Supermarket Monopoly – Global Farmer in Australia

The Farmers in Europe are Revolting

There is a paradox, an absurdity of enormous proportions happening in agriculture in much of the Developed world. In spite of the US$486 billion a year being paid to farmers in the 21 top food producing countries in the world – heavily subsidised farmers in the European Union (EU) have embarked upon a civil disobedience campaign, some of it has been violent and massively disruptive to the rest of society. Their problem is that in spite of being paid over US$100 billion a year in subsidies, they are going broke. Their costs are greater than their returns. Across Britain, France, Germany, the low countries – everywhere in Europe, mainly family farmers are saying ‘enough is enough.’ They are taking to the streets and the supermarkets to show those who buy and consume the food what the difference is between what it costs to produce food, what the producers are being paid for it and what the consumers are paying for it at the supermarket. There is a sober lesson here for Australian agriculture as the value of the food we import goes up every year it is mostly from countries who subsidise their agriculture. According to the Worldwatch Institute, ‘Agricultural subsidies are not equally distributed around the globe. In fact, Asia spends more than the rest of the world combined. China pays farmers an unparalleled US$165 billion. Significant subsidies are also provided by Japan (US$65 billion), Indonesia ($US28 billion), and South Korea ($US20 billion).’

The value to Australian agriculture from Free Trade Agreements (FTAs) can be put into perspective when we contemplate having to compete against the home grown subsidised produce of much of Asia. If their ‘home grown’ produce, for instance beef, is subsidised, then to compete we have to be price competitive with a subsidised product – can we compete with subsidised agriculture? Only if we can sell at a price that is competitive, which may mean lower, than the subsidised product. For decades, since the seventies, Australian farmers have been duped by politicians of all colours and from agriculture, that ‘market forces’ and a ‘free market economy’ will eventually prevail. Fig 1 and Fig 2 (later) puts a lie to that propaganda and shows what it has cost. To compete we can see that Australian farmers ‘chased’ the ‘get big or get out’ mantra of the 70s with debt. More of that later.

As a child growing up in post-war Britain anything from Australian from wool to meat, to apples both fresh and dried, dried fruit and the delicious Sunday treat of Australian canned peaches, was a sign of absolute quality. The only exception to that rule was the processed cheese we were served in the army in the nineteen fifties. I am sure it had been imported during the war. Second World War, I think – maybe?

How times have changed. Britain is part of the EU, the European Union. This is what the EU say about themselves:

The EU is an attractive market to do business with:

We have 500 million consumers looking for quality good
We are the world’s largest single market with transparent rules and regulations
We have a secure legal investment framework that is amongst the most open in the world
We are the most open market to developing countries in the world

That is a proud boast and if you look at the link you will see the truth of it. They are indeed a powerful union – even a nation. To protect their agriculture the EU pays their farmers subsidies amounting to about US$100 billion a year.

In ‘Farming on Line’ a UK farming journal came this alarming news on Wednesday 29 July 2015. Copa and Cogeca warned at the EU Milk Market Observatory meeting today that the EU dairy market situation has deteriorated rapidly in the past 4 weeks, and without EU action, many producers will be forced out of business by Winter. Speaking at the meeting, Chairman of Copa-Cogeca Milk Working Party Mansel Raymond said “The market is in a much more perilous state than it was 4 weeks ago, with producer prices far below production costs. It’s a critical situation for many dairy farmers across Europe”.

Who or what are ‘Copa’ and ‘Cogeca’? ‘Copa’ was formed in 1959 to represent farmers within what we now know as the EU, it had 13 affiliates at that time. It now speaks in Brussels for sixty farmer organisation’s within the EU and another thirty six affiliates like Norway and Turkey, outside of the EU, but in Europe.

Cogeca? Straight off their website : On 24 September 1959, the national agricultural cooperative organisations created their European umbrella organisation – COGECA (General Committee for Agricultural Cooperation in the European Union) – which also includes fisheries cooperatives.

COGECA’ s Secretariat merged with that of COPA on 1 December 1962.

When COGECA was created it was made up of 6 members. Since then, it has been enlarged by almost six and now has 35 full members and 4 affiliated members from the EU. COGECA also has 36 partner members.

So ‘Copa & Cogeca’ to our antipodean ears may sound like a dance from South America, is in fact a very powerful agricultural lobby in Brussels and the Parliament of Europe. Stuck down here at the other end of the world we tend to forget that Europe is now a bigger trading bloc than America and China.

Vive la France !

French farmers are a passionate lot and in support of Copa & Cogeca, last month on warm summer days in the middle of the tourist season they dumped loads of animal manure in the middle of Paris and other cities. For those who don’t know what the machine below is, it’s a ‘muck spreader’. Normally filled with animal manure and coupled to the power take off on the tractor it ‘spreads’ the manure on the fields or paddocks. In this case it looks like it is being used to ‘clean’ windows – on a bank perhaps?

Continue reading “The Farmers in Europe are Revolting”

A Lidl of what you fancy does you good.

European Bank Subsidised Lidl Expansion with A$1200 million.

