Winter wheat crop success could be a game-changer for the industry

Recently released research could be a game-changer for Australia’s wheat industry and increase the national wheat crop by 20 per cent.

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Research released today could be a game-changer for Australia’s wheat industry and increase the national wheat crop by 20 per cent.

In a seven year-trial led by La Trobe University and the CSIRO, wheat farmers planted crop varieties normally grown in the northern hemisphere, up-ending a method used by growers for more than a century.

Farmer and agronomist Barry Haskins, from Griffith in southern NSW, farms on one of the 16 sites across the country that has been planting winter wheat crops instead of the spring wheat normally grown in Australia.

“I personally believe that this is the next leap for us in terms of our potential yield,” he said.

Winter wheats are mostly grown in the northern hemisphere, take longer to grow, but can provide higher yields.

The research findings have been published today in the journal Nature Climate Change.

Associate Professor at La Trobe University James Hunt said scientists and farmers have been trying to grow winter wheats in Australia without any success, until now.

“The first paper you can find on it comes from 1937, so there’s a bit of a history of it — a few attempts at getting it to happen,” he said.

“But really we needed a lot of modern agronomic management to come along in order to make it happen.”

Using modelling, the research team found the national yield could be increased by about 20 per cent, worth up to $1.8 billion to the national economy.

In Australia wheat is typically sown in time for what’s known as the ‘autumn break’ — the first significant rainfall of the winter growing season between April and June, depending on the part of the country.

But autumn rainfall in Australia has been declining since the 1990s, leading to a reduction in wheat yields.

The advantage of planting winter wheats is they can be planted months earlier than spring wheats — so if a farm gets rain in March, or has lots of moisture in the soil from summer rains, the wheat can be planted then.

Tim McClelland’s farm at Birchip, in north west Victoria, was also part of the trial, with the break expected to come in early May.

“With the variable rainfall we’re going to have to be more adaptable, we’re going to have to plant crops when we get those rainfall events.”

But Associate Professor Hunt said the real potential would not be unlocked until winter varieties — known as cultivars — were developed specifically for Australia.

“But there’s breeding companies working on that — I’m hoping we’ll have a lot better cultivars than we have now within the next 2-3 years,” he said.

Mr Haskins said winter wheats would not replace spring wheats entirely but he believed it could be adopted across the country.

“All of my clients will definitely have a crack at some of these and I see no reason why all of the production areas in NSW or even Australia wouldn’t adopt it,” he said.

Source: ABC News 2019-03

Vegetable prices on the rise after floods, drought and heat

If you’ve been pushing a trolley around the supermarket fruit and veg section lately, one thing has probably jumped out at you — high prices.

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Key points:

  • Vegetable supply hit by floods and drought
  • Other regions will pick up shortfalls
  • Short-term prices increase likely

After floods in Queensland and continuing drought in other parts of the country, the supply of vegetables has been hit particularly hard, with staples like broccoli now selling for $8.90 a kilogram.

Vegetables such as womboks have risen to $7.90 per head, cabbages are $4.90 a head, and other crops like green beans are limited in availability altogether.

Extreme weather driving high prices

Shaun Lindhe from the peak vegetable industry group AUSVEG said that widespread flooding in Queensland and heat in other areas were the main reasons prices had risen.

“Our industry is naturally a supply and demand driven industry,” he said.

“What we saw over summer was some very hot weather, which affected southern Victoria’s key growing regions, and flooding in Queensland as well.”

Mr Lindhe is calling on consumers to continue to support Australian vegetable producers.

“Most vegetables are grown in different regions around the country. He said if there were supply issues in one area, it would take some time for another region to pick up the slack.

“In the meantime, there will be a short-term price increase.

“It can be hard to predict when prices will fall, I don’t want to put a time on it, but I would be very surprised that if in the next few weeks supply issues weren’t returning to what we’d normally expect at this time of year, and then prices should reflect that supply.”

Many supermarkets now put up signs explaining the reasons behind a jump in price or a lack of availability. It’s a move that has been welcomed by AUSVEG.

“There is a growing disconnected between the consumer and the farmer, and anyway the retailer can give a consumer a bit more information about what goes into their fruit and veg helps bridge that gap.”

