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Executive Summary

Most of the agricultural statistics in this report have been obtained directly from the Australian Bureau of Statistics on request. In most cases reasonably consistent time series data were available from 1985 to 2002 although there have been some changes over time in the definition of agricultural establishments, and in some recent years the information comes from a representative sample of rural establishments rather than from a full census.

Time series data for forestry land use is not as complete as for agriculture. Information used has come from Forestry Tasmania and Private Forests Tasmania as well as the Australian Bureau of Statistics.

Additional information on overall State land use came from a recent mapping study undertaken by Drenen1 for the Department of Primary Industries, Water and Environment.

In assessing plantation distribution in relation to land capability further spatial analysis was undertaken by Davey & Maynard using land capability data from the Department of Primary Industries, Water and Environment in combination with plantation land use data obtained from Private Forests Tasmania and Forestry Tasmania.

Total Land Area of Agriculture and Forestry
The total land area of Tasmania is around 6.8 million hectares. Agriculture and forestry activities utilise around 1.6 and 1.5 million hectares of this total - 24 and 22 per cent respectively. Of the estimated 1.5 million hectares of land used for forestry activities, production forestry2 accounts for around 86 per cent and plantation forestry for the remaining 14 per cent.

Land Area of Agricultural Establishments
According to Australian Bureau of Statistics figures the total area of agricultural establishments in the State is around 1.9 million hectares. The main reason for this figure being higher than the 1.6 million-hectare estimate above lies in the Australian Bureau of Statistics definition of "agricultural establishments". Agricultural establishments include all establishments where agriculture provides the main source of income. As such it also includes some area of production and plantation forestry.

Farm Numbers
Australian Bureau of Statistics figures appear to suggest that total farm numbers have declined by almost 20 per cent since 1986 - from 5,300 to 4,300. However, the apparent reduction is at least partly due to the inclusion or exclusion over time of establishments with relatively low output. With the exclusion of all establishments where the Estimated Value of Agricultural Operations is less than $22,500, the number of agricultural establishments (farms) has been more consistent at around 3,000 to 3,400.

Agricultural and Plantation Land Use
In recent years there has been a significant increase in the area of plantation forestry in the State. Since 1997, the first year that data is available for both private and public land, total plantation area has increased by 31 per cent from 158,200 hectares to 207,300 hectares. Sixty per cent of this area (124,400 hectares) is on private land.

While around 22,000 hectares or 18 per cent of plantations on private land has come from areas previously under pasture, it is difficult to ascertain any major impact of this in Australian Bureau of Statistics figures on agricultural land use or total output.

Sown pastures make up almost 50 per cent of the total area of agricultural establishments in the State - 800,000 to 900,000 hectares. Because of the fact that plantation development on what was previously agricultural land has tended to favour grazing land in relatively high rainfall areas, this should be the land use category most impacted by plantation development. In fact, the Australian Bureau Statistics estimates for the area of sown pasture have fluctuated from year to year so that no real trend is evident. To some extent this may be due to differences over time in the way in which data has been collected and interpreted.

There are no statistics that show the allocation of sown or native pasture areas to various livestock enterprises, however there are statistics on the numbers of stock that graze those pastures.

Stock Numbers
The main trends in livestock numbers since 1985 are:

Beef cattle numbers relatively constant over time but with a decline in the late 1990's and some recovery since then
Substantial increase in dairy cattle numbers over the period but with some reduction in the past few years
Substantial reduction in sheep numbers
The livestock enterprises potentially most affected by the expansion of plantation forestry on agricultural land are beef cattle and dairying. Sheep tend to be run in drier areas less suited to plantation forestry.

Because beef cattle returns are generally lower than for dairying, beef farms are more likely to be converted to plantation forestry than dairy farms. However, some dairy properties have been also been converted in recent years.

Total beef cattle numbers have declined by 17 per cent from 521,000 in 1996 to 432,000 in 2002. It is likely that some of this reduction is a result of the expansion of forestry plantation area. The relatively high prices paid by plantation prospectus companies for land in the late 1990s in combination with relatively low beef prices throughout much of the 1990s were the main drivers for this conversion.

Interestingly, however, while there was a sharp decline in total cattle numbers from 1996 to 2000, there has been some recovery in 2001 and 2002, possibly as a result of increasing beef prices. There is, in fact, a similar number of beef cattle in Tasmania in 2002 as there was throughout the late 1980s and early 1990s. This would tend to support the view that total cattle numbers have been influenced more by prices paid than by the amount of land taken up by plantation forestry.

Australian Bureau of Statistics figures show a steady expansion in total dairy cattle numbers from 1985 through to 1999 despite the growth in plantation forestry that occurred in the late 1990s. Conversion of beef and sheep properties in higher rainfall areas to large-scale dairies was a factor in that growth. A substantial increase in irrigated dairying was also a factor. Since 1999 the statistics show a decline in total dairy cattle numbers. This is likely to be a response to low milk prices (except for 2001-02) and the continuing exit of smaller dairy farms with no compensating increase in large-scale dairy conversions. The exit of smaller less economic dairy farms has been assisted to some extent by the expansion in plantation forestry.

