Re: Is a golden age for agriculture really coming?
Over the centuries a family would have been content if they had managed to have enough food, shelter and clothing to keep them warm. In Victorian England "Upstairs" did much better than this but there was still much deprivation "downstairs". Those of us who can remember the pre and post 2nd World War Era know that the privleges of the modern consumer society, that we now all enjoy, are just a tiny blip in the history of mankind. There is no reason why the majority of people shouldn't return to the old axiom of being grateful for food shelter,and warmth! If there is any semblance of truth in this then I agree with John, that we are embarking on a new era for Agriculture; the things we produce are soon going to be the priority items in everyones budgets! However we must be cautious. There are fast areas of the World, South America, Eastern Europe, Central Asia, and Africa that have excellent soils, reliable rainfall, cheap land and low cost labour that could respond to a price stimulus. The thing holding them back in the past has been their instituitions. This is an area that progress is now being made, particularly in South America. On the other hand Australia is carring the burden of poor public policy that is increasing our costs, particularly of Capital. This is becoming an increasing burden for efficient Agricultural producers. Some of these public policy issues which must be adressed if we are to prosper as an efficient food exporting nation are:- Drought relief that props up inefficient farmers and has the end result of keeping land values higher than would otherwise be the case- increases the cost of capital to commercial farmers.
Management Investment Schemes (MIS) that gives the speculative investor in agriculture a privelged taxtion benefit- increases the cost of capital to commercial farmers. Carbon Sink Legislation that gives the power industry a priveledged taxation benefit to purchase land for trees- increases the cost of capital to commercial farmers. Then there is the 2% tax on our gross proceeds for our industry instituitions that on any criteria are a waste of space and crowd out innovative creative commercial people, not to mention legislation that prohibits the control of woody weeds, distorts water markets; and heaven knows what the end result of a carbon trading scheme is going to be. A new era in agriculture cannot be taken as a given. There is much needed reform of public policy needed and very little will from any quarter to confront the issues and do anything about it!.
By 065405 on
11/01/2009 9:34 PM