Australasian Science Magazine

By Ian Lowe

It makes more economic sense to trash the farm for short-term profit than to farm it sustainably.

The national Landcare program was formally launched in 1989 with an ambitious goal of spreading to 2000 local groups. The early focus was on planting trees to preserve topsoil and strengthen the banks of inland waterways. There are now well over 5000 community-based groups in all corners of Australia.

The conference was told that the Landcare movement has evolved over the decades, so it now has a much broader role than protecting topsoil, native vegetation and the riparian zone. Local groups are concerned about carbon storage, mitigating the effects of climate change and the integrity of landscape-scale ecosystems, as well as such broader social issues as food production and food security. The farm sector is under pressure as social changes sees young people leaving the land for city life, while economic pressures see small landholdings merged with larger farms or acquired by corporate entities. I was on a panel of “elders” wrestling with the thorny issue of adapting the Landcare movement to these changes.

As the conference coincided with the announcement that Cubbie Station had been sold to overseas interests, there was impassioned discussion of the issue of foreign ownership. While some delegates argued that foreign investment is needed in rural Australia and should be welcomed, others were clearly worried by the prospect of land management decisions being driven by the commercial priorities of large transnational corporations. I agreed with them.

I illustrated my concern by an example of alternative approaches to land management. If, as a hypothetical example, it were possible to farm an area of land sustainably so as to produce net revenues of $1 million per year forever, or there was the alternative possibility of farming intensively to produce

$2 million per year for 10 years, after which the land would be totally degraded and unproductive, which approach should a responsible farmer take? It seems intuitively obvious that it would be better to earn $1 million per year forever than $2 million per year for only 10 years.

Any land-owner who took their duty of stewardship seriously would seek to maintain the productivity of the land, probably hoping to hand it on to their descendants in as good a condition as possible. But if the farm was managed by a commercial organisation, their accountant would probably do a discounted cash flow calculation based on present interest rates. When the future revenues were discounted to 2012 dollars, the accountant would conclude that the net present value of $2 million per year 10 ten years is greater than $1 million per year forever, so a commercial operation might put pressure on the farmer to use the land more intensively at the expense of its long-term profitability.

By contrast, Landcare has many success stories of increasing sustainable productivity by increasing tree cover and reducing the stocking levels.

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The Australian government has released a Green Paper on the proposed National Food Plan. While I expected the paper to concentrate on food quality, food security and the importance of a healthy diet, those issues get less attention in the discussion paper than the economic opportunities the government sees in exporting food to the Asian region. Forecasting that food demand in Asia could double by 2050, an amazing prospect in itself, the government proposes to pursue free trade agreements and otherwise promote liberalisation of trade in food, provide assistance to companies wanting to expand into “emerging markets”, and encourage foreign investment in agriculture on the grounds that “Australian investment alone is not enough for our food industry to continue to grow”.

With food exports now equivalent in value to about two-thirds of the total value of farm and fisheries production, I don’t think further growth is important enough to literally sell the farm.