THE Federal Government’s carbon tax has prompted dairy farmers to get sustainable and slash costs.

With the carbon tax posing major threats to the intensive Australian dairy industry, facing the prospect of higher power bills and lower milk prices, some dairy farmers have already made big moves to slash on-farm electricity costs.

They say switching to a more sustainable system will not only save money, but it’s better for their farm in the long term too.

Boorcan dairy farmers Darren and Camilla Moloney are slowly chipping away at a 10-year plan to transform their business into a self-sustainable operation.

“We don’t have a big cash flow, but we are trying to do things that will pay for themselves,” Mr Moloney said.

Firstly the couple installed a five kilowatt solar panel on a disused dairy.

It generates about 20kW per day, which in turn produces enough money to offset the electricity costs at their actual dairy.

“We get 68 cents before they drop the feed-in tariff,” he said.

Setting up the solar panel on their actual 20-aside Herringbone dairy down the road would not have been viable, because the Moloneys would have required power when the sun was still up.

At the moment the plan is working – and will be even more effective when electricity prices increase in the second half of the year.

“Everyone is forecasting what will happen when the tax comes in, but no one really knows,” Mrs Moloney said.

“I feel that it’s not necessarily a bad thing if it makes farmers realise their carbon footprint.”

An environmental adviser is helping them with the sustainability plan, but the next steps are not yet set in stone.

“We are looking at putting tubes on the roof of the dairy to heat the water up, because that is one of our bigger costs,” he said.

The relatively new concept is expected to shrink power costs even further.

In the future they aim to produce a surplus of energy to sell – an idea they hope might fuel a valuable side-line income.

“We are looking into renewable energy too, but it’s still very new,” Mr Moloney said.

They say an effluent digester is in the pipeline too, which will generate power from methane gases.

“As soon as the technology becomes available to turn methane into power, we are keen to use it. It makes sense to us,” Mrs Moloney said.

In the future, the family hope their efforts will mean that nothing is brought on-farm – even water.

At the moment they are 100 per cent reliant on town water, which costs up to $200 per megalitre.

“Our last water bill was ridiculous,” Mr Moloney said. “But we are in the process of building a big dam that should help the cause.”

They are learning how to make on-farm compost out of old silage, manure, and straw in a bid to phase out synthetic fertilisers such as urea.

“At some stage, the stuff they dig out of the ground will run out,” he said.

“It’s all about changing the whole farming system, not just one part of it,” he said.

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THE poor returns beef and lamb producers have had to accept recently has prompted many to question whether domestic meat prices are too high.

I get to speak to a lot of people during the course of a normal week and when they find out that I’m involved in the livestock industry, most express dismay at the price of meat.

This is nothing new, of course, but last year’s lamb prices may have really alienated a large percentage of consumers.

It seems like yesterday that lamb was a staple Australian diet, but now it has gotten to a point where most prime lamb cuts have become a luxury item that families are enjoying at longer intervals.

Beef sales seem to be suffering declines, although I believe – for different reasons – breed societies have done a superb job of promoting their cattle.

Despite their successes in building demand and value-adding their product, consumers – who are generally uneducated in the way of meat – tend to target, the fashionable breeds as a special treat instead of buying quality beef at reasonable prices more often.

The proliferation of television cooking program have strengthened the ideal that meat is a luxury item.

I’m not having a shot at any particular breed, but I’ve lost count of the number of times that a certain daytime cooking show has featured Wagyu steak.

The perception that it is something far superior to any steak from other breeds is hurting beef consumption in general.

I would like to see a blind-taste test of different breeds conducted on a prime time show and see if those gourmands, who set themselves up as experts, could find any discernible difference.

One good thing about lamb prices has been the return of cheaper cuts into the family diet.

Lamb shanks, flaps and necks have become essential budget meat for families, although demand has made prices for these cuts climb above what many consider to be cheap, especially considering that these cuts used to be discarded as nothing better than dog’s meat.

Everybody involved in the livestock industry knows that lamb prices have fallen dramatically.

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THE world’s beef markets are changing from simple to complex, growth markets are moving from West to East, and the future bears no resemblance to the past.

As the world’s economic tides surge toward Asia, Australian beef producers will be presented with enormous opportunities, MLA economist Peter Barnard told the opening session of Beef 2012 in Rockhampton, but the new market may also challenge some assumptions that have underpinned genetic selection in the past couple of decades.

