Agricultural Reforms in Australia Livestock Production

Question: Discuss about the Agricultural Reforms in Australia for Livestock Production. Answer: Introduction Agriculture is the art and science of growing of crops and livestock production. There has been a huge decline in Australian agricultural production in the recent years. However, this is not how the case should be; the nation depend on this sector to obtained food. Owing to this reason, there is a need for the government to ensure that it solves the various challenges facing this industry to ensure sustainable food security (Gray, Oss-Emer and Sheng, 2014). In the attempt to promote agricultural activities, the Australian government has implemented many reforms. Some of these reforms has stimulated its growth whereas others hasnt shown any improvement. This study will be important to farmers to understand the various challenges facing their sector and also in making decisions that oversee such challenges. The policy makers will observe the trends of the agricultural contribution to GDP and may take actions that could benefit the whole economy. Australian climate is not so supportive for agriculture; this explains the decline in production especially in the recent period when it is being faced by a prolonged drought. The area receives very little rainfall and agriculture is mainly irrigation based. Those areas that do not receive enough rainfall are used for pastoralism activities. Article Review It can be noted from the article by Batt (2015) that the policy reforms on Australian agriculture are mainly industrial based. He noted that though the importance of agriculture in Australia has been diminishing owing to the growth of service-based and the manufacturing sector, it has remained and will remain to be an importance component of the Australian economy. This sectors proportionate contribution to Australian GDP was recorded to be 203 % in the article. This is a significant contribution. One of the most essential need for agriculture besides food provision is the creation of employment (Pc.gov.au, 2005). Many people are employed in this sector. Those employed on agricultural farms are about 307,000 in number. However, this is not the limit; the highest number is employed on the output and input sector, food manufacturing and processing, etc. in overall, the industry employs more than 1.6 million workers. The food produced by Australian farmers is sufficient to feed 80 milli on people. Fig: Proportionate contribution of Agriculture to Australian GDP The contribution can be observed to be rising over the years. Even during the 2008/09 global recession, the sectors still maintained its contribution at a high level. The Australian farmers have a high contribution on Australian food export. The government has reformed on reducing trading tariffs so as to promote the trading of goods and services. Exportation of farm produces has created a wider market base for which the farmers produce are sold. The availability of a market for output creates an incentive for the farmers to produce more. They are even assured that their products are going to fetch some better prices. If the farmers supplied only to the domestic consumers, there would be an excessive supply of food and the prices the consumers will offer will be too low. Lower prices are a disincentive to the farmers owing to the increased cost of inputs used in the production. Population is experiencing a fast growth in many economies; this accompanied by an increment in personal income has resulted in Asia providing a market for 60 % of Australian agricultural produce. Chinas provide 22 % and this is also a high contribution. Batt noted that the market is growing in other economies such as 9.4 % for Japan, 7.3 % Indonesia, 5.8 % Korea, 3.0 % Malaysia and 2.8 % for Singapore. There has been a deregulation of this industry; one of this being the reduction of governments assistance to the farmers (Harris and Rae, 2017). The article indicates that Australian farmers receive the lowest support from the government compared to other large economies such as US, Japan and Korea. While this 3 economies receive US $31 billion, US $54 billion and US $22 billion respectively, Australia only receive US $ 960 million (Batt, 2015). From these deregulation the transitioning of the previously assisted farmers to the market driven agriculture has been confirmed (Zhou, 2013). The factors behind the success of the Australian agriculture industry is the protection of the farmers by the government (Sanderson, 2016). To ensure that the incentives of farmers in producing more, the government reformed to abolish imports by raising import quotas and tariffs (dfat.gov.au, 2017). This has helped in ensuring that there is very little or no importation of agricultural products. Irrespective of this, the prices for the products are falling. Recommendations There is high potential for growth in the agriculture industry. If the government could ensure that there are proper water management and supply to support this sector, massive growth could be experienced. The government should also teach the farmers on the best practices they should employ on their farms so as to lower production costs and yield better output. Research and development could result in innovation in the sector thereby boosting production. Conclusions Owing to the own supply of agricultural produce, the Australian are able to enjoy the products at a lower affordable price. A shortage of supply could have raised the living costs owing to the increased food prices. Support by the government is a disincentive to the farmers since for some the major concern is the money to be received by the government. Many people would be employed in the agricultural industry as it expands. References Batt, P. (2015). Australia's 'five strong pillar economy': agriculture. [Online] The Conversation. Available at: https://theconversation.com/australias-five-strong-pillar-economy-agriculture-40388 [Accessed 11 Apr. 2017]. Dfat.gov.au. (2017). Advancing Agriculture Reform in the EU and Australia. [Online] Available at: https://dfat.gov.au/geo/europe/european-union/Documents/advancing_agriculture.pdf [Accessed 12 Apr. 2017]. Gray, E., Oss-Emer, M. and Sheng, Y. (2014). Australian agricultural productivity growth: Past reforms and future opportunities. [Online] oecd.org. Available at: https://www.oecd.org/tad/events/Mr.%20Merrilees_Agricultural%20productivity%20growth%20reforms%20opportunities.pdf [Accessed 12 Apr. 2017]. Harris, D. and Rae, A. (2017). Agricultural Policy Reform and Industry Adjustment in Australia and New Zealand. [Online] Ideas.repec.org. Available at: https://ideas.repec.org/p/ags/iapr04/15762.html [Accessed 11 Apr. 2017]. Pc.gov.au. (2005). Trends in Australian Agriculture. [Online] Available at: https://www.pc.gov.au/research/supporting/agriculture [Accessed 11 Apr. 2017]. Sanderson, F. (2016). Agricultural protectionism in the industrialized world. 1st ed. Routledge. Tradingeconomics.com. (2017). Australia GDP from Agriculture | 1974-2017 | Data | Chart | Calendar. [Online] Available at: https://www.tradingeconomics.com/australia/gdp-from-agriculture [Accessed 12 Apr. 2017]. Zhou, Z. (2013). Developing successful agriculture: an Australian case study. Wallingford, UK, CABI.