fair-go Who would have thought it? This year Australian agricultural exports could be just $3 billion less than the darling of every politician and the maker of billionaires in this country, iron ore. The leaders of this land love to wear the high vis vests, helmets and glasses, tug their forelocks and queue up to have a ‘selfie’ with ‘Twiggy’ Forrest and Gina Rhinehart or make sure they are seen wining and dining with the captains of BHP, Rio Tinto and anybody in the A League of world business. I haven’t noticed the Prime Minister or the Leader of Her Majesty’s Opposition queuing up to have their selfies taken with the President of the National Farmers Federation or the leaders of our state farmer organisations to say ‘thank you’ for the contribution agriculture is making to the economy of this great country. What a dreadful display of ignorance, an indictment against the government and the opposition of this country that they cannot spare the time to be seen saying ‘thank you’ to the thousands of Australian farmers, for striving to achieve the targets predicted in March of this year by the Australian Bureau of Agriculture and Resource Economics and Sciences (ABARES) that total agricultural production for 2017 will be $63.8 billion and that exports could reach $48.7 billion.

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Nothing to do with politics. A Rhode Island Red and a Black Leghorn by the look of them. But then again?

The Department of Foreign Affairs and Trade (DFAT) states that in 2016, iron ore exports from Australia were worth $53.7 billion and coal exports were worth $42.3 billion. Agricultural exports for 2017/18 could be below the ABARES forecast due to the drought in Western Australia, which normally produces about 80% of our wheat exports. Never-the-less, exports of agricultural products could have been just $5 billion less than the total iron ore exports, and $5 billion more than the total coal exports. Given a reasonable year next year, Australian agriculture will again be the second or third biggest Australian export industry. That means that the Australian economy needs agriculture as much or more than at any other time in its history. Does Australia celebrate agriculture? No. Why is that?

The media runs the country.

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Guarding the assets of Australia.

The main stream media (MSM) is frightened of agriculture, it has no expertise in agriculture and the result is that the people of Australia have lost touch with the second biggest exporter in the nation. Most media outlets from TV to radio to the press have teams of people in Australia and all over the world who report daily on every facet of Australian and international business life. Finance, exports, the international stock markets, foreign affairs, Donald Trump, China, Japan, London, Paris and Rome, Russia they are all covered. What is not covered because they don’t know anything about it, is what is happening in the international world of agriculture and how it may affect the welfare, the finances of second biggest exporter in Australia. If the price of iron ore goes down by $20 a tonne the markets get in a flap. If the price of wheat falls below the cost of production, which happened recently, the main stream media couldn’t give a toss. When was the last time you heard the CBOT mentioned on the MSM? Don’t know what the CBOT is? That’s my point. There are senior editors and opinion writers, who, because of the new media laws, can write a thundering column one day and be on prime time television the same day promulgating the same ideas. Politicians are superfluous, the media runs the country because the media decides what is news and what is not and agriculture, because they know nothing about it, is not news. The second biggest export industry in the country is not news worthy, get used to it! By the way, I don’t exclude the ABC Rural from my comments. The strong men and women from the media should take a few reality pills and get out into the country, wear some agricultural high vis vests and attend agricultural conferences, dinners and meetings. Our political leaders should stay and listen and learn and not make their excuses and leave as soon as they have read the platitudinous crap dreamed up for the occasion by their speech writer. They should stay and listen, quietly, to those who know a thing or two about agriculture. About the trials and tribulations that go into ensuring the heart of Australia’s second biggest export industry keeps beating, no matter what. They would learn from those around them what is important in life and although most of them do care about same sex marriage and the plethora of gender issues, they are tired of the cost to the nation of this media driven twaddle that fills the airwaves 24 hours a day 7 days a week when there are far more important issues that need to be settled.

