AgDM newsletter article, February 2004

Lessons from Australian agriculture

Mike DuffyBy Mike Duffy, Associate Director for the Leopold Center for Stustainable Agriculture, 515-294-6161, mduffy@iastate.edu

I recently had the opportunity to spend a month in Victoria, Australia, in the southeast part of the country. My visit came at the request of the Australian government to help evaluate its family farms program. The government is concerned about the loss of family farms and began the program to get a better understanding of the subject and to determine what could or should be done about it.

Throughout my career I have had the opportunity to visit farms and meet agriculturalists from many countries. This was my first opportunity to spend an extended time in such an outwardly different agricultural situation.

Victoria has a more moderate climate than Iowa, but its soils by comparison are very poor. They face serious problems of water availability and excess salinity. As a result most agriculture involves grass-based animal production, especially beef cattle, dairy and sheep. The northwest section of Victoria has much larger fields for small grain crops, similar to production in the western United States. In spite of the differences in climate and soils, some of the same problems confront family farms in Australia as in Iowa. The problems may rank differently, but the main ones appear on both lists.

Similar issues in agriculture

A major problem is trying to define what is meant by a family farm. The family part is fairly easy, however, it is more difficult to describe a farm.

Like Iowa, Victoria has a number of rural residences that really do not meet the criteria of what is generally thought of as a farm. Such rural residences are critical when considering land use and other social and policy aspects, but they really are not important in the overall consideration of agricultural production. Most people do not realize that based on census data, Iowa has more people living in the countryside but not on a farm than those living on a farm. As in Victoria, this creates very interesting dynamics when considering the type of agricultural production that is practiced and acceptable to the populace.

Victoria and Iowa both face the same concerns with the so-called disappearing middle. In the context of family farms, the disappearing middle simply refers to the loss of the midsize farms. What we see in both locations is an increasing number of small and large farms.

The farmers I spoke to commented on other issues and concerns often voiced by Iowa farmers. The cost/price squeeze, how to make a profit in production agriculture, the impact of high land values, the loss of farmers in the neighborhood, the lack of succession or estate planning, concerns over international trade regulations, environmental concerns, and so forth were all the topics of discussion.

My conversations with county, government, and university officials centered on the same issues that Iowans face. During most of the meetings I could have closed my eyes and, except for the accents, I could have been at a meeting in Iowa.

So, what does this tell me? First of all, it says that the core problems we are facing in Iowa are not isolated ones. They are problems associated with all agriculture, at least in developed countries. We need to think in a global context when considering these problems, not just for exports or to see what our competitors are doing, but in search of different solutions to the issues we face.

More than once I heard complaints about direct government support to Iowa (and U.S.) farmers. Similarly, I also heard comments regarding unfair trade positions that the United States is taking. This was interesting to me because I have often heard similar complaints from Iowa farmers; perhaps not directed towards the Australians, but toward other countries. We need to realize that people view any situation from their own perspective. We want to think that our policies do not distort trade, but others do not hold the same point of view.

One significant difference between Victoria and Iowa was the level of direct government support. In Australia, there is no direct commodity support while in Iowa there is. In spite of this type of support in Iowa, our problems are much the same. This suggests that we need to rethink the type of support we give agriculture. If an agriculture that receives large amounts of direct, commodity support experiences the same kind of problems as an agriculture that receives no support at all, we need to reconsider our position. We should be searching for alternatives if we want government commodity support to address these problems.

Lessons we can learn

So, how can Iowa farmers use the knowledge that they are not alone in facing the problems of modern industrialized agriculture? At a base level, I suppose there is some virtue in the saying “misery loves company.” But, more to the point, I think Iowa farmers can use this information as they consider their own situations and how they make decisions. They also can use this knowledge as they process information they receive from various sources on agricultural issues.

Iowa farmers and Victoria farmers can evaluate their situations using the same basic principles. They need to have clear goals and objectives, be able to realistically assess available resources, and determine the best way to use these resources to achieve the desired goals.

Several years ago ISU Extension sponsored a conference called “Four Roads to the Future of Agriculture.” This conference spelled out different approaches farmers could take in adjusting to the current situation in agriculture. I have slightly modified the roads that were identified at the conference. In a general sense, the four roads are commodity production where you try to make a living using volume to overcome the tight profit margin; specialty production where you try to widen the margins to make a living; getting off-farm income to supplement farm income; or simply leaving agriculture.

Within each of these categories there are many options, but the general idea is that farmers have a range of alternatives and they need to decide the best course of action based on their own circumstances.

A simple comparison between Victoria and Iowa offers stark contrasts to the role of government in production agriculture. Iowa has substantial government commodity programs while Victoria does not. In spite of these programs, Iowa farmers are facing many of the same problems that Victoria’s farmers are facing and the four roads are exactly the same paths. Like us, they have choices. They may not like the choices, but they have choices.

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