Under Pressue

August 21st, 2019

The drought conditions affecting farmers in the eastern states are also being felt closer to home, and not just by farmers.

One of the main issues is the rising price of hay, which is causing ripples throughout the community.

Not only is there less hay due to low rainfall in previous seasons, but much feed is being taken interstate to alleviate pressure, therefore raising prices and reducing local supply.

Harrogate beef producer Tom Hampton said eastern states’ farmers were in trouble but that local farmers are not immune to drought issues.

Tom, who runs 25 breeding cattle, bought a year’s worth of hay at a reasonable price last year.

“We knew there would be a problem so in October I purchased what we needed for our farm,” he said.

“The drought has driven up the cost of producing, and the costs don’t always flow through to the sell price.

“You’ve got to reduce profitability, which you can only do so much.”

This sentiment is echoed by Barrie Stratton of Mount George’s Academy of Dressage, who said the school is including a hay price surcharge in lesson prices.

“The cost of feed per week was $420 a year ago, now it’s $700,” he said.

“It’s a struggle with such high overheads, but we don’t want to push that onto clients more than necessary.

“We’re tightening our belts.”

Tom said much of Australia’s hay is not irrigated, meaning production relies on rainfall.

“It’s not necessarily easy to produce more hay, because you can’t control the rain,” he said.

Dwain Duxson, founder of online farming marketplace Farm Tender said “a lot” of South Australian hay had been sold interstate.

“You can’t put a figure on it,” he said.

“The prices of hay have never been higher than what they were a couple of weeks ago – a tonne of good quality vetch hay was going for up to $500 and cereal hay could fetch around $450.

Managing increasing costs is a problem for farmers, particularly as much produce is a global commodity.

“Farmers are price takers, not price makers – it’s a challenging sector in that regard.” Tom said.

“Many are either reducing herds or leaving the industry and, sadly, there’s also a high level of suicide in the agricultural sector because of financial pressures.”

However, Tom is staying optimistic that circumstances will change.

“The good outcome is if it rains again, the costs come back down and everyone gets on with farming,” he said.

“I’m hopeful that we’ll get a good spring growing season this year, and that there is reasonably-priced hay locally – then I’ll stock up again for the whole season.

“This year has had below-average rainfall, but winter isn’t over yet.

Dwain also believes relief is on the horizon as the new hay season approaches – in the past week prices have already dropped by up to $100.

Moreover, the on-going drought has meant many Queensland and New South Wales producers have needed to reduce their herd sizes – the lower demand will also impact prices.

“It’ll put pressure on prices to drop and we’re already starting to see that,” he said.

“In about a month and a half, we think supplies will be replenished in a sufficient way.”

Yet, Bureau of Meteorology (BOM) climatologist David Martin said the greater Adelaide region had experienced a severe rainfall deficiency since April 2018 and the initial spring rainfall outlook is not boding well for much of South Australia.

“Below-average rainfall is likely,” he said.

“The Adelaide Hills is dominated by winter rainfall, so if we haven’t received it now, the averages start to drop off.”

According to BOM data, the driest year on record in parts of Adelaide was in 2006.

Comparatively, the wettest year in the Hills was almost 90 years earlier in 1917.

This deficiency is part of a trend, with rainfall during the cool season diminishing over the last three decade – late autumn and early spring rainfall has decreased consistently, while winter rainfall has remained roughly the same.

David said the greater Adelaide region has experienced very few wetter than average cool seasons since the 1990s.

“It’s definitely consistent with the changing weather patterns we’ve seen, attributed to human-induced climate change,” David said.

“Adelaide gets the bulk of its rainfall in cooler months and now we are not getting the normal cold fronts come up from the south.

“Changing weather patterns are pushing them further south.”

Producers such as Tom are well aware of the changing climate, demonstrated by the move to sustainable farming practices.

“Traditional farming methods are changing – moving away from just taking from the land to enabling some input back into the soil,” he said.

“Rotational grazing, for example, allows the pasture to recover.

“We’re getting more and more weather events like this drought – it’s quite a significant issue to contemplate.

“We need to be mindful of global warming, the global community is starting to realise what the effects are and minimise our impact.”

Barrie is not convinced the weather changes are due to climate change, but agreed the land needs to be taken care of.

“There are arguments for if that is happening or not – if you look at weather patterns, there have been droughts before,” he said.

“That doesn’t mean things are all okay and we don’t know what’s around the corner.

“All I can say is, we need to try and look after the environment as much as we can.”

Consumers may not initially feel the impact from increased production costs, but Tom said they will eventually flow on.

“Long-term, food prices will have to adjust to match production costs,” he said.

“Consumers need to support small businesses producing food.”

“Small-scale producers create quality products and supporting local businesses that buy from those farmers is excellent for the local economy,” he said.

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