honest way to incur the added burden of GST."

WAFarmers president Mike Norton said he had received numerous phone calls from concerned farmers about where input costs were headed.

He said the organisation met with Agriculture Minister Kim Chance and Agriculture Department director general Ian Longson last week to discuss alternative solutions.

"Farmers are really wondering if the State Government is interested in a sustainable agriculture industry in WA and it is time it showed some leadership and not sit on its hand being silent." Mr Norton said.

"We need to do a lot more research on alternatives. There has not been any research and development carried out on fertiliser use for a long time.

"The Department has done quite a lot on biofuels, but with the way the price of diesel is going now the farming community is going to have to look very closely at on farm production.

"Every time fuel prices have risen this dramatically before it has always dropped to below a dollar in a reasonable time frame and once diesel prices drop below a dollar it is not cost effective to produce your own fuel.

"At the moment it appears that fuel prices are going to stay up this high for the long term, agriculture will need to look very closely at alternatives and that is where government support is required.

"The problem is the governments have a vested interest in fuel prices because they get very big licks of royalty out of it.

"The thing that annoys me about our current crop of state and federal politicians, they do not seem to mind that everybody is ripping the poor old farmer off."

Mr Longson said there was not a lot the department could do in relation to finding new sources of fertiliser.

"We can play a role in efficiency of use of fertiliser and assisting farmers in putting on as little fertiliser as possible to get the maximum benefit," Mr Longson said.



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