Research Reports

Is Counting Farmers Harder than Counting Sheep?

Is counting farmers harder than counting sheep? A comparison of the agricultural statistical systems of Australia, the United States and France. Almost every decision made by government agricultural policy-makers, agribusiness organisations and farm business managers is underpinned by agricultural statistics, yet few stop to consider the reliability of the statistics used for decision-making. New Institute research set out to do this for the Australian agricultural statistics system. As has recently been observed for a range of different issues, agricultural statistical systems play a crucial role in informing policy and business decisions, and the absence of reliable statistics can result in considerable uncertainty and poor decision-making.The research report, Is counting farmers harder than counting sheep? A comparison of the agricultural statistical systems of Australia, the United States and France, involved a desktop study of the government agricultural statistical systems of Australia, the United States (US) and France.
Issues considered in the research included: the nature of statistical information collected; the way in which information is collected; the frequency of information collection and published; the cost of resources utilised in collecting and collating agricultural statistics; the ways in which the information is made available; any proposed future changes in agricultural statistics collection, collation or publication.
A key finding in the report was the varying levels of public expenditure on national agricultural statistical systems. Australia’s agricultural statistics service annual expenditure per farm business was A$19.62 in 2007/08 which is only 12% of French agricultural public expenditures and 6% of the US ones. In addition, a series of statistical products were used as case studies to further develop the comparison of the three statistical systems, and help identify their effectiveness.
The case studies related to: agricultural production statistics and forecasts; the national agricultural census; data detailing farmgate and supply chain prices; farm demographic and socioeconomic data;  agriculture-related environmental (water, climate change) data.
A specific objective of the research was to make recommendations about possible changes, if any, that could or should be made to the Australian agricultural statistical system to improve its accuracy, coherence, consistency, transparency, objectivity and comprehensiveness. The final recommendations made were as follows: Recommendation 1: The Australian Government Department of Agriculture, Fisheries and Forestry (DAFF) and more specifically ABARES should be given a real leadership in agricultural statistics. Recommendation 2: DAFF and the ABS have to ensure suitable long-term funding arrangements so that the system more effectively meets government and industry needs. Recommendation 3: Appropriate statutory provisions should be implemented to reinforce the impartiality, objectivity and confidentiality of ABARES agricultural surveys. The statistical skills of the organisation are also key. Recommendation 4: To ensure that data and agricultural statistics in Australia are readily accessible to stakeholders, a unique interactive data warehouse has to be created. Recommendation 5: The various components of the Australian agricultural statistical system should be better integrated, and ABS, ABARES and state agricultural agencies should better cooperate. Recommendation 6: The ABS and ABARES should clearly identify the costs and resources associated with the Australian agricultural statistics system. The authors’ overall conclusions are that the Australian agricultural statistical system is not adequate to meet either the current or future needs of its stakeholders. Indeed, it is in need of major reform if it is not to fall into further decline and loss of utility.

Full report, pp. 1-83 (100 pages), March 2013
Australian Farm Institute
Authors: Potard G, Keogh M
ISBN 978-1-921808-21-0 (Print)
ISBN 978-1-921808-22-7 (Web)

Assessing the Opportunities for Achieving Future Productivity Growth in Australian Agriculture

It is widely recognised that in order for the Australian agricultural sector to remain domestically and internationally competitive, continued and perhaps even accelerated productivity growth is required. The need for domestic competitiveness arises because limits exist to natural and human resources in Australia, and agriculture faces increasing competition from other sectors for access to these. The need for international competitiveness arises due to the emergence of major new agricultural exporting nations that have a much richer natural resource base and much lower cost structures than Australian agricultural businesses, and which are becoming major competitors in global agricultural markets. While the need for productivity growth in Australian agriculture is well recognised, what is less clear is how that productivity growth might be achieved. The current ‘environment’ is not conducive to accelerated agricultural productivity growth, with declining real levels of investment in research and development, the progressive withdrawal of government services to agriculture, and increasing constraints on access to resources. On the other hand, Australian agriculture has a sound track record of innovation and superior productivity performance, and is not limited by some of the institutional and cultural constraints associated with the agricultural sectors of other developed nations. Some of Australia’s leading agricultural researchers were asked to contribute to this report, which explores the scope of the productivity challenge facing Australian agriculture, and seeks to identify specific technologies and initiatives that could realistically assist the sector to attain the levels of productivity growth that are likely to be required in the future. It is hoped that these papers will act as a catalyst for the sector and governments to redouble efforts on a wide range of fronts to tackle Australian agriculture’s future productivity challenge.