If it’s not flooding, it’s drought

Meanwhile in Victoria, for the first time in over a decade the Lindenow farming area, which relies on irrigation from the Mitchell River, has had a total ban on water-use put in place.

Lindenow farmers are waiting for a text from Southern Rural Water each day to see how much water they are allowed to use. They are on heavy water restrictions.

Andrew Bulmer is one of the country’s largest lettuce growers, and supplies McDonald’s with a fifth of the lettuce used in its meals nationally.

Mr Bulmer said a lack of water due to drought had puts his entire business under pressure.

“We’ve had to reduce production in some areas, and we’ve got people working on keeping our bores working overnight.

“We’ve got a couple of hundred people employed with the business and we’d like to maintain employment, but a lack of water means a lack of production and we have to look at how we run our business through times like this.

He said February had been a financial disaster for the business.

“We had a freak hail storm come through, and that coupled with the drought, has probably knocked $750,000 off the bottom line.”

Mr Bulmer said he wanted to see on-farm water storages co-funded by the Victorian government.

“If we could get some matched funding in that space, then we can take some confidence into next season that we could get the water storages in place on farms and help offset further droughts in the future.”

Heat impacts vegetables in South Australia

In South Australia hot weather has also impacted the supply of vegetables

At the SA Produce Market vegetable lines that are normally well supplied at this time of year such as broccoli, celery and cauliflower are also seeing high prices.

SA Produce Market marketing manager Nadia Boscaini said as a result the wholesale prices had increased two and threefold.

“We saw broccoli at about $55 a box. It’s normally about $45 wholesale.

“We saw cauliflower at $5, it’s now come down to $2.50 a piece. Celery remains high and beans are about $100 a box so that’s $10 a kilo for customers,” Ms Boscaini said.

“He said lemon prices had been in with short supply and prices went to about $130 a box, now had recovered to about $80 a box.

“But keep in mind this time of year we’re in between seasons. We’re sourcing citrus from both Queensland and Renmark and the Riverland so that means our SA produce increases,” she said.

Struggling in the heat

Northern Adelaide Plains grower Anthony De Ieso said his crops were produced in open fields and were struggling in the heat.

He said there was a slight dip in quality and it was not so much from the farm point of view.

“Our stuff still looks good on the farm but once it’s picked there is only a certain window that we have to bring it to the packing shed to get it washed, to get some water on it, to rehydrate it and get it into the cool room.

“So as far as quality goes you might see a slight dip in shelf life and also some of the leaves might look a little sad, but the quality is still there.

“It’s just a matter of getting it into a cold environment as soon as possible,” Mr De Ieso said.

While consumers have queried the prices at the market Mr De Ieso said consumers were generally understanding on the weather situation.

“I think the consumers are pretty fantastic. We’ve got a Facebook page and I get a lot of support messages from consumers saying ‘hey I wish I could take that whole pallet of rejections off you, I absolutely love silverbeet.’

They’re [the consumers] are experiencing the heat as well so they’re pretty understanding,” Mr DeIeso said.

Source: ABC Rural 2019-03

MDBA urges accelerated progress on key water projects

The Murray–Darling Basin Authority (MDBA) has released its first progress report into projects designed to make water use more efficient.

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The Murray–Darling Basin Authority (MDBA) has released its progress report into projects designed to improve river management across the Basin under the Sustainable Diversion Limit Adjustment Mechanism (SDLAM).

Under the Basin Plan three core project areas have been put in place; supply measures, constraints and efficiency measures. This report details the progress with these projects that need to be delivered by 2024.

MDBA Executive Director of Partnerships Carl Binning said the MDBA has reported progress and warned that work needs to be accelerated to ensure projects are in place to deliver for the environment by 2024.

“This report is an early MDBA health check on the progress of the process,” Mr Binning said.

“The projects are an ambitious collaboration of Basin governments, and are a historic opportunity to move from a river management system designed primarily to extract water for agricultural use, to one that was optimised to achieve a range of benefits based on a healthy river system.