One hundred and twenty million dollars sounds like a lot on money for a postal vote to settle the same sex marriage debate, and there are parliamentarians who can mischievously make it sound far more than it really is, they poke fun at each other for being so lavish, munificent with the people’s money. How silly they make themselves look in the eyes of farmers who can easily gamble a million dollars each and every year to plant a crop. The main stream media and the government take large amounts of money from betting companies for running their advertisements on TV in prime time. Those advertisements always have the bye line ‘Always gamble responsibly’. No such warning ever goes out to farmers.

It’s called plunder. No taxes or royalties will be paid to the Australian people by the developers of the biggest gas field in the world right here in Australia.

Australia is being plundered. The wealth of the nation is being taken away by some of the biggest companies in the world and not a red cent is coming back to  the people who own the asset. Is it any wonder we have a third world national rail system? Is it any wonder that Western Australia which has been the epicenter of the resources boom over the last thirty years or more has got nothing to show for it outside of state-of-the-art iron ore ports in the north, a road and rail system in the metropolitan area that isn’t big enough and a new stadium and foreshore development costing well over a billion dollars.

Western Australia sells about 15% of the grain traded on world markets. It is facing serious competition from Ukraine and Russia who have an almost limitless capacity to increase their production. If Australia is to compete it must invest in the future and build new roads and new railways— the current infrastructure is terminal, it’s worn out, it’s buggered.

Plunder it is.

Our politicians always want to be there and the developers are always only too pleased to have them there when Australia opens another gas field working inexorably towards Australia becoming the biggest gas producer in the world. What our political leaders leaders forget to tell us is that they have been so good at making deals on the income from what will be the biggest gas fields in the world and owned by the Australian people, that the developers will not pay the Australian people a cent in taxes or Royalties in the foreseeable future. They have been given away and the Prime Minister was there to give them away.

How can it be when a country is as far in debt as Australia, that deals can be done with the major oil and gas companies in the world so that they will not pay any royalties or taxes? This is just part of what they all do to avoid paying money, let’s face it that is what it is, money, lots of it, unimaginable amounts of it all due to the Australian people for exploring and developing the resources owned by the people of this country. If the gas isn’t worth anything why have the developers spent billions in exploration and development? Certainly not for the fun of it. This is just part of what Michael West discloses in his articles. We must be too frightened as a nation to fight these all powerful companies, so by being gutless and compliant we line the pockets of others with what is rightfully ours: This is a must read article on how the oil companies are ripping off every Australian. If you are cold and cannot afford gas or electricity to keep you warm, look no farther than the piece of 21st Century plunder for which no one will go to jail. This is just part of that article which first appeared on the Michael West web site. Read the full article it is a must read for anyone concerned about how this country is being treated by the all powerful oil companies.

A BP post card

When executives from BP Australia fronted the inquiry into corporate tax avoidance last year, they omitted to inform the senators presiding that their parent company had sucked out a $3.2 billion “dividend” to a tax haven. Tax-clean.

The senators – Sam Dastyari, Nick Xenophon, Richard Di Natale and Matt Canavan among them – were not even made aware that BP Australia had a parent company in a tax haven. Nor had the government been made aware, as the law requires, through any disclosure to the Australian Securities & Investments Commission (ASIC).

The official ASIC records show the parent company in question, the enigmatically-named 200 PS Overseas Holding Inc, is domiciled in Illinois.

In fact, it is not domiciled in Illinois. Rather, its address is the tax haven of Delaware, the same address where another 285,000 entities are registered. Delaware is home to many of the world’s premiere tax dodgers, including the top two targets of the Australian Tax Office (ATO): Chevron and Rupert Murdoch’s News Corp.

“Too big to care, too big to be policed, too big to worry about regulators and too big for pesky politicians and their inquiries.”

Six months before the tax inquiry kicked off in November, BP had made its submission, along with rival oil majors Shell and Chevron. In this submission it also failed to mention its secret parent, its secret tax haven connection and its $3 billion rip on Australian taxpayers. Not a word, nary a skerrick of disclosure.

