Farmers count cost of drought

By Lara Webster

As the rain began to fall in March, those in the city rejoiced but the cattleman tugged his Akubra down low and continued to hand feed starving cattle.

Those in the suburbs brought mowers to life but the farmer prayed for more rain and prepared for another day of heartbreak as he watched his cattle wither away and his debt rise.

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As consumers savour grass-fed steak, they do not often stop to consider how it got from the paddock to the plate. They do not understand the Australian farmer and that rain does not end drought. There are long-term impacts and the beef cattle industry in Queensland is about to embark on a long road to recovery as winter frosts begin to stall the growth of what little pasture there is.

The beef industry is Queensland’s largest agricultural sector, producing more than one million tonnes of beef every year.  Around 12.2 million cattle graze across 85% of Queensland and in March 2014, that entire area was drought declared. Although rain did fall on the pastures of some of the worst affected regions, it will not be enough to sustain producers over the coming year. Queensland Farmers Federation spokesman Brad Pfeffer says recovery from the drought will be a hard task.

“Despite some recent rain over some of Queensland’s key farming regions, one rain event does not break the drought,” Mr Pfeffer said.

“We have just been through one of the driest summers in record.

“This not only impedes production but it has put input prices for feed and electricity through the roof.

“The process of moving out of drought is a long one, and we hope that the recent rain is a start to that process.”

Mr Pfeffer echoes the thoughts of many in the agricultural sector.

A report by Meat and Livestock Australia declared that producers would continue to struggle, despite the rainfall, because of “three-decade high slaughter rates in 2013”.  Since the drought began towards the end of 2012, producers have had no choice but to de-stock their herds and last year 8.36million cattle were slaughtered in Australia – the highest rates since 1978. In Queensland, Australian Bureau of Statistics revealed beef producers slaughtered 2.2 million cattle, an increase of two per cent from 2012, which saw 1.9 million cattle killed.

When producers sell or slaughter top-line breeders, industry production falls radically and herds take years to rebuild. Producers rely on strong herd numbers to cope with costs and over the past decade, beef producers have battled with rising production costs and inputs. Long-term droughts have made this difficult and AgForce senior policy advisor Dale Miller says it will take many years for cattle producers to recover financial loses.

“Internal AgForce analysis indicates that it takes at least two years for each year of drought experienced for incomes of a beef operation to return to normal and the full restoration of financial positions takes much longer than that,” he said.  “This impact relates to the time period and costs required to restore herds to the usual carrying capacities of affected properties and to overcome the income downturns resulting from increased mortalities and decreased breeding and growth rates.”

This was seen between the Queensland drought of 2006 and 2007. The Northern Australian Beef Industry Assessment of Risks and Opportunities report released in 2008 revealed cattle numbers were reduced by 4 per cent per farm. After good rainfall in 2007, producers began the task of rebuilding herd numbers. By 2009 the industry had recovered and The Australian Beef Report for 2008 revealed producers had contributed around $5 million dollars to the economy. However, Dr Miller said many producers were less optimistic following the 2013 drought.

“Seventy per cent of surveyed AgForce members rated the financial impacts of this drought as worse than any other drought they had experienced,” he said.

“There are also serious personal and emotional impacts on those primary producers and their communities suffering through drought and ongoing environmental impacts of dry periods and reduced ground cover.

“These impacts – financial, personal and environmental – can take many years to fully recover from, and in some cases will be the catalyst for some producers to exit the industry.”

As a result of these factors, the Queensland Government announced a $320 million drought assistance package on February 26, 2014. Assistance will include land rent assistance, water licence fee relief, agistment, road train concessions and mental health workshops. Now the Government is working on a Draft Beef Industry Action Plan with a focus on “drought preparedness”.

In the plan, the Government outlines future goals for the beef industry and funding for more research to help producers improve business and land management after drought.  It is hoped these funds will improve and sustain cattle production through measures which will reduce climate change risks, reproduction, nutrition, pasture improvements, technology and management systems. Through these proposed measures, the Government plan to double Queensland beef cattle production to two million tonnes by 2040 but Dr Miller says the Government should be focusing on doubling profitability of beef before production.

“Australia by itself will never meet all of the increased demand from the emerging middle classes overseas, particularly in Asia, but we can target our higher value, clean and green products to those customers prepared to recognise and pay for the full value of our produce,” he said.

“Broadacre agriculture in Queensland experienced the serious ‘Millennium drought’ in the first decade of this century and this was followed in quick succession by floods and fires in some areas and the widespread negative impact of the decision to suspend live exports to Indonesia.

“The combination of these factors plus the current dry conditions and the increased costs that go with managing drought are having a significant financial impact.”

Climate change experts have also made some worrying predictions for the future of agriculture. Early reports released in 2008 by the CSIRO and Bureau of Meteorology contained evidence that temperatures were going to increase and the CSIRO has undertaken further research which has revealed droughts will continue to worsen due to these increases in global temperature.

After the early millennium and the resurgence of drought during 2000 and again between 2005 and 2006, more research has been dedicated to the effect of climate change and future drought situations. Analysis by experts has found that rainfall averages will also decrease, leading to negative impacts on pasture growth and soil erosion. Sunshine Coast Environmental Council executive officer Wiebe ter Bals said climate change predictions could not be disputed.

“As the climate changes, what a normal weather pattern is in an area changes,” he said.

“Climate is not about what the weather is tomorrow or any other day, it is about the averages.

“We understand changes to long term averages because we can understand oceanic and atmospheric processes.”

The Climate Adaption Outlook report for 2013 also outlined that south-east Queensland would experience “frequent and extreme weather events…” far worse than producers battled so far. It would seem those predictions are coming true. Queensland Country Life reported that the “likelihood of an El Nino” remained high for 2014, which means much of Queensland is expected to experience below average rainfall. This is a worrying prediction when producers have not even begun to recover.

As a result of these predictions, farming organisations have called for farmers from all agricultural sectors to look towards the future and incorporate climate initiatives into traditional farming methods.  A report by the ABCsuggests farmers have begun to accept climate change predictions. In 2013, The Queensland Farmers Federation (QFF) made a submission to the Queensland Government to address the impact of climate change in agriculture policy and strategy.

In the submission, QFF stated that future production “is reliant on the natural resources soil, water, nutrient supply and the wider agricultural ecosystem”. Mr Pfeffer said agricultural policy must help famers adapt to climate change risks which threatened the future of agricultural production.

“While QFF understands the need for policies that mitigate carbon pollution, in the context of the risks posed to the agricultural sector these mitigation measures will not be able to sufficiently reduce the risks that already occur with a variable climate, let alone those that might occur under a climate change scenario,” he said.

“For example, this means programs that help farmers instigate projects that help them cope with a variable climate.

“Just one example could be helping farmers invest in more water use efficient irrigation infrastructure.”

For the Queensland cattleman, this will not be an easy transition but it is one which must be made. Producers have battled with extreme weather events for decades but each time the road ahead becomes harder to navigate. Rising temperatures and declining water levels are only the start of worrying predictions. If predictions of frequent droughts are correct, it is possible our beef producers will struggle to survive. It makes you wonder where the beef on our porcelain plates will come from in the future.

*Photo by Phil McIver

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