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Action 4: Strengthening land and water management

The long-term productivity of the farm sector relies on resources being used in a sustainable manner, requiring Victoria’s farmers to adapt their practices to manage land, water and environmental risks and improve the natural resource base.

Managing environmental risks and adopting more sustainable farming practices are now accepted as essential to successful, productive agriculture.

An important factor in achieving productivity growth in farming is the approach taken by Government to land and water management. A ﬂexible Statewide regulatory framework can drive the development of robust and resilient farm businesses and communities.

As competition for land and water intensiﬁes efﬁcient markets will ensure that prices for these vital inputs reﬂect their true value, and result in greater productivity.

Farm businesses will beneﬁt from a smooth and competitive water market that allows them to shift water to its highest value use. Farmers will also beneﬁt from balanced and sensitive land use planning that ensures they can maintain, expand, reduce or intensify their operations with greater certainty.

The Victorian Government’s recently released Green Paper, Land and Biodiversity at a time of Climate Change explores how government, the community and landholders can work together to ensure Victoria’s land, seas and waterways are healthy, resilient and productive.

Victoria’s farm businesses are also increasingly subject to community expectations and scrutiny about their methods, environmental impacts and performance. Balancing these expectations with farm business objectives is a reality of modern farming.

Managing water

Victoria’s farm businesses depend upon water and use it in different ways.

Irrigated agriculture relies on groundwater, surface water and in some instances, recycled water. Forestry and dryland agriculture rely on water from rainfall, while inland aquaculture relies on water from rivers and streams. Some parts of the dairy industry rely heavily on water for irrigating pasture, watering stock and cleaning dairy sheds.

In the past, Victorian-irrigated farm businesses have enjoyed a relatively secure supply of water. They now face intense competition for scarce water resources. In the face of greater climate variability, strong population growth and continued low rainfall, this competition is likely to increase.

Maximising the beneﬁts from available water supplies is critically important to the long-term growth and prosperity of farm businesses and communities. Enabling water to move to its highest value use through the market, managing an efﬁcient allocation and entitlement system, and improving delivery infrastructure and on-farm water efﬁciency will remain important tools for farm businesses in the future.

Over the past eight years, Victoria has led the nation in water management and reform. We gave Constitutional protection to keep our water authorities in public ownership, we were the ﬁrst Australian State to appoint a Minister for Water and have invested in major projects such as the Wimmera Mallee Pipeline. The 2004 Our Water Our Future plan delivered actions which have saved over 100 billion litres of water per year, and began the planning for the next stage of major water projects. Victoria’s market in water shares, now separated from land property rights, enables the movement of water to its highest value use.

The second phase of the Government’s water strategy, Our Water Our Future, will deliver the single biggest boost to Victoria’s water supplies in decades. A new desalination plant, major irrigation upgrades and an expansion of the Victorian Water Grid are the centrepieces of a $4.9 billion plan to secure water supplies for the long term. Modernising Victoria’s Food Bowl alone will take up to eight years to complete and will involve a total investment of $2 billion to ultimately capture around 425 billion litres of water – ensuring the future prosperity of the region by modernising ageing infrastructure to create a world-class irrigation system.

While the patterns and reasons for water trade are complex, efﬁcient water markets can allow regional communities to adjust to changing demand for water in a timely way. Signiﬁcant investment in the ongoing national reform of water markets will help to ensure that these scarce resources are used in the most effective and efﬁcient way.

Changing use of land

As the traditional face of farming in Victoria evolves, our land-use planning system must also evolve.

Historically, rural land-use planning has focused on the notion of a landscape where agriculture is the presumed use. This is based on planning goals that include preventing a decline in productive agricultural land, containing urban sprawl and protecting biodiversity and rural landscapes.

The Victorian Government has recently reformed rural zones and created a new ‘Farming Zone’ where non-farming uses are signiﬁcantly restricted. A key goal of these reforms is to ensure that farm businesses can maintain, expand and intensify their current operations without being affected by non-farming uses in rural areas.

“We play in a harsh environment and we have to be attuned to opportunities – and that’s what we’ve done with water.” Ardmona farmer Jeff Odgers

Urban migration to regional Victoria or new land uses, such as intensive animal industries or plantation forestry, can create conﬂict between productive and amenity land use. Land-use planning must provide greater certainty and productivity for farm businesses by setting a clear policy direction that balances complex and competing community demands.

The Victorian Government will continue to work with local governments to provide a strategic framework for local planning schemes. This involves increased expert advice and information on the needs of the farming sector from a State perspective, to provide the certainty and ﬂexibility needed by farm businesses to respond to the changes and challenges ahead.

Natural resources management

As land and water managers, farmers have rights and responsibilities.

Victoria’s farm businesses invest around $500 million on natural resources management each year, including improved cultivation, replanting of native vegetation, and pest and weed management. They also spend an average of 85 days each year on natural resources management activities.

Good farm management practices have delivered signiﬁcant private and public beneﬁts, including improved productivity and amenity, reduced soil erosion and weeds, and enhanced biodiversity.

While many farm businesses are addressing land degradation, soil health, habitat and biodiversity loss by developing their management practices, there is scope for improvement. Historically, inappropriate Government policies and farming practices and land management have resulted in soil erosion, loss of nutrients and native vegetation, and increased salinity and soil acidiﬁcation in some areas of Victoria. Improved knowledge about solutions, ﬁnancial resources and collaborative action is helping to improve natural resources management.

The Victorian Government recognises its role in clarifying the responsibilities of landowners in natural resource management and biodiversity conservation, ensuring that farm businesses operating under appropriate guidelines have a community ‘licence to operate’. The Government also recognises its own responsibility to meet community expectations and assist farm businesses to improve environmental and cultural heritage management. The Government recognises that with the right incentives farm businesses can achieve a higher standard of environmental protection than that required by legislation. Voluntary efforts combined with support from Government, such as the Landcare program, have delivered signiﬁcant local improvements over the last 20 years.

