Fix needed for regional councils funding

Despite significant challenges, from a protracted drought to rising input costs, burdensome government regulations and most recently, a global pandemic, the state’s 24,000 farm businesses have continued to feed, clothe, and provide amenity to Queenslanders, Australians and many others around the world. However, farmers in the Bundaberg region have received little thanks for their continued hard work, instead receiving increases of up to 235 per cent, or as much as $30,000, in their rates notices this year. They were further dismayed when the Bundaberg Regional Council released its 2019-20 Annual Report which showed an operating surplus of $1.5 million.

The Bundaberg farmers have been very clear that they are not asking other ratepayers to cover rural ratepayers’ share, nor are they suggesting that they are disadvantaged by the increase in rural land valuations. However, they are asking for transparent and equitable rates. The state government could regulate to make rates and charges resolutions more flexible after which the Bundaberg Council could apply a concession to the whole of Category 9 (farmland) under Sections 119-122 of the Local Government Regulation 2012. Moreover, prior to the dissolution of the Queensland parliament a regulatory amendment providing extra powers for additional decisions about levying of rates and charges for 2020-2021 financial year was made. However, while the head of power was introduced, the necessary regulation to implement section 94A has not been made. This must be done as a priority.

QFF acknowledges the financial sustainability of local governments across Queensland continues to be a challenge with increasing community demand for services, population fluctuations and rising costs associated with maintenance and renewal of ageing infrastructure. In February 2020, the Queensland Audit Office reported to parliament that over half of Queensland councils spend more than they earn.

With a new Minister for Local Government this is an ideal time to fix what are complex issues. QFF is calling on the Queensland government to review the rates approaches and safeguards of other Australian jurisdictions with a view to creating a fairer funding model for regional councils as well as a review of the effectiveness of protections for all rate payers. Additionally, we encourage the Local Government Association of Queensland to ensure a level of predictability in the rates levied on parcels of land and businesses, and compulsory compliance with the principles set out in the State Government’s Guideline on Equity and Fairness in Rating for Queensland Local Governments.

Bundaberg farmers say council rates rise too high, adding to crippling operating costs

In a landscape where the cost of farming is increasing, growers say they’re struggling to cope with Bundaberg Regional Council’s hefty rates rise.

Charles Grima, who has farmed sugarcane and sweet potatoes for decades, has had one of the area’s highest increases in rates.

Previously his net half-yearly payment was $1,704 and now it’s $5,771 — a rise of more than 238 per cent.

“Farmers don’t have a guaranteed income; one year we can make a lot of money and the next year we’re lucky to break even,” he said.

“If we’re not allowed to keep some of the money from good years, you’re struggling to survive.”

Area category 9 rates — rural properties — faced hikes of between 1 and 238 per cent following increased land valuations by the State Government.

Council will take an income of almost $10 million solely from this rate category during this financial year, making up more than 12 per cent of their total budget.

This is an increase of more than $2 million from last year.

Out of the 1,796 properties in this category, only 16 will see a decrease in rates.

‘It just kills you’

Mr Grima said that in all the time he’d spent farming, he’d never seen such a severe rate rise.

“It turns everybody from the land — my son is the last generation in farming because of costs,” he said.

“My grandkids will not be farmers after they see what their parents and grandparents go through.

“It just kills you.”

Glenn Pressler, who grows cane and runs cattle on a 30-hectare property in Windermere, said his rates bill had tripled.

“It’s a fairly large increase — it’s gone from $600 to about $1800 for six months,” Mr Pressler said.

“It’s just wrong — you can’t sustain that huge rise.”

Mr Pressler said the rate rise contributed to the cost of farming becoming unsustainable.

“Everything is going up in price, input costs are going up and we’re getting less from our produce and the weather isn’t very good for us — we’re in drought conditions,” he said.

“You just can’t afford to keep going on like that.”

Bundaberg Regional Council has defended its decision for the rate rise.

In a statement to the ABC, a spokesman said the impact of COVID-19 on council’s budget had forecast a $2.8 million reduction in revenue (from the airport, Moncrieff and holiday parks) and a $5.2 million deficit.

He said individual landholders could apply for hardship relief. To do so, he said, they would need to provide evidence of financial difficulty, but farm lobby groups had provided no evidence of general hardship across the entire agricultural category.

Council’s forward plan is to keep rate increases aligned with the CPI.

Labor, LNP and Australian Party promise cheaper water for Queensland farmers ahead of election

Bipartisan support has been given for cheaper water prices as the Queensland state election race enters the home stretch.

