Andrew Broad (Mallee, National Party) Share this | Link to this | Hansard source

Australia has always been a land of droughts and flooding rains. But I wish to update the house—I guess it is a grievance—of the difficult season that we have encountered across the Wimmera and the Mallee and particularly the disappointing finish that we appear to be getting. 2015 has been a difficult year. Rainfall has very tight. But last Tuesday 6 October, with temperatures upwards of 39 degrees and hot northerly winds, has taken a lot of the edge off the crops.

Credit needs to go to our farming communities that have done very well to put their crops in and to get the potential that they have, given the amount of moisture that has been around. No-till farming systems have been something that has really revolutionised our cropping ways. Summer spraying and trying to maintain moisture in the soil profiles and varieties is testimony to years and years of research and development and the benefits that has led to. There are times when even the best farmers, with the best science and the best technology, still cannot overcome the seasons when it does not rain.

Livestock has been in the mix that has provided some opportunities. I think of the value of opening up trade. In 1990, as a 16-year-old, I had to shoot sheep for my father when we could not get 23c for some wethers. In those days, we were exporting sheepmeat to 12 countries. Now we export to 96 countries. The other day I sold some crossbred ewes with no teeth—they were a bit fat—for $110. Because we have opened up market opportunities, it has meant that those who have had some livestock amongst the tough season have still been able to realise some reasonable income and some reasonable prices.

Water has been very tight. That is something that has been very evident even to the communities that the member for Bendigo would represent, where run-off water has been very tight. We have seen across the Wimmera and the Mallee the great benefits of the Wimmera Mallee Pipeline system. It is pleasing to see the Victorian water minister, Lisa Neville, commit $1 million to a scoping study to put in a pipeline for the townships of Wedderburn, which are not in my electorate, and for those farming communities through there, where they might be able to access pipeline water. I look forward to seeing the results of that scoping study. Once I see that, there will be strong merit for the federal government to add some support to that.

Just to update the House, though, the soil types have played a big part. If you look across the electorate of Mallee, soil types to the north of Hopetoun are lighter soil types. Where you go south of Hopetoun, the soil types are heavier. The great, interesting part—for those who are not agriculturally aware—is that lighter soils and lighter rainfall can still produce yields. Heavier soils require more rainfall. Where the soil type has changed, the wheat yields have been next to nothing or very low, and it looks like barley may have finished in the soils north of Hopetoun.

South of Hopetoun there have been a lot of crops that have been cut for hay and have been laid down. This is another thing that has the quirk of export opportunities: at least the hay market has stood up very well on the back of export hay. We are seeing, particularly in the electorate of the member for Bendigo, as she will be aware, the export oat and hay businesses that are out there at Epsom, where they are taking export oat and hay, compressing it and putting it into shipping containers. That is going into the feedlot dairy industry, both in China and the feedlot Wagyu beef industry in Japan. In some regards, you lose one commodity, but because of trade opportunities you create others and create processing businesses in our country towns and our inland cities. But at least that is providing some floor in the price of the hay market right across those areas.

The areas that have missed out and really will not have much opportunity to cut hay and are now on the back of two-year droughts are Birchip, Watchem, Wycheproof, Charlton, Wedderburn and Culgoa—in that area. It is going to impact those communities quite significantly. It was pleasing to see that Jaala Pulford, the state Minister for Agriculture, has been out there and had a look. I talked to her this morning, and I hope that, as we are working with communities that are drought affected, there is a level of bipartisanship between the Victorian Labor government and the federal coalition government. It appears that there is. The communities there will have to be mindful that it is not just the farmers who are affected; it is also the small businesses. In those country towns, those small businesses also sell the papers, the milk and the local seed graders. So we will have to be mindful, as we look at a package to support them, that it is the broader reaches that are impacted by the seasons.

Cash flow constraints are going to start to be felt in mid-January and February in 2016. These are grain growers, and they are not used to getting a cheque every fortnight, like you and I might be. They get a cheque once a year, and they are coming up to that cheque. Of course, the year is going to come around where they have deferred bills through to January and February 2016 and the income is not going to be there. The federal government has farm household assistance packages available. In my opinion, they have been rather difficult to apply for, and it has been a program that, I think, has not been administered as well as it could have been. It will be very important that rural financial counsellors are there to assist people with the paperwork.

What I want to say to our rural communities is: do not self-assess; we want to stand by you. We know that you are going to be a profitable business. We know that you have exercised the best science and the best risk management strategies and used the best varieties but sometimes the season has not gone in your favour, but do not self-assess. The rural financial counsellors will be there to assist you. I will be talking to the Minister for Agriculture and Water Resources, Barnaby Joyce, and asking for some additional rural financial counsellors for those particular areas.

When we think about drought reform and drought affected farmers, I think that low interest loans have been very worthwhile. Essentially, what the government does is borrow the money at government bond rates and pass that borrowing on to those agricultural producers. This does two things. It does not cost the Treasury anything as a booked account, but it puts competitive tension with the farmers' existing lenders to ensure that banks are mindful of the difficult season when offering packages. I will also seek to have meetings with banks and lenders and ask them to have conversations with their businesses and customers around the cash flow constraints that will come in, particularly as farmers go to put the crop in in 2016.

I will also be having some discussions around the role of drought insurance—something that has been taken up across the world and on which Australia has probably been dragging its feet. I was in Washington over July this year, and seasonal insurance—they call it ranchers and croppers insurance in the United States—has become an integral part of the risk management strategies of their farming systems. It is something that we have flagged in the agricultural white paper, but it is certainly something that will continue to need to be rolled out and looked at.

The other thing that I would appeal to the state government on is about that in the very difficult years that we farmed through in the millennium droughts they offered a 50 per cent shire rates rebate, or assistance. If you were receiving household support, you were able to then present that and the state government covered half the costs of your rates. It is only a small area in the state of Victoria, but I would appeal to the state Andrews government to certainly give that due consideration.

Barnaby Joyce, the agriculture minister, has committed to come in and have a talk to those farmers. I want to say to the farmers something that was said to me when I was a young man and I first bought my first farm at 22. They said, 'You can be the hardest worker, use the best science and use the best varieties, but occasionally the wind blows against your face and things don't go your way.' What I want to say is that in those circumstances it is not your fault. Talk to your neighbours and talk to us. We are there to stand by you through what is a difficult time. Profitability, of course, will come back. It does rain. It always rains again at the end of a dry time. We believe in what you are doing. We believe in your contribution to the nation, and we will stand by you through this difficult season.