Recently, new approaches have also shown promise, with market-based instruments such as trading mechanisms, auctions and price signals (which inﬂuence how landholders manage environmental assets) providing additional incentives. Victoria’s White Paper, Land and Biodiversity at a time of Climate Change will build on these new approaches by working with the private sector to increase investment in improved land and biodiversity management, using carbon markets to improve biodiversity and land health, and expanding ecosystem services markets such as Bush Tender and Eco Tender.

Weeds and pest animals

Despite substantial successes managing a range of invasive plants and animals, Victoria faces new and growing threats.

Increased trade means that Victoria faces a greater range and number of invasive species. More than 2,500 exotic plant species already in Australia could become signiﬁcant weeds and many new species could enter the country. The majority of these species are not covered by existing approaches.

The Victorian Government has delivered a new biosecurity approach to invasive plants and animals, focusing on mitigating invasive species risks to the economy, the environment, social amenity and human health. Action is being taken to prevent new, high-risk invasive plants and animals from becoming established, eradicate high-risk invasive plants and animals in their early stages, contain high-risk established invasive plants and animals, and protect priority assets from the impact of weeds and pests.

The Government will pursue a new approach that contributes to a healthier and more productive natural resources base, and enhanced biodiversity.

Taking action

4.1 New action on weeds and pests

The Victorian Government will invest an additional $20 million over four years for a range of initiatives to tackle weeds and pests, including:

supporting local government in their management of weeds and pests on roadsides
developing incursion and treatment plans for regionally prohibited weeds
improving early response capability for new and emerging pests in a changing climate
increasing voluntary compliance for regionally controlled weeds
more effectively controlling weeds and pests on public land by expanding the Government’s Good Neighbour Program
improving the use of bio-controls for management of widespread weeds
reviewing wild dog management options
increasing community involvement in more targeted programs for integrated fox management.

4.2 National action

The Victorian Government will work with the Commonwealth Government and the Council of Australian Governments (COAG) to progress national water reform in a way that enhances Victoria’s water market, allocation and entitlement system, and improves delivery infrastructure and on-farm water efﬁciency.

Over $100 million in irrigation upgrades will begin in the ﬁrst half of 2008 as part of Stage 1 of the Food Bowl Modernisation Project – the biggest water infrastructure upgrade in Victoria’s history. In March, the Commonwealth Government agreed to invest up to $1 billion in Stage 2 of the project – on top of the $1 billion already committed as part of the Victorian Government’s 2007 Water Plan. Stage 1 of the project will capture around 225 billion litres of water, to be shared equally by local irrigators, rivers and Melbourne.

As part of the funding agreement with the Commonwealth, the water savings from Stage 2 will be shared equally by irrigators and the Murray River. This brings the total water savings from Stage 1 and Stage 2 to around 425 billion litres each year. The Victorian Government will continue to work with the Commonwealth in developing Stage 2 of this important national project. We will also be active participants in national reviews of inter-district trading caps and exit fees. We will seek to reﬁne and clarify water property rights to address the emerging effects of climate change on water availability, ground water extraction, land-use change and farm dams.

4.3 Land and Biodiversity White Paper

The Victorian Government will continue working with community groups and landowners to ﬁnalise the Land and Biodiversity White Paper. A green paper has been released and further consultation will be undertaken. A white paper will then be released in 2009 and will direct policy and investment priorities in natural resources management, land health and biodiversity for the next two decades.

4.4 Improving rural land-use planning

A new Regional Strategic Planning Expert Group will be established to identify and plan for future scenarios for farming and farming communities. Funding of $3.79 million over four years will be provided to establish the expert group and support its work, which will include identifying barriers to adjustment, developing land-use planning policy to help farmers adapt, delivering regional land-use planning projects identiﬁed by the group and, where necessary, changing statutory planning tools to ensure policy alignment with directions in the Future Farming strategy.

What we’re already doing

The Future Farming strategy builds on existing support provided by the Victorian Government, including:

developing Victoria’s Biodiversity Strategy – a national benchmark for biodiversity conservation and management that outlines how to conserve native species, communities and gene pools, prevent threats and encourage community involvement. It fulﬁls Victoria’s commitments under the national Strategy for the Conservation of Biodiversity
implementing Bush Tender – a groundbreaking, auction-based approach to improving the management of native vegetation on private land. Bush Tender is being used in north-east and central Victoria as part of the $502 million Moving Forward regional economic initiative. A further $2.7 million has been provided to extend Bush Tender across other parts of Victoria between 2006 and 2009
developing the Soil Health Policy Framework to guide investment and strategic policy, to ensure healthy soil continues to support primary production and ecosystem services, and is maintained as part of natural capital
providing additional funds to protect biodiversity assets across Gippsland, south-west Victoria, the Mallee and the Grampians through fox, rabbit and weed control programs
reducing red tape associated within Victoria’s planning system and improving the effectiveness and efﬁciency of land-use planning across the State
delivering the next stage of the Our Water Our Future water-saving campaign, which provides water security for Victoria’s growing population and economy in the face of drought and climate change. Key initiatives include:
– $2 billion for the Food Bowl Modernisation Project to upgrade the Goulburn Murray region’s irrigation infrastructure (jointly funded by up to $1 billion from the Commonwealth Government, $600 million from the Victorian Government, $300 million from Melbourne Water and $100 million from Goulburn-Murray Water)
– adding more than 250 kilometres of new pipelines to the Victorian Water Grid, giving the State a network of almost 10,000 kilometres of pipeline, including the Wimmera Mallee pipeline, to deliver water to where it is needed most
– implementing Regional Sustainable Water Strategies to deliver on the National Water Initiative and support regional water planning to ensure water security over time.