Full report, pp. 1-82, November 2012
Australian Farm Institute
Authors: Mullen, J, Tester, M, Goddard, M, Goss, K, Carberry, P, Keating, B, Bellotti, B
ISBN 978-1-921808-23-4 (Print)
ISBN 978-1-921808-24-1 (Web)

Does Australia Need a National Policy to Preserve Agricultural Land

 Does Australia need a national policy to preserve agricultural land? This study provides a comprehensive review of what is currently known about the amount and location of Australian agricultural land, the rate of land use change occurring, and how governments make decisions both in Australia and internationally. Australia has the sixth largest land area and the lowest population density of almost any nation on earth, so the question of whether or not there will be sufficient good quality land available for agriculture in the future has not been a high priority issue for most of the past two hundred years.However, an increasing number of people are starting to express concerns that Australia is being too reckless with its best agricultural land, and future generations might regret decisions that are currently being made about the future use of that land. With urban, mining, CSG and environmental demands taking more and more land, and foreign investors also purchasing significant areas, it is legitimate to ask whether Australia can realistically plan to become the future "food bowl of Asia. Agriculture productivity is directly related to the quality of a soil and prevailing climatic conditions, and while Australia appears to have plenty of land, in reality only about 3% is actually suitable for cropping, and even less of this is considered to be prime agricultural land. Many of the current disputes about future land use are actually concentrated in specific areas considered to be some of the best agricultural land. This research finds that Australia currently lacks a consistent and comprehensive understanding of where this land is located, or how much of it is being diverted from agriculture each year. 'This report is a valuable review and analysis of the current extent of agricultural land use, and land use change. It also provides a benchmark for understanding how land use and land use change is currently monitored at the state and national level, and how these levels of government could better work together to clarify these questions.

Full report, pp. 1-49 (54 pages), May 2012
Australian Farm Institute
Authors: Budge, T, Butt, A, Chersterfield, M, Kennedy, M, Buxton, M,Tremain, D
ISBN 978-1-921808-17-3 (Print)
ISBN 978-1-921808-16-6 (Web) 

Transport Costs for Australian Agriculture

Transport costs for Australian Agriculture
This research shows that the available statistics estimating than transport only represents  4% of the total Australian agricultural output are a far cry from the reality. This research finds that from the farm to a the foreign customer (delivered to the foreign port of entry of domestic central market), transport cost of Australia's agricultural products represent between 4% and 48.5% of the farm gate value, with an average of 8.75% for domestic delivery and 23.64% for international delivery. These results have been obtained through twelve different case studies and assess all the costs incurred to the different stakeholders of the supply chain (road freight, storage, handling, wharf fee...).
While these results cannot be extrapolated to respective agricultural industries as a whole, they demonstrate that for many products, particularly beef cattle and grain, transport costs are a major part of the total cost to produce and deliver the product to its destination. The work constitutes a benchmark against which changes in transport costs can be assessed and compared over time. It is also hoped that the Australian agricultural transport costs identified, as part of this research, will be able to be compared with transport costs incurred by agricultural producers in other countries.

Full report, pp1-31 (44 pages), December 2011
Australian Farm Institute
Authors: Goucher, G
ISBN 978-1-921808-14-2 (Print)
ISBN 978-1-921808-15-9 (Web)

Farm Level Modelling of Greenhouse Emission Mitigation and Sequestration Options for the Australian Wool Industry

The implementation of Australian policies which will impose a cost on greenhouse emissions will bring
about some important changes to the business environment in which Australian sheep and wool producers
operate. Energy costs will increase, and this will have implications for a range of farm input costs, although
some uncertainty surrounds future cost impacts on fuel. At the same time, the Australian Government’s
recently legislated Carbon Farming Initiative creates potential opportunities for those landholders
voluntarily choosing to participate in carbon markets by becoming producers of offsets. Exactly how the challenges and opportunities associated with greenhouse policies will play out for individual sheep businesses is still very uncertain, but it is clear that those involved in the sheep and wool industries need to gain a good understanding of these issues and consider how they may impact on their businesses in the future.

Please note this Research Report is available in electronic version only

Full report, pp1-56 (72 pages), August 2011
Australian Farm Institute
Authors: Davison. S, Keogh. M
ISBN 978-1-921808-13-5 (Web)

The Implications of the Australian Government's Carbon Farming Initiative for Beef Producers

The CFI legislation will create a regulated marketplace for farm sequestration and mitigation activities, and farmers who voluntarily participate will earn offset credits which will be able to be sold to businesses that with to use those to reduce their total business emissions, or to claim carbon-neutrality for their products. In many respects, carbon offset production will for some farmers become one extra enterprise option available, bringing with it additional revenue and additional costs, new decisions about how to physically integrate the enterprise into a farm business, and the need for farmers to manage this enterprise in a way that adds to total farm profitability.
The Carbon Farming Initiative (CFI) has been proposed by the Australian Government as a legislated mechanism that will enable farmers to generate revenue from the sale of greenhouse gas sequestration and mitigation activities.

The introduction of a carbon offset market for farms will have significant long-term implications, and will entail both opportunities and risks for farm business managers. The research detailed in this report is an initial attempt to gain some understanding of the issues the farm sector and individual farmers will need to consider as this new farm enterprise emerges.

This report was prepared with funding from Meat & Livestock Australia.