This article owes its origins to an intriguing report originally published by GRAIN. You will see why I found it intriguing when you get to it. I have spent some time on the Global Farmer discussing agricultural subsidies, little did I know and I’m sure you didn’t, that the Guardian Newspaper recently revealed German discount supermarket giant Lidl and its sister chain Kaufland have benefited from almost US$900 million (A$1200 million) in public development money over the last ten years. Is this just another form of subsidy to encourage the global expansion of European supermarkets and European food?

The companies, owned by the large retail company Schwarz Group and controlled by one of Germany’s wealthiest families, received loan funding from a little-known wing of the World Bank and from the European Bank for Reconstruction and Development (EBRD). There is no suggestion there was anything ‘wrong’ with the funding, as you will see it is part of the specific mandate of these organisations funded by taxpayers and owned by governments to encourage local development, in this case in Europe.

The German Federal government, on their website has been heavily promoting both Lidl and Aldi in America to help it to become established in that country and, no doubt, sell food that has been made or produced in Germany. Lidl like Aldi, also sell a range of German made hardware, electrical goods and many other things.

Aldi already have stores in Australia and it is understood they plan many more. Lidl are also planning a chain of stores throughout Australia. In what seem like a few years in the UK they have secured over 10% market share and are causing both Tesco and Waitrose, the two biggest food retailers in the UK, to review their business plans.

They have made no secret about being ‘aggressive’ with their entry into America. Maybe interesting times for the Australian consumer, but what about the producers and what few processors are left, what of the future for them?

Continue reading “A Lidl of what you fancy does you good.”

Is China Australia’s Land of the Golden Fleece?

There is a lot of ‘chatter’ mostly in the media and mostly from the uninformed like politicians that Australia has the agricultural productive capacity to become the ‘Food Bowl of Asia.’ Is it true?

Part 1.

There are those in the city who are plotting and have the money.

Is China Australia’s land of the Golden Fleece? Or is there a danger we could lose our money on the way to the goldfields? Fear not there is hope. Why? Well, for one thing there have been several very high profile meetings under the banner the ‘Global Food Forum’. Never heard of them? Not surprised, they were advertised in places where those on the land were unlikely to see the the advertisements.

When I saw the ‘Global Food Forum’ first advertised in The Australian and had a look at the list of speakers I thought they were notable in the world of finance and agribusiness if not agriculture, that is I couldn’t see many farmers on the list, but my interest was aroused non the less. I then enquired as to the price of a ticket and added on two nights accommodation in Sydney and the cost of plane ticket and the thousand kilometre round trip in the car to get to Perth, I decided the whole thing was out of my reach, way out.

Disappointed because I couldn’t afford to go, I gained some pleasure out of becoming cynical about the whole thing. Just another Pitt Street Cockie talkfest I reasoned, and those Pitt Street Cockies are so clever they know the answers before you ask the question and most of them don’t know where Western Australia is anyway!

I noticed the host of the event was a multi millionaire, one of the biggest carton manufacturers in the country, so he had a whopping vested interest. I deduced he would have said to himself, ‘more food, more cartons, only two manufacturers in Australia so it’s worth a punt.’ I looked up the definition of the word ‘altruism’. Never met the man so I don’t know if it applies.

Will these men save or ruin Australian agriculture. We need to hear what they have to say.

Continue reading “Is China Australia’s Land of the Golden Fleece?”

The Sadness that is Kojonup

The battle in Court between two farmers from Kojonup is one of the saddest events in my career in agriculture, which now spans over half a century.

It is sad because it has given those for and those against, this time GM Canola, but it could just as easily been ‘Yellow Vitamin A Rice’ another stage, this time a Coliseum, to vent in public their malevolence and witlessness.

I admit to being a bit dim-witted at times but is there any way anyone can stop the flora and fauna of this world spreading seeds, either by wind or defecation where ever and wherever they wish? When that foreign seed germinates on organic land how does the foreign plant automatically become organic?

To some on the against side, and one can only judge those against by what they say and write, truly believe that many scientists and farmers, those on the for side are monsters, purveyors of teratogenic engineering, which has the capacity to cause the most awful damage to mankind.

That is sad and grieves me that they hold those opinions. Mainly because it means they truly believe that the for side are or would be, could be, complicit in poisoning, killing, their own families. An outrageous thought.

To some on the for side, those against are Luddites, nihilists and in some cases vandals and despoilers. It is regrettable that some of those against have been vandals and despoilers. Those against have been labelled as anti-science.

It has been known for more than a decade that by 2050 there could well be 9 billion mouths to feed on this earth. To feed those people food production will have to increase by at least 50%, some say more than that. I know I write about this often, that’s because it’s true.

In my working life of over half a century the population of the world has doubled. At the end of WWII world agriculture was basically organic.

We, that is science, farmers and their advisers have fed twice the number of people we started with 50 years ago. Today some eat too much and others go hungry and starve to death. There is no shortage of food though, we just don’t get it to those who need it, we are too busy. Instead we fly over the countries with the starving millions and marvel at international travel, which will take us to the next banquet. Continue reading “The Sadness that is Kojonup”