“Before I started, I wanted to be a computer technician and if that failed I was going to go into the dairy industry. But now I’ve learnt that in the dairy industry they need computer technicians, so I can combine the two.” Dairy industry trainee Josh Ailey

Turning the tide – from weeds to productive land

Case Study

When dealing with the South American weed Serrated Tussock, Victorian farmer Scott Chirnside realised that keeping farm land productive required land holders to think global, act local and help their neighbours to do the same.

Serrated tussock is one of Australia’s worst weed invaders because of its ability to spread rapidly, causing severe economic and environmental impacts.

Serrated tussock is one of the main threats to basalt grasslands – Victoria’s most valued and vulnerable native vegetation community. It has high ﬁbre and low protein content, resulting in signiﬁcant loss of livestock production. Heavily infested areas cannot support livestock.

Over the past 10 years, Scott has played an important role developing a community-based approach to managing serrated tussock.

The success of this approach reﬂects the Victorian Community Weed model, which involves the community in pest management, improving land productivity, securing markets, and protecting the environment.

As a result, local farming communities, Landcare groups, industry bodies and Catchment Management Authorities across Victoria have worked together to reduce the area infested by 37 per cent (from 130,000 hectares to 82,000 hectares).

More than 60 per cent of the remaining 82,000 infested hectares are under management programs.

“Land managers, hobby farmers, industry and semi-government agencies all have a responsibility to tackle the weeds on their patch,” Scott said.

“No matter where you are you have to have every level of government sitting in the one room together with private landholders and commercial industry representatives.

“It’s the only way to achieve the kind of coordinated action and community awareness necessary to make these land areas productive again.”

The Victorian Serrated Tussock Working Party operates on an annual budget of $1 million from the Federal Government and other sources, including $200,000 from DPI.

Today, the Victorian working party includes representatives from 27 Landcare groups, 11 local councils, ﬁve Catchment Management Authorities, DPI and the Department of Sustainability and Environment.

Scott now has an Australia-wide role as Chair of the National Serrated Tussock Management Group.

Water trading and successful farming

Case Study

Ardmona dairy farmer Jeff Odgers recognises that success and survival in agriculture demands constant improvement and a sharp eye for any tactic that can deliver an advantage.

“We play in a harsh environment and we have to be attuned to opportunities, and that’s what we have done with water,” Jeff said.

The father of three, who lost a leg in a trenching accident and survived a battle with cancer, is now a Director of Murray Dairy Incorporated (a regional research and development program).

Jeff owns 190 hectares and runs 375 milkers in the Central Goulburn Irrigation District. His farming operation is pasture-based in normal irrigation seasons, and generally water is used on-farm to grow feed. But with temporary water trade prices reaching as high as $1,200 per megalitre, selling water and buying dry feed proved a more effective strategy.

Victoria’s water market enables permanent trade of ongoing rights to allocated water, as well as temporary trade, where some or all of the water allocation in the current season is transferred but the ongoing right is not.

Jeff carried more than 70 megalitres from the previous season and used a total of 100 megalitres to irrigate and create a ‘spring’ on the best parts of his farm to grow pasture. He then traded on the temporary water market from late September to mid-November, selling off a total of 220 megalitres in ﬁve parcels.

“That helped our cash ﬂow enormously and we were able to go out and buy dry feed and grain mix to supplement our pasture,” he said.

Since then, Jeff has been able to replace most of the water sold in the spring with water purchased at lower prices in the autumn.

“Milk returns, relative to the price of water, grain, hay, nitrogen fertiliser (they are all variable inputs) determine the production system that we run with during a given season”, he said. “We are interchanging inputs in order to drive maximum proﬁts with manageable risk. That’s the way it is: farms in this region have come a long way in terms of understanding the key numbers in their business.”

Action 5: Helping farming families to secure their futures

As the farm sector enters a new era, there is a clear need to build the capacity of rural communities to manage and adapt to social, cultural, economic and environmental change.

Rural communities are renowned for being innovative and resourceful in the face of signiﬁcant challenges. They have a strong sense of community and build wide-ranging networks. Many residents participate in voluntary activities, take on leadership roles and consistently report high levels of personal wellbeing and satisfaction.

Robust and resilient farm communities are built on productive and competitive businesses and good social networks. There are real challenges ahead for rural communities in responding to and managing rapid change in the farm sector and in regional Victoria more broadly. But there are also signiﬁcant new opportunities and possibilities. The role of Government is to work with these communities to ensure that they have the support, skills and information they need to capture the opportunities offered by the new agricultural landscape.

Social and demographic change

Since the 1970s, average life expectancy in rural Victoria has increased by almost 10 years. Birth rates have dropped, the baby boomer generation are farming for longer and young adults are leaving to take up education, work and lifestyle opportunities elsewhere. These trends are resulting in a pattern of structural ageing in farm ownership and in many small rural towns.

Urban environmental preferences and ‘tree-change’ migration are increasing the price of land in amenable and accessible parts of the rural landscape. Farm sizes in these areas are decreasing and enterprises are intensifying. This migration is changing the traditional social composition of rural towns and communities, enhancing the skills base, increasing cultural diversity and having an impact on the capacity of some rural communities to manage change.

While Victoria’s primary industries have increased productivity, the rise of highly efﬁcient, large-scale agriculture in some parts of the State has reduced the demand for local labour and shifted services to larger regional centres.

Smaller towns and communities now play a critical role in the growth of regional centres by providing lifestyle opportunities, affordable housing, workers, consumers, recreational areas and tourist attractions. The major centres contribute to the survival and growth of nearby towns by providing jobs, education and health services, and retail, cultural and recreational activities.

The Victorian Government has a long record of driving growth and building conﬁdence in rural towns and communities. In the face of the new challenges and opportunities ahead, the Government will support farmers and their families to manage change and make sound decisions about their future. The Government will also continue to provide an extended Rural Financial Counselling Service in Victoria for farmers and their families.