In fairness to BP, which denied its behaviour had been misleading in a written statement to michaelwest.com.au during the week, it should be said that, when it comes to corporate citizenship, the UK oil major is ahead of its rivals Shell and Chevron.

Although it only forked out $18 million in income tax in Australia last year, revenues had fallen sharply with the oil price. Usually it pays more than $200 million on sales of more than $20 billion – still a fraction of what it should pay.

Still, it does pay more tax in Australia than its peers and is not as aggressive in tax structuring. Shell managed to rack up revenues of $60 billion in Australia in three years and not pay one red cent in tax.

Blame the British.

Logo - East India Trading CompanyIt’s a system of legalised robbery and plunder dating back 1600 when a Englishman called John Watt, formed the East India Company. What the famous East India Company did was legal because among its shareholders were the British Royalty and aristocracy. At one time the East India Company controlled half the worlds trade and had a private army of 260,000, twice as big as the British Army. Much of its wealth came out of India and Qing China. India of course was much bigger in those days because it included what is now Pakistan. This is from Wikipedia:

Originally chartered as the “Governor and Company of Merchants of London trading into the East Indies”, the company rose to account for half of the world’s trade, particularly in basic commodities including cotton, silk, indigo dye, salt, saltpetre, tea and opium. The company also ruled the beginnings of the British Empire in India.[4]

The company received a Royal Charter from Queen Elizabeth I on 31 December 1600, making it the oldest among several similarly formed European East India Companies. Wealthy merchants and aristocrats owned the company’s shares.[5] Initially the government owned no shares and had only indirect control.

It folded after the Indian Rebellion of 1857. Nothing much has changed. The world of corporate plunder is alive and well, the East India Company has been replaced by Shell, ExxonMobil, Royal Dutch Shell, Total, Gazprom, BP and Ampol and others… Add on to those energy companies, empires like Rio, Amazon and Alibaba and coal exporters like BHP and Anglo and you have the trifecta.

Now we have no one to blame but ourselves.

I wrote a few months ago that Japanese consumers pay less for Australian natural gas than we do. Lots of people read the article and nobody gave a damn, apparently. We just roll over and do as we are told, just like the Indians did with the East India Company. So what, why should we care we have all the important things in life? All codes of football are on the TV, Fox, Sky and Netflix have changed the world and very soon virtual reality will be as common as the mobile phone —what more could anyone want? Life in a fantasy world available at the flick of a switch. That story about the gas was based on a story from Michael West, here’s another from the same man and the full story is in The Conversation.

Michael’s articles always raise questions in my mind that he hasn’t had the space or the time to cover. I hope I do him justice in what I write and a declare my gratitude for him stimulating the dark corners of my brain. What follows in italics, is a direct quote. The whole article should be read and can be found at the reference to The Conversation in the first paragraph. I have an idea on what we can do to stop this rot and get us back to being the country we once were, the country that I came to over fifty years ago now, a country that filled me with wonder, having spent too long in the black heart of industrial England. What follows would make good fiction, the trouble is that it’s true the only things missing are the axes and beads:

This week’s budget papers show the government spending A$33 billion on education this year, nearly the same amount that Australia’s five new offshore gas fields will make in sales each year when they are running at full capacity.

Unless prices spike higher, however, these five monster projects may never pay a cent in royalties or Petroleum Resource Rent Tax (PRRT). Unless the aggressive tax structuring of the oil majors is met with equally aggressive enforcement by government, the world’s biggest oil companies – Chevron, Exxon, BP and Shell – will pay very little in income tax too. Billions each year in profit from extracting Australia’s natural resources will be funnelled offshore. It is a giveaway of immense magnitude.

Under pressure from a campaign by unions and the Tax Justice Network, the government finally extended the Senate Inquiry into Corporate Tax Avoidance to encompass the PRRT. Hearings have recently, though not ideally, been held in Perth. The evidence was stunning.