Full report, pp 1-30 (42 pages), April 2011
Australian Farm Institute
Authors: Davison, S, Keogh, M
(Web) ISBN 978-1-921808-09-8
(Print) ISBN 978-1-921808-08-1

Private Sector Investment in Agricultural R and D in Australia

 

There is wide recognition that for Australian agriculture to remain internationally competitive and to be able to take advantage of emerging international opportunities, sustained productivity growth will be required. While the  agriculture sector has one of the best records of any sector of the Australian economy in achieving productivity gains over the past three decades, all the evidence available at present indicates that the productivity surge that commenced in the 1970s appears to be tapering off, and increased efforts will be required to restore previous productivity growth rates.
A key driver of agricultural productivity growth is agricultural research and development (R&D) investment, but trends over recent decades indicate that public agricultural R&D investment levels are declining in real terms. There has been some suggestion that the private sector will increase agricultural R&D investment and become more important as a driver of agricultural productivity, but surprisingly little is known about private sector agricultural R&D investment trends, especially in a country such as Australia which has a relatively small and somewhat unique agricultural sector.
The aim of the research reported here is to investigate these issues through desktop research and an industry survey. By talking directly to major private sector organisations about their involvement in agricultural R&D, their relationships with public-sector R&D providers, and their perceptions of likely future developments, decisions about future levels of public-sector investment in Australia can be much more soundly based.

Full report, pp 1-71, May 2011
 Australian Farm Institute
(Web) ISBN 978-1-921808-06-7
(Print) ISBN 978-1-921808-05-0 (Web)

Growing Regional NSW- Policies to Revitalise the Non-Metropolitan Regions of NSW

Australian governments have adopted a range of initiatives at different times to foster economic development in non-metropolitan regions of the nation. These have included land and water allocation policies, transport and infrastructure
development, regional service subsidisation, decentralisation policies and regional planning initiatives. Despite these policies, large areas of the nation have very low population densities, and the vast bulk of the population is crowded into five mainland capital cities and the metropolitan and coastal areas close to those cities.

The congestion and other stresses created by the rapid growth of metropolitan populations are now becoming a significant issue for state governments, and these problems are likely to be exacerbated in the future as the nation continues to experience relatively strong population growth.

At the same time, low population densities and declining populations in many non-metropolitan regions are creating challenges for governments in the provision of equitable services and facilities in regional areas, and also for non-metropolitan businesses which are having increasing difficulty in securing workers.

It seems logical that, if current Australian population growth rates are to be maintained, the solution to the challenges this will present for both metropolitan and non-metropolitan residents is to find ways to stimulate greater non-metropolitan population growth.  
In the past, regional development policies often consisted of measures to entice manufacturers and processors to establish facilities in non-metropolitan areas to provide the employment that would attract new residents. These policies had limited
success, especially as manufacturing has declined in relative importance as a source of employment. However, the rise in prominence of the services economy and the development of modern transport and communication systems, have created new opportunities for economic growth and employment in non-metropolitan areas.

This report proposes a range of policy measures based on international best practice which, if adopted with serious long-term intent by a NSW Government, have the potential to reverse the population drift to metropolitan centres from inland NSW while at the same time enhancing the quality of life in major metropolitan centres.

Please note this Research Report is available in electronic version only.

Full Report
March 2011, 1-52 (52 pages)
Publisher: Australian Farm Institute
Authors: Davison, S, Ryan, T, Goucher, G & Keogh, M
ISBN 978-1-921808-07-4 (Web)

The Implications of Greenhouse Mitigation Policies on the Demand for Agricultural Land

As Australia moves towards the implementation of policies to reduce greenhouse gas emissions, much attention has been directed towards the potential for carbon sink forestry to provide significant amounts of greenhouse gas sequestration, at a relatively modest cost.

While providing immediate sequestration and potential revenue for landholders, there are also some potentially negative aspects of an expansion of carbon sink forestry that require careful consideration.Residents in regions where plantation forestry has already occurred cite adverse socioeconomic impacts arising from large areas of plantations being established on farm land. Concerns have also been expressed about potential negative environmental impacts such as increased bushfire risk, changes to biodiversity, and reductions in water runoff.

Whether or not these impacts might arise in regions where future carbon sink forestry is concentrated will depend very much on the policy framework that is adopted by government to manage this issue.

The research reported here has involved an exploration of these issues, firstly from the perspective of the potential future scale of carbon sink forestry, and then from the perspective of the policy and approvals framework which will determine how carbon sink forestry develops in Australia in the future. It highlights that there is a need for further consideration of this issue and the development of appropriate policy if some of the potential adverse impacts are to be avoided.
The Implications of Greenhouse Mitigation Policies on the Demand for Agricultural Land  is a compelling review of the existing research and results regarding the possible impacts of carbon sink forestry. The topics covered are:

• Current scale and rate of land use change
• Models of potential agricultural land use changes arising from greenhouse mitigation policies
• Potential impacts of carbon sink plantation developments
• Carbon sink plantation approval processes

This report constitutes a needed reference for any further research on the topic and outlines the need of consistent policies and approval processes.

