Selling the Farm !

Many people will be dismayed by the decision to approve the sale of Australia's biggest dairy company to a Chinese Investment company.  The fact that the 17,800 hectare Van Diemens Land company and it's milk production will in future be under foreign direction represents a lost opportunity.

For several years Australian parents have battled to buy infant formulae because the shelves of our supermarkets are often bare.  China has an insatiable demand for Australian and New Zealand baby formulae because the Chinese made product was discredited when local manufacturers substituted Melamin for milk to enhance profits - and as a result several babies died.

Chinese students studying in Australia are urged by their relatives to buy Antipodean baby formulae and ship it home, and in some instances this is on offer on the Chinese black market at astronomical prices.  We have been slow to ramp up production and take advantage of this great export opportunity, and now it seems that this market is slipping away.

A lot depends on what Moon Lake Investment Company, the new owner of the Van Diemens Land company decides to do with this new acquisition.  Investment companies are in the business of making profits and we could suffer a double whammy  if they decide to ship our milk to China and make baby formulae to satisfy this unmet demand - and deprive the local market of the milk we need to satisfy local demand.   If we have a milk shortage, it is inevitable that the price at the supermarket will rise !

Food security is very much on the mind of many other foreign governments.  The world population has ticked over seven billion and the estimates of future numbers is frightening. There is a doubt whether we will be able to adequately feed all these people and climate change is adding a new dimension because it will certainly change both crop viability and area suitability for agriculture.

Australia is lucky because we have the capacity to feed ourselves.  Many will remember the desperation of the second world war when Britain was dependent on those convoys to stave off starvation.  There are many world countries with big populations and small land areas that must rely on imports for food - and that situation will become more common in the future.

That raises the question of the wisdom of allowing foreign ownership of our agricultural land.  Some argue that ownership is not an issue because land can not be rolled up and shipped overseas.  That misses the point that control of what is done on that land is in the hands of other people and what is produced there will be determined in the interests of that owner, not necessarily in the interests of Australia.

Ideally, agricultural land should have it's title invested in an Australian public company listed on the stock exchange and subjected to a charter to determine that it's management remains within listed guidelines.  It's shares would be equally available to Australian and foreign investors, but with safeguards against investor action changing that public ownership charter.  Basically, land would be held in trust with investors trading shares on the basis of how successfully it operates and what dividends it pays - but without the ability to take the company out of public ownership.

It would take a law change to bring that into reality.  Food security may well become the major issue later in this century !