Problems a head -

[mag]

In the coming years Australia US and Canada are going to face very hard competition from countries that can out produce us by their shear weight of numbers, we really have had it too good for too long and have become too complacent in our marketing and production methods.

Some countries may have an advantage of not repeating our costly mistakes in soil erosion and salinity problems which have been passed down from previous generations of over grazing and land clearing. I am definitely not a greenie but I do believe in sustainable agriculture, and in some case's greed is getting out of hand, where we are forced by commodity prices to either get bigger and become more productive just to keep afloat via the use of huge amounts of fertiliser and chemicals, what I fear is that we are heading for a big fall when the awakening of countries such as those in the Eastern EU and South America and Asia solve some of there infrastructure problems, they will, to put it bluntly kick our butts production wise, and with the help of lower exchange rates be more economical than us so called developed countries.

One frighting trend starting to show up is large corporations such as fast food giants buying up large tracks of land in South America and Asia where labour is cheap and setting up huge farms to produce their own meat and vegetable supplies along with processing plants to allow them to be fully vertically integrated in their production and bypass import laws regarding fresh produce by exporting processed frozen foods into countries. Another frighting trend here is the huge use again of genetically modified plants, growth hormones and unrestricted use of pesticides in these countries where they are starting to operate.

What do you think?

[Dave]

I don't think it's all doom and gloom, based on one simple word - quality :D.

An emerging country may produce a commodity cheaper than Australian producers can, but if the quality is not there the consumers won't buy it. Australia enjoys a 'clean and green' reputation in some markets, which is another postive aspect. The wine industry is a good example of how well this can work - Australia is now in the top 4 exporting countries behind France, Italy and Spain.

I have read media reports saying that Australia is about to be inundated with fresh fruit and vegetables from China, and I don't think this is about to happen either. It is very difficult to ship fresh produce internationally and maintain quality. Maybe it might happen with apples and a few other hardy horticultural crops, but broccoli, lettuce, tomatoes etc. would be hard going.

I'm not saying Australian farmers won't find it more difficult in the years ahead. There is still work to be done on marketing and branding with some commodities, whereas others have a head start.

Countries can self-destruct as quickly as they can develop - Zimbabwe being a recent example.

[mag]

I agree with some of your comments, however I will state the following:

Ask yourself this “is it our arrogance that makes us believe that we produce the best, because we read it in the media, where the so called governing agricultural bodies of the various agricultural sectors release all these press releases saying that we have created a new standard in quality and we collectively believe that South Americans/Asians or anyone else for that matter cannot possibly match our quality produce”, this my friend is shear stupidity, for in the long term history has shown that the market will find its own level playing field in the long term, their will be some wins and a few losses, but it is going to be a hard slog for those still in the agricultural sector in the coming years.

I have been in the international trading business now for nearly 30 years and have found some fantastic insights in so called quality products produced here in Australia, where most traders have to guarantee the produce that can be spoilt by a single rural producer taking a short cut in laid down protocols, in other words we constantly pay out on claims because of sloppy production methods, for example a small blue towel in a single bale of wool can cause a whole batch to be rendered useless, or a hand full of stains in a bale can have the same effect. Also where a crop was infected by insects and the producer sprayed, but failed to withhold the crop back from the exporter for fear of loosing income which then caused the whole consignment to be rejected by the importer. Also the citrus cranker in QLD, was this case caused by greed by a certain producer?

Locally the mum and dad shoppers will buy locally made produce, up to a point but other countries have the ability to produce high quality produce as well, if they find that the locally regulated market is using “quality” as the issue, they are very good a adapting to customer demands quicker than us because they are not a regulated as us, however that's not the point, we are a small consumer of produce compared to other countries with larger population bases, exporting is a major life blood for Australia, and over time we will find that our competitors will use the quality issue against us by either a greedy rural producer not following laid down protocols or by just copying our protocols, there is no shortage of so called agricultural consultants willing to sell their own mother for a few bucks in this world.

cheers...

[mag]

2001-2002

Chinese garlic traders in China and Vietnam saw a peak in the demand in garlic and acted upon it by selling 30% lower than world prices, still gaining larger returns for their growers but causing wide spread havoc in the industry.

Flow on here in Australia, a number of garlic producers where forced out of the industry because they were caught in the cross fire, even thou domestic consumption of was rising at that time, growers went ahead and planted a crop and when it came time to sell the crop they found that the prices offered and received were way below the production cost. Yet at planting time in China and Vietnam they were already harvesting their crop and asking for bids but the so called peak body that is funded by the growers failed to foresee or understand these movements of these competitors overseas, this is a classic example of not knowing what is going on in the world markets or the ability to see beyond our shores.

[Dave]

That's why crops like garlic are minor crops in Australia - they are hard to grow, hard to market and consequently higher risk. The rewards are there for the risk sometimes, other times they are not.

I'd guess and say most of the problems were with garlic destined for processing. Fresh market produce is different, as it's harder to sell imported product versus the local version.

I'm willing to be corrected if there is a garlic farmer lurking out there somewhere :thumb.

[Dave]

Just read on ABC Rural the pear industry is looking at regaining some export sales volume lost due to competition from South Africa (link (http://www.abc.net.au/rural/content/2005/s1399857.htm)).

[mag]

Just read on ABC Rural the pear industry is looking at regaining some export sales volume lost due to competition from South Africa (link (http://www.abc.net.au/rural/content/2005/s1399857.htm)).

Nice to see they use up funds to protect domestic markets, yet leave the export market alone, so some growers can be seen to be saved but what of the future of exporting to create the possibility of a sustainable industry not a possible overseas import marketing opportunity, or is the industry body just trying to ensure its funding for the future, bit of both I suspect.

keep up the comments, am enjoying you and I playing devils advocate...

[mag]

abc report - at last they are starting to wake up- but too little too late
http://www.abc.net.au/rural/content/2005/s1416535.htm

[mag]

http://www.abc.net.au/rural/content/2005/s1446004.htm

Nasty stuff, however not unexpected, more to follow shortly :eek:

[Dave]

That's not good. Unfortunately, crops like onions and potatoes are easy to 'dump' as they are less problematic to store and transport.

Note that the article mentioned that Tasmanian growers have flooded the Australian market due to the Chinese effects on the world scene - we aren't about to start eating Chinese onions ;).

I agree though the flow-on effect is bad for Australian growers.

[mag]

Note that the article mentioned that Tasmanian growers have flooded the Australian market due to the Chinese effects on the world scene - we aren't about to start eating Chinese onions ;).
its all cause and effect, South African farmers are facing the same problem as well as Mexico - so the effects are global