Drought survey: Farmers tell us how they are faring

Published: June 2019 | Source: NSW Farmers 2019 Drought Survey

The results of NSW Farmers' survey are in. Farmers across NSW have shared their experiences of drought, government funding and support and what could be done better.

Many NSW Farmers members are feeling the effects of this current drought. A survey by the association has given them the opportunity to open up about their experiences and expectations. Source: Getty Images.
Question 1: What additional state or federal government help might be of benefit to your business during the drought?

I believe that I qualify for the Farm Household Allowance, however by the time it might be approved, I will have gone nine months living on nothing!

It’s a tough stance, but helping farms now doesn’t help. Invest in communities and longer term education and infrastructure so the businesses are sustainable and can also benefit from value-enhancing industries.

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The decision not to charge [Local Land Services] rates in 2019 was welcome. Subsidised soil tests profiling trace elements and organic carbon together with advice on how to improve soil health would be most welcome.

Relaxing of shire and Local Land Services rates.

Any expenses that we incur as a result of state or federal legislation should be supported. Superannuation and workers compensation insurance are really hurting our business. Federal superannuation [for employees] is costing me $35,000 a year. 

Pay the equivalent of the unemployment benefit to employers (town and farmers, and contractors) to assist employers to hold onto staff until cash flow returns. This should not cost the government much because those employees will be claiming it anyway if this keeps going. It is vital we hold onto skilled staff.

 
Skilled staff are vital to farmers and the wider community during drought. Photo by: Gethin Coles.

Many regions are getting to the stage where income is nil, borrowing capacity maxed, and no rain to generate feed or likelihood of a winter crop. Cash flow is strained or non-existent and the current offerings involve spending money first. 

The Farm Household Allowance is incredibly difficult to navigate and access, and while it’s not a business assistance measure it would help to access this to take the strain off household expenses. 

The government could help with sowing subsidies, multi-peril crop insurance subsidies, interest subsidies. These times won’t last forever but they will halt rural economies if some financial assistance doesn’t hit the ground running soon. If underwriters would take on multi-peril crop insurance in normally reliable cropping areas and cropping businesses were subsidised into taking these policies out, then the rural communities would keep turning.

RELATED: Tax breaks needed for farming insurance 

I would like to see the whole process more structured. Currently it seems very piecemeal with funds being spread around multiple agencies on a first-in best-dressed basis. Funding should be directed towards costs all farmers (farmers being people who make the bulk of their income from agriculture, not a miner who has a 40ha block on the outskirts of town and is claiming drought relief for his 10 starving cows!) have, such as shire rates, Local Land Services rates, farm employees etc.

“Proper incentives to use renewable energy.”

Governments should be encouraging some farmers to really assess whether they can continue and provide some assistance along with the farmers’ bankers in a transition away from the farm, or at least a generational change. 

There are many farmers not crying out demanding government assistance who are in a position to upscale and this would provide opportunity if encouragement was provided to those that are barely hanging on and will continue to struggle regardless of seasonal conditions.

RELATED: The day the city woke up to the drought

Some relief on fixed water charges as annual allocations are very low.

We have to develop business/production models that can cope with these sorts of climatic conditions, it is not government’s role. Government can make sure Local Land Services and the NSW Department of Primary Industries is resourced to help people deal with the issues. Transport subsidies are very helpful.

 
Louise Burge from Deniliquin has experienced the flow-on effects of the government’s water management, after losing a whole harvest to flooding during the drought. Photo by: Simon Bayliss. 

Question 2: What additional state or federal government support might be of benefit for your local community during the drought?

We need to have a laugh, more art and culture and coming together in joy. I’m sick of being told about the suicide rates and the doom and gloom. Bring music and culture to town. 

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- Coleambally community is strong
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- 105 years of farming success in far-west NSW
- Bingara: a rural community success story

Offer financial support to all agricultural-related small businesses in country areas affected by the drought. 

Increased support for rural policing to decrease on-farm theft. Increased support for tailored mental health services and subsidies for primary and secondary school students. Make the Farm Household Allowance more widely available.

