AU: Vegetable farmers going into debt to cover operational costs
Industry-commissioned research by the Australian Bureau of Agricultural Resource Economics and Sciences (ABARES) revealed the cost of vegetable production had gone up 10 per cent in two years. Growers said commodity prices were so low it was impossible to keep step with the rising cost of doing business.
Manager of Industry Development at industry body AUSVeg Andrew White said across the board, costs were increasing. "There are a number of impacts on growers at the moment, rising costs in particular," he said. "Electricity, fuel and labour costs are really impacting on returns and making it harder to remain profitable."
He said the figures come on top of a steady increase over the past 10 years.
Increasing prices 'passed onto farmers'
The chair of the Tasmanian Farmers and Graziers Association Vegetable Council, Andrew Craigie, said there were a number of hidden costs for farmers.
"There's increases everywhere whether its in insurance premiums, council rates, the guy that works on a piece of equipment, the electrician, the tyre service," he said. "They've all had to increase their prices and pass them on."
Mr Craigie said unlike tradesmen and retailers, farmers were unable to pass on their increasing costs. He said farmers were paid a very small portion of overall retail prices, and that had to change.
"The farmer on certain varieties of beans gets down to 28 cents a kilo," he said. "People have a bewildered look on their face when they look at it in the supermarket and that same kilo of beans is now $4.50 a kilo."
Mr White said farmers were going into debt to cover the cost of production.
The industry has spent millions of dollars on research and development over recent years, searching for ways to produce more for less. Mr White said it was not enough to cover the rising cost of production.
Mr Craigie said unless the price farmers were paid began to tally with the rising cost of production, the number of farmers growing vegetables would go down.
Source: www.abc.net.au