A SIGNIFICANT step forward for Australian agriculture, backed by serious money, is how Parliamentary Secretary to the Agriculture Minister Richard Colbeck describes the Abbott government’s Agricultural Competitiveness White Paper.
The new $4 billion industry plan was launched by Prime Minister Tony Abbott and Agriculture Minister Barnaby Joyce and Victorian Liberal MP Dan Tehan, near Warrnambool on Saturday.
Mr Joyce then outlined the government’s vision for agriculture at the National Press Club in Canberra on Monday, before national media and another large gathering of industry stakeholders.
Senator Colbeck was present at both events but maintained a low profile, despite playing a key role in the industry and the document’s development.
He told Fairfax Media the white paper contained significant funding and policy measures which provided a strong boost for agriculture’s future, especially managing production risk.
He highlighted funding initiatives to help access new markets and complement the free trade agreements finalised by the Abbott government into China, Japan and Korea.
The white paper delivered $30.8 million to help break down technical barriers to trade and appoint five new overseas Agriculture Counsellors.
It also unveiled $12.4m to modernise Australia’s food export traceability systems to further enhance food safety credentials.
“This allows farmers the opportunity to look at other markets internationally which is about them being able to drive a better price at the farmgate,” Senator Colbeck said.
Senator Colbeck said taxation improvements delivered in the white paper and this year’s federal budget also helped strengthen farm business planning.
They include doubling farm management deposits (FMDs) to $800,000, from July 1, 2016, and immediate tax deduction for fencing, water infrastructure and fodder storage.
Senator Colbeck said those items would help producers manage agricultural production risk and set up their properties “for the tough times”.
“On top of the increased allowance we announced a few years ago for off-farm income, and then being able to offset that against your farm-debt, all these things really allow farmers to be set up for the long term,” he said.
“This white paper is a really forward looking document that’s about providing a vision for agriculture for the future.
“It’s a significant document with really large scale measures.”
Market power imbalance
Senator Colbeck said the $11.4m for an agricultural commissioner at the Australian Competition and Consumer Commission (ACCC) would seek to address concerns about market power imbalances in agricultural supply chains.
“One of the issues me and my colleagues have looked at over a period of time is how you balance up the market power imbalance in different agricultural supply chains,” he said.
“We saw that with the dairy arguments a few years ago over $1 per litre milk, some issues in my home State of Tasmania and a lot of conversations that still exist, through the horticulture supply chain and for other commodities.
“Having someone within the ACCC - who actually understands agriculture and agriculture supply chains - will bring real value.
“It’s about providing some tools to actually balance up that fairness in the balance of power within the supply chain.
“The big guys have their scale to their advantage but the real question has always been how do you even out that balance of power?
“We think that can be achieved by having someone with specific knowledge and understanding of agriculture within the ACCC,” he said.
“It also sends a strong message to the broader community and especially to the rural sector that this government is interested in ensuring farmers can get a fair deal throughout the supply chain.”
Senator Colbeck said the supermarket code of conduct regulated by the ACC, and the competition watchdog’s Agricultural Enforcement and Engagement Unit, provide more tools to help control market power issues in agricultural supply chains.
“If you pull all those things together, along with the capacity for farmers to work together collectively to negotiate with processors and supermarkets, you start to have a really strong toolkit, to help deal with some of these market power issues,” he said.