Farm family health and wellbeing

Farm family health and on-farm safety is a signiﬁcant issue for the long-term human capital and workforce capacity of major farming industries.

Stress and mental health issues are widely recognised as having an impact on the capacity of farmers to make decisions and manage change.

The Government will ensure that health initiatives support farm families in areas of highest need that are undergoing rapid change, while working to understand and improve the health and wellbeing of farmers and their families across the State.

Taking action

5.1 Working with rural communities

The Victorian Government will invest $3.74 million over four years towards the Rural Futures Initiative to engage and work with 12 rural, agriculturally-based communities each year. The initiative will assist communities, agricultural industries and farmers to make decisions about their future and adjust to change. The proposal will provide key information relevant to farmers and rural communities experiencing change, as well as encourage dialogue between farmers, communities and stakeholders, and support local decision-making processes.

5.2 Farm family health

The Sustainable Farm Families Program will be extended at a cost of $2.18 million over four years to support the physical, mental health and wellbeing of farmers and their families. Funding will be used to run workshops and focus on practical steps to improve the lives of farm families, targeting 500 farmers in areas that are undergoing signiﬁcant change.

5.3 Case management for farmers

Additional funding of $3.46 million over four years will be provided to pilot a targeted case management service for farmers undergoing adjustment and transition, including the continuation of rural ﬁnancial counselling support. This initiative will help farmers and their families choosing to leave farming to make the transition, and ensure coordinated delivery of Government services to farm families.

5.4 New National Centre for Farmer Health

The Government will provide $2.4 million over four years to create a National Centre for Farmer Health. The new centre will aim to improve the health and wellbeing of farm workers and their families across Australia. Research programs will investigate the causes and consequences of poor health within the farming community and seek to develop cost-effective policies and programs to improve physical, mental and social health outcomes. Education and training programs will also be offered to health professionals working with the farming community to increase their skills and knowledge about farm-related health issues.

“Farming is a great life and there’s deﬁnitely a great future for family farms, especially if community networks get together.” Newbridge farmer Lachlan Ralton

What we’re already doing

The Victorian Government has provided strong support to farmers, their families and rural communities, including:

implementing the $502 million Moving Forward in Provincial Victoria blueprint for continued population and economic growth in provincial Victoria, with the following major initiatives:
– a new $100 million Provincial Victoria Growth Fund, to help regional communities capture opportunities for economic and population growth
– an additional $25 million Small Towns Development Fund, to help smaller towns generate new opportunities for growth through economic and community infrastructure
providing grants to community organisations and local government to undertake community planning, strengthening and infrastructure projects through the Victorian Community Support Grants program. The program has been in place since 2004 and has supported a large number of rural communities to solve local issues
investing $1.3 million each year in the Rural Financial Counselling Service, which provides free and impartial ﬁnancial advice to farm businesses
delivering the Rural Futures Initiative to help farmers, industries and communities in seven locations that are undergoing signiﬁcant change to make the best possible decisions about their futures
supporting small rural communities to work together to plan for the future, deliver new and improved facilities and services and increase participation through the $10 million place-based Community Building Initiative
enhancing the resilience and capacity of communities and individuals to respond to and manage change through the Community Learning Partnerships funded by the Adult Community and Further Education Board
providing targeted health support services to 1,000 Victorian farmers through the Sustainable Farm Families program
employing additional rural mental health counsellors, providing grants to farmers and farm related businesses to help them to retain apprentices, and assisting severely drought affected families through the Victorian Drought Response program
employing Community Engagement Ofﬁcers – Women in Drought in ﬁve rural regions to create opportunities for rural women to meet, share information about local activities and approaches, and develop supportive networks to deal with drought and climate change
ensuring access to Maternal and Child Health services in all communities in rural Victoria and undertaking community building demonstration projects in 16 rural communities.

Sustainable farm family

Case Study

Recovering in hospital after a serious accident gave Kaniva cropping farmer Harry Rabone plenty of time to think about the importance of health.

“I had a motorbike accident on the farm a few years back, ended up in hospital, and wasn’t expected to come home,” Harry said. “It made me realise that health is pretty important.”

When DPI ran a Sustainable Farming Families health education workshop in nearby Horsham, Harry and his wife Jacci took time out from their busy farming schedule to attend.

For Harry and Jacci it was a life-saving decision. Basic health checks included as part of the workshops identiﬁed an early-stage skin cancer on Jacci’s leg. Harry found he had high cholesterol levels which, combined with a family history of high blood pressure, required immediate attention.

Both health issues were addressed immediately with excellent results, and regular health checks, exercise and a healthy diet are now part of the Rabone’s family routine.

“I try to eat better and do a bit more exercise – after a long day in the tractor I’ll ride the pushbike, and instead of taking the ute down to the workshop I’ll walk,” Harry said.

“We also learned about healthy eating, checking food labels, the importance of exercise, and looking out for changes in your own body and in your partner.

“This program helps you become pro-active about health, and not just be reactive when something goes wrong.

“I’d certainly recommend these programs to everyone, and not just people in rural areas.”

The Sustainable Farming Families health education program is being rolled out to 1,000 farming families across Victoria over the next two years. Topics include cardiovascular disease, cancer, stress, diabetes, women’s and men’s health, farm safety, nutrition, physical activity, anxiety and depression.

The program is delivered by DPI and Western District Health Service, along with rural health services across the state and agricultural industry groups.

Action 6: Developing new products and securing new markets

To succeed in an increasingly competitive environment, farm businesses must increase their capability in developing new products, identifying and securing new markets, and maintaining access to existing markets.

Agricultural production in Victoria is highly export-focused, with some industries such as dairy exporting more than 65 per cent of their produce. This highlights global competitiveness, but also emphasises the importance of market access.