“The report fulfils the MDBA’s commitment to report annually and to ensure environmental outcomes can be achieved and to improve transparency of the process.

“The report acknowledged Basin governments’ ongoing commitment to deliver all of these projects, but noted there is a substantial amount of work to be done.

“Key priorities include finalising funding and governance arrangements, ensuring project designs are robust and increasing efforts to engage and work with communities to support on-ground implementation.”

Once delivered, the projects will deliver the equivalent environmental benefits of recovering 605 gigalitres in the southern basin, while 450 gigalitres of water for the environment needs to be delivered to the rivers in return, through efficiency measures that must have neutral social and economic impacts on communities.

The SDL Annual Progress Report is available on the MDBA website.

Source: MDBA 2019-02

Southern Australia milk pricing systems set for change

Milk pricing systems look set for a shake-up as southern Australia processors grapple with falling supply.

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The heads of Australia’s three largest processors – Saputo, Fonterra and Bega Cheese – in a wide-ranging discussion at the Australian Dairy Conference in Canberra in February identified pricing systems as one of the issues that needed to be sorted.

But there appears to be a split about how that will be approached – with Saputo and Bega indicating simplified contracts as the solution and Fonterra talking about offering a range of price “portfolios” to farmers.

The introduction of a mandatory code is also driving the change, with the draft code proposing a requirement for all processors to release a standard form agreement and minimum prices at the same time.

The standard form agreement would include a base offer farmers could accept or use to negotiate with processors. But each processor would have its own standard form agreement and farmers could negotiate terms with processors.

Saputo chairman and chief executive officer Lino Saputo Jr told the Australian Dairyfarmer Saputo would be offering farmers the choice of five or six programs next year and there would be no special deals for select suppliers.

“I will say this categorically there will be no special deals beyond those programs,” he said.

“So any of those large corporate farms that want to have a sideline deal, they should not do it with Saputo Dairy Australia because we are not going to be doing those things.

“We tell our suppliers on an ongoing basis we have one class of farm whether you are producing a hundred million litres or you are producing a billion litres of milk, we have one class of farmers.”

Mr Saputo said from July the former Murray Goulburn and Warrnambool Cheese and Butter programs would merge with 5-6 simpler programs offered.

“Everyone tries to outdo everyone else by offering these very complicated bonuses and structures,” he said. “We need to simplify that.”

Bega Cheese chief executive officer Paul van Heerwaarden also identified simpler pricing systems as a way to lift farmer returns.

“One of the things we are looking at is what will we do with our milk-pricing systems, which over the last 20 years have become quite complex and, dare I say, have provided an incentive for farmers to produce milk perhaps at a time of the year or in certain practices that may not be best for the farm,” he said.

Mr van Heerwaarden said he looked at their company’s recent investment in the Koroit, Vic, factory as an example of how Bega could take a different approach to help farmers.

“We can handle a lot of seasonal milk, we’ve got a lot of capacity, and so, for example, there we are not looking to incentivise farms to produce milk in February/March when it’s very expensive,” he said.

Milk pricing systems needed to better suit the whole supply chain.

“As an industry, historically we have been one of the lowest cost most competitive dairy industries in the world, but we are not there today,” he said.

Farms had become more dependent on inputs that now represented 40 per cent of costs compared with 15-20pc 20 years.

“Do we move to pasture-based systems in regions that are suitable for pasture-based systems and take cost structures down and importantly take risk down?”

He acknowledged that the approach would mean more seasonal milk for processors.

Fonterra Australia managing director René Dedoncker flagged a different approach.

In February, Fonterra offered northern Victorian farmers who were willing to commit to a minimum volume of milk a higher price. The company said the special price for farmers who produced a flatter milk curve was in response to seasonal conditions and heightened competition in the market.

Mr Dedoncker hinted at the conference that the company was looking at offering more of these types of premiums.

“Farmers are all different: different age profile, different risk profile, different propensity to be able to farm flat or through a curve,” he said. “Is it feasible we are in a world now where we say there is a portfolio and you get to choose, you get a choice?”

Mr Dedoncker also hinted that Fonterra could consider different pricing for suppliers to different factories.

