With drought ravaging Australia’s eastern states, much attention has been given to the need to provide short-term solutions through drought relief. But long-term resilience is a vital issue, particularly as climate change adds further pressure to farmers and farmland.
Our research has found that helping farmers improve the rivers, dams, native vegetation and trees on their land increases productivity, the resilience of the land to drought, and through this the health and well-being of farmers.
Now is the time to invest more heavily than ever in vital networks in regional Australia, such as Landcare and natural resource management groups like Local Land Services and Catchment Management Authorities.
Growing pressures on agricultural land
Some researchers suggest that up to 370 million hectares of land in Australia and the Pacific is degraded. This diminished productivity across such a large area has significant implications for the long-term sustainability of agricultural production.
Australia also has one of the worst records for wildlife diversity loss, including extensive loss of biodiversity across much of our agricultural land. The problems of degradation and biodiversity loss are often magnified under the pressure of drought.
The good news is that there are ways to strengthen the resilience of the farmland. One key approach is to invest in improving the condition of key natural assets on farms, like shelter belts, patches of remnant vegetation, farm dams, and watercourses.
Many studies have shown improving the natural assets on an farm can boost production, as well as avoid the costs of erosion and flood control. For example, restored riverbank vegetation can improve dry matter production in nearby paddocks, leading to greater milk production in diary herds and up to a 5% boost in farm income.
Similarly, shelter belts (tree lanes planted alongside paddocks) can lower wind speeds and wind chill, and boost pasture production for livestock by up to 8%, at the same time as providing habitat for biodiversity.
Our own long-term work with farmers who invested in their natural assets prior to, or during, the Millennium Drought in New South Wales suggests these farmers are currently faring better in the current drought.
Investing in resilience for the long-haul
Well-supported and resourced organisations like Landcare groups are pivotal to supporting effective land management, which improves degraded land and helps farmland (and farmer) through tough times.
However, Landcare and other natural resource management agencies have been subject to major budget cuts over the past decade.
They are also a key part of the social fabric of rural communities, bringing together landowners to exchange ideas and support each other. Indeed, the Australian Landcare model is so well regarded globally it has been adopted in 22 other countries.
This drought is a critical decision point. The need to invest in maintaining and improving our vegetation, water and soil has never been more apparent than it is now. We have a chance to determine the long-term future of much of Australia’s agricultural land.
It underlines just how variable the Australian climate can be.
While attention is focused on responding to the current situation, it is important to also think long-term. In our rush to help, we need to make sure well-meaning responses don’t do more harm than good.
The drought policy debate
The recent drought has stimulated much empathy for farmers from the media, governments and the public. Federal and state governments have committed hundreds of millions of dollars in farmer support. Private citizens and companies have also given generously to the cause.
A central concern is that drought support could undermine farmer preparedness for future droughts and longer-term adaptation to climate change.
Another concern is that simplistic “farmer as a victim” narrative presented by parts of the media overstate the number of farmers suffering hardship and understates the truth that most prepare for and manage drought without assistance.
Sensationalist media coverage can also damage Australia’s reputation as a reliable food producer. Images of barren landscapes, stressed livestock and desperate farmers send the wrong signals to customers and trading partners.
An acute policy dilemma
The tension in drought policy is real.
To remain internationally competitive Australian farmers need to increase their productivity.
Agricultural productivity depends on two main factors. First, innovation – adopting new technologies and management practices. Second, structural adjustment – shifting resources towards the most productive sectors and most efficient farmers.
Supporting drought-affected farms has the potential to slow both these processes, weakening productivity growth.
This gives rise to an acute dilemma: should we support farmers in distress, or support the industry to be the best it can be?
Research by the Australian Bureau of Agricultural and Resource Economics and Sciences shows climate change has negatively affected the productivity of cropping farms, particularly in southern Australia.
Second, most farm businesses are also farm households.
While many other risky industries are made up of large corporate businesses (generally with diversified assets and ownership), agriculture is dominated by family farms.