New opportunities and challenges are now emerging in international food and commodity markets. Rising incomes in high-growth countries such as China and India will translate directly into increased consumption and potentially new markets. On the other hand, Victoria’s farm businesses will face increasing pressure as producers in these countries and other countries also target the same markets. Some consumers are also looking beyond price and quality attributes to the health, environmental and ethical attributes of food.

In the future, understanding markets, improving the value of farm products and creating efﬁcient supply chains will be a critical factor in the competitiveness of the farm sector.

Market access

While Victoria’s farmers supply products to more than 100 countries, access to some markets for some products is limited or completely restricted. Easing these restrictions will create new market opportunities for Victoria’s farm sector.

Multilateral reform, bilateral trade agreements and a variety of country-speciﬁc tariff and non-tariff barriers shape farm businesses’ access to overseas markets. In the longer term, multilateral trade offers the best opportunities for market access. In the interim, bilateral negotiations on tariff and non-tariff barriers have the greatest potential to improve market access.

The Victorian Government will continue to work with the Commonwealth to provide intelligence, liaison and research to substantiate market access requirements for Victoria’s farm sector and to fast-track priority market access negotiations.

The Government will also focus on emerging sectors with the potential to secure new international markets, such as aquaculture.

Biosecurity

Australia has a high biosecurity status as it remains free from many of the harmful pests and disease that affect agriculture, human health and the natural environment overseas. This has given Victoria and Australia a competitive advantage as a major agricultural exporter. However, we are highly susceptible to exotic pests or diseases that breach the quarantine barrier.

In recent years, Victoria’s and Australia’s biosecurity has come under signiﬁcant pressure from the increasing movement of people and goods; the evolution of new or more pathogenic strains of infectious agents; and changes in climate, ecology, population demographics and resource use that affect distribution of pests and diseases.

In 2007, Victoria’s farm sector was affected by outbreaks of fruit ﬂy, anthrax, abalone virus and equine inﬂuenza (EI). The EI outbreak, while infecting only horses in New South Wales and Queensland, demonstrates how such events require signiﬁcant Government and industry resources to achieve successful prevention, control or eradication.

Victoria’s major response capability for animal and plant pests, disease and invasive species is coordinated by Biosecurity Victoria (BV), a division of DPI. Key activities of BV include surveillance and diagnosis to eliminate the possibility of an exotic pest or disease, with a strong emphasis on the early detection of exotic organisms.

The Government will strengthen Victoria’s biosecurity capabilities, ensure existing biosecurity infrastructure is more sustainable, and develop measures to address new and emerging biosecurity threats.

Food safety and quality

Good food safety systems are critical for public health and are a prerequisite for access to any local or international market.

All governments play a key role in establishing and enforcing food safety standards. Most of Victoria’s farm businesses seek compliance with industry quality standards. Also most exporters are required to meet compulsory minimum quality standards.

Victoria has led the way in Australian food safety reforms and the Government will continue to strengthen its partnerships with the farm sector to consolidate Victoria’s reputation for clean, high quality food, while minimising the regulatory burden on farm businesses and the food chain.

Animal welfare

A high standard of animal welfare is central to running a successful farm business and ensures market access of animal products domestically and internationally.

The wider community is paying increasing attention to livestock management on farms. The Government has helped farm businesses to meet the animal welfare expectations of the broader Victorian community through codes of practice and guidelines. However, the community is now looking for greater levels of assurance from governments that livestock producers are managing their farm animals in accordance with the guidelines.

Victoria has played a leading role in the implementation of a national process to develop mandatory standards for the management of farm animals. This will provide enhanced animal welfare outcomes in key industries and foster greater understanding and conﬁdence in the community about the animal welfare performance of the Victorian farm sector.

The Government will take new action to ensure that production systems in Victoria meet the appropriate animal welfare standards.

Taking action

6.1 Better market access and supply chain development

The Victorian Government will provide $2.93 million over four years to improve industry and Government understanding and response to market and value chain challenges. This includes developing a more responsive and internationally competitive agrifood sector that is able to capture new market opportunities. This initiative will focus on developing new and existing markets, fostering alliances within value chains and supporting market driven enterprises for farmers.

6.2 Support for organics

An additional $1.08 million over three years will be provided to assist the Victorian organics sector to develop its resilience and further differentiate and substantiate organic products. The funding will be used to develop a reference group to help the industry tackle current challenges and capture emerging opportunities. This initiative meets the Government’s commitment to the sector given in its response to the review of the moratorium on GM canola.

6.3 Support for aquaculture industry

Aquaculture is an emerging sector in Victoria with the potential to be a major international industry. Aquaculture also provides opportunities for horticultural and dairy businesses in northern Victoria to diversify, enabling them to produce Murray Cod and other species for international markets using existing irrigation infrastructure and water.

New funding of $4.05 million over four years will enable DPI and Regional Development Victoria to provide innovative research, market and value chain development and investment attraction activities for the development of aquatic farming systems and services, genetically improved species and health enhancing products. This initiative will integrate agriculture and aquaculture production systems by supporting existing agriculture to diversify into the seafood industry.

6.4 Support for the grapevine industry

Funding of $3 million over four years will be provided for a targeted program to improve biosecurity and market access for a number of Victoria’s grape-growing regions that currently have an unknown phylloxera status. The Bendigo/Heathcote, Bellarine Peninsula and Macedon regions will be surveyed for phylloxera to enable these to be declared as phylloxera exclusion zones (PEZ). This will be accompanied by a community awareness and compliance program that will help maintain the status of the zones and prevent the spread of phylloxera in other parts of the State.

In addition, we will establish a Victorian Viticulture Biosecurity Committee to ensure that industry plays a key role in the management and funding of future phylloxera and exotic grapevine pest control programs.