“Fonterra has a network of different communities where we are,” he said. “What if I don’t call it one Fonterra?

All three chief executives acknowledged milk supply was an issue.

The rebuilt Stanhope, Vic, factory was now producing three times as much cheese as it had before it was destroyed by fire in 2014 but Fonterra was struggling with milk supply to it. The worst-case scenario could be moving milk from the west to the north.

“We don’t regret the investment, it is state of the art and we take a 10-year view,” he said. “But what we don’t do is go back and panic about that”.  “We have a scenario planned around that and we have to be smart. Yes we are under pressure, there is no doubt about that, and we have to take a long-term view.”

Mr Saputo acknowledged that the company had not grown supply above 1.6 billion litres since taking over Murray Goulburn last year. The company has set itself a target to get up to 2.1 billion litres of milk in three years.

“We are confident that we are going to get there in terms of processed milk,” he said. “Out of the gate, we haven’t grown our milk base from the 1.6, only because we are sort of changing how milk prices are communicated.”

Mr Saputo said it was rebuilding trust with suppliers that the opening price was the guaranteed minimum price they would receive for the year.

“(Last year) we came out with an opening price that we believed was reflective of the dairy markets and we came out first,” he said. “And we did it to inform our suppliers that they shouldn’t be overly focused on opening price, rather they should be more concerned with closing price.

“We made a guarantee we would be paying a leading price for dairy at the close of the year. Now, of course, it was very easy for some of our competitors to have a higher opening price than what we had.”

“And some of the suppliers criticised us – there was a great opportunity for Saputo to collect more milk had they had a higher opening price. And I reminded them that’s not responsible on our part.”

Mr Saputo said the opening price was the number on which farmers could build their budgets for the year.

“We are not going to be taking a step down; we are not going to be doing a clawback,” he said.

Mr Saputo said he was optimistic that once the company convinced suppliers it was “honourable and ethical” it would collect more milk. The company had taken the same approach after it took over Warrnambool Cheese and Butter in 2014 and had grown milk intake by 25pc in the following four years.

“I am still optimistic that within the three-year period we will get to 2.1 billion litres of milk processed in our facilities,” he said.

“And why is that number important because that gets us to a capacity utilisation somewhere around 95pc, which makes facilities that much more efficient and effective.”

Mr van Heerwaarden said companies need to look at investments in light of what worked best to drive growth and profitability.

Growth was critical for the industry to be successful.

“And in the last 20 years in this country we haven’t had growth, we’ve been in decline or we’ve stagnated,” he said. “I know that when I’ve worked in industries that are in a growth mode, life is a whole lot easier.

“The size of the pie is increasing, there’s value that you can create, you can work together on opportunities that are making you more money, creating jobs, creating futures and certainly encouraging investment.”

Mr van Heerwaarden said growth would not be brought about by processors investing in more stainless steel.

“Unless we have more milk, we don’t have growth and that’s where it has got to start,” he said.

Source: Farm Weekly 2019-03

Drought-stricken Broken Hill’s water supply switched to Murray River

The water supply in Broken Hill, New South Wales has been secured via a 270-kilometre pipeline from the Murray River.

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Key points:

  • The $500-million pipeline was announced in 2016 when Broken Hill was months away from running out of drinking water
  • Groups are criticising the pipeline, saying Government should have focused on improving management of the Murray-Darling Basin
  • WaterNSW says the town will be supplied entirely by water from the Murray River by April

Properties along the Darling River and the town of Pooncarie will not be connected to the pipeline and will have to rely on a dwindling supply of water held in four temporary block banks.

The $500-million project was announced in 2016 after Broken Hill came within months of running out of drinking water and will be commissioned today by the Deputy Premier John Barilaro and Member for Barwon Kevin Humphries.

“We’ve been able to finance and construct the largest piece of water infrastructure in rural NSW since the Snowy Hydro,” Mr Humphries said.

Despite the improvement to Broken Hill’s water security, many in the region argue the Government should have instead improved the management of the Darling River and Menindee Lakes.

“We’ve always had a secure water supply from the Darling,” Broken Hill Mayor Darriea Turley said.

