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CONTEXTUAL INFORMATION – AUSTRALIA
Main economic, land use and agricultural characteristics (2002 or latest year available)
GDP per capita (USD)
Population density
Agriculture in GDP
3/km2 (2001)
20,468
Agriculture in employment
3.3%
4.9% (2001)
Source: OECD
Land
(2001)
use Total area
000 hectares
% of total area
Forest area
Total agricultural area
Arable land
Grassland
774 122
145 000
455 500
50 304
404 900
100
19
59
6
52
Source: FAOSTAT – Agriculture Data, Forestry area from 1994
Australia’s land area, of almost 7.7 million square kilometres, is dominated by desert and is the driest
inhabited continent. Most of its soils are shallow, infertile and deficient in phosphorous and/or nitrogen.
The majority of agricultural land is in the river system contained in the Murray Darling Basin (MDB), a
geographical area equal to the size of France. The MDB covers one-seventh of Australia’s landmass, and
supports more than 50 percent of the country’s cropland, producing more than 40 percent of the country’s
total agricultural output. From the 1980s to 2002 Australia has maintained a trend that has seen about 10%
of agricultural land under cultivation.
Livestock grazing accounts for the largest area of land use in Australian agriculture. In 2000-02, 33%
of farm holdings were between 100 and 499 hectares in size. These farms are mainly engaged in beef cattle
grazing, dairying, sheep grazing or grain growing. The second main farm size class are small farms of 49
hectares or less, accounting for 20% of all farms. These farms are engaged in grape growing, beef cattle
grazing, fruit and vegetable growing or plant nursery operations. Large farm holdings of over 2,500
hectares account for 11% of all farms and are mainly engaged in grazing or cropping operations. Because
of the low soil fertility and other environmental conditions, average yields are very low, with wheat yields
over the past five years around 1.75 tonnes per hectare. Similarly, animal stocking rates are very low,
especially in the rangelands area of central Australia. Horticultural products account for about 15 percent
of Australia’s total value of agricultural production.
Farming is dominated by beef, wheat, milk and wool production. Livestock production represents
around 46 percent of the gross value of agricultural production with the beef industry contributing 12 to 20
percent of the gross value of agricultural production and around one-eighth of the agricultural export
income. Winter cereals (wheat, barley and oats) are major crops accounting for 17 to 20 percent of total
agricultural production. The Australian crops sector generally accounts for over half of the gross value of
farm production with the grains industry being the largest sector of the crops industry. Over 10 million ha
of land is devoted to wheat growing, representing one-half the total cropped area.
Agricultural policies and support to agriculture
States (sub-national) have the primary legislative responsibility for managing the environment. The
Australian Government’s role is to facilitate better natural resource management and sustainable
agriculture through partnerships with the States. Support to the Australian agricultural sector is mainly
provided through budget-financed programmes, regulatory arrangements and tax concessions. Budgetary
financed programmes, such as Agriculture — Advancing Australia and the Natural Heritage Trust, are
mainly used for structural adjustment and for natural resource and environmental management,
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respectively. State level statutory and regulatory arrangements enable pooling of returns for some
commodities. Statutory marketing arrangements are in place for wheat, barley, rice and sugar in some
States. Australian Government (national) tax concessions aim to smooth annual taxable income flows.
Consumers of diesel fuel, including farmers and other primary producers, receive rebates of excise taxes on
fuel used in off-road vehicles and machinery. Landholders can claim a tax deduction for expenditure
relating to landcare operations and water storage. Expenditure on research and development is financed
from Australian Government and State budgets, supplementing funds collected through special industry
levies. In exceptional circumstances (e.g. droughts, floods) disaster relief payments may be provided to
producers. Tariffs protect producers of certain types of cheese, unprocessed tobacco, and processed fruit
and vegetables, while aAgricultural imports may be subject to quarantine requirements to prevent the
import of exotic pests and diseases.
Support to agriculture : Australia
%PSE
100%
100
80
60%
60
40%
40
20%
20
0%
0
19
86
19
87
19
88
19
89
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
p
80%
Other
Payments based on historical entitlements
Payments based on area planted/animal numbers
Market Price Support, payments based on output and on input use
%PSE
Source : OECD, PSE/CSE database 2004.
Agri-environmental policies
The main agri-environmental concerns in Australia relate to biodiversity loss, dryland salinity,
introduced pests and plants, soil acidification, soil structure decline, soil erosion and water quality and
scarcity issues. According to the Australian State of the Environment 2001 Report
(http://www.deh.gov.au/soe/2001/), nearly 6 million hectares of land are currently at risk from salinity,
with 17 million hectares that potentially could be impacted by 2050. Two-thirds of this potentially affected
land (11 million hectares) is currently under agricultural use.
Most environmental legislative responsibilities rest with state/territory governments. The National
Strategy for Ecologically Sustainable Development (NSESD) provides the guiding framework for most
environmental and natural resource management policies. Federal funding is provided to those
states/territories which enact legislation supporting national strategies.
The Natural Heritage Trust (the NHT) is the most significant agri-environmental measure funding
sustainable development initiatives important to agricultural producers. The Australian Government
introduced the National Action Plan for Salinity and Water Quality (the NAP) in 2000. A central feature
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of the NHT and the NAP is their joint focus on getting communities to identify the key natural resource
management issues in their region, and governments' investing in strategic actions to improve resource
condition at the landscape scale. The investments are assessed against the level of public good benefits
expected to eventuate, with private (landholder) contributions generally sought if the investments are also
expected to generate benefits for individual landholders.
The National Landcare Program seeks to engage industry and resource users, particularly through
community landcare groups, in landcare and natural resource management activities. Of the total landcare
membership, around 40 per cent are farmers. Another 35 per cent of farmers draw on information on
sustainable farming practices provided by the 4000 plus landcare groups that operates nationally, mostly in
rural Australia.
Market-based instruments are increasingly being used to address environmental issues. A system of
tradeable water extraction rights is being implemented on a State basis and includes trading of water across
State boundaries to improve the allocation of water to the highest value uses, and to allow the cost effective
recovery of water for environmental outcomes. Australia has commenced a major national program of
water reform that is directed at increasing confidence for investors in Australia’s water industry. The key
elements of the reform program are: improving water security and clarifying access entitlements; better
monitoring, reporting and access to information; ensuring water is made available for key environmental
assets; and encouraging water conservation.
Key information sources
Australian Government Department of Agriculture, Fisheries, Forestry www.daff.gov.au
Australian Government Department of Environment and Heritage http://www.deh.gov.au/index.html
Natural Heritage Trust http://www.nht.gov.au/index.html
Australian Government Environment Portal www.environment.gov.au
Landcare www.landcare.gov.au
Land and Water Australia www.lwrrdc.gov.au
Statistics Australia www.ausstats.abs.gov.au
Australian Government Natural Resource Management www.nrm.gov.au
Australian Natural Resource Atlas http://audit.ea.gov.au/ANRA/atlas_home.cfm
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