Full report
October 2010, pp. 1-116 (116 pages)
Publisher: Australian Farm Institute
Authors: GHD Hassall
ISBN 978-1-921808-04-3 (Web)
ISBN 978-1-921808-03-6 (Print)

Towards a Better Understanding of Current and Future Human Resource Needs

The availability and suitability of labour in the Australian agriculture sector is an issue that has been of concern for a number of decades, but appears to have become more significant recently, for a number of reasons. These include the continual migration of young persons from rural to urban areas, an apparent decline in the number of persons opting for a career in agriculture, and competition for labour from
industries such as mining.

The first step in seeking solutions to improve the availability of labour in agriculture is obtaining a clear picture of both demand for and supply of labour in the sector. Unfortunately, this is not a simple task as currently available statistics do not provide a clear picture of the industry situation.

Labour statistics fail to capture seasonality, or use categorisations that are of little relevance to industry. Similarly, statistics concerning participation in education and training courses relevant to the sector use a number of different categorisation systems, and in recent years the publicly available higher education data has become almost completely irrelevant for agriculture, necessitating the unofficial collection of statistics to try and obtain some meaningful information about the real situation.

The research reported here has attempted to overcome these shortcomings in a number of ways. It aims to shed light on the labour situation in Australian agriculture and to identify actions that could be taken to improve it.
 
It is apparent that there are no silver bullets available, and that more concerted efforts are required firstly at the industry level, to position agriculture as an attractive career option, and secondly at the employer level to create better career paths with an increased focus on education and training.
Towards a Better Understanding of Current and Future Human Resource Needs of Australian Agriculture aims to shed light on the labour situation in Australian agriculture and to identify actions that could be taken to improve it. The research, jointly funded by Horticulture Australia Limited, AgriFood Skills Australia and the Institute, involved a detailed examination of labour demand and supply statistics for the agriculture sector, an industry survey, and the development of future labour and demand supply scenarios over the next decade.

Full report
June 2010, pp. 1-113 (114 pages)
Publisher: Australian Farm Institute
Authors: AECgroup
ISBN 978-1-921808-01-2 (Web)
ISBN 978-1-921808-02-9 (Print)

Making Decisions About Environmental Water Allocations

There are major changes underway in the management of water in Australia, with one of the most significant being the ownership of water entitlements by the environment. When announced water buy-back programs are completed and promised water infrastructure investments are implemented, the environment will be the sole largest holder of water entitlements in Australia, and that water will be used to restore or improve ecological processes and environmental assets associated with Australia’s major inland rivers.

How that water will be managed; who will be responsible for making decisions about it; how the general community will be able to monitor how well that water is being used; and who will decide whether the environment is receiving sufficient water, are all questions that are yet to be answered. The decisions that will need to be made are complex, because they incorporate both economic (attempting to ascribe economic values to outcomes that can be achieved from alternative uses of water) and scientific (how much water is needed to achieve desired environmental outcomes) elements, and both have considerable uncertainty.

The research project was initiated by the Australian Farm Institute to advance discussion on these questions, and to identify some preferred options for the future management of environmental water in Australia. Given that the Australian public will, in future, be the owners of water assets valued in excess of $3 billion, it is important to make sure these assets are managed in a way that maximises the return from them, while at the same time enabling irrigated agriculture to continue to make a large contribution to national economic output.

The aim of the research reported here was to utilise the knowledge of experts who have extensive experience in water policy issues to further develop thinking on how decisions about allocating water to the environment should be made. This is important not only to ensure environmental water is used effectively, but also because the same decision-making framework will be used to decide how much water will in future be available for irrigated agriculture. Each of the four experts responded in quite different ways to each of the questions posed.
Making decisions about environmental water allocations is a report stemming from the collective work of two economists - Professor Jeff Bennett and Professor Mike Young - and two environmental scientists - Professor Richard Kingsford and Professor Richard Norris.

How that water will be managed; who will be responsible for making decisions about it; how the general community will be able to monitor how well that water is being used; and who will decide whether the environment is receiving sufficient water, are all questions addressed in this report.

Full Report
June 2010, pp. 1-80 (80 pages)
Publisher: Australian Farm Institute
Authors: Bennett, J, Kingsford, RT, Norris, RH & Young, M
ISBN 978-1-921808-00-5 (Web)
ISBN 978-0-9806912-9-0 (Print)

Essential Services in Urban and Regional Australia – a Quantitative Comparison

Over recent decades the Australian economy has largely been deregulated, and governments have progressively reduced direct involvement in the provision of a wide range of services to the community. The trend towards reduced direct government involvement in service delivery commenced during the 1980s, and was accelerated by the National Competition Policy agreement of 1994. Over the past two decades, the direct involvement of governments in the provision of services including telecommunications, public transport, some postal services, education, health and medicine, transport infrastructure and a range of health-related services has been substantially reduced.

One unresolved aspect of these changes is the extent to which governments have an obligation to provide a core set of essential services to all taxpayers, irrespective of their place of residence. This was an issue that remained contentious during the sometimes intense political debates over National Competition Policy, and which regularly resurfaces in debates about the quality of telecommunication, health and education services in rural and regional Australia.

A major weakness in the debates about this issue has been the lack of objective data that enables essential service accessibility to be compared between locations, and over time. The research project reported here has addressed this by utilising census and other data to develop objective measures of essential service accessibility.

