CANBERRA: Agriculture Minister Barnaby Joyce has warned that Australians will not be the beneficiaries of an expected boom in farm exports unless superannuation funds and domestic investors lift their exposure to the rural sector and compete with foreign buyers.
Mr Joyce has endorsed the announcement by Scott Morrison of the rejection of the sale of the massive S. Kidman & Co holdings to foreign buyers.
Mr Joyce has challenged the finance sector to develop instruments to allow Australian funds to take a greater stake in agriculture, saying agriculture offers stronger returns than the resources sector and international bonds.
He said Australia risked missing out if domestic buyers didn’t enter the market and stave off foreign buyers. Agriculture at the moment was “killing it’’ with strong export growth. “And I’d love the Australian people to be greater participants in that,’’ he said. “Let’s start thinking about how we attract super funds with a financial instrument that makes investment in agriculture more sustainable.’’
Mr Joyce said land 2 ½ times the size of Victoria was owned by foreign investors. “Do you believe there is not a line in the sand?” he said. As the line was approached Australia needed to look to different approaches such as partnerships and leasing rather than outright sales.
The government believes agriculture has major export opportunities as the expanding middle class in Asia demands higher calibre sources of protein. The signing of free-trade deals with China, Japan and South Korea has also lowered tariff barriers for Australian agricultural exports, giving them new opportunities in expanding major markets.
In a blunt warning, Mr Joyce said: “Corporate Australia, this one is right under your nose and you are missing it.’’ The deputy Nationals leader said he was not against foreign investment. “If you had no foreign investment, that would be ludicrous. If you had 100 per cent foreign investment, that’s also ludicrous. Somewhere between those two points is a discussion piece,’’ he said.
Mr Joyce said he had talked to superannuation funds about how to help open more investment in the rural sector, but he believed there was an ignorance of the sector in financial circles.
The government is heading for a Senate showdown with Labor over its legislation to lower the Foreign Investment Review Board threshold for farmland to $15 million and agribusiness to $55m. Labor has proposed lifting the farm threshold to $50m and agribusiness to $252m.
Opposition agriculture spokesman Joel Fitzgibbon said Mr Joyce should talk to Peter Costello, the chairman of the government’s Future Fund which spent more of its money in North America than in agriculture in Australia. He said the government’s agriculture white paper had failed to lift confidence and was seen in the business community as a “sad joke’’.