Support to encourage people to stay in the communities. In times of drought, employment is less which affects all aspects of the community from the number of students in schools to the number of customers for small businesses (e.g. the local tyre shop gets less business because there are less tractors being used in a drought, therefore less tyres to fix). These businesses need assistance as much as farming families.

RELATED: NSW preschool filling gap in rural education  

Millthorpe hosted a ‘Picnic Drought Get Together’ that encouraged more than 150 farmers and their families to get off the farm and enjoy a good dose of community hospitality. Photo by: Robert Bruce.

If farmers are supported, there is a flow-on effect to the local community. Many regional centres rely on farming to keep their economy strong. If we are doing it tough, then so are they.
“Scrap payroll tax for small regional businesses.”

Small businesses, especially cafes, find the cost of power for them outweighs having the doors open because we don’t have the population. They are paying top price for power during the day. Would there be some concession they could receive for their power as they need to have everything running, ready for the next customer? We need these little businesses as it makes travellers stop and spend a dollar in our town.

Waive stamp duty on insurance. 

More support for the part-time workers (shearers, shed hands, tractor drivers, etc.) as they are getting less hours. If they move to bigger towns and cities for work, they won’t come back. There has to be incentives for them to stay until the farming sector picks up again.

RELATED: Why is there a shortage of shearers?

Real action on climate change. Investment in R&D.

Question 3: What do you think of the NSW government’s Farm Innovation Fund

It is more debt and aimed at preparing for the next drought, not this one. We may take advantage of it, if we qualify, but are reluctant to lock in debt for the future at our age.

It will be a benefit after the drought has broken and we start to get cash flow again. Currently we have too much debt and don’t want any more. We hope the Farm Innovation Fund keeps going beyond this drought so we can access it post-drought, ready for the next one.

We are considering investing in more on-farm storage so this fund, particularly now it has increased, would be of benefit to our business.

RELATED: Silo storage helps harvest top dollar

It is not as market distorting as subsidies and puts some responsibility on the business owner to show the farm is viable.

I have used this funding to finance improvements and repairs to irrigation bore and stock water infrastructure.

 
The efficiency and effectiveness of the Farm Innovation Fund is a point of contention amongst farmers but some believe in its validity and its role updating infrastructure. Photo by Michael Frogley. 

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Helped develop water infrastructure in 2015. Not used by current stock, but we are in better shape now, having been able to graze paddocks that would have been off limits when the surface water dried up.

Don’t qualify.

“Would allow us to put in more efficient infrastructure at a low-interest rate but we are still debating if we need more debt.”

Has enabled us to invest in critical infrastructure which has increased our productive and economic capacity for when it does rain, increased the value of our property, has full support of our bank due to there being only a statutory charge, and helped our wellbeing by making improvements on our property despite being in drought since 2012.

Don’t want more debt.

Question 4: Are Regional Investment Corporation loans of benefit to your business today? 

They are complicated and they dilute the existing relationship with our bank. It is much more efficient to manage one loan facility.

We have been told they are VERY hard to obtain. We might have a go regardless once it rains and the pressure of feeding is off.

Low interest is a big help to our business.

The time frame is too short, the rate is variable and more than 50% has to be with a commercial lender, so overall it is just adding to farm debt, to be dealt with at a later time.

We have adequate loan arrangements with our bank.

Drought Impact Survey Results

What do you estimate is the percentage of average annual rainfall received on your property?

Do you have sufficient soil moisture to plant a winter crop?

YES 5% | NO 87% | N/A 8%

If you do not consider you have sufficient funds, do you think you will be able to borrow funds?

LIKELY 63% | UNLIKELY 37% 

Do you think the NSW government's Farm Innovation Fund is of benefit to your business today?

YES 28% | NO 72% 
Drought Impact Survey Results

Describe your average crop yields as a percentage of normal.



Do you consider you have sufficient funds to plant a winter crop?

YES 43% | NO 45% | N/A 12%

Do you think you have sufficient water to maintain permanent planting through autumn and winter?

LIKELY 13% | UNLIKELY 87% 

Do you think that the Regional Investment Corporation loans are of benefit to your business today?

YES 17% | NO 83% 

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