6.5 Ongoing leadership in biosecurity

New actions will be taken to consolidate Victoria’s leadership in biosecurity, including:

leading the review and development of Victoria’s new Biosecurity Strategy to identify current gaps in the State’s biosecurity framework and risk management procedures
placing a greater focus on the development of a seamless national capability to prevent, prepare for and respond to pests, diseases and invasive species that affect agricultural production, as well as natural and built environments
developing a Biosecurity Framework to combat invasive plants and animals.

6.6 Improved food safety and standards

The Victorian Government recognises the importance to the farm sector of a food regulation regime that supports and manages food safety, while allowing the food industry scope to innovate and respond to market opportunities. The Government will:

implement its response to the inquiry by the Victorian Competition and Efﬁciency Commission into food regulation in Victoria with the aim of achieving a more simpliﬁed food regulation system
continue to advocate at the national level for the principles of good regulatory practice to apply to food regulation and for the development of national food standards through the Council of Australian Government’s Food Regulation Agreement
address gaps in knowledge about food safety objectives and improved systems and standards to mitigate risks to food.

6.7 Improved animal management

The Victorian Government will continue to work with the Commonwealth Government, other states and livestock producers on practical national animal management and biosecurity standards for the livestock industries.

In consultation with stakeholders, the Victorian Government will develop a Livestock Management Bill. This will validate the operation of the national standards and protect complying farm businesses from intrusions that jeopardise the integrity of their biosecurity systems.

6.8 Support for plantation industry

The Victorian Government has a strong record in facilitating sustainable plantation development on private land in Victoria. In line with the new Timber Industry Strategy, the Government will continue to support the plantation industry by providing an environment that supports sustainable investment and employment, and assist the industry’s adaptation to environment, social and economic change.

What we’re already doing

The Victorian Government has a strong record of achievement in supporting the farm sector and regional industries to access new markets, including:

working with commercial partners to develop novel products and processes that increase nutrition and industry competitiveness through our role as a joint partner in Australia’s leading food, health and nutrition research organisation, Food Science Australia (FSA)
providing $11 million from 2004 to 2008 for the Next Generation Food Strategy – a framework to drive growth in the food production and processing sector, targeting seven key areas: sustainability, product integrity, industry and regional development, exports, innovation, education, training and careers, and promoting excellence
maintaining and developing biosecurity and market access programs for the livestock, plant, ﬁsheries and forestry industries through Biosecurity Victoria, an agency of DPI
providing a research, training and teaching resource in animal welfare science through the Animal Welfare Science Centre, in collaboration with the University of Melbourne and Monash University
reviewing planning scheme requirements for timber plantation developments consistent with the Government’s response to the Victorian Competition and Efﬁciency Commission’s report on Regulation in Regional Victoria.

From local horticulture to global aquaculture

Case Study

When Sunraysia horticulturalist Col Beasley turned his mind to aquaculture, he ﬁgured the simplest way to grow Murray Cod would be to create a feedlot system; similar to the one used for sheep and cows, but underwater.

It has proved to be a simple and spectacularly successful approach, with domestic and Asian markets clamouring for all the ﬁsh he can produce.

Col Beasley owns the 3,450-hectare Thurla Farms at Red Cliffs in the Sunraysia district, which he converted from dryland to irrigated horticulture, growing wine grapes, melons, avocados, asparagus and grain.

To manage risk by diversifying and to explore more efﬁcient ways to use precious water resources, Col began to experiment with raising Murray Cod hatchlings in his irrigation storage dams.

Col and his sons designed and patented the modular ‘underwater feedlot’ system for growing the cod and, after just two years of commercial production, he has established keen markets in Asia for the ﬁrm white ﬂesh and delicious taste of Murray Cod.

He has sold his farming business and licensed his technology to leading Australian computerised monitoring system manufacturer, Computronics Holdings, which plans to reﬁne the electronic monitoring systems Col developed to manage the ﬁsh hatchery and to market them to other farmers.

Computronics already develops and markets technologies to improve farmer productivity and long-term sustainability and Col’s dam-based aquaculture system is just one of several new technologies Computronics is looking to add to its portfolio.

Meanwhile Col has negotiated with Sunraysia Rural Water Authority to pipe in 3,800 megalitres of nutrient-rich ‘Class C’ treated waste water for drip irrigation of an expanded horticultural zone, and root zone irrigation of grain, cereal and fodder crops.

The treated waste water is ideal for growing energy, ﬁbre and fodder crops, as well as for growing other ﬁsh varieties for use as feed stock for the Murray Cod.

By using waste water to grow grains and other ﬁsh for use in the Murray Cod ﬁsh meal, Col plans to work with Computronics to achieve the ultimate goal of a fully sustainable business, which produces fresh ﬁsh and fruit; recycles waste into fertiliser, fuels and energy; protects natural waterways and biodiversity; and re-uses urban waste water.

“I have been farming for 38 years, and it’s about advancing where we are – life on the land is getting tougher, and if you don’t move with the times you don’t survive,” Col said.

“Take fertiliser for example – it went to $1,300 a tonne. We can’t grow anything at that price, but we can make fertilisers from our farm wastes while we grow ﬁsh for export markets and then use those fertilisers on valuable food crops.”

Cutri Fruits – new ideas and new markets

Case Study

Faced with the loss of key international markets, skyrocketing water costs, and falling domestic prices, Swan Hill stone fruit growers Cutri Fruits set out to survive and thrive using new ways of thinking.

Dominic and Connie Cutri established their stone fruit farm at Woorinen, growing peach, nectarine, apricot and plum trees, and were regional pioneers with automated irrigation systems.

In 2005, their son Gaethan and his wife Nicole gave up their city careers and returned to help run Cutri Fruits. Gaethan, a lawyer, and Nicole, a public relations specialist, brought new ideas for business management and marketing to the farm, which has helped make it more efﬁcient and open new markets for their delicious fruit.