Dr Barnard, MLA’s general manager for Trade and Economic Services, reached back to 1955 and forward to 2020 to show the full-house audience at Beef 2012′s International Beef Cattle Genetics Conference where Australia’s beef industry currently sits within the long-term trends.

Over decades, Australia’s beef export business has moved from sending carcasses to very few countries, to sending a huge variety of cuts and other carcass components to many countries.

In 2007, three markets – Japan, Korea and the United States – accounted for almost all beef exports. But those same three markets took less than 70pc of the 900,000 tonnes of beef that Australia shipped in 2011.

In what Dr Barnard thinks will be an evolving trend, about one third of 2011 exports went to new, diverse markets – Russia, Europe, the Middle East, and particularly to China and other south-east Asian nations.

While other regions will continue to provide valuable markets for niche products, Dr Barnard argues the big growth will happen in Asia.

The income gap between western nations and Asian nations, quite recently a vast gulf, is closing fast.

In 1970, even the rich in Indonesia were poorer than the poor in the United States. Today, the income of the wealthy in Indonesia overlaps with that of the US poor – “and poor people in the US eat a lot of beef”.

While the affluence of the Chinese as a whole is still well below Western levels, in prosperous mega-cities like Shanghai “purchasing power is not eons away from the US”.

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AUSTRALIAN Merino wool took centre stage at a special market event for the United States’ fashion and retail industry in New York this week – with woolgrowers on hand to help spruik the benefits of the natural fibre.

The event was held as part of the International Wool Textile Organisation’s annual conference, the “2012 Fashion and Retail Market Report – What’s Working Now and Why” seminar this week.

Organised by AWI and Woolmark, it linked retailers and designers with natural and sustainable aspects of Australian wool, while key US fashion industry representatives spoke on future market opportunities.

Woolmark International northern hemisphere regional marketing manager Kara Hurry, who promotes Australian wool to retailers, said the event was important because the US fashion industry was one of the most influential in the world.

Ms Hurry said the US was a tough market and extremely competitive.

She said after a decline in demand because of the global financial crisis, there were positive signs that customers were back into buying luxury fibres.

“Retailers are posting sales growth. Nordstrom Inc, at the high end of the consumer market, saw a 10.5 per cent jump in total retail sales while Macy’s Inc, the mass moderate side of the consumer market, total sales edged up 0.4pc for April 2012 compared with 2011,” Ms Hurry said.

“In the past four months there has been steady growth and there have been reports that the US is slowly coming out of recession.”

Ms Hurry said the next six months would tell whether the increase would be sustained.

“But wool at the end of the day has only 2pc of the global market share of fibres. To see that the premium end of the US market is growing is really positive.

“As a niche luxury fibre, after a 10-year hiatus, we are back talking to US consumers about why they should look at the ingredients before they buy fashion and that Merino wool is the ingredient that will deliver the best natural fibre fashion experience.”

Ms Hurry said many young US fashion designers were now working with wool with 30 entered in the International Woolmark Prize USA Competition, promoting the benefits of wool to emerging designers.

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A MULTI-pronged attack against the weed, fleabane, is being advised for southern grain growers before winter sets in.

Flaxleaf fleabane has become a major issue for farmers in southern cropping regions in recent years, and weed management authorities are encouraging farmers to take an integrated approach to tackle the problem – and they say now is the best time to do it.

They say the best form of defence against fleabane combines the use of competitive crops and pastures, grazing, herbicides, cultivation and targeting weeds at the vulnerable stages of their lifecycle.

Consultant Chris Minehan, of Rural Management Strategies, Wagga Wagga, says early detection of fleabane is important and growers should now be controlling autumn germinations.

“Fleabane can produce in excess of 100,000 seeds per plant, allowing it to rapidly colonise bare ground,” Mr Minehan said.

“While most problematic in summer, fleabane can germinate at any time of the year given moisture and appropriate temperature.

Mr Minehan has been speaking about the problem at Grains Research and Development Corporation (GRDC) update sessions and said even young seedlings are relatively tolerant to glyphosate herbicides.

“The evolution of cropping systems from broad scale cultivation towards chemical weed control based largely on glyphosate has provided fleabane and other surface germinating weeds with a competitive advantage.”

He said a ‘double knock’ approach with a range of primary herbicides, followed by paraquat, is one recommended component of an integrated control management program.

