Mr RAMSEY (Grey—Government Whip) (16:35): I have to say, I farmed for 35 years. It’s always challenging, and this year is proving absolutely no different. In my state and in my electorate after a wonderful start to the season, where, in particular, the June and July rainfalls were exceptionally good and the seasons seemed to be set up for complete success, August proved to be dry, September turned the tap off completely and October wasn’t a lot better. That has caused some problems with the crops, and they’re not as good as we had hoped, but there are some good crops around. Since November started, though, the season seems to be intent on making up the rainfall deficit. We’ve seen 70 to 100 millimetres of rain over the last two weeks across a substantial part of my electorate, including on my own farm. It’s just at a time as the headers have entered the paddock. The quality of the crops was exceptional, and the yields, considering the season, were pretty good. We are now waiting to see just how much damage has been wreaked by the rainfalls across those broad areas as it dries out enough to get the headers back on the ground and assess the quality.
There are a whole lot of other issues facing farmers at the moment, and increasing concerns are being shown around the supply lines on new machinery, parts and, more concerningly, the fertiliser and chemical supplies coming into the nation and their pricing. In fact, we’ve seen staggering price increases of anything up to almost 300 per cent on fertiliser and chemicals, and we’ve seen concerns about supplies. To give a bit of explanation: nitrogen fertilisers are largely made from gas, and most plants in the world—certainly where we get product from—are in Asia. In Asia and Europe, the gas price has increased by around 400 per cent. It is up to $40 a gigajoule or thereabouts, and that is driving the price of fertiliser higher and causing the producing countries to restrict exports to try and dampen the prices in their own jurisdictions. That includes China, but that is not an unexpected response. In Australia, the gas price is around $10 a gigajoule, and that is a result of the government’s ‘big stick’ policies. Unfortunately, we don’t have that manufacturing capacity in Australia, and our ability to produce nitrogen fertiliser is severely limited. That is a problem for farmers.
Worldwide, there are more issues at stake. One of them is the supply of freight and shipping services. With COVID, people stopped buying services and have been on a consumer goods binge ever since. They’ve got money in their pockets. They’re not eating in restaurants. They’re not spending money on tourism. The one-way volumes of consumer goods have soared. There hasn’t been enough back load on those containers, so those containers have been piling up in consumer countries and haven’t been finding their way back. The shipping companies followed the best advice at the time—that trade levels were going to be slashed—and they took the opportunity to retire some old and pretty dirty ships, so there was a shortage of ships around. They’ve commissioned new shipping, but they’re not out of the shipping yards yet, so there’s a ship shortage. We’ve got problems on wharves, particularly here in Australia, where the maritime unions are causing concerns. There are bottlenecks around ports all around the world. There are all kinds of hold-ups on freight, and that is feeding through to the farmers’ supply system, including on chemicals and on fertiliser.
On fertiliser, I was asked by a farmer: ‘We produce a lot of fertiliser in Australia. Why don’t we hold that in Australia, much as other countries are doing?’ In fact, we are fairly short. We produce about enough DAP, a couple of hundred thousands tonnes a year. We produce more than enough single superphosphate, and we export about two thirds of that capacity. But the big outlier is in MAP, where we produce about 162,000 tonnes but need nearly a million tonnes a year. We are a net receiver of fertilisers in a big way. These are real problems for farmers as they look at their books for next year. This shortage of freight capacity is feeding into the chemical market as well. As it rains, almost as I speak, at home, it’s causing damage to the crops. It’s also causing a whole raft of new summer weeds to grow, and it will require chemicals that are three times as expensive as they were this time last year to keep those summer weeds under control. To be fair, the rainfall will stop eventually. (Time expired)