Third, financial markets both in Australia and internationally struggle to provide viable risk management products for farmers – particularly drought insurance.
This means farming is an unusually risky business. Farmers must therefore be more conservative about financing and operating their businesses, which constrains investment, innovation and ultimately productivity.
It provides a fortnightly payment, usually set at the rate of the Newstart unemployment allowance. There is also a financial assessment of the farm business and funding to help develop skills or get professional advice.
Those welfare programs provide an important safety net for farm households. Because they provide targeted support to households, rather than businesses, they result in fewer economic distortions than alternative approaches.
Past reviews have consistently recommended against subsidising farm business inputs or supporting output prices. This includes providing subsidies for livestock feed.
While these measures might provide short term relief, if they become routine they risk weakening the incentives to manage farms properly, by for instance destocking sheep and cattle ahead of likely droughts.
Such insurance, if done well, could provide farmers with better protection from climate risk, while also supporting adaptation and productivity growth – effectively sidestepping our current drought policy dilemma.
The chances of an El Niño developing late in 2018 have increased and this week the Bureau moved to El Niño ALERT. This means that model outlooks and observations indicate there is approximately a 70% chance that El Niño will develop in the coming months. Current patterns in the Pacific are similar to the early stages of past El Niño, with warm water shifting east towards South America.
We’re also seeing indications a positive Indian Ocean Dipole (IOD) has likely started, in which warmer waters near Africa drag moisture away from Australia. El Niño and positive IOD events typically mean below-average spring rainfall in central and southern Australia, and a drier start to the wet season in Queensland and the Northern Territory.
The development of either would favour continued dry weather, and increase the likelihood that widespread drought relief will be delayed until 2019. Higher than average temperatures, heatwaves, and more severe bushfire weather are also more likely during El Niño and positive IOD events.
A dry year so far
September 2018 was a very dry month, adding to low rainfall seen across many parts of Australia so far this year. September 2018 was not only the driest September in 119 years of record for Australia, but it was also the second-driest for any month of the year (behind only April 1902).
Rainfall for the year to date has been exceptionally low over the mainland southeast, with much of the region experiencing totals in the lowest 10% of records for January–September. Many locations in eastern New South Wales, eastern Victoria, and southeast Queensland have received about 400 mm less rainfall than they usually would have by this time of the year.
Much of southern Australia has experienced a persistent rainfall decline spanning several decades, which is adding to drought stress by drying the landscape.
Southwest Western Australia has experienced significantly lower cool season (April to October) rainfall since the mid-1970s, compared to observations since 1900, while for the southeast the drop has been more recent, emerging in the mid-1990s. These rainfall declines have been linked to circulation changes in the southern hemisphere influenced by the increase in greenhouse gases.
These rainfall changes have also been accompanied by much larger reductions in streamflow, particularly in the southwest of Australia where high flows have become much less frequent.
And it’s also been unusually warm
Low rainfall has also been accompanied by very high daytime temperatures so far this year. Of course, Australian temperatures are warming in line with global trends, but in individual years variations which are likely to be largely natural (such as droughts) may add to or subtract from the broader trends.
Historically, droughts have often brought hot conditions, and this has been borne out in 2018. Maximum temperatures for January to September were the warmest on record for the Murray–Darling Basin and New South Wales, with neighbouring regions also much warmer than average.
These extremely warm days, combined with extremely low rainfall, have caused an intense drying of the Australian landscape in 2018, resulting in an early start to the bushfire season in New South Wales and Victoria, where damaging fire were observed as early as late winter.
So how might the year end?
Like all Australians, the Bureau hopes farmers and those suffering through drought get the rainfall they need, but unfortunately, the outlook indicates dry conditions are likely to continue for some time.
Large parts of southern and eastern Australia are likely to see a drier than average end to the year, though odds favouring drier than average conditions tend to moderate as we head towards summer. Most of the country is likely to see a dry October, though local heavy falls can occur against a backdrop of broadly suppressed rainfall.