The intent in developing this data is not to advance arguments that all Australians should have absolutely equal access to all essential services, but rather to provide a mechanism to enable more objective decision-making to occur. This should assist in ensuring that residents of regional and rural areas maintain equitable access to essential services; that governments innovate to find better ways to efficiently provide essential services to all residents; and that governments consider alternative policy measures in the event that essential services cannot be made universally available.

Newly released research has for the first time quantified the extra costs faced by Australia’s non-metropolitan residents in accessing essential Government services, and highlighted the need to find better ways to deliver essential services in regional Australia.

The research, commissioned by the Australian Farm Institute and carried out by the National Institute of Industry and Economic Research (NIEIR), used census and other objective data to calculate the costs faced by all Australian residents in accessing essential services such as doctors, hospitals, schools, TAFE colleges and universities. These costs were then compared between metropolitan, urban and rural residents.

Full Report

November  2009, pp. 1 - 81 (81 pages)
Publisher: Australian Farm Institute
Author: National Institute of Economic and Industry Research (NIEIR)
ISBN 978-0-9806912-5-2 (Print)
ISBN 978-0-9806912-6-9 (Web)

The Australian Carbon Pollution Reduction Scheme - An Introduction for Farmers and Agribusiness

The first step in understanding Australia's CPRS is to gain an insight into the international agreement that Australia has committed to, because those agreements impose obligations on the nation which are reflected in the proposed design of the CPRS. Chapter 2 of the guide explains the history and key features of these international agreements, and their signifiance to Australian agriculture.

Chapter 3 explains the greenhouse emission accounting rules that Australia has adopted as part of the nation's compliance with the Kyoto Protocol. Chapter 4 provides details of Australia's greenhouse emissions, and trends in national emissions over the past fifteen years.

The main design features of the CPRS are detailed in Chapter 5.

How the Australian Emission Units (AEU), traded in a government created market, could be purchased and traded, which businesses get free AEUs, what defines an 'eligible' forest are outlined in Chapter 6.

There are some important potential ecomomic impacts of the proposed CPRS which the agricultural sector needs to consider and Chapter 7 details the results of economic modelling of these impacts. Chapter 8 provides some discussions of potential 'modes of engagement' for the farm and agribusiness sectors with the CPRS.

The high degree of uncertainty that currently exists  about both Australian and international climate policy makes it difficult to be too presciptive about taking early action, however there are number of actions that seems sensible, and these are outlined in Chapter 9.

For most Australians, discussions about an Australian emissions trading scheme are complex and confusing, and seem to have little real relevance to day-to-day life. For those involved in Australian farming and agribusiness, discussions are equally complex and confusing, but there is a growing realisation that the policies could have quite a significant impact on businesses in the sector.

This guide has been written to try and assist those involved in Australian agriculture to gain a better understanding of this issue, and to begin to prepare for what has the potential to be the biggest change seen in the sector for many decades. The scale of the potential changes the CPRS will bring about makes it very important that farmers and agribusiness participants understand how the CPRS will operate, and what it will mean for their businesses.

Full Report
September  2009, pp. 1 - 60 (60 pages)
Publisher: Australian Farm Institute
Author: Sally Davison &  Mick Keogh
ISBN 978-0-9806912-1-4 (Print)
ISBN 978-0-9806912-2-1 (Web) 

Some Impacts on Agriculture of an Australian Emissions Trading Scheme

The Australian Government proposes to introduce a national greenhouse emissions trading scheme which will commence in July 2010. In its initial stages, the scheme will require firms that directly emit more than 25,000 tonnes of carbon dioxide equivalent per annum to be participants, and to purchase government-issued emission permits equivalent to their estimated annual greenhouse emissions.

Transport fuel distributors will also be required to be participants, and will be responsible for the emissions estimated to be created when the fuel they sell is combusted.

Farm businesses will not be required to directly participate in the scheme in its initial years. The government has announced that the earliest that farm businesses might be required to participate in the scheme will be 2015, with a final decision to be made in 2013. The announcement of this timetable for decisions concerning farm business participation might lead to a sense of complacency about both the potential impact of the scheme on farm businesses, and the need for decisions about future farm participation. On both counts, it seems the complacency may be mis-founded.

Firstly, the fact that farm businesses are price takers in global markets and consumers of a wide range of inputs – many of which are energy or energy-related – means that the indirect impact of energy-price increases will directly impact on farm profitability, irrespective of farm-sector participation. Secondly, if farm businesses are to become scheme participants, administrative decisions will need to be made well in advance of 2013 in order for this to occur.

For these reasons, the research reported here provides critical and timely information that will assist the farm sector and policy-makers in future decision-making processes relating to this most challenging issue.

The research was commissioned before the Australian Government released its White Paper, specifying the preferred design of the national emissions trading scheme, and it therefore does not precisely model the potential impacts of those proposals on the farm sector. However, the scenarios modelled in this research are sufficiently close to the White Paper proposals such that the results of the analysis reported here are very relevant to considerations about future potential impacts of the scheme on farm businesses.

