When Old Macdonald retires, who should own the farm?

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Him (distracted by his new iPhone 6): A litre of milk, please.
Me: That’s $1.20, thanks.
Him: $1.20? No way, I can’t afford that. We go through four litres of milk a week. I’ll get it at $1.00 down the road.
Me: But $1.00 isn’t enough!
Him (wanders off, still looking at the iPhone)

Me (in 10 years): I’m tired of trying to make ends meet. I’m retiring.
Him (looks up from new iPhone 60): You’re selling the farm?
Me: Yep. Got a good price from a guy who says he can see the farm’s potential. I’m finally able to retire.
Him: But where will I get my milk from?
Me: The new owner, I guess.
Him: But he might sell it to someone else!
Me: Just get it from down the road then, like usual.
Him: But what if they decide to retire as well and sell it to this bloke?
Me: Relax. Not everyone’s going to sell to the same bloke.
Him (waving arms, stamping feet): But what if they do? It’s not fair. You are not to sell to him. This is MY milk. I demand food SE-CU-RI-TY!!!
Me: Maybe you could just offer him $1.20 for it?

Banning foreign ownership of Australian farms sounds nice in theory but it’s just not fair. Not to the farmers who want a fair price for their land and not to international investors who appreciate the true value of our farms.

There are two main arguments against foreign ownership of farms: ethical practices and food security.

Ethical practices are important and Australia has stringent rules governing almost every aspect of farm operations. In 2014, I wrote about my concerns regarding an overseas firm publicly railing against those laws but, even so, am dismayed to see Milk Maid Marian used as a rationale for preventing any foreign ownership. Farming well, no matter who by, should be supported. Farming badly, no matter who by, deserves concern.

Food security, on the other hand, is a privilege, not a right. Australians – among the globe’s wealthiest people – are in a great position to compete for our share of the world’s abundance of food. And there is no place for a peasant underclass here in Australia.

It’s dazzlingly hypocritical to gleefully buy cheap, high quality electronics from poor nations on one hand but refuse to allow them to buy affordable, high quality food from us in return. If Aussies really want food security, they need to start putting their money where their mouths are.

 

7 thoughts on “When Old Macdonald retires, who should own the farm?

  1. From the mole’s eye view of the consumer who is out of the loop of all the global wheeling and dealing, I still like to purchase whatever I can from my local farmer, and I realize he/she has to charge more. Your posts are always educational. Keep them coming.

  2. Marian, I have always bristled at the political jostling over Free Trade Agreements where, it seems particularly, Australians only ever ever see what they think they can gain rather than what they are giving up. I do not favour tariffs and trade barriers but we should value what we have and not give it away cheaply.

    • Hi Kevin,
      From a dairy farmer’s perspective, there was nothing left to give away when it comes to free trade. There are no trade barriers when it comes to the Australian dairy market, only an oligopolistic retail sector to distort the price.

      • Imagine if FTA’s had to be based on parity of reciprocity…not parity of some arbitrary economic value for political convenience. Somewhere between the FIRB, ACCC, ATO, DFAT and ASIC we, as a nation, have been sold out and left to fend for ourselves as individuals.

        The big domestic retail market does the agri-investment and farming communities no favours at all with their aggressive supplier negotiations and prohibitive engagement practises and operational conduct & behaviour.

        Our competition rules & regulations tend to brutalise domestic competition and yet leaves our major exporters exposed to intense international competition from other suppliers from other geographies where the rules are in their favour and their own domestic markets are highly protected.

        We allow direct investment from other countries where there is neither reciprocity nor parity and then increase the burden on our taxes in having to monitor, administer and manage those direct investments. We lack using any test of character or test of sovereign respect in fear of upsetting the politically correct. We lack the smarts or interest to look to aggregation of industry sectors to ensure we are not losing key industry sectors, geographic clusters or business segments. We don’t look beyond the transaction-of-the day to see what is behind and what is driving the direct investment, let alone “who”.

        Transfer pricing is probably the wrong topic to put in this forum but it is another area of poor consideration and allows Australia to be harvested for all the wrong reasons.

        We allow complex offshore financial structures to exist in Australian trading markets to provide a “compliance platform” for offshore interests to acquire wholesale industry segments for repatriation to home turf and yet, again, there is no reciprocity or parity.

        We don’t respect, protect or preserve our food industries from Canberra all the way down to the person in the street with the iPhone but boy can we talk up a good FTA and associated media frenzy.

  3. Nice article, love the iPhone 6 and iPhone 60…the important things in life to many it seems.

    A timely reminder who feeds us and a hint, it isn’t the supermarkets. Simpliciter if we don’t look after the source the source wont look after us.

    Australia in general (excluding VDL in Tasmania) uses a Torrens Title approach to land ownership and the title holder has a right to sell their land to whomever they wish so long as the prevailing laws are complied to. If the purpose to which that land is put is provision of food and the new owner chooses to change its purpose it has a right to do so and if the new owner chooses to supply the food it produces to another party it also has a right to do so.

    Unless we wake up and start looking after our farmers (not just dairy) we will not only go hungry we will run the risk of drying up the economic health in many more parts of regional Australia. Investment in agriculture goes alot deeper than an ROI on a spreadsheet and also depends on regional and national infrastructure.

    If we distance ourselves from our country cousins and treat their efforts with disdain then we deserve to go hungry as they seek a better and more respected life and accept offers from foreign shores. Super funds need to wake up, investment houses need to wake up, banks need to wake up, supermarkets need to wake up, major processors need to wake up and look after their supply source and so on and so on…

    Admittedly it is a really complex topic and it has many perspectives and many interested parties from all points of the compass and maybe, just maybe, that is the problem. New Zealand has one thing over Australia and that is its size – it is too small and too economically sensitive to farming to be able to carry the risk of getting it wrong. Australia needs to wake up to it’s farmers too…

    There I said it! Now I am going back to my Chinese made tablet to browse American news channels whilst I finish my Chai Latte with soy milk sitting on my Swedish sofa covered in Indian cotton!

  4. And again why instead of sitting back and watching our great industry die we need to actively be working towards a National Milk Pool for the good of all dairy farmers.
    Neither of the ALP or LNP will do it so this is one of the reasons why I am standing as a Independent Candidate in the Federal election.
    It’s up to us something highlighted by the MG issues this week
    Time to wake up

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