While some parts of New South Wales and southeastern Queensland have received very welcome rainfall in the first days of October, rainfall has been below average over much of over eastern Australia for so long (since early 2017) that this rainfall event hasn’t been enough to break the drought.
Looking at temperature, outlooks show a very high chance of warmer than average days and nights through to the end of 2018. Considering the year so far has already been very warm, this means 2018 has the potential to rank as another significant warm year. Seven of Australia’s ten warmest years have occurred since 2005, with just one cooler than average year in the last decade (2011), highlighting how warmer than average temperatures now dominate Australia’s climate.
Prime Minister Scott Morrison will announce a Future Drought Fund, that will grow to $5 billion over a decade, at Friday’s national drought summit.
The fund is to provide support against future droughts, helping primary producers, non-government organisations and communities prepare for and respond to their impact.
It will be given an initial $3.9 billion injection, and will expand to $5 billion by 2028. The funding will be managed by the Future Fund Board of Guardians.
From 2020, about $100 million annually will be available, with payments starting on July 1, 2020.
Morrison has made dealing with the impact of drought one of his priorities since becoming prime minister, with various immediate measures for the current dry.
The summit will be attended by all levels of government, and representatives of farming and agribusiness, banking and finance services, and community and charitable organisations, as well as experts.
The special envoy for drought, Barnaby Joyce, and the coordinator-general for drought, Major General Stephen Day, will speak, while the Bureau of Meteorology will brief on present conditions and the projected outlook.
The planned fund will provide community services and research, and assist the adoption of technology to support long-term sustainability in periods of drought, through capital or ongoing initiatives. It could include investments in local projects, infrastructure, and research.
The criteria for the type of projects to be supported have yet to be determined and the government says these would continue to change, depending on the drought and community response needed.
Initiatives to be supported by the fund would be decided as part of the budget process.
Morrison said that in his visit to Quilpie in western Queensland, which he undertook immediately after becoming prime minister, he had been struck by “the strength, resilience and hope” displayed by the families.
“Our response to the drought has to be the same. Deal with the here and now, but also make sure we plan for the future.
“That’s what the Future Drought Fund is all about. Putting money aside for non-rainy days in the future,” he said.
“The fund will build over time, starting with an initial $3.9 billion up front. Part of the earning in the fund will be used to fund important water infrastructure and drought resilience projects, while the balance is ploughed back into the fund, so it grows to $5 billion over the next decade.
“This funding will support farmers and their local communities when it’s not raining.
“The challenges of drought vary from farm to farm, district to district, town to town and we continually need to adapt and build capacity – the Future Drought Fund gives us this opportunity,” Morrison said.
So far, 2018 has been very warm and exceptionally dry over large parts of mainland Australia. The Bureau of Meteorology’s climate outlook for spring, released today, shows that significant widespread relief is unlikely.
The chance of a spring El Niño, along with other climate drivers, is likely to mean below-average rainfall for large parts of the country in the coming months.
A dry winter for most of Australia
Winter rainfall has been below average over most of Australia’s eastern mainland. Large parts of New South Wales are on track to have winter rainfall in the lowest 10% of records. This has compounded drought conditions in the east after mixed rainfall last year and a dry start to 2018 for much of the country.
But it’s not just the lack of rainfall that has made the impact of drought severe. Another factor was the warmer than average daytime temperatures.
The 2017-18 summer average temperature was Australia’s second-warmest in 108 years of records, while autumn was Australia’s fourth-warmest on record. Winter 2018 is likely to be among the five warmest winters on record in terms of maximum temperatures.
Many of the above-average daytime temperatures have been focused over the country’s southeast. In fact, South Australia, New South Wales and Victoria are all on track for their warmest maximum temperatures for the January to August period.
The below-average rainfall combined with above-average maximum temperatures resulted in a rapid and intense drying of the landscape. This has led to unusually severe fire weather conditions in July and August – conditions more typically seen at the end of spring than the end of winter.