Labor joined the party to announce a 15 per cent reduction in water charges for farmers accessing the state-owned irrigation schemes, and half-price water specifically for fruit and vegetable growers.

This will start from July 2021.

Earlier this month the LNP announced they would cut water costs by 20 per cent and Katter’s Australian Party have promised a 25 per cent reduction.

The Australian Sugar Milling Council (ASMC) released a report earlier this year into irrigation water charges and their consistent increase over many years, putting forward a range of potential reductions between 15 and 25 per cent.

“So now we have commitments that fit within that range,” ASMC CEO David Pietsch said.

“It’s not just a benefit to the canegrowers and the sugar millers, it would also deliver broader benefits to the communities that rely on our industry.”

More questions than answers

Canegrowers CEO Dan Galligan said the industry was relieved to have secured solid promises from the major political parties.

He said the decrease would result in substantial savings for irrigators across growing regions

“So we’re talking tens of thousands of dollars, certainly for the average grower in the Burdekin, easily $10,000 to $15,000 will be saved by a 15 per cent reduction,” Mr Galligan said.

“The price of water and electricity were essential to our election pitch, so this is a really important initiative.”

A linear irrigator on wheels sprays water across a field.
Bipartisan support has been announced for cheaper water charges for irrigators across Queensland.(Supplied: Bundaberg Sugar)

But he said many questions still remained, including around the different reductions for cane and horticulture crops.

“Pumps don’t differentiate where the water is going, obviously, and a lot of our members grow more than just cane,” Mr Galligan said.

“So many irrigators will be trying to work out how that works if Labor forms government this weekend.”

‘We create the most jobs’

In the far north of the state Joe Moro has a crop of mangoes that are drip fed from the Mareeba-Dimbulah irrigation scheme.

He said the interest all major state parties have taken in water pricing is timely acknowledgement of the heavy lifting the industry has done this pandemic.

“By water pricing coming down, they acknowledge that it will create more jobs,” Mr Moro said.

“The horticulture industry is phenomenal for creating jobs, we create the most jobs in all the agriculture industries.

“And if farmers can make a dollar out of it, they will reinvest it.

“We have seen that in the Tablelands in particular, we will see more confidence.”

Bundaberg calls for more

Bundaberg-based macadamia grower Andrew Lewis said while the announcement was a step in the right direction, they need more.

“I think it’s good news but what we’d really like to see is a guarantee prior to the election for the Bundaberg region — Paradise Dam will be returned to full supply level,” he said.

“The 130,000 megalitres that are missing from that dam at the moment that will be a real guarantee that there will be jobs in the future.

Drone photo of construction vehicles and workers at spillway of Paradise Dam near Bundaberg.
One Bundaberg farmer is welcoming the announcement but wants to see more commitments around Paradise Dam.(ABC News: David Shipton)

Mr Lewis also wants to see more detail.

“Irrigation costs are a big consideration for us the cost of the actual water is probably two thirds of the cost and power would be the other third,” he said.

“You think about it every time you turn the pump on.

“It’d be interesting to see how long these price reductions continue on for — it’d be nice to think they go well into the future.

“In a COVID year we’ve all grown to understand that having access to fresh fruit and vegetables and everything else that comes from agriculture as well as jobs has been critical to powering the state of Queensland.”

Queensland farmers to be paid “reef credits” to reduce coral-killing pollutants

A new market mechanism designed to reduce the impacts of pollution on the Great Barrier Reef has been kick-started with banking giant HSBC and the Queensland government announced as the first buyers of so-called “‘reef credits”.

These new “‘reef credits’ are the creation of environmental traders GreenCollar, working in collaboration with Queensland landholders, to establish a new certification scheme that works in much the same way as carbon offset mechanisms. They are designed to rewards farmers and graziers for reducing the level of pollutants in wastewater leaving farmlands.

The first ‘reef credits’ have been issued to projects located in Queensland’s Tully River Catchment, with sugarcane farmers recognised for improvements in the quality of water that ultimately flows into areas of the Great Barrier Reef, by preventing nitrogen, sediment or pesticides making their way into the waters of the reef.

“Farmers and graziers are important stewards of the catchments of the Great Barrier Reef,” local farmer Jamie Dore said. “Reef Credits recognise the value of the work undertaken by Queensland farmers and provide a valuable additional source of co-investment that isn’t impacted by commodity prices and doesn’t compromise existing agricultural practices.”

“It is exciting to see both leaders in the private and public sectors investing in the work we’re doing, and supporting the future of this iconic asset.”

