Australian and international farm policy news

Western Australian GM crops recklessly contaminated with ideology

A landmark case in Western Australia over genetically modified (GM) crop contamination has further emphasised the irrelevance of science in GM rulings. After a three week hearing, Justice Kenneth Martin ruled against Steve Marsh who had attempted to sue neighbour Michael Baxter after GM canola traced to Baxter’s crop was found on his organically certified property. Pending an appeal, Steve Marsh will be responsible for the financial loss incurred when the National Association for Sustainable Agriculture, Australia (NSAA) withdrew their organic certification in what Justice Martin described as an ‘unjustifiable reaction’.

The genetically modified ‘round-up ready’ canola found to be ‘contaminating’ Marsh’s field by the NSAA could not biologically cross-pollinate Marsh’s crop. Though Baxter won the hearing, the case demonstrates the limits of science in the organic industry. The verdict on the ‘organicness’ of crops is the preserve of the certifiers whether scientifically justifiable or otherwise.

Revenue losses like that of Marsh’s are derived from scientifically dubious standards open to misuse and monopoly. If ideology must take precedence over science, it is critical legislation at least be made consistent if matters of culpability and certification loss are to be kept out of the courts.

China’s sovereign wealth fund goes foraging for agricultural assets

China’s $650 billion sovereign wealth fund is looking to increase foreign agricultural investment according to Chairman Ding Xuedon. To date, Chinese capital has been leery of Australia agriculture. A joint report by KPMG and University of Sydney, Demystifying Chinese investment in Australian agribusiness, found less than 1% of farmland is currently under Chinese ownership. This may change as state-owned enterprises and private agribusiness chase returns and look to sure up supply chains.

However, there is no guarantee Australia will be a major destination for agricultural investment. Chinese capital has shown a preference for competitor nations including the hypercompetitive New Zealand dairy industry. Developing nations, notably in Africa, have already received a greater share of Chinese agricultural investment. There is concern that Australian agriculture is losing its appeal to Asian investors.

To slow the decline in foreign demand the KPMG/University of Sydney report showed Australian agriculture should focus on its comparative advantage as premium producer. As China’s middle-class continues to rise, so too does the demand for nutrition and food safety. ‘Australia’s opportunity lies in meeting China’s food safety objectives – providing premium, fresh, safe foods: meats, dairy products, vegetables and wine.’

While growing nutritional awareness among China’s middle-class might not be the sheep’s back of 21st century agriculture, it may see Australia capture a greater share of FDI from sovereign wealth funds.

Marketing marketing

A Fairfax Agricultural Media Survey of agricultural producers revealed significant discontent with the administration and industry ROI of levies. The lowest satisfaction came from wool producers, currently paying $44 million on levies to Australian Wool Innovation (AWI).
Thirty-five per cent of producers surveyed rated the group’s performance as poor or very poor versus 23% good or very good. Tellingly, 35% of respondents to the question: ‘How would you rate the effectiveness of Australian Wool Innovation’s current overseas marketing focus on positioning Merino wool as a luxury fibre?’, answered ‘poor’ or ‘very poor’. Less than half that number at 17%, answered ‘good’ or ‘very good’.
In 2012 woolgrowers were given a vote to allocate AWI funding between on-farm R&D, off-farm R&D and marketing operations for the next four years. The allotted ratios are currently 25%, 15% and 60% respectively, suggesting there is recognition among woolgrowers of marketing’s value if not AWI’s specifically. 

United States' Clean Water Act changes raise farmers’ ire

Proposed changes to the United States (US) Clean Water Act by the Environmental Protection Agency (EPA) of the US Government have caused a ‘flood’ of criticisms from US farmers’ groups. The proposed changes would give the EPA power to protect what are referred to as ‘small waters’ – creeks and ponds that are not directly part of larger river systems that the EPA currently has responsibility for. The EPA claims its new powers would allow it to impose regulations on small waters only to the extent necessary to protect the quality of water downstream. However, farmers have expressed concerns that it will amount to the EPA requiring farmers to obtain licences to enable livestock to cross streams, or to be licensed to carry out normal agricultural activities close to any farm pond, drain or waterway, no matter how small.

The issue has arisen due to the findings of several court cases, where the EPA’s powers to impose its regulations over ‘waters of the United States’ (as the legislation specifies) have been challenged in relation to swamplands close to major rivers and smaller streams running into larger rivers. It has been pointed out that if legislators could actually make a decision that more clearly specified the EPA’s responsibilities, then the agency would not need to propose new ‘small waters’ regulations.

Keep up-to-date with discussion on current issues in Australian and international agriculture policy via the Ag Forum on the Institute website.

Images:  CSIRO, Greenpeace, Murrumbidgee Irrigation 

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