It is hoped this research will assist both the farm sector and policy-makers in reaching robust and appropriate decisions about the future role of the farm sector in the national emissions trading scheme. The changes likely to arise from these decisions will be profound and long-lasting, and for that reason require very careful consideration and analysis.

This report provides the Australian agricultural sector and its associated commodity and regional sub-sectors with a strong understanding of the economic implications of a range of different greenhouse policy scenarios. Prepared for the Australian Farm Institute, Australian Wool Innovation, Dairy Australia and Cotton R&D Corporation by the Centre for International Economics, the research report adds valuable information to the debate on greenhouse gas emission policies. 

Full Report
February 2009, pp. 1 - 68 (68 pages)
Publisher: Australian Farm Institue
Author: TheCIE
ISBN:978-0-9805475-8-0

Australia's Emissions Trading Scheme - Knowledge Gaps and Research Needs for Primary Industries

A particular challenge for agriculture are the difficulties associated with accurately estimating and monitoring the greenhouse emissions that are attributed to the sector under international greenhouse accounting standards.

The research was carried out before the Australian Government released its 2008 Green Paper identifying a preferred option for the design of a national greenhouse emissions trading scheme. For that reason some of the assumptions made about the proposed design of the ETS may no longer be valid, although the broad implications of the ETS for Australian farm businesses remain appropriate, and the research and information needs have not changed as a consequence of the specifics of the Green Paper – which are still subject to potential change when legislation is enacted in 2009.

The proposed introduction of a greenhouse emissions trading scheme (ETS) in Australia will present some particular challenges and opportunities for Australian agriculture, irrespective of whether businesses in the sector become direct participants in the ETS, or remain non-participants but need to manage the higher farm input costs and other changes that the ETS will inevitably bring.

The research reported here was commissioned by Land and Water Australia, and aims to consider some of the implications of the ETS for farm businesses, and then to identify the key information and research needs that the sector will have to address in order to respond to the challenges and opportunities the ETS will present.

Full Report
October 2008, pp. 1 - 62 (62 pages)
Publisher: Australian Farm Institute
Author: Australian Farm Institute - Keogh, M

ISBN: 978-0-9805475-5-5-9

Preliminary Modelling of the Farm-Level Impacts of the Australian Greenhouse Emissions Trading Scheme

One of the biggest challenges in making decisions about future climate change policies for agriculture is the great uncertainty surrounding future technological developments to mitigate greenhouse emissions. Will new technologies suddenly emerge that dramatically reduce agriculture’s emission profile? Will new clean energy sources quickly develop? To what extent will the unleashing of market forces (via an Emissions Trading Scheme) accelerate these changes?

The answers to these questions will become evident at some stage in the future, but cannot be predicted or modelled with any certainty. On the other hand, sufficient information is already available to enable reasonable estimates to be made of the probable costs associated with policy measures such as the proposed national Emissions Trading Scheme. Knowledge of the range of potential future prices that will be imposed on greenhouse emissions means that estimates can be made of the flow-on costs for farm businesses, and the cost impact of different policy scenarios can be modelled with some degree of accuracy.

This imbalance between the certainty of future costs and the uncertainty of future mitigation advances makes economic modelling of climate change policy proposals extremely challenging, with the outcome very dependent on assumptions that are made about the major areas of uncertainty. Recognising this, the modelling reported here is preliminary in nature, and does not attempt to foreshadow some of the dynamic changes or new developments that will undoubtedly arise in the future as a consequence of imminent policy measures. However, by detailing all assumptions and not taking a ‘black box’ modelling approach, the hope is that insights emerging from this work will assist further efforts to gain a better understanding of the future implications of this issue for Australian agriculture.
The research reported here has examined the implications of an emissions trading scheme (ETS) for Australian agriculture, using ten model farm businesses, three future greenhouse emission price scenarios, and four potential modes of engagement for the agriculture sector with the ETS.

The modelling indicates that increases in the prices farmers pay for farm inputs as a result of the ETS have the potential to reduce average farm cash margins in 2016 by between 3 and 9% in comparison with a business as usual scenario, with cropping specialists experiencing larger impacts.

Full Report
September 2008, pp. 1 - 63 (63 pages)
Publisher: Australian Farm Institute
Author: Australian Farm Institute - Keogh, M & Thompson, A
ISBN: 978-0-9805475-6-6

Value in Value Chains - Collaborative Business Models and Farm Accreditation Systems Examined

The range of case studies analysed provide a diversity of examples where value chain engagements have benefited farmers, but also highlight that such arrangements are dynamic and evolve over time, and require continual management.

A related issue is the role of farm accreditation systems in consumer-driven value markets. Should Australian agriculture be developing national accreditation systems in order to secure market access, or do such systems simply add cost without delivering value? The research reported here examines these questions in the light of the experiences of those involved in the case studies analysed as part of the
research. Becoming an integrated part of a value chain will not necessarily be the best option for all farm businesses.