“With the strong Australian dollar, the loss of the Taiwanese market, and price competition from Chile and South Africa, Cutri Fruits was of the opinion that the local market would be oversupplied and prices would fall,” Gaethan said.

“And like many other horticultural producers, we are being forced to buy water on the temporary water market at up to $1,200 per megalitre.”

With the Australian market saturated, and prices falling below the cost of production, Cutri Fruits became direct exporters.

Nicole’s experience in marketing and public relations proved invaluable in identifying, costing and executing an effective international marketing and export strategy. Austrade and the Victorian Government helped identify potential buyers, while Nicole and Gaethan travelled overseas to meet buyers.

The move paid off and last season Cutri Fruits exported between four and 24 tonnes of fruit each week to buyers in the United Arab Emirates, Singapore, Hong Kong and Thailand.

“We’re deﬁnitely exporting again next year,” Gaethan said. “If we can survive and maybe thrive when it’s this tough, it’s only going to get better.”

Action 7: Transporting products to market

To get products to market, farm businesses rely on access to reliable and economical transport options serving both domestic and international outlets. Rail infrastructure has declined over the decades and a major re-investment program is underway to provide the track needed to transport products to market.

Farm businesses, and the grains industry in particular, rely heavily on the regional freight network for the efﬁcient, timely and safe movement of agricultural produce. The increasingly competitive global marketplace means that moving produce to and through Victoria’s international gateways in an efﬁcient and timely matter is critical.

Agricultural produce is exported through three of Victoria’s commercial sea ports – Melbourne, Geelong and Portland. Perishable high-value, low-volume products are increasingly air-freighted through Melbourne or Avalon Airports. Most Victorian food and ﬁbre exports, however, are transported by ship in bulk form. This means the rail network and access into the Port of Melbourne are critical issues for farmers.

The Victorian Government is working in partnership with the private sector to undertake signiﬁcant investment in Victoria’s rail, road and port network. The Government has taken action to ensure that the State’s transport network has the capacity to support changing industry needs and meet the growing freight task over the next 20 years.

Road and rail transport

Victoria’s freight task is expected to double between 2004 and 2024, so further investments in our road and rail network are needed to provide for the future needs of the State’s farm sector. Road freight is expected to grow strongly, but Victoria’s rail network will need to take up a higher share of the freight task. Reduced grain harvests in recent years and a deregulated market environment have contributed to reduced demand for rail freight services in some areas; at the same time the condition of the track has deteriorated as a result of the failed privatisation of the regional rail network.

The Victorian Government is undertaking a number of initiatives to expand regional Victoria’s network of inter-modal terminals, including funding for an inter-modal terminal at Dooen (near Horsham and Shepparton) and feasibility studies at Geelong. The Government is also securing AusLink 2 funding for the Nagambie bypass; Princes Highway East Duplication; Princes Highway West Duplication; and various improvements along the Western Highway, Geelong Ring Road and Colac-Lavers Hill Road.

Following its $133.8 million ‘buy back’ of the country rail network from Paciﬁc National in 2007, the Victorian Government commissioned the Victorian Rail Freight Network Review and is implementing a number of the review’s recommendations. The Government is committed to a sustainable rail freight network for Victoria that gives the agriculture sector a choice on how they get produce to market.

The rail freight network has faced a series of challenges, most recently the drought, which has cut tonnages. But as the review conﬁrms, one of the greatest challenges was a ﬂawed Kennett Government privatisation that did not require the private operator to invest in the network.

The privatisation created a maintenance backlog, requiring a methodical and prioritised works program. After buying back the track, the Government immediately injected $25 million to undertake essential maintenance.

The Government is committed to improving the rail network across Victoria. Work has started on the $73 million upgrade of the Geelong to Mildura rail line, one of Victoria’s busiest freight corridors with around 1.5 million tonnes of product transported each year. When the upgrade is complete, freight train speeds will reach up to 80 kilometres per hour, reducing travel times from 14 hours to 10 hours and creating a more competitive transport alternative.

Air freight

The use of air freight has expanded dramatically in recent years – giving many specialist farmers access to new markets for time-sensitive quality products. There are huge markets overseas for fresh produce – and sectors such as cut ﬂowers and seafood have grown rapidly through the opportunities opened up by air freight.

Victoria’s Avalon and Melbourne Airports operate export services. Both airports have considerable scope for further development to enable Victoria to become the gateway of choice for air freight operations.

Victoria’s ports

Victoria’s four commercial trading ports play a vital role in supporting Victorian farmers. In total they handle in excess of $80 billion in trade each year – providing an international gateway to over 300 markets. The Victorian freight and logistics sector accounts for 14.7 per cent of Gross State Product – one of the highest percentages in the western world. The Port of Melbourne is Australia’s largest container and general cargo port.

Currently 31.2 per cent of exports in the Port of Melbourne originate in regional Victoria and the majority of these exports are agricultural products or processed food, beverages and other commodities, including horticultural produce, dairy and grains. This reﬂects the trend towards the containerisation of agricultural commodities.

The Victorian Government recognises the crucial role our ports will play in growing the prosperity of regional Victoria. In 2004, the Government released its vision for the future development of our commercial trading ports through the Victorian Ports Strategic Framework. Draft development plans have been released for all four of Victoria’s commercial ports. These identify the challenges facing our ports, and the opportunities to increase efﬁciency through technological advancements.

Melbourne Markets relocation project

The relocation of Melbourne’s wholesale fruit and vegetable market is also expected to provide substantial economic beneﬁts to the State. This important project will create a more efﬁcient market precinct and free up the existing Footscray Road site for port and rail development over the next 20 years. In one of the largest infrastructure projects being undertaken in Victoria, the market will be relocated to a new site in Cooper Street, Epping, in Melbourne’s north. It will replace the ageing and restricted facility at Footscray with a large, modern, innovative and efﬁcient fresh produce trading and distribution precinct.

