Carbon, carbon, carbon
On the 12th October the Australian Federal Government passed into law the Clean Energy Future Bills bringing about the imposition of a tax on Carbon from July 2012 and probably more importantly enshrining the Labour minority Government’s Clean Energy Future Policy
The Opposition has vowed to repeal these laws if they are elected at the next election however the majority of pundits are predicting that if this Government runs full term then this will be nigh on impossible to unravel so it looks as though the country is now stuck with it.
Under the Policy, the carbon pricing mechanism will commence on July 1st 2012 with the Nations top 500 polluters being charged a fixed price of $23 per tonne of CO2 emission. This will rise to around $25.40 by July 1st 2015. At this date this carbon price will transition to a fully flexible price under an emissions trading scheme with the price then determined by the market.
Is this good or bad for grazing and pastoral businesses and what can be done about it ?? Here is my take:
Bad news
In the short term suppliers to the agricultural sector will immediately pass on any carbon tax impost so farm input costs will rise with little compensation to the farmer. High energy users such as the dairy sector will have significant direct cost increases. The higher cost of energy to the businesses processing and distributing agricultural produce will in part be taken out of farm gate prices with farm returns and profitability taking the hit.
Good news
The policy states: ‘that farmers and land managers will receive significant support (presumably from the tax so generated) to pursue climate change action on their land and enhance biodiversity through a suite of measures, such as the Carbon Farming Initiative (CFI), the Carbon Farming Futures program and a new Biodiversity Fund.’
That is, farmers will be ‘paid’ to undertake measures such as rangeland restoration, fire management, manure management, management of methane from livestock and increasing soil carbon sequestration and biochar. However proving up any of these projects will be extremely complex and subject to a huge amount of bureaucracy. Agricultural peak organisations have to become actively involved here (and quick smart) to lobby and prove the methodologies of carbon offset farming otherwise this will be left to the realm of the get rich quick city based (MIS) fund managers and the likely unnecessary destocking of otherwise sustainably productive farmland.
Take for instance destocking large rangeland properties. Under the CFI there could be two carbon dollar ($carbon) streams: one from rangeland restoration sequestering more carbon in plants, grasses humus and soils as a result of greater plant growth due to destocking, and also greenhouse gas abatement income as a result of destocking several 1000 cattle and hence removing a source of methane emissions – do the sums – at $23 per tonne of greenhouse gas this could add up to several $M per property per year.
Possible very bad news
The Policy states CO2 and methane emissions from agriculture are to be excluded from a carbon price however this will be reviewed in 2015. Carbon credits generated by the above may be offset greatly by a price being applied to carbon emissions from agricultural activity and in particular the grazing of livestock
What farmers can do about it?
Bugger all in the short term.
In the longer term?
Farm ‘carbon smart’ by foreseeing and implementing practices that will reduce green house gas emissions and making sure that you take advantage of any $carbon offset that is available to the farming operation from these ie ‘milk the carbon minimisation system’
As always, keep concentrating on increased production efficiency ie increase the net production per unit of feed consumed in the grazing operation – animal type, genetics, disease control, pasture production, grazing management etc etc. This could also generate $carbon under the CFI as well as mitigate any future impost on methane emissions
What can Chemvet do about it?
The profitability of our clients is important to us as is our commitment to providing quality animal health solutions at a cost effective price. Therefore Chemvet will be fighting to keep any cost increases from this tax to a minimum and commits to a two year freeze on the regular announced prices of our Vetmec range of products (beat that Julia!!)
Kind Regards, Murray Grant
Rugby World Cup
By the time this Newsletter is delivered the winner of the 2011 Rugby World Cup will be decided. Ron is barracking for the Wallabies and Murray for the Allblacks. (Kiwi heritage hard to let go when it comes to Rugby) Hopefully one of us will be pleased with the result and that Wales or France doesn’t spoil the party! Go Walla-Blacks!!
Beef Expo Rockhampton – May 2012
The Beef Expo only comes around every three years – seems like yesterday that we were up at Rocky for the last one. This is a world class event and well worth making the trip if you can. We are running a stand again and look forward to catching up with all our clients who make it up there in May.
New Website
As you can see if you’re reading this online, the Chemvet Website has been revamped. Online ordering form the new online store is really easy for the time poor and for those who prefer to order this way. However, we still like a chat with our clients when they ring up to order!
News Flash
Registration has just been granted for our VETMEC F with NIL MILK WITHHOLDING FOR DAIRY CATTLE. This is great news for our Dairy clients who wish to treat their cows for liver fluke and worms whilst they are still milking. Stock of this product will be available in early 2012!
New Products
NLIS Round Tags
Our Datamars range of tags has been extended to include a round NLIS tag to supply those who prefer a round tag. The price is a keen $2.70 each with a standard handling and postage fee of $10.00. A free applicator is supplied if required for all order over 100 tags. Click here to read more.
NLIS Triangle Tags – Datamars Retention Guarantee
Datamars are now offering a lifetime retention guarantee on their triangular NLIS tags. If you take this option Datamars supplies a FREE large visual matching management tag with the triangular NLIS tough tag. For our Victorian clients who presently receive a subsidised non Datamars NLIS tag this deal, if you take the cost of the Management tag in to account, means that you can receive a high quality Datamars NLIS tag roughly equal to the present subsidised price. Click here to read more about the Datamars Retention Guarantee.
Vetmec Injectors – 5mL and 2mL now available
We have now in stock 2mL and 5mL versions of our highly popular Vetmec dial a dose Injectors for those who are injecting smaller amounts of Vetmec and other drugs. The 2mL gun can adjusted in 2mL increments and the 5 mL gun in 0.5 mL increments. Both of these high quality guns are priced at $35.00 + GST. Click here to read more or to order these cattle injection guns.
People News
Ron recently took a break and travelled to Phuket, Thailand with his wife Catherine. He had a great time taking in the sites, feasting on plenty of exotic food and eating loads of bananas at only 25 cents a kg!
As you can see you can’t keep him away from livestock! But looks like this elephant could really do with a good dose of Vetmec Pour-on…