However, this research provides some valuable information and lessons for those farmers contemplating closer engagement in value chains, and should assist in ensuring that farmers do secure value from chains.
As Australian agriculture evolves from being a low-cost supplier of bulk commodities to global markets into a supplier of both bulk commodities and more specialised and differentiated products to higher-value markets, the interaction between farmers and the value chain post farmgate will become an increasingly important element of farm business profitability.

While farmers have recognised the need to become part of the value chain, there is a great deal of uncertainty about the extent to which these arrangements deliver increased value to farmers. Many question whether farmers are actually better off being involved in the value chain, and there are a myriad of stories about how such arrangements have worked to the disadvantage of farmers.

Full Report
August 2008, pp. 1 - 72 (72 pages)
Publisher: Australian Farm Institue
Author: Australian Farm Institue - O'Keeffe, M
ISBN: 978-0-9805475-1-1

Estimating the Value of Environmental Services Provided by Australian Farmers

For some time the Australian agricultural sector has been subject to considerable public criticism about  the impact of some industry practices on the environment. Issues of concern have included loss of biodiversity, diminishing water quality, reduced water availability, and increased soil erosion and salinisation.

However, over recent decades there have been signifi  cant changes implemented to many farm management systems, which have resulted in improved environmental and productivity outcomes. These changes have included introducing deep-rooted perennial pastures, extensive tree planting, fencing off riparian zones, the adoption of best-management practice systems, and the retention of areas of natural vegetation. Changes
have been stimulated by a range of different factors including government regulations, incentive programs, government grants and market-based instruments.

The improved environmental outcomes arising from these changes are of great importance to both the sector and the wider community, although generally go unnoticed. In part this is due to the propensity for bad news to gain more attention than good news, but it is also partly due to the fact that improved environmental outcomes are a public good that is usually not marketed or valued economically.
Developing robust methodologies to establish the value of enhanced environmental outcomes from agriculture is an important step that will assist increased community recognition of positive change, and is also a necessary step in developing future natural resource policy priorities.

The research reported here provides a detailed examination of this issue, and uses case studies to highlight the value that changes in farmers natural resource management practices have delivered to the Australian community. The research also highlights the opportunity that exists for governments to increase the value of farm environmental services provided for the community, if appropriate policies and incentives are implemented.

Full Report
June 2008, pp. 1 - 91 (91 pages)
Publisher: Australian Farm Institute
Author: Gillespie, R
ISBN: 978-0-9803460-8-4

Agriculture, Greenhouse and Emissions Trading Summit Proceedings

Presentations at the Agriculture, Greenhouse and Emissions Trading Conference 2008 include:

An Australian Emissions Trading Scheme, Blair Comely 
Economic Implications of the ETS, Brian Fisher  
Emissions Trading in Agriculture: A Canadian Perspective, Cher Brethour and Maria Klimas  
Address by the President of Federated Farmers of New Zealand, to the Australian Farm Institute  Charlie Pedersen
Future International Developments in Climate Change Policy, and in Particular the Likely Future Situation of Developing Nations David Crombie   
A National Climate Change Research Strategy for Primary Industries (CCRSPI) Michael Robinson  
Mitigation Technologies for Agriculture – Now and in the Future, David Whitehead
Measurement Issues and Mitigation Options – Land Use, Beverley Henry, Ian Johnsson, Grant Fraser, John Carter and Steven Bray  
Greenhouse Emissions from Livestock and Fertiliser and Implications for a National Emissions Trading Scheme Richard Eckard, Chris Grainger, John Graham and Traci Griffin


The first Agriculture and Greenhouse Emissions Trading Summit was held in Queensland in April, 2008. The Summit brought together a wide cross-section of people involved in agriculture, agribusiness and agricultural policymaking to discuss the complex and wide-ranging issues for agriculture associated with the proposed introduction of a national greenhouse emissions trading scheme.

The Summit was made possible through the generous sponsorship of Rabobank and Ridley Corporation, and their support is gratefully acknowledged. 

Full Report
May 2008, pp. 1 - 64 (64 pages)
Publisher: Australian Farm Institute
Author: Australian Farm Institute
ISBN: 978-0-9805475-3-5

The Implications for Australian Agriculture of Changing Demand for Animal Protein in Asia

What Australian agriculture should do to take full advantage of these changes is the main question that is addressed in this report. For a resource-constrained agriculture sector such as Australia’s, there will not always be easy opportunities to increase the volume of output. An important question is how the sector can best maximise the value that it extracts from emerging opportunities. By stimulating thinking and discussion on these issues, it is hoped that this research might act as a catalyst in the development of policies that best equip Australian agriculture to take advantage of these opportunities.Amidst all the changes that have occurred globally in agriculture over recent decades, one truism that seemingly remained constant was that over the longer term, the price of agricultural commodities continues to decline in real terms. However, recent developments have led many forecasters to suggest that this may no longer be the case, and that fundamental changes in agricultural markets will have long-term consequences and drive sustained increases in prices.

Whether or not such projections prove to be correct is yet to be seen, but there is no doubt that changes in food demand, as wealth increases in developing nations, and aggressive national biofuel policies are placing considerable upward pressure on global agricultural commodity prices. They will continue to do so for the foreseeable future.