“We struggle when there’s a drought but certainly that is the issue and the Government should have addressed these issues.”

Tom Kennedy from the Darling River Action Group said taking Broken Hill off the Darling River would leave the Lower Darling River vulnerable.

“The Darling River won’t need as much water coming down to have a guarantee of water for Broken Hill,” Mr Kennedy said.

“So, in essence, there’ll be less water coming down the Darling River and the Menindee Lakes will be drained a lot quicker.”

‘Government don’t care about the lower Darling’

The Menindee Lakes, which have recently become known as the scene of mass fish kills over summer, have supplied Broken Hill with drinking water for decades.

Menindee and Wilcannia will remain reliant on the Darling River, which lead residents to believe the Government has given up on their stretch of the river.

“The Government don’t care about the lower Darling — not one little bit,” Menindee resident Karen Page said.

“They’ve sacrificed the health and wellbeing of the small towns for the Broken Hill pipeline,” she said.

Like many Menindee residents who rely on the Darling River for household use, Karen Page has become dependent on carted water and water donations from kindly strangers.

Ms Turley said concerns have been validated by several scientific reports into the recent fish kills in Menindee.

 

“We are in drought now, but before that we had a water crisis in the Darling and we believed that was because there was over-extraction, which has now been proven,” she said.

Full switch-on to take weeks

Water from the Murray River will slowly make its way into the Broken Hill water system from a storage tank at the local treatment plant.

“I expect over the next month or two there’ll be a transition for domestic, commercial and industrial use,” Mr Humphries said.

“That water will be coming from the new bulk water delivery system from the Murray.”

WaterNSW spokeswoman Kate Thomson said in a statement the city would be entirely supplied with Murray water by April.

“Over several weeks residents will see an increase in the proportion of River Murray water flowing through their taps,” she said.

Source: ABC 2019-02

BlazeAid auction for Naracoorte agents

Local stock agents are calling on graziers to support a fundraiser for Queensland’s drought and flood victims.

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Naracoorte combined agents will hold a mini auction before the usual Tuesday sale at Naracoorte on March 12 to support charity organisation BlazeAid.

They’re calling the sale the “North Queensland Farmers Flood Drive”.

BlazeAid is a volunteer-based organisation that works with families and individuals in rural Australia after natural disasters such as fires and floods.

Working alongside the rural families, volunteers help to rebuild fences and other structures that have been damaged or destroyed.

Graziers are being asked to donate sheep or cattle to be offered for sale at the auction, with all proceeds going to BlazeAid.

Naracoorte combined agents president Richard Jennings said all of the local stock agents were behind the fundraiser and they were getting excellent support from all the graziers they work with.

“Any donations of stock would be greatly appreciated by us and by BlazeAid and the Queensland farmers,” he said.

Mr Jennings said a number of ideas had been suggested for supporting the Queensland farmers, but in the end, an auction to benefit BlazeAid was seen as the most beneficial.

“They’ve been in drought for 10-plus years, they’ve fed out hundreds of thousands of tonnes of hay, and now they’ve been wiped out by floods,” he said.

“A fella the other day said half a million cattle have been lost, and he said you could make it a million easily.”

Prime Minister Scott Morrison has toured Queensland this month and predicted that it would take years for the cattle industry, in particular, to recover from the flood impacts.

The Bureau of Meteorology said the weather event was “rare and exceptional”, with rainfall topping a staggering 2000mm in parts of the state over a two-week period.

Mr Jennings said everyone involved in the auction knew how dire the situation in Queensland was, and they were all happily donating their time, expertise or livestock.

He urged more to come on board to donate what they could. Anyone interested in offering support can contact their local stock agent.

Source: Stock Journal 2019-03

Wet season missing in action for Northern Territory

“It’s starting to look catastrophic” is how one cattle industry source has described the famous Barkly Tablelands in the Northern Territory.

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The engine room of the Northern Territory’s cattle industry has received little to no rain this wet season and has been baking in 40-degree-plus heat for months.

Speaking to RN’s Fran Kelly, the CEO of Consolidated Pastoral Company, Troy Setter, said some paddocks had simply run out of feed and water.

