19/12/2019

(AU) Climate Change Slashes More Than $1 Billion From Farm Production Value Over Past 20 Years: ABARES

ABC Rural - Kath Sullivan

Wind is blowing topsoil away and farmers fear it will take years for some landscapes to recover.
(ABC News: Lucy Barbour)
More than $1 billion has been wiped from the value of Australia's annual crop production due to the change in climate over the past two decades, according to a new report.
For the first time, government commodity analyst ABARES has quantified the financial loss Australian farmers have experienced due to the increasingly warmer and drier climate.
It found changes in climate since 2000, had reduced the average broadacre farmer's profits by 22 per cent, or about $18,600 per year.
For cropping farmers — considered the most heavily exposed to climate variability — the annual farm profits fell by 35 per cent, or $70,900.
"We knew it was big, but we didn't have a precise number before and this model and method allows us to get at that," report co-author Steve Hatfield-Dodds said.
Dr Hatfield-Dodds said the modelling relied on 30 years of data, which distinguished the impact of price, climate variability and other factors on Australian farms.
That was modelled with reporting by the Bureau of Meteorology.
"Essentially, there's been a shift in climate in the last past 20 years, where the climate has become noticeably hotter and drier," he said.
"Dry years are more frequent since the year 2000 … temperatures have gone up by about 1 degree since 1950."
Drought support reduces adaptation
The ABARES report has thrown up questions about government support for farmers affected by drought, and how best to drive innovation in the sector, as the climate continues to change.
"Adjustment, change and innovation are fundamental to improving agricultural productivity, maintaining Australia's competitiveness in world markets, and providing attractive and financially sustainable opportunities for farm households," it reported.
"In some cases, well-intentioned policies can also disadvantage farmers who have been better prepared or luckier than farmers who are provided assistance and relief, diluting management incentives and raising difficult equity issues."
The State of the Climate Report 2018 shows winter rainfall over southern Australia has been declining over the past 20 years. (Supplied: CSIRO and Bureau of Meteorology)
Dr Hatfield-Dodds said the sector must increase its resilience to a warmer and drier climate.
"There's a lot of talk about economists versus normal people," Dr Hatfield-Dodds said.
"The economists worry about drought assistance because there is this unavoidable dilemma between helping farmers who are in need now, and slowing down innovations and adjustment in the sector.
"And we know from this study — and lots of other ones — that innovation is crucial to improving farm income for households over the long run.
"But there aren't many options for governments to help farmers that don't risk slowing down innovation."
He suggested incentives, such as improved weather-insurance policies for farmers, could help build resilience in the sector.
Dr Hatfield-Dodds also highlighted the Federal Government's Future Drought Fund, providing $100 million a year from next year, as a policy which would support resilience in the sector as the climate evolved.
It was not yet clear how that funding would be allocated, but the legislation passed earlier this year outlined spending on future drought preparedness.

Losses could have been greater
The report found the losses would have been even greater had Australian farmers not adapted to drought as well as they had.
"Without these gains, the effects of the post-2000 climate would have been larger — a 26 per cent average decline in profit for all broadacre farms, and 49 per cent for cropping farms under the 1990 technology," the report said.
In short, if the average cropping farm had made no adaptions to the hotter and drier climate, its income would have been down by a further $26,700 a year.

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