Increased transparency for ag land purchases

Jul 20, 2015

Foreign investment has historically been an important source of support for the Australian dairy sector. The dairy industry is strongly supportive of all investment, foreign and domestic, that helps the industry grow and prosper provided it adheres to the same regulations.

On 1 March 2015, the Federal Government announced a reduction to the screening threshold for agricultural land from AU$252 million to AU$15 million. The new threshold will include the cumulative value of agricultural land owned by the investor and the purposed purchase. An AU$55 million threshold for investments in agribusiness will be introduced 1 December 2015.

A step towards a register of foreign owned farmland is also underway, with the Australian Tax Office (ATO) collecting information on all foreign purchases, regardless of size from 1 July 2015. The ATO will also be auditing existing ownership of agricultural land by foreign investors to gain further insights into the investment landscape.

ADF President, Noel Campbell said the register would help increase transparency and give industry a better idea of what foreign investment really looks like in the dairy sector.

“The register is sound policy and will hopefully provide credible land ownership data to give us a comprehensive landscape of investment in agriculture across Australia,” Mr Campbell said.

ADF supports the government’s recent initiatives to improve the robustness of the investment landscape in Australia which recognise the important role of our global partners in helping the dairy industry to grow and strengthen.  


Budget offers mixed bag for dairy

Jun 16, 2015

The 2015 Federal Budget announced on 12 May, delivered modest gains for agriculture. With initiatives aimed at supporting rural and small businesses such as tax breaks for those with annual turnover under $2 million, social and community support services for rural Australians, and drought relief assistance, dairy came out slightly better off than the year before.

On 27 May, ADF welcomed the announcement from Federal Government that it would bring forward the introduction of accelerated depreciation of fodder, fencing and water assets to the night of the Federal Budget, as opposed to 1 July 2016. This decision will greatly benefit farmers who have been recently impacted by severe floods and drought. ADF acknowledges the considerable effort of the Hon. Barnaby Joyce, Minister for Agriculture, in making this happen.

Key gains for dairy in the 2015 budget:

•Tax write-offs for fences and new water storage
•$25 million for assistance for drought affected areas to reduce the impact of pest animals
•$20 million towards social and community support services for emotional impacts on farmers. And an extra $1.8 million for more counsellors.
•Cattle Farmers in the north will see $101.3 million over the next four years for improved road infrastructure
•$25 million to towards assisting Australian producers access the benefits of free trade agreements
•Tax burden for small business will be reduced to 1.5 per cent for businesses with annual turnover under $2 million
•A 5 per cent tax discount for smaller, unincorporated businesses
•An immediate tax deduction of all assets under $20,000 will allow small businesses to invest in new tools or machinery.
•$3.7 million allocated to implement recommendations from the review into the integrity of the 457 Visa Program.

The budget also included money for drought grants and loan schemes, however, this is the same money that was previously allocated but not spent.
ADF would have appreciated the budget also address the lack of Agricultural Counsellor postings to assist with reducing technical barriers to trade within key international dairy markets. We also would like to have seen further Investment in agriculture R, D&E, CRCs, infrastructure for rural regions and biosecurity.

There is still an opportunity to address these issues in the upcoming Agricultural Competitiveness White Paper. ADF will continue to advocate and work with government to help ensure the budget allocations are used to maximise its benefit for the dairy industry. 


President's Message - June 2015

Jun 15, 2015

 

Whether at the farm gate or in the board room, stopping to take stock, acknowledge success and identify areas for improvement is essential to ensuring any good business remains on track to deliver desired outcomes.

Now at the half way mark for 2015, Australian Dairy Farmers (ADF) is reflecting on the progress made thus far and the challenges yet to overcome, with the interests of dairy farmers and their profitability top of mind.

Volatility is a constant theme for dairy farmers and the past six months has been no different with all regions affected in some way by floods, drought and an ever fluctuating global milk price. But while there have been challenges there has also been important progress.

In March, we welcomed the Australian Government’s announcement to introduce legislation capping water buybacks in the Murray-Darling Basin Plan (MDBP) at 1500 gigalitres (GL). The 1500GL cap provides dairy farmers in the Murray-Darling Basin with much-needed certainty about future water availability to sustain their business.

ADF has also welcomed the relaxation of audit requirements for farmers in the southern-connected region of the Basin who participate the On-Farm Irrigation Efficiency Programme. This policy win will be explored later on the newsletter.

ADF’s lobbying on competition policy was instrumental in securing a positive step toward reforming Australia’s flawed legislation - the introduction of a Prescribed Code of Conduct. The Prescribed Code is not perfect, but it does address several key imbalances with regard to retailers’ power over suppliers. We welcome the commitment already made by retailer Woolworths by signing onto the Prescribed Code, and expect that in the days to come all the major retailers will follow suit.

ADF will continue to monitor the Codes’ effectiveness over the next three years with a view to seek the strengthening of regulations if necessary. We will also continue to advocate for an Ombudsman to help balance the market power of major retailers.

The above ‘short list’ skims the surface of the progress made so far this year, with many challenges, and triumphs, still ahead. At the forefront of our agenda is ensuring our industry retains the confidence and trust of consumers, customers and the broader public by addressing issues of concern such as unconventional gas mining and highlighting dairy farmers’ commitment to the health and wellbeing of their cattle.

The team at ADF remains committed to ensuring Australian dairy’s voice is heard through government policies that support our industry, and working with our industry bodies to ensure dairy’s good practices are known and understood across the broader community.

Noel Campbell
ADF President

TPP must be commercially meaningful for dairy

Jun 10, 2015

The Trans-Pacific Partnership (TPP) offers a historic opportunity to address a broad range of distortions affecting Australian dairy producers, and to ensure consumers throughout the region involved have access to safe, high quality Australian products.

A free trade negotiation that commenced in March 2010, the TPP involves 12 Pacific Rim countries including Australia, who account for approximately 40% of the world’s GDP*. Included in this round up are key Australian dairy export markets such as Japan, Singapore and Malaysia, as well as competitor countries such as New Zealand and the USA.

Australia exports dairy products to all eleven TPP countries – between 250,000 and 300,000 tonnes valued at around $US1 billion per year. Around 50% of these exports (worth $425 million in 2013/14) go to Japan.

Throughout the negotiations, the Australian Dairy Industry Council (ADIC) has continuously lobbied for the TPP to address traditional tariff barriers for dairy products and more subtle trade distorting non-tariff measures such as the European Union’s aggressive stance on Geographical Indications, as demonstrated in their trade agreement with Canada.

The ADIC expects that the TPP will address these non-tariff barriers, especially in the Japanese and Canadian markets where these restrictions are most pervasive. For the TPP to be commercially meaningful, markets like Canada and Japan must demonstrate that they are prepared to significantly increase their existing dairy market access positions.

Sustained economic and population growth is driving an increase in dairy demand for the Asia-Pacific, but to take full advantage of this unprecedented opportunity, the TPP must be ambitious, comprehensive and commercially meaningful.

The latest round of TPP negotiations took place in Guam at chief negotiator level on 26 May 2015. There are many issues yet to be addressed and the ministerial meeting planned to follow the negotiators talks did not take place with the US Congress yet to pass the crucial Trade Promotion Authority (TPA) Bill.

The ADIC will continue to advocate strongly for dairy’s interests in the TPP.

*Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. 


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