11 Percent of Australian Farmland Foreign Owned
Posted: January 18th, 2012 | Author: Michael Courtenay | Filed under: Business News, Indeep Media | Tags: ABARES, Agriculture, Australia, Australian Bureau of Agricultural Research Economic and Sciences, Business News, Farming, Foreign Investment, Foreign Investment Review Board, National Farmers Federation, NFF | Comments Off
Australia: The National Farmers Federation – NFF – says it is concerned by the rising level of foreign investment in agricultural land and says it welcomes more regular research into the issue. A report from the Australian Bureau of Agricultural Research Economic and Sciences – ABARES – shows the amount of farmland that is either partly or wholly foreign-owned has increased by nearly 60 per cent since the early 1980s. The report also found that roughly 99 per cent of agricultural businesses by number are entirely Australian owned, as is 89 per cent of agricultural land and around 91 per cent of water entitlements.
More than 11 thousand farming enterprises were surveyed for the report, covering the ownership of the enterprise, land and water assets, the study took place in May 2011.
The study concluded:
- 99% of Australia’s 133,600 agricultural enterprises are entirely Australian owned.
- 89% of Australias 353 million hectares / 88 million acres of agricultural land is entirely Australian owned.
- 91% of the nations 13,700 gigalitres of water for agricultural enterprise is entirely Australian owned.
The Government says the report shows that foreign investment is a good thing for Australia, but it has decided to commission more regular research into the issue, a move the NFF welcomes. ”We’ve got a baseline now with the work that’s been done and we’re going to have biennial assessments,” NFF president Jock Laurie said. ”I think that’s crucial to understand where the trends are, where the trends are going, and obviously if there needs to be adjustment made to the Australian policy in regard to what the trends are showing.”
Mr Laurie says the numbers do not tell the full story. ”Over the last few years there has been some changes in the way that foreign ownership has come in,” he said. ”The changes we’ve seen over the last few years are very much associated around… probably purchases around mining areas, for instance, and also overseas governments looking seriously at coming in and being players for the Australian market.”
Shadow minister for agriculture and food security, John Cobb said foreign investment had been vital for the development of agriculture, which was supported by the ABARES data. However he said it was concerning that in the past three years there had been a 10-fold increase in foreign investment in ownership and control of agricultural supply lines.
While the number of agricultural businesses with foreign ownership – 1300 – represents just 1percent of the total, it was significant that 63 per cent had greater than 50 per cent foreign ownership.
“While the overall figures for agribusiness are low they are skewed by not looking at the size of agribusinesses,” Mr Cobb said. “By including every small family farm business structure with an ABN we cannot see the proportion of large businesses like the grain marketing companies or the dairy food processes that are foreign owned. “Foreign control of one of these businesses can have more impact than a owning a thousand farms.
UPSIDE: Mr Laurie says the Federal Government should apply a national interest test to some investments from foreign governments and continue to monitor any changes in levels of overseas ownership. But the NFF acknowledges foreign investment can be enormously beneficial.
“It has maintained … lots of big players coming into the market and even though they’re buying top-end properties, you get the ripple effect right through the property market in Australia,” Mr Laurie said. ”What that does is maintain equity levels in rural land right across all property holders within the Australian community, and that’s been very important.
Mr Cobb said that other countries are already preparing for tighter food supplies by strategically buying into world-wide agricultural supply chains. He went on to say that current rules for foreign investment were outdated and did not address food security and would not protect agricultural commodities from foreign control.
“At present the Foreign Investment Review Board is required to investigate agricultural investments above the $231 million trigger. Mr Cobb said. “There are still many unanswered questions about the level of foreign ownership of agricultural land”
Mr Cobb says the level of detail in the report is disappointing. ”It doesn’t show what the value of land is as compared to what it was once,” he said. ”It doesn’t show what areas of production are involved. It doesn’t even say where the land is, and what’s even more disappointing is that the Government says ‘we don’t know very much about this and we’re going to report to you more often about what we don’t know.”
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