Growing competitive crops and pastures is another strategy, while grazing also offers benefits.

“Grazing can be particularly useful in stubble situations where fleabane populations are low,” Mr Minehan said.

“Other weeds can be controlled cheaply and easily, leaving only the fleabane alive for stock to graze.”

Landholders are advised to also target fencelines and roadsides, as well as crops, pastures and fallow paddocks, in their bid to manage the weed

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Prime Minister Julia Gillard thinks the answer is yes, after she revealed to the crowd at an international food summit last week her visions for the country to become a “global superpower” to meet the needs of a rapidly emerging Asian population.

“It would involve building our food-processing industry so that it can supply Asia’s growing consumer markets and developing the research, technologies and logistics that strengthen irrigation, grow higher-yield crops and improve safety,” she said.

But her remarks have angered leaders in the agricultural and food processing sectors who argue the Federal Government’s policies do not align with this idea.

Victorian Farmers Federation (VFF) president Peter Tuohey said the looming carbon tax and Murray Darling Basin Authority plan were expected to have disastrous effects on Australian agriculture.

“The current MDBA plan will remove 30-35 per cent of the water from irrigators, who produce almost 40pc of Australia’s food,” he said.

“If you take dairy farmers as an example – they won’t grow their herd when there is uncertainty surrounding future water supplies.”

Mr Tuohey said infrastructure development continued to be an enormous issue for agriculture too, but recently few investments had been made by the government.

“Victorian agriculture is crying out for investment in road and rail infrastructure to more efficiently transport food and fibre to port,” he said.

“If Ms Gillard wants us to be a superpower – then she needs to understand what is happening out in the real world and get some dirt on her boots. The carbon tax and the MDBA plan are all going to impact on the cost of production.

“The Government needs to realise we compete on a global market and put measurements in place to support agriculture and food production.”

National Irrigators Council (NIC) chief executive officer Tom Chesson applauded the Government’s “superpower” idea, but agreed there needed to be a fundamental shift in government policies if Australia’s food processing sector was to fully take advantage of Asia’s growing needs.

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New oat varieties required

for Australian hay industry

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Opposition Leader Tony Abbott has all but ruled out backing Clive Palmer as a candidate for the Queensland seat of Lilley – held by the Treasurer Wayne Swan – saying the Liberal National Party needs a grassroots candidate who will ‘‘do the hard yards’’.

Mr Abbott said news of Mr Palmer’s bid for preselection had come as a ‘‘surprise’’ and confirmed he had not spoken with Mr Palmer before his announcement.

The LNP in Queensland would decide if he won pre-selection, Mr Abbott said, but indicated he would strongly back a ‘‘grassroots’’ candidate for the seat.

Mining billionaire Clive Palmer.

‘‘I was as surprised as everyone else at the announcement today. Clive Palmer, like millions and millions of other Australians, is desperate to see a bad government gone,’’ he said.

‘‘But like everyone else who wants to run for the LNP, I’m afraid he has to run the gauntlet of a very testing preselection process.

‘‘I will be urging the LNP to pick the right candidate for every seat in Queensland and the right candidate … is someone who is going to to do the hard yards, knocking on doors, going to shopping centres and talking to newspapers.’’

In a clear indication Mr Abbott was not in favour of Mr Palmer’s proposed tilt at federal politics, he dismissed further questions on the matter from the journalists, saying: ‘‘Clive is a character and I think I’ve said what needs to be said.’’

Mr Palmer also announced he planned to build a replica of the Titanic.

‘‘Good luck to him,’’ Mr Abbott added.

Queensland Premier Campbell Newman said he could only speculate on Mr Palmer’s motivations, but he assumed the potential candidate was appalled by the government’s lack of vision and financial management.

“As to what happens, that’s a matter for the LNP,” he said.

“I don’t run around endorsing candidates for preselection.”

Asked whether he agreed with Mr Abbott’s comments the party should select a candidate who could work hard doorknocking and talking to people in shopping centres, Mr Newman smiled and said: “I’m sure Mr Palmer can do that if he becomes the candidate but that’s a matter for the party.”

Mr Palmer said he would seek preselection in Mr Swan’s Queensland seat of Lilley.

“He’s been a sitting member for far too long and it’s about time we get this country moving again,” Mr Palmer said of the Deputy Prime Minister.

