A chance to help farmers help themselves

Should government set-up a feed bank along the lines of the farm management deposit model?


Opinion
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A feed bank would help demonstrate longevity and pro-activeness both by the government, and the livestock industry and be another tool for drought preparedness.

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A few sharp eyes among our readers were a tad confused by a letter from Xavier Martin in last week’s The Land (“Appetite for feed bank”, p26) about the need to expand the farm management deposit concept to create a feed bank.

The drought context was relevant, but the numbers were about 15 years old. 

So why run it? 

Mr Martin dug this letter out in a frustrated attempt to demonstrate that since published in The Land in 2003, little has changed in terms of drought strategy.

Even over a decade ago, farm management deposits contained $2.5 billion and grain cost $300/t. In 2018, there is about $6b in FMDs and most producers are now paying $500/t or more for grain.

The situation on the whole is similarly dry, but fodder is now much scarcer.

With reference to our previous editorial, “Fodder reprieve, or interventionist policy” (The Land, August 30, p26), better co-ordination of stockpiled feed would help minimise the need to divert water during drought, would potentially be more cost effective, and could provide better transparency around remaining feed stocks.

This would allow producers to make better informed decisions about trigger points for when to sell stock,  those stock would likely be in better condition, and the fodder wouldn’t be as expensive.

In 2003, Mr Martin also referred to the large amounts of tax payers’ cash being poured into the first home buyers’ initiative. 

Many billions have continued to flow into this in the years since – likewise into bailing out car manufacturing and the big banks. 

So if that amount of tax payers’ money can be poured into propping up those industries, wouldn’t it make sense to put some money into a system that sets farmers up to better help themselves in the long term –  like FMDs do?

A feed bank would help demonstrate longevity and pro-activeness both by the government, and the livestock industry.

If farmers paid the cost of the feed and storage once the system was set-up, the demand would represent their willingness and ability to pay, and their actual need for fodder beyond what their own facilities might hold for risk management.

This would therefore be a reflection of actual demand for fodder, and further reduce the need for government intervention in drought, which we have returned to because of a lack of suitable alternatives.

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