Five new offshore gas projects are coming online: Gorgon, Wheatstone, Ichthys, Pluto and Prelude. When these are running at full production capacity they are unlikely to pay any PRRT for many years to come – the companies themselves concede it will be 2029 – and no royalties apply. The Tax Justice Network and the International Transport Workers’ Federation (ITF) say there is a good chance, on the government’s own numbers, that PRRT will never be paid on these 40-year projects.

Now we know part of the reason why we are broke after the biggest resources boom the world has ever seen.

Can you believe that? It’s no wonder the infrastructure in WA like roads and rail to support our massive agriculture is falling to pieces, when those in government who negotiate these deals are so stupid to agree to a deal where the people who own the oil and gas get nothing, nothing out of the deal. Look at India today and look at what the British took out and didn’t pay a fair price for it, why? Because the fair price was fixed by the buyer — sound familiar?

A few months ago I also wrote a true story that we have less than a months store of fuel, petrol, oil and diesel in this country. We could be closed down in a month if the sea route to Singapore was blockaded, North Korea is capable of anything — they have the bomb and soon the rockets to get them here. Does anybody care, apparently not. She’ll be right mate, so long as the world behaves itself. Look out if it doesn’t. There was a time when this kind of behaviour would have brought down the government. Imagine not having the fuel for the ADF. Dad’s Army lives again!

WAPET were drilling for and finding gas in Western Australia on the Dongara sandplain, an hour south of Geraldton, during the 69 drought. I know, because I had a couple of horses, a pack of dogs, a beach buggy and together we drove a big mob of merinos around the bush until the drought broke in 1970. Welcome to Australia and Kangaroo ticks. Nearly fifty years later the only gas we have in Albany, down on the south coast of WA, is LPG, Liquid Petroleum Gas, brought down the Albany Highway in tankers with a pay load of over 100 tonnes.  My understanding is that the gas is then pumped into the old coal gas grid and of course sold in gas bottles. What has happened that in fifty years we have been unable to get our huge resources of natural gas to Albany to encourage industry to grow. To provide jobs for our young people. What are we all about when in fifty years we can’s build a pipeline 500 kms long?

Is life is too easy or just too hard?image007

What has happened in fifty years to our national objective and determination to excel in the world and be better than everyone else? In agriculture we were the best in the world and then someone, some idealistic clown, decided that the market economy should prevail. Every other leading agricultural country in the world was subsidised and still is.  Our arrogant politicians told us we didn’t need subsidies, that ‘market forces’ were our future and we needed to tighten our belts or ‘get big or get out’. And of course like the sheep we kept, we believed them. Subsidies paid to our competitors took our markets away. We tightened our belts until until we had the financial waists of a ballerina and the world still kicked shit out of us and stole our self sufficiency. The Australian rural debt at $70 billion is testimony that ‘getting big’ has failed and forced many to get out — and of course we still compete in world food markets with countries that resolutely support their agriculture through subsidies. Is it any wonder it is hard to make a quid? We import just about everything we need, machinery, fertilizers, chemicals, fuel, even our trains, from countries that have a subsidised agriculture. I will gladly publish any argument that can make sense of that.

 

 

 

Roger Crook

About 

Over the last fifty years or so Roger has worked in agriculture, since 1967 in Australia. From farm labourer, to station and farm manager, then progressively to a senior management position in agribusiness as the marketing and sales manager of what was at the time the biggest agricultural chemical company in Australia, ICI (Australia- Rural Division), Roger has both a practical farming and comprehensive agribusiness background.
After a brief spell as the marketing director of a big public relations company in Perth, Roger formed his own consultancy specialising in agribusiness communications and the marketing of Australian agricultural intellectual property overseas.
Roger says he will only ever be 'semi retired'. He believes Australian agriculture is at the crossroads so he has set up the 'Global Farmer' as a forum to both pose, debate and hopefully answer some of the challenges being faced by the Australian family farm and so by Australian agriculture.

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