“We would normally have a good foot to a foot-and-a-half of green feed [in the Barkly], but some of the properties there have only had 3 per cent of their annual monsoonal wet season,” he said.

“Overall it’s exceptionally dry and we’re hoping that some of the cattle in the Barkly, that have got no feed at all, might be able to move and be agisted or sold to people in the Gulf [in north-west Queensland] when the flood waters recede.”

Tennant Creek lowest rainfall figures on record

The outback town of Tennant Creek has had just 62.44 millimetres of rain this wet season — its lowest on record for the wet season period October 1 to February 28.

Just north of town, Phillip Creek Station has received even less rain.

Owner Sandy Warby said, after two failed wet seasons in a row, the Barkly region was now experiencing drought conditions.

“It is getting pretty dry, last year we only had half of what we usually have for our annual rainfall,” he said.

“This year, usually for January to February is five or six inches (125mm to 150mm) per month and we’ve had about 10 millimetres — so yeah, a big difference.

“Most of the places around here are in the same boat, and after a pretty ordinary season the year before and a failed wet season so far this year, I’d say [calling it a drought] is the right call.”

Will March rainfall save the day?

A climatologist with the Bureau of Meteorology, Greg Browning, said March “was not looking especially promising for significant rainfall”.

He said the latest climate outlook suggested only a 30 per cent chance of getting above-average rainfall in the Barkly during March, although in April the odds increased a little for the eastern Barkly, to about 50 per cent chance of above-average rainfall.

“The best chance of significant rainfall across the Barkly would be if the monsoon gets active again and the best window of opportunity for this will be from mid-March to early April,” Mr Browning said.

“This is when a pulse of weather called the Madden–Julian Oscillation [MJO] moves into the Australian region.

“The active phase of the MJO is often associated with monsoon bursts and tropical low or cyclone development.

“Unfortunately, the monsoon can be a fickle thing and, as we have already seen this wet season, the monsoon has largely stayed away from the NT but has hit northern Queensland hard.”

Source: ABC Rural 2019-03

Murray Darling Basin’s dairy shutdown as water prices go sky high

Farmers are becoming more concerned about potential negative socio-economic impacts from the $13 billion Murray Darling Basin reform.

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Water prices of $500 a megalitre are almost three times what dairy farmers can afford. And even if prices fall back, industry analysts warn dairy farmers face paying an average $200/ML from here on.

“I don’t think we can make money once it gets above $150/ML,” Invergordon dairy farmer Mark Norman said.

“Our milk price doesn’t match our water price. Our farm is on the market for exactly that reason.”

In 2000-01 northern Victoria and Riverina milk production was 3.3 billion litres. This season Dairy Australia estimates the region will produce little more than 1.8 billion litres.

Over the same period, the number of dairy farmers in the GMID has fallen from 2800 down to 1119 and in the Riverina from 250 to just 89 today with satellite images showing a massive reduction in dairy farmers’ water use over the past year.

Murray Dairy chief executive Jenny Wilson said the biggest concern was job losses, given dairying was the region’s biggest employer, with 3200 people working on farms and another 8000 in milk processing and servicing the sector.

“What will replace it as the major employer in the region,” Ms Wilson said.

United Dairyfarmers of Victoria president Paul Mumford said Victoria’s northern dairy industry was undergoing “systemic change”.

“Within 50km of Cohuna local farmers are saying 20 farmers have left, exited the industry this season,” Mr Mumford said. “That’s 5000 cows gone from the area, a loss of 40 million litres.”

“We’re extremely concerned about the whole region, given many must decide by St Patrick’s Day (March 17) if they stay on. It’s D-Day for them.”

The most vulnerable group is young farmers, who have entered irrigated dairying with land, cows and enthusiasm, but have been unable to own water entitlements worth $4000-$5000 a megalitre.

Young dairying couple Rikkie-Lee and Aaron Tyrrell have battled to survive their first 12 months in irrigated dairying, watching water prices rise from $100 a megalitre when they first arrived at their Invergordon farm, to $500/ML today.

“We went through winter with next to no rain and when water prices came up we went ‘holy hell’,” Ms Tyrrell said.

