Canberra Times | 30 Apr, 2011
BY EDMUND BARTON
Rural MPs, especially those from NSW and Queensland, have been fielding increasing complaints from constituents in recent months about the level of foreign ownership of farms and agricultural businesses.
Complaints about ''selling off the farm'' tend to recur in cycles in Australia, but this one has prompted the Nationals in Federal Parliament to start a lobbying exercise to show supporters that they are taking their concerns seriously.
On the last day of its pre-budget sittings, the House of Representatives agreed to a motion from John Cobb, the shadow minister for agriculture and food security, that sets in train an interesting process. It ''requires'' the Government to establish a database on foreign ownership of agricultural land and agribusinesses for Australia overall and by state and key regions, and for particular agribusinesses.
This would be done by the Australian Bureau of Statistics with the assistance of the Australian Bureau of Agricultural and Resource Economics and Sciences, then evaluated by the Productivity Commission as to the foreign investment's ''contribution to the national interest in terms of economic development, food and water security, and agricultural sustainability''.
The Cobb motion also calls for the evaluation to indicate whether there should be a lower threshold for scrutiny by the Foreign Investment Review Board of rural land and agribusiness acquisitions. Figures from the FIRB a few weeks ago showed approval of such acquisitions as being worth $2.3billion last year, compared with $2.8billion the year before. However, the threshold triggering FIRB action is $231million and many people in the bush are convinced that many deals are slipping in undetected.
After passage of the motion, Nationals leader Warren Truss said Australians were ''alarmed by the lack of transparency and scrutiny over who owned what in their own country''. He said, ''Food security concerns in countries for whom food supply is a matter of life and death may be leading to significant purchases of Australian farms and agribusinesses by overseas interests. Anecdotally, we hear that foreign interests both government and privately owned are targeting farms in Australia to shore-up their own food security.
Foreign takeovers of Australian agribusinesses have increased tenfold since the election of the Rudd-Gillard government. In many sectors, Australia has already lost effective control over its food supply chain and decisions about our food supply are being made in foreign boardrooms.''
That reflects the sort of concerns being put to the Nats; whether the statistics bear them out remains to be seen.
However, there is no doubt that some of Australia's biggest companies in the food business have been taken over by foreign companies in recent years National Foods (for $2.8billion), ABB Grain ($1.6billion), Dairy Farmers ($910million), CSR Sugar ($1.75billion), and AWB Limited ($1.2billion), to name a few. And the FIRB has approved a $600million takeover offer from Spanish group Ebro Foods for SunRice. Shareholders will vote on the deal next month.
As to land, a Canadian pension fund has just bought 252,000ha in south-west Victoria and eastern South Australia from the receivers of Great Southern at an average price of $1650 a hectare. The Victorian Farmers' Federation thought it was a steal and wants a parliamentary inquiry. Real estate experts estimated that a more realistic price range was $3000 to $7000 a hectare. Concerns about farmland purchases have been exacerbated by the scramble by gas producers to secure property.
The Australian Financial Review reported last month that the Queensland Gas Company had bought about $50million worth of rural property in southern Queensland for a $15billion gas project. In addition, it said, the company was believed to be paying about $20million a year in compensation for other land it was using. QGC is just one of many coal-seam gas producers gobbling up farm land in Queensland and NSW.
The strength of opposition from farm communities to the gas developments in places such as the Liverpool Plains in NSW and the Darling Downs in Queensland may force the hand of politicians long before the Cobb database is created, but the issue has a long way to run.