While total dairy cattle numbers appear to have declined somewhat from a high in 1999, total milk production continued to increase until 2002. Production in the 2001-02 season was a record 671 million litres. Lower milk prices and poor seasonal conditions in 2002-03 saw a reduction to less than 600 million litres - more in line with the three years prior to 2002. It appears that the long-term increase in State milk production has levelled off in recent years.

Sheep numbers have declined steadily since the late 1980s mainly as a result of low wool prices following the demise of the reserve price scheme that was in place prior to that time.

Crop Areas
The overall area of crops grown in Tasmania (including fodder crops) is around 80,000 hectares or four per cent of the total area of agricultural establishments in the State. Trends since 1985 include:

Total cereal area relatively constant but with an increase in wheat at the expense of barley
Vegetable area relatively constant but with potato area up and peas down
A significant increase in poppy area
A recent increase in perennial horticulture - particularly grapes, cherries, apricots and walnuts
"Other Crops" which includes fodder crops and cereals for hay and silage have shown a marked fall in total area
The area of poppies has increased from around 5,000 hectares in 1985 to over 16,000 hectares in 2002. This has also been a major driver of irrigation development throughout the State but particularly in the Northern Natural Resource Management Region. The reduction in "Other crops" is most likely due to a reduction in the area of forage crops grown for sheep.

Plantations and Land Capability
Analysis of forestry plantations on various land capability classes suggest that only a small percentage of the total plantation area has been established on prime agricultural land (Classes 1, 2 and 3). Most of the prime agricultural land that has been converted to forestry plantations is in the North Western Natural Resource Management Region.

Irrigation Area
The total area under irrigation in Tasmania has risen from around 40,000 hectares in 1985 to almost 70,000 hectares in 2002. Additional irrigation use on pasture and poppies makes up the bulk of the increase, but there has also been an increase for vegetables and perennial horticulture. Licensed water allocations have increased from 83,000 ML in 1986 to 357,000 ML in 2003 - mainly for capture into on-farm storage rather than as direct take from rivers or streams.

Employment
According to the Australian Bureau of Statistics, direct employment in agriculture, forestry and fisheries is around 12,300 people or seven per cent of the total State workforce. The total employment associated with these industries is greater than this because the Australian Bureau of Statistics employment figures do not include employment in businesses that service the production sector or the downstream processing that flows from it.

There was a decline in direct employment from 13,100 to 11,300 between the 1986 and 1991. However, there has been an increase back to around 12,300 since that time

Gross Value of Production
The gross value of agricultural production in Tasmania in 2002 was $903 million. This represented an increase of around 20 per cent over 2001 on the back of record high production and prices for both milk and poppies, and high beef and lamb prices.

In 2001 the gross value of agricultural production was around six per cent of Gross State Product. With inclusion of multiplier effects associated with industries dependent on agriculture, the total agricultural contribution was almost 20 per cent of Gross State Product.

Since 1985, the gross value of agricultural production has increased at a compound rate of 5.2 per cent per annum. With adjustment for inflation, the annual increase is reduced but there has been a steady upward trend since 1990 despite the decline in the wool production and prices following the demise of the reserve price scheme.

There are no equivalent statistics on the gross value of forestry ex forest or plantation in Tasmania.

Private Forests Tasmania publishes a range of stumpage prices for timber produced throughout Australia. Depending on the proportion of the various grades of timber produced in Tasmania, the total stumpage value of timber produced in recent years (both plantation and native) might be somewhere in the range of $100 million to $130 million. As for agriculture, this estimate is essentially a first market figure and does not include the value of harvesting and cartage or further value-adding within the State.

Land Use Drivers
A wide range of drivers impact on land use patterns in Tasmania. While objective measures of the impacts of individual drivers are not available, a number of issues are reviewed.

For agriculture, terms of trade and productivity improvements are important drivers in farmers land use decisions. They will also impact on the degree to which forest plantations will compete for sown pasture areas in higher rainfall districts over the next few years. Changes to the taxation provisions associated with forestry prospectus companies have resulted in a recent increase in investment in those companies. At the same time, predicted increases in milk and beef prices (at least in nominal terms) will increase the competitiveness of those enterprises. Land prices are likely to increase in areas where plantations, dairying and beef cattle compete for land.

For some crops, the area planted will be limited by the requirements of the processing sector. While vegetable production, including potatoes are likely to show moderate growth over the next few years, there has been some downward adjustment to the poppy area as a result of existing high stocks relative to expected market demand.

In general, while there is a relatively small amount of prime agricultural land in Tasmania (Class 1-3), there is a large area of Class 4 land that can be used for irrigated cropping if correctly managed, and Class 4 and 5 land is suitable for both dryland and irrigated grazing. The availability of suitable land is not considered to be a major constraint to expansion in agricultural output at the present time. However, the availability of irrigation water could potentially restrict future agricultural development, although there is still further potential to capture winter flows into storage in most catchments. This issue is being addressed through a number of initiatives being undertaken by the Department of Primary Industries, Water and Environment.

NOTES.
1 Drenen,A., Land Use Mapping at Catchment Scale, Tasmanian Report, DPIWE, March 2003 (Back to text)
2 Production forestry is defined as commercial production from native forests and related activities on public and private land (Bureau of Rural Sciences, Land Use Mapping at Catchment Scale, Principles, Procedures and Definitions, Edition 2, September 2001) (Back to text)