Farm ownership Australia: Now ag must play catch-up

EXCESSIVE regulations may be deterring foreign investors, writes JAMES WAGSTAFF.

AUSTRALIAN agriculture is lagging behind the rest of the world due to government interference on issues such as foreign investment, and a lack of capital, industry leaders say.

“There is no doubt that it was not that long ago that we were up there with the best farmers in the world in terms of our capacity to turn sunlight and rainfall into agricultural produce,” key agriculture investor David Goodfellow said.

“But because of the lack of investment in Australia in the past 15 years, we are quickly falling not just a little bit behind but way behind the rest of the world.”

Mr Goodfellow, chief executive of AustOn Corporation — the Australian arm of Canada’s Ontario Teachers’ Pension Plan Board — said governments had “lost their way a little bit in terms of leadership we require in our industry”.

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He said while Australia was “sitting around waiting to be looked after by the China boom” the rest of the world had “gone on and invested in the future of agricultural production”.

CBRE Agribusiness regional director Danny Thomas said constant changes to government “regulation and legislation” weren’t good for any industry and agriculture in particular received “far too much of it”.

National Farmers’ Federation president Fiona Simson said the Government’s stance on foreign investment in agriculture, in particular, was too “political” and called for greater transparency around its decision-making process.

The Coalition Government in 2015 reduced the trigger on Foreign Investment Review Board scrutiny of farmland sales from $253 million to $15 million, and investment in agribusiness from $253 million to $55 million.

In February, the Government added new rules where farms valued at more than $15 million needed to be advertised to Australian bidders for at least 30 days before foreign investors could buy them.

“Foreign investment is one of those things where there is a continual change in the rules which affects how we are perceived internationally,” Mr Thomas said. “When you continually change the rules … the accumulative effect is that we’re giving people a reason (to look elsewhere).”

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Foreign investment in agriculture has become a significant issue in recent years. In 2016, the Government knocked back the sale of S Kidman and Co — Australia’s biggest landholder — to Chinese investors on the grounds of “national interest”.

But Ms Simson said the Government’s national interest test was “one of those black-box type things where there are no clear rules”.

“Some of these decisions are being made on political grounds.”

Agriculture Minister David Littleproud said the Government’s foreign investment rules were “nothing to fear because all that does is gives us is a lens to be able to look at how we make those decisions”.