HSBC and the Queensland government have now joined the scheme as the first purchasers of the reef credits.

GreenCollar, one of Australia’s largest facilitators of carbon farming projects, and one of the largest participants under the Emissions Reduction Fund, has sought to adapt the approach taken in carbon offset markets to reduce the flow of agricultural pollutants into the Great Barrier Reef.

According to a ‘reef credit standard’ developed by GreenCollar, each ‘reef credit’ issued under the scheme represents a “verified amount of pollutant that has been prevented from entering the Great Barrier Reef lagoon”, with each ‘reef credit’ representing a kilo of avoided pollution.

The health of the Great Barrier Reef has been under immense stress due to the combined impacts of pollution and warming ocean temperatures. Scientists have observed a significant decline in the health of the reef, with a surge of mass bleaching events and a decline in coral coverage.

summary of climate science published by the Intergovernmental Panel on Climate Change suggests that coral reefs would decline by 70 to 90 per cent with global warming of 1.5°C, and virtually all coral reefs would be lost with global warming of 2°C or more.

In an effort to protect the environmental and tourism value of the Great Barrier Reef, GreenCollar created the accreditation scheme for pollution reduction project and oversees the issuance of ‘reef credits’ to projects in line with the amount of pollution they are able to avoid. GreenCollar predicts that six million reef credits could be created by 2030, that could be purchased as environmental offsets in a similar way to carbon offsets.

“The Great Barrier Reef contributes $6.4 billion to the national economy and supports more than 64,000 jobs up and down the Queensland Coast. Poor water quality is the second-biggest threat to the reef, and helping to protect this iconic asset will continue to support these jobs and businesses,” GreenCollar CEO James Schultz said.

The Queensland government welcomed the opportunity to become one of the first purchasers under the Reef Credits scheme, with environment minister Leeanne Ecoch saying she hoped it would help support further investment in improving environmental outcomes for the Great Barrier Reef.

“Exploring ways to accelerate and incentivise actions to improve water quality flowing onto the Great Barrier Reef was a priority activity for our Major Integrated Projects,” Enoch said.

“The establishment of the Reef Credits Scheme, this first purchase, and a new partnership between GreenCollar and HSBC signals the start of an exciting new way to value natural capital and actions taken to deliver good environmental outcomes.”

HSBC said that the purchase of ‘reef credits’ formed part of the bank’s climate ambition statement, that includes targets to increase investment in zero carbon projects, and nature-based solutions over the next five years.

“Partnerships like this between governments, the private sector and firms like GreenCollar are vital to achieving net zero carbon, and appropriately valuing and investing in natural capital,” CEO of HSBC Australia Kaber Mclean said. “Our participation in this global first reinforces our credentials as a sustainable finance pioneer in the Australian market, as well as our commitment to safeguarding natural assets like the Great Barrier Reef.”

HSBC recently announced a partnership with Australian advisory firm Pollination Group, to invest up to A$ 4.15 billion in ‘natural capital projects’, that aim to protect the environment and cut greenhouse emissions.

On-farm Emergency Water Infrastructure Rebate Scheme

On 2 October 2020, the Australian Government announced an additional $50 million of funding for the expansion of the On-farm Emergency Water Infrastructure Rebate Scheme in 2020-21.The roll-out of the expanded Scheme is currently being negotiated with all states and territories, including co-funding arrangements. Read the Minister’s announcement – Joint media release: $50 million boost to successful drought water infrastructure rebate.

Rebates for on-farm water infrastructure expenses. Helping primary producers and horticulture farmers in drought-affected areas.

$50 million over 3 years. Starting in 2018-19 financial year.

Access rebates

State and territory governments administer and deliver the rebates. Rebates for primary producers and horticulture farmers are now available in all states and territories.

Who can apply

You must be:

  • a primary producer or horticulture farmer (as defined by your state or territory)
  • a property owner, share farmer or lease holder
  • in an area defined as drought affected (by your state or territory)
  • in the grazing or horticulture industries.

Eligible expenses

Your new infrastructure must:

  • be for grazing livestock or permanent plantings that you own (rebates do not apply to agisted stock)
  • be for an animal welfare or permanent planting need
  • improve your drought resilience.

Eligible expenses for primary producers must relate to:

  • buying and installing
    • pipes
    • water storage devices such as tanks and troughs associated with stock watering
    • water pumps and associated electronic systems to manage water delivery
  • desilting dams
  • drilling new stock water bores and associated power supply such as generators.