The core of the precinct will be the relocated Melbourne Wholesale Fruit and Vegetable Market and National Flower Centre currently situated in Footscray Road. The precinct will also include an extensive, complementary development accommodating facilities and businesses that improve and develop the transportation, handling and marketing of fresh produce.

The Melbourne Markets are an important part of the State’s economic infrastructure, with an annual turnover in excess of $1.6 billion. As it is fully developed over the next 10-20 years, the new market precinct is expected to drive over $1 billion of investment on the site. The principles under which the market will be developed have been signed off by the State and the market community’s project entity Victoria Fresh Markets Pty. Construction is due to begin in early 2009, with market operations due to commence in 2011.

Taking action

7.1 Regional rail review

In December 2007 the Victorian Government released the final report of the independent Rail Freight Network Review chaired by the Hon. Tim Fischer AC, Switchpoint – The template for rail freight to revive and thrive! and immediately reduced access charges for domestic grain shipments. This reduced grain handlers’ freight costs by about $6 a tonne, making overall rail freight costs competitive with road freight costs, and resulted in GrainCorp contracting to keep this freight on rail.

In February 2008 the Government announced a $20 million Rail Freight Support package that extended the access charges rebate to export grain, and made rebates available to export container terminal operators who continue to use rail for freight to port.

The review identified a number of priorities and levels of investment to upgrade Victoria’s rail freight network. The Government will invest $42.7 million, including $23.7 million to enable the upgrade works to start progressively on the priority Gold lines. This means the most important lines will be upgraded in priority order to ensure they continue to provide a competitive transport alternative and are capable of carrying the harvest when better seasons return. A further $19 million will be allocated for maintenance works on the freight network over the next 12 months.

7.2 Channel Deepening in Port Phillip Bay

The Channel Deepening project is part of a broader freight strategy of the Victorian Government. The economic beneﬁts of channel deepening have a direct effect on Victoria’s farmers. On average $90 million worth of exports leave the Port of Melbourne every day. The project will result in better economies of scale in shipping, ultimately leading to reduced costs for farmers in exporting Victorian goods overseas.

Exports will improve after completion of the project and the long-term effect of this will be great economic beneﬁt to rural and regional Victoria. Signiﬁcantly, regional Victorian GDP is expected to be boosted by $50 million between 2010 and 2020 as savings are felt throughout the supply chain.

Economic studies suggest the channel deepening project will create 1,107 jobs, with a ﬂow-on of 905 jobs, in Victoria. The total economic impact of the Channel Deepening project on regional Victoria is estimated at $248.8 million.

The Port of Melbourne commenced the Channel Deepening project in February this year; it is expected to be completed by the end of 2009.

What we’re already doing

The Victorian Government has a strong record of investment in infrastructure to support the farm sector and regional industries to access new markets, including:

signiﬁcantly improving the State’s road and rail network, with $13 billion in investment in infrastructure projects since 2000 including upgrading the main regional links from Melbourne as part of the regional fast rail project
investing $133 million to buy back the rail freight network; $25 million for priority maintenance and upgrades; and, in conjunction with the Commonwealth, $73 million to upgrade the Mildura rail line
providing a $20 million short-term support package for Victoria’s rail freight industry to support export container and grain freight terminal operators to keep freight on rail while infrastructure is upgraded and industry restructured
delivering improved rail access to the Ports of Melbourne and Geelong
providing more than $380 million through the Regional Infrastructure Development Fund for critical economic and industry infrastructure in regional Victoria
implementation of the Victorian Ports Strategic Framework to guide future development of Victoria’s four commercial trading ports: Melbourne, Hastings, Geelong, and Portland, including the Channel Deepening project for the Port of Melbourne
progressing through VicRoads the uniform national regulations for the transport of hay and straw by truck through the National Transport Commision (NTC) – and working through VicRoads with NTC to develop a national fodder transport policy to free farmers from unnecessary restrictions on the dimensions for carrying hay and straw.

Summary of Funded Actions

Action 1: Boosting productivity through technology and changes in farming practices
Major new investment in research, development and practice change	$77 million over four years
State-of-the-art services to farm businesses	$8 million over four years
Changing irrigation practices	$2.3 million over two years
Precision farming through GPS technology	$1.47 million over three years + $3.4 million from the RIDF fund
High productivity in the dairy industry	$8.57 million over four years
Stakeholder engagement, implementation and evaluation	$2.71 million over ﬁve years
	$103.45 million
Action 2: Building skills and attracting young people to farming
Strengthen primary industry skills	$0.308 million
	$0.308 million*
Action 3: Understanding and managing climate change
Planning for climate change	$5.2 million over four years
New technologies and strategies	$6.22 million over four years
	$11.42 million
Action 4: Strengthening land and water management
New action on weeds and pests	$20 million over four years
Improving rural land-use planning	$3.79 million over four years
	$23.79 million
Action 5: Helping farming families to secure their futures
Working with rural communities	$3.74 million over four years
Farm family health	$2.18 million over four years
Case management for farmers	$3.46 million over four years
New National Centre for Farmer Health	$2.4 million over four years
	$11.78 million
Action 6: Developing new products and securing new markets
Better market access and supply chain development	$2.93 million over four years
Support for organics	$1.08 million over three years
Support for aquaculture industry	$4.05 million over four years
Support for the grapevine industry	$3.0 million over four years
	$11.06 million
Action 7: Transporting products to market
Regional rail review	$42.7 million
	$42.7 million
Total: $204.51 million
* New school and TAFE funding will be outlined in the 2008-09 Budget.

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Published by the Department of Primary Industries, Marketing & Communications Branch. April 2008

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Authorised by the Victorian Government, 1 Spring Street, Melbourne, Victoria 3000, Australia

ISBN 978-1-74199-888-7 (print)

ISBN 978-1-74199-889-4 (PDF)

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