Australian and international farm policy news

Should Australian wool growers have had a word with Thai rice farmers?

Politics and markets can be a dangerous mix, as Thai rice farmers have just discovered.

Some years ago, the incoming Government of Thailand secured strong support from rice farmers in Thailand by promising to lift the prices Thailand’s farmers received for their rice. The government subsequently implemented a rice marketing scheme based on a minimum floor price, coupled with export limits, which had the aim of maintaining a high domestic rice price. Several years later, the Thai Government owes more than $3 billion to rice producers, has an enormous stockpile of rice, has lost international markets, and some government members are now being sued for corruption. Thailand went from being the top world rice exporter to third, severely damaging its trade relations along the way. On top of this, farmers’ political support for the current Prime Minister is very uncertain, as many of them have lost large amounts of money.

The current situation faced by the Thai rice industry and government closely resembles the situation faced by the Australian Government and the wool industry at the time of the collapse of the Australian Wool Reserve Price Scheme. The restrictions that Thailand placed on rice exports did not increase international prices, because rice farmers in Vietnam and India simply increased their production – in the same way that man-made fibre producers and the cotton industry grabbed market share when Australia over-priced greasy wool.

It took a few years for the Australian wool industry and the Australian Government to accept their mistakes, and it took even longer to sell the wool stockpile, the marketing of which had longer-term impacts on the wool industry. Australian wool producers lost trust in government schemes and market interventions, and tend to regard any form of collective action, from R&D to advocacy, as dubious or contentious.

Canada phases out sow stalls – eight years after Australia

Canada plans to phase out the use of sow stalls through the adoption of a new Code of Practice for the Care and Handling of Pigs. The new Code requires that all new pig barns constructed after 1 July 2014 must provide group housing for sows, and that existing piggeries will be required to phase out conventional sow stall systems by 2024. In 2012, Canada was the world’s fifth largest exporter of pork meat and pork food products, and the third largest supplier to Australia, with Canadian imports worth US$98 million in the US$480 million market.

The Australian pork industry committed in 2010 to phase out the use of sow stalls by 2017, which is some seven years earlier than will be the case in Canada. Despite this commitment, in 2012 the major retailer Coles announced it will stop selling Australian branded pork, ham and bacon produced in piggeries using sow stalls by January 2013. As a result Australian pork producers now have to compete with overseas pig producers that have a substantial cost advantage.

The effect of the ban by a retailer at an earlier date than the deadline decided by the industry, has created a difficult situation. Firstly, Australian consumers have been given the impression that the Australian industry does not take animal welfare issues seriously, despite being a world leader. Secondly, consumers can still decide to purchase cheap imported pork products produced in systems that do not comply with Australian standards, and many of these products are labelled in ways that make them look like Australian products.

The ACT bans factory farms – despite not having any!

On 25 February 2014, the Australian Capital Territory (ACT) Government passed an amendment to the ACT Animal Welfare Act 1992. As a result, it is now an offence to have a commercial egg farm in the ACT where the laying hens are kept in a ‘battery cage’; or to have a pig farm where sows are kept in a ‘sow stall’; and it is also an offense to remove or trim the beak of a fowl in a commercial farm. The ACT Government claims it is setting a best-practice precedent for the rest of Australia. In fact, given the fact that the ACT actually has no factory farms, this legislation looks to be as tokenistic as the bans on nuclear power some local government authorities loudly proclaimed during the 1980s.

The ban on specific practices by the ACT Government is actually a highly simplistic response to issues that governments have recognised are actually much more complex. For example, the EU started phasing out the use of ‘battery cages’ for laying hens in 1999, with a compliance period of 12 years. On 1 January 2012, when the ban was finally introduced, 25% of EU egg production was still non-compliant and the EU egg industry faced increasing imports of caged eggs from bordering countries. In relation to pig production systems, the Australian pork industry has already started the transition to sow-stall free pig farms, and should have finished the transition in 2017, but faces increasing competition from imported pork produced under cheaper systems. In the case of debeaking and beak trimming, it is important to remember that the reason for beak trimming is reducing the risk of injurious pecking that can, if unchecked, lead to significant feather and skin damage (cannibalism), with attendant pain and suffering, leading sometimes to death (occasionally with mortality in excess of 20%).

The Australian Government has been working with industry over the last five years to establish consistent national animal welfare standards, based on wide consultation and science. In contrast, the ACT Government has chosen politics and grandstanding over science with no actual impact on animal welfare.

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

Images:  Australian Pork Limited, Dirk Heine, Mick Keogh, USDA

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