Mr Swan, who holds the seat with a margin of just 3.2 per cent, took to Twitter to respond.

“Over the moon to fight in Lilley for relief for families and small businesses, against Clive and [Opposition Leader] Tony Abbott fighting for Clive’s profits,” Mr Swan tweeted.

Mr Palmer, recently one of the targets of Mr Swan’s attacks on the influence of “vested interests” in the national political debate, said he wanted to grow the nation’s prosperity and lift standards in Parliament.

“I think [Opposition Leader] Tony Abbott’s a great leader,” he said.

“He’s the next prime minister of Australia.”

Mr Palmer, a former major donor to the LNP, dismissed suggestions he would need to give up his business interests.

“I don’t think I have to give up anything if I win the seat. Politics is about ideas; you’re not there for money. You’re not going to become rich being a politician,” he said.

“I’m not going into politics to pursue business interests; I’m going into politics if I can [to] contribute to ideas, where this country should go.

“We’ve only got a small family company.”

Mr Palmer, who in 1984 was defeated by Peter Slipper for National Party preselection for the seat of Fisher, said he would follow the policies of the LNP and this included repealing the mining tax.

“I’m just putting my name in like any other member to serve the community,” he said.

“Queenslanders in particular voted very definitely that they wanted change at the last state election; but they want more than change; they want follow-through to see things are happening in this country.”

This morning, Mr Swan said that the Liberal Party stood to become a “wholly owned subsidiary of Clive Palmer” if Mr Palmer was successful in the battle for Lilley.

“I could not be happier to fight in Lilley for tax breaks for 16,000 small businesses and 51,000 workers, while Mr Palmer and Mr Abbott fight to protect Mr Palmer’s multibillion profits,” Mr Swan said.

The Treasurer called on Mr Abbott and Mr Palmer to spell out the nature of Mr Palmer’s financial contribution to the Liberal Party before the next election.

“Mr Abbott and Mr Palmer must immediately guarantee that Mr Palmer will not use his massive wealth to buy his way into Parliament or influence in any way the election in Lilley,”  he said.

Mr Swan also called on Mr Abbott to declare whether he supported Mr Palmer’s CIA conspiracy theories and whether he accepted the mining magnate’s intention to be only a part-time member of Parliament if elected.

“I believe we live in a community, not in a corporation,” Mr Swan said at a media conference this morning.

“This Labor government believes that the tremendous opportunities of the Asian century and the mining boom should be shared fairly with all Australians, not just captured by a fortunate few.”

Last month, Mr Palmer made headlines when he accused the Greens of being linked to the US Central Intelligence Agency through a report entitled Stopping the Australian Coal Export Boom.

He then went on to tell reporters his comments were designed to take negative attention off the Liberal National Party in the lead-up to the Queensland election on March 24.

The billionaire has been involved in an altercation with Football Federation Australia, after the body axed his Gold Coast United club from the A-League following Mr Palmer’s outspoken dissent on a range of issues.

Mr Palmer has also been involved in legal action over the future of the Hyatt Coolum resort on the Sunshine Coast, and announced plans to sue QR National over an alleged breach of confidentiality regarding a proposed rail link to the Galilee Basin coal region.

The LNP recently put out a call for potential candidates to put their hands up to run for a number of Queensland seats, including Lilley, held by Mr Swan with a 3.2 per cent buffer.

The LNP set today as the deadline for potential candidates to lodge expressions of interest.

Mr Palmer made the preselection announcement on the same day he flagged plans to launch a new international shipping venture.

It would include a fleet of world class luxury liners including a 21st-century version of the Titanic.

He had signed a memorandum of understanding with state-owned Chinese company CSC Jinling Shipyard to build Titanic II, according to the statement.

Mr Palmer denied his political tilt was a stunt.

“No, this is not a stunt. It’s a factual reality,” he said of the bid for preselection.

Mr Swan won the seat in 1993 but was defeated at the election three years later.

He regained the seat, which stretches from Brisbane’s inner north to Moreton Bay, in 1998, and has been re-elected at every federal election since.

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AUSTRALIANS can expect a series of rate cuts, beginning with a drop of at least 0.25 points at the Reserve Bank board meeting next Tuesday, after much weaker than expected inflation figures.

