Hon Colin Barnett MEc MLA — Agriculture at the centre of WA’s future: Premier

0Western Australian agriculture is on the cusp of a new era and may just be looking at its best opportunities in more than half a century, Premier Colin Barnett said.

Speaking at the 2014 Muresk Lecture this evening, Mr Barnett said while there were many challenges ahead, the growth of Asia and the emergence of a modern China were fundamentally altering the world’s food trade opportunities.

“It’s a chance too good to miss,” he said.

“If we see this as just another ‘good time’ for farming then we will have failed. This is the opportunity to take agriculture to a new level and to provide greater financial security for farmers and to provide benefits for all West Australians.”

The Premier said the world’s food trade was undergoing a fundamental change and was being constrained by supply, rather than demand.

High growth rates in Asia over the past 20 years have seen significant demographic change, with a rising middle class and shift to the cities.

“The global shift is fuelled by the same Asia-centric economic expansion that is driving the WA minerals and energy sectors,” Mr Barnett said.

Annual incomes in China and India are expected to grow at 5.5 per cent each year to 2050 – double the rate expected in Australia.

“With higher incomes, consumers spend more and spend differently. Staple food commodities will benefit, but the new prize will be in areas of higher quality and greater diversity. The shift toward a more western diet is already obvious and has been for some time. I’m just not sure that we have taken full advantage of that,” the Premier said.

Mr Barnett said WA had strong established relationships with Asian countries to our north, home to some two billion people.

“That’s not to say there won’t be challenges,” he said.

The ANZ Banking Group report identified the sector’s key challenges as being sourcing capital and skilled labour, accessing land and water, closing performance gaps on farms, improving supply chains and targeting premium markets.

The Premier said the Liberal National Government was committed to addressing these issues and has started rolling out a number of agriculture and food initiatives including:
A $40million Water for Food program
$20million for boosting grains research
$15million for northern beef futures
$10million to help grain growers manage risk by promoting a better flow of information between grain growers, their consultants, suppliers, grain buyers, researchers and suppliers of weather data.
Mr Barnett said because West Australians prided themselves on an industry based on the ‘family farm’, changes to agriculture could take a personal toll on farmers and meant the social structure of farming was being challenged.

“The average age of farmers is now 52. The typical size of a Wheatbelt farm has grown from around 4,200 acres in the 1970s to somewhere over 10,000 acres today,” he said.

“A typical cropping program may range from $750,000 to $1.3million, which, if the crop fails, is enough to bankrupt the farm.

“Little wonder there is heightened levels of stress and depression in rural areas. For many it is a yearly rolling of the dice for a farm that may have been in the family for several generations. As I said, farming is more personal.”

The Premier said agricultural investment from large private, institutional and foreign investors presented many new opportunities for farms to take on a more corporate structure and to better exploit current opportunities.

“The challenge now is for farmers, the Government and the agricultural industry to work together to ensure that the once in a lifetime opportunities that now present themselves, are maximised to the benefit of all of us,” he said.

Mr Barnett said governments had a role in establishing relationships with trading partners, broadening the relationships, promoting understanding of each other’s countries and, for example at the Federal level, negotiating a free trading environment.

The Premier said the WA agricultural sector would also benefit from more effective branding.

“We can look across the Tasman and marvel at the market success of ‘100% Pure’ and products such as New Zealand lamb and the kiwifruit,” he said.

“At home, Margaret River wine has a world brand. I think Southern Forest Food has great potential and perhaps Kimberley beef will become a product in its own right. Smart branding can improve market access and market price.”

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