Water infrastructure to support livestock watering must be purchased after 30 June 2018.

Eligible expenses for horticulture farmers must relate to:

  • desilting dams
  • drilling new groundwater bores and associated power supply such as generators.

Water infrastructure to support permanent plantings must be purchased after 30 June 2019.

Rebates will be 25 per cent of the costs for eligible expenses or up to a maximum amount agreed by the implementing state.

Benefits

Improving on-farm water supply will:

  • address animal welfare and permanent planting needs
  • help primary producers and horticulture farmers to be more resilient for future droughts
  • increase productivity for primary producers
  • mitigate degradation of natural watering points.

More funding

You may also be eligible to apply for funding through the Water Efficiency Program.

Funding for on-farm projects in the Murray–Darling Basin is available in New South Wales, Victoria, Queensland, South Australia and the Australian Capital Territory.

Molasses ‘new normal’ – short supply, high demand

REDUCED supplies of molasses for stockfeed in line with smaller cane crushes has sparked talk that beef producers should start thinking seriously about on-farm storage.

While La Nina conditions are far from the severe drought that drove demand for the high-energy feed to the point where it had to be imported during the past two seasons, market conditions are pointing to the likelihood higher molasses prices and shorter supply will be the ‘new normal’.

Added to lower molasses volumes out of Australian sugar mills is growing demand with more grainfed beef production and increased competition from overseas buyers, from both the feedstock and fermentation (ethanol) industries.

It is also used in some Australian distilleries for fuel production, although much of the capacity this year was diverted to making hand sanitiser.

Where molasses had traded for $150 a tonne in previous years, cattle producers are now expecting little to be on offer under $200 and more likely towards the $250 mark.

Some Queensland producers paid as much as $800/t for imported molasses last year, backed into a corner of continually supplementing through drought, with no agistment on offer, no grass and a depressed market to sell on.

Several thousand tonnes was imported from Vietnam and Thailand over the past two seasons in a very unusual move – long-time producers can remember it being imported only once before.

Around 40 Queensland producers signed up for the imported product and some made its way into NSW.

Feeding molasses

Molasses-based mixtures are widely used in areas within a reasonable distance of sugar mills, where transport costs keep it competitive with grain costs. It’s an energy-only feed so has to be mixed with urea for protein.

Northern Australia beef consultant Geoff Niethe said there was always a place for feeding molasses to get out of trouble or to hit certain targets but it would not replace good pasture management.

Molasses-based supplements had a role in keeping weaners moving forward, spike feeding heifers and breeders and – in some circumstances – finishing steers, he said.

Attention has to be paid to stocking rates and pasture spelling as molasses mixtures use can result in more pasture being consumed and thus reduced ground cover.

“If you are feeding molasses for energy, you need to look at the comparative price per unit of megajoules of metabolisable energy on a dry matter basis,” Mr Niethe said.

On a dry matter basis, molasses has approximately 10.7 MJ per kilogram, compared to wheat at 13.

It has high potassium levels and low sodium and phosphorus.

When its energy is balanced with key nutrients, it becomes a good supplement in many situations, Mr Niethe said.

It can still be fed in grassfed programs provided certain additives are not included.

Research indicates it can be stored for up to five years or longer but stronger tanks are required.

Contractor Daniel Mifsud, Mifsud Heavy Haulage at Clermont, said he had been encouraging clients to invest in storage for many years.

“It’s like any commodity – if you need to have it, you have to create your own insurance,” he said.

He was involved in importing molasses during the past two years and said while drought was obviously the big driver of increasing demand, the growth in feedlotting was also contributing.

Shortage across Asia Pacific

The Australian Sugar Milling Council said it had been working closely with producer bodies such as Agforce to encourage pastoralists to establish storage to manage their exposure.

The shortage of molasses extended across the Asia Pacific, ASMC’s Jim Crane said.

The forecast cane crush for Australia this year was just under 31m tonnes, down 1m on last year and well below the 36m crushed in 2016.

Thailand, however, has dropped from 130m tonnes to 70m. Meanwhile, India’s big crops are being diverted to ethanol production.

Molasses tonnage sits at around 3pc of cane tonnage. With mills under pressure from low sugar prices, they will need to maximise all income streams so will be looking for the highest bidders for byproducts.

In previous years, Australian mills have exported around 40pc of their molasses.

The NSW Sugar Milling Co-operative this year opted to put out tenders for its molasses production and entered into long-term contracts with local customers who factored in the rising market to the tune of around $30/t.