The consumer price index climbed just 0.1 per cent in the first three months of the year, and by just 1.6 per cent over the year to March – the weakest annual price growth since the 2009 global financial crisis. This is a sign that both inflation and economic growth are weaker than the Reserve had expected.

More rate cuts are likely to follow in response to a tough budget which will tend to further dampen economic activity in the quest for a surplus.

Debate at Tuesday’s meeting will be about whether to cut the cash rate by 0.25 or 0.50 points.

Lower interest rates and easing cost of living pressures could take some sting out of the unpopular carbon tax, to be introduced in July.

Pushing down prices was a 60 per cent drop in the price of bananas in the quarter and a 30 per cent fall in the price of fruit. Over the year to March fruit prices fell 24 per cent and vegetable prices 17 per cent.

Even ignoring the price of volatile items such as fruit and vegetables, inflation is weak. The Reserve’s measure of so-called underlying inflation came in at an extraordinarily low 0.35 per cent for the quarter and 2.15 per cent for the year. The annual figure is the lowest in 13 years.

“The Reserve Bank got it wrong,” said Stephen Koukoulas, an economic consultant who was until recently an adviser to the Prime Minister.

“They should have cut in February, they should have cut in April. Even as late as last year they were expecting inflation above 3 per cent. It is now clear they underestimated the impact of the strong dollar and failed to appreciate how weak retailing and construction really were.”

The Treasurer, Wayne Swan, said while the Reserve Bank was independent, “you would only have to look at their minutes published a week or two ago to see that they themselves have said that they’ll be looking closely at this inflation number, and they will do that and take their decision independently”.

The bank said if inflation eased further “a case could be made for a further easing of monetary policy”.

Financial markets were last night pricing in four more cuts of 0.25 per cent by Melbourne Cup day, taking the Reserve Bank cash rate down from 4.25 per cent to 3.25 per cent. If fully passed on they would bring down standard variable mortgage rates from around 7.4 per cent to 6.4 per cent. This would cut $190 a month from the cost of servicing a $300,000 mortgage, taking monthly payments below $2000.

Attempts to make political capital of the Reserve’s deliberations turned to farce yesterday when the Opposition Leader, Tony Abbott, wondered out loud whether the bank would “lower interest rates today”, apparently unaware the bank board wasn’t meeting until next Tuesday. The Financial Services Minister, Bill Shorten, pounced, saying anyone who wanted to be the alternative prime minister ought to know when the bank board met.

“The Reserve Bank board has been meeting on the second Tuesday of the month since 1960,” he told the ABC’s PM program. Mr Shorten was also wrong. The board meets on the first Tuesday of the month

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A case of mad-cow disease reported in the US may boost Australian beef exports to Japan and South Korea, an industry group said.

“We need to see how this affects the Korean and Japanese markets,” David Byard, executive officer of the Australian Beef Association, said by telephone today. “It all depends on how the Japanese and the Koreans take this.”

Australia last year overtook Brazil as the largest shipper of beef, with its three biggest markets, Japan, the US and South Korea. The government is monitoring the situation, the Department of Agriculture said in an e-mailed statement, adding Australia “does not import beef or beef products from cattle of US origin.”

A case of mad cow disease detected in California may benefit Australian beef exporters. Photo: Glenn Campbell

The brain-wasting disease has been found in a dairy cow in central California, John Clifford, the USDA’s chief veterinarian, told reporters in Washington yesterday. Its meat did not enter the food chain and the carcass will be destroyed, Clifford said. South Korea will halt customs clearance of any new US beef imports, Park Sang Ho, an official at the Asian nation’s farm ministry, said by phone today.

Japan has no plan to suspend US beef imports “at the moment” even after the discovery, Minoru Yamamoto, director of the animal health division at the farm ministry said by phone.

Fourth case

It was the fourth confirmed case of the disease in the US cattle herd since the first was discovered in December 2003 in an animal that came from Canada. Dozens of countries shuttered their doors to US shipments following that discovery and nations including Japan and China have maintained some restrictions ever since.

Losses to livestock producers and meatpackers ranged from $US2.5 billion to $US3.1 billion annually from 2004 through 2007, according to the International Trade Commission.

Australia’s beef and veal exports, valued at $A4.3 billion during fiscal 2011, may increase 1.6 per cent next year as production gains on heavier carcass weights, according to a March 6 report from government forecaster the Australian Bureau of Agricultural and Resource Economics and Sciences.

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