I was among a group of twenty six Iowa farmers who had the opportunity to visit Australia the first two weeks of March. The land “down under” is 16 hours ahead and I had my days and nights and seasons all turned around. I quickly discovered though that as many things are different there, farmers across the world have many things in common.
Consumer’s Market Australia grows a lot of non-genetically modified crops including soybeans, canola, and wheat to reach the food grade markets in the Pacific Rim. These have GM counterparts, but for instance GM canola receives a $50-75 a ton discount. We visited an 18,500 cattle feed yard focused on both Wagyu beef and Angus beef for the rest of the world. Their mission was producing “Quality rather than quantity.” While there are large scale farms, Australia as a whole seems to concentrate on premium products in smaller volume.
Traceability Australian farmers seem to have embraced traceability. I am not sure if it’s because of necessity or the market opportunities that made it palatable. Cattle and sheep have electronic ID tracking which follow them birth to processing. For instance, that traceability allows consumers in Tokyo to know exactly where that steak came from (this was available to us at a restaurant we visited in 2016). Grain is also identified and tracked. The soybean farmers we visited indicated that was very important for the soybeans being accepted for food use.
Marketing Challenges Farmers is Australia seem split on marketing crops in any manner before they are produced. Weather plays havoc on production and without affordable crop insurance its farmers are split on selling futures or forward contracting any production until it is in the bins. Basis is another challenge for farmers with wide swings due to transportation in many cases.
Weather and Climate The Darling Downs area west of Brisbane boasts that it is one of the most fertile soil regions in the world, but rainfall and climate limit production. We even heard stories of children growing up and not seeing their first rain drops until they were five or six years old. We saw the other extreme of sugarcane and soybeans planted in raised beds near Grafton to improve drainage then fields left fallow by Toowoomba to recharge soil moisture for the following year. It’s a land of extremes.
Infrastructure It starts at the farm. Generally, on farm storage is increasing, but its small 3,000-5,000 bushel hopper bottom bins. Most cash crops are exported and the ports can range from a few hundred miles to several thousand. Rail is not extensive and trucking can range from $1 to $3 plus per bushel. Port facilities vary with time of year and can be very extreme in their loading capabilities.
Succession Planning There are fewer and fewer young people planning to farm and those that do have some major challenges. According to farmers we talked with along the way a high minimum wage, $21 an hour, there are mining industry jobs paying from $75,000 a year and up making the challenge to farm seem less appealing to many. There are no beginning farmer programs in Australia, and it’s common to need 30-40% down payment for financing.