Full Report
October 2007, pp. 1 - 92 (92 pages)Publisher: Australian Farm Institute
Author: Dalton, G, Keogh, M
ISBN: 978-0-9803460-7-7

Developing a Good Regulatory Practice Model for Environmental Regulations Impacting on Farmers

Modern environmental law dates only from the 1970s, and the design and application of market instruments to achieve environmental outcomes is also a recent development. The timeliness of this report is paramount. The Australian Farm Institute and Land & Water Australia jointly commissioned this research, led by Professor Paul Martin, University of New England, to take stock of the domestic and international literature surrounding modern environmental regulation and make informed recommendations to improve the creation and implementation of environmental regulations in Australia. This research is expected to benefit policy-makers at all levels, farmers and other natural resource managers across Australia, and others with an interest in improving the efficiency and effectiveness of Australian environmental policy.

This research report provides a detailed analysis of the regulatory process literature in order to identify opportunities to improve environmental regulatory development. It draws on lessons within Australia and overseas to present comprehensive recommendations that could be utilised by governments to ensure better environmental regulatory outcomes for farmers and the wider community. Based on their analysis, the researchers propose reform of: the fundamentals of Australia’s natural resource management system encompassing the architecture of environmental law; the way in which strategies are formulated and account for market instruments; the regulatory process; and the financing mechanisms used.
For Australian farmers, who are increasingly operating in global markets where competitor products are always less than 24 hours away, the need to retain competitiveness is acute, and the impact on competitiveness of poorly designed and implemented regulatory measures can mean the difference between success and failure. For that reason, Australian farmers and the broader agricultural sector have a very strong interest in making sure that when regulatory measures are developed, the process is such that all the potential impacts and costs are carefully considered and any negative impact on farm competitiveness is minimised.

Full Report
September 2007, pp. 1 - 104 (104 pages)
Publisher: Australian Farm Institute
Author: Martin, P, Bartel, R, Sinden, J, Gunningham, N & Hannam, I
ISBN: 978-0-9803460-5-3

The New Challenge for Australian Agriculture- How Do You Muster a Paddock of Carbon

While the exact design of an emissions trading scheme is yet to be developed, sufficient information is known to be able to predict, with some certainty, that farm input prices will increase, particularly fuel and electricity, and a wide range of other energy-price sensitive inputs will also increase in price, including chemicals, freight and contracting costs. The result will be a reduction in the international competitiveness of Australian farming.

There are, however, potential opportunities that may arise for the farm sector to provide greenhouse offsets, which may generate income to counteract the anticipated additional costs. To have these offsets recognised within a national emissions trading scheme will, however, require concerted action by farmers and their leaders over the next year.

This discussion paper has been prepared with the objective of providing Australian farmers with a comprehensive collection of relevant information about this issue, so that farmers can participate fully in forthcoming debates and ensure Australian agriculture’s international competitiveness is retained.
The implementation of a greenhouse emissions trading scheme for Australia by either 2010 or 2012 (depending on the outcome of the next Federal election) presents potential challenges and opportunities for Australian farmers and the wider agriculture sector.

Full Report
July 2007, pp. 1 - 60 (60 pages)
Publisher: Australian Farm Institue
Author: Keogh, M
ISBN: 978-0-9803460-3-9

Productivity Growth in Australian Agriculture - Trends, Sources, Performance

Full Report
March 2007, pp. 1 - 92 (92 pages)
Publisher: Australian Farm Institute
Author: Mullen, JD & Crean, J
ISBN: 978-0-9803460-1-5

Enhancing the Customer Focus of Australian Agriculture

Full Report
October 2006, pp. 1 - 84 (84 pages)
Publisher: Australian Farm Institute
Author: S G Heilbron Pty Ltd - S G Heilbron & J T Larkin
ISBN: 0-9757453-9-5

Vertical Contracting and Australian Agriculture - Implications for Farmers and Policy-Makers

Full Report
April 2006, pp. 1 - 72 (72 pages)
Publisher: Australian Farm Institue
Author: ACIL Tasman Pty Ltd - Mark Barber & Greg Cutbush
ISBN: 0-9757453-7-9

Agricultural Development in Argentina and Brazil - Emerging Trends and Implications for Australian Agriculture

Full Report
October 2005, pp. 1 - 76 (76 pages)
Publisher: Australian Farm Institute
Author: Jared Greenville & Mick Keogh
ISBN: 0-9757453-5-2

Australian Farm Sector Demography - Analysis of Current Trends and Future Farm Policy Implications

Full Report
August 2005, pp. 1 - 110 (110 pages)
Publisher: Australian Farm Institute
Author: Synapse Research & Consulting Pty Ltd & Bob Hudson Consulting Pty Ltd.
ISBN: 0-9757453-2-8

Australia's Farm-Dependent Economy - Analysis of the Role of Agriculture in the Australian Economy

Full Report
March 2005, pp. 1 - 76 (76 pages)
Publisher: Australian Farm Institute
Author: Econtech Pty Ltd
ISBN: 0-9757453-1-X