Ms Wilson said many young farmers were keen to dairy in the region but were witnessing older industry leaders selling up and moving to greener pastures down south.

Corporate almond grower GoFarm has just snapped up 5-6 dairy farms sitting over the Katunga deep lead groundwater system, with at least one of those dairy farmers moving their operation to Gippsland.

Real estate agent Kevin Hicks said large agribusiness firms were looking for properties that had access to gravity irrigation, groundwater and efficient water use, but were not willing to pay a premium for dairy infrastructure.

“Interest in dairy farms as a going concern is limited, with improvements discounted heavily,” Mr Hick said. “It’s $4000 an acre ($10,000/ha) for land with dairy infrastructure and $4000 an acre for cropping ground.”

“There’s no doubt there are distressed sellers, but sometimes we can link them (into a larger parcel).”

Grain grower Eddie Rovers got out dairying five years ago, selling water entitlements to buy more land.

He had one well and is happy to be described as an opportunistic irrigator, delving into the market when water was affordable and sticking to dryland cropping when prices were high.

But for those who stuck to irrigated dairying it has been a tough few years for dairy irrigators.

Many bought water in the 2015-16 season for $200 or more a megalitre on the expectation of receiving $6 a kilogram for milk solids and were then hit with a milk price clawback late in the season.

“They then had the wettest winter in 16 years (in 2016), which had a big impact on milk production,” Ms Wilson said. “2017-18 was an average year, but it wasn’t enough for them to recover before being hit with expensive feed and water.”

“This year is worse than 2006-07 when there was a bit more fat in the system. They (dairy farmers) had a bit more equity and owned more water.”

The Commonwealth has drained 23 per cent of the water from northern Victoria’s irrigation communities for the environment and 20 per cent from the Riverina, which has forced up water prices as irrigators compete with almond, table grape, citrus and cotton growers for a smaller pool of water.

Water ownership has crashed in the wake of federal buyouts, with GMID dairy farmers selling off half their water entitlements over the past decade — from owning 709GL in 2003-04 to 352GL today.

Mr Norman, like hundreds of other Goulburn Murray Irrigation District dairy farmers, must now rely on buying water off others in the increasingly competitive temporary or allocation market, which has risen from $100/ML a year ago to $500/ML this week.

Dairy Australia’s Murray Region 2019 Future Focus report shows 40 per cent of the Goulburn Murray Irrigation District’s dairy farmers rely on the temporary water market for half their water needs.

“Most dairy businesses have relatively low water security, with 66 per cent using significantly more than they own in entitlements, highlighting the industry’s vulnerability to a volatile temporary water market,” the Focus report states.

Farmers such as Robbie Glover have cut their losses early and are in survival mode, waiting for the season to turn and milk prices to rise.

“The outlook was so grim, (we) decided to pull the plug and sell 100 (cows)” Mr Glover said. “I’m back under 120 cows, so we can keep it ticking over until it comes good, which will happen because there’s so many people getting out.”

Herds are being heavily culled, with reports the core of many herds are being lost, especially in the Riverina, where irrigators have no water allocations.

Dairy Australia figures show production has fallen from more than 200 million litres in 2015-16 to just 51 million litres for the first six months of 2018-19.

Source: Weekly Times 2019-03

River Murray system water delivery shortfall risks

Water delivery shortfalls are rare but occur when available water cannot be delivered to users when they want it.

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Water shortfalls can happen due to a number and combination of reasons including environmental and seasonal influences.

For example, shortfalls can occur for example when the demand for water exceeds the physical capacity of rivers and channels to carry the water, or when demands for water unexpectedly spike and there’s not enough time to release additional water from dams to meet the demand.

Water holders along the River Murray, especially downstream of the Barmah Choke, need to understand the risk of water delivery shortfall and take it into account in their business planning and investment decisions.

More information

This Water delivery shortfall assessment for 2018-19 document was updated on 21 February 2019 to make minor changes to improve explanatory text and clarity.

Source: MDBA 2019-02

Sources include: ABC Rural, The Land, The Weekly Times, Stock and Land, Stock Journal, Bloomberg, Farm Online, Queensland Country Life

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