However, most international climate models have been forecasting a spring El Niño since June. Sea surface temperatures in the central Pacific have been gradually warming since autumn and are rising towards El Niño thresholds. At the beginning of June the Bureau went on El Niño watch, which indicates a roughly 50% chance of El Niño forming in 2018 – double the usual likelihood. El Niño during spring typically means below-average rainfall across eastern and northern Australia.
Three out of five international models are forecasting that a positive Indian Ocean Dipole event is also possible this spring. A positive IOD during spring typically means below-average rainfall in central and southern Australia. When El Niño and a positive IOD coincide, their drying influences can be exacerbated.
So, what’s the outlook for spring?
With a reasonable chance of both El Niño developing and a positive Indian Ocean Dipole, the outlook for spring shows below-average rainfall is likely over much of the southeast and parts of the northeast and southwest. The rest of the country has a neutral outlook, showing no strong push towards a wetter or drier than average three months.
Inland areas are typically dry at this time of year, so the neutral outlook in the arid interior typically implies that low rainfall is likely. No part of the country favours above-average rainfall in the spring outlook.
Spring days are likely to be warmer than average across Australia, with the highest chances (greater than 80%) over northern and western Australia. Most of the country is likely to have warmer than average nights this spring, except for areas around the Great Australian Bight which have roughly equal chances of warmer or cooler than average minimum temperatures.
What does this mean for the drought and bushfires?
Like the rest of the country, the Bureau is hoping that farmers in drought-affected areas get the rainfall they need soon. But this outlook isn’t the news many want to hear.
Last weekend’s rainfall over northeastern New South Wales and southeastern Queensland was welcomed by most, but unfortunately it was well short of what was required for a recovery from the longer-term rainfall deficits. Many locations on the east coast are well below their average year-to-date rainfall totals.
Rainfall deficiencies for the first seven months of 2018 in areas of western NSW, northwest Victoria and eastern South Australia widely show rainfall totals in the lowest 5% of the 118 years of record. It would take many months of above-average rainfall to return to average levels.
The above average temperatures in 2018 so far, combined with below average rainfall and dry vegetation, mean a higher likelihood of fire activity in parts of southern Australia. The warm and dry outlook for spring means the drought in parts of the country’s east is likely to continue.
Government funding of agriculture during a drought typically falls into three categories:
subsidies for farm businesses
income supplements for low-income farm families
support for better decision-making.
Unfortunately, none of these government outlays induces the much-needed rainfall. But, as this article will explain, income supplements and help with decision-making are better ways of supporting sustainable farming. Subsidies are much more problematic.
Farming is a known risky business. Seasonal conditions vary from drought to normal and above-average rainfall. Some are hit by floods and cyclones. Farmers also face outbreaks of pests and diseases.
Farm commodity prices are volatile. Farmers, and others along the food and fibre supply chains, are fully aware of volatile and uncertain seasons and markets.
People commit to farming if anticipated returns in the good times balance low or negative returns during droughts and other adverse conditions. This is consistent with the productive allocation of limited national labour and capital between agriculture and other sectors of the economy.
Farmers employ production and financial strategies to adapt to changing seasonal and market conditions. This includes smoothing over time the availability of funds for family consumption. Most farmers prepare for and adjust to the ups and downs of farming, including droughts.
So why a new round of government handouts for another drought? Current drought relief amounts to $576 million, a figure that excludes concessional loans to farmers. Of course, drought conditions are tough, but they are not a surprise. They do, however, provide graphic material for the media, and some families fall into poverty.
Drought subsidies have the effect of raising the average return from farming. They might be said to “privatise the profits of good seasons and subsidise some of the losses of droughts”.
Subsidies must be paid for, though, by higher taxes or lower government outlays affecting others. Artificially increasing the average returns to farming leads to a misallocation of limited national labour, capital and other resources from the rest of the economy to agriculture. The effect is much the same as the efficiency costs of tariffs protecting the car assembly industry.
Farm drought subsidies have important and unintended side effects. Knowing that subsidies will be provided during drought and other adverse conditions reduces the incentives for some farmers to adopt appropriate drought preparation and mitigation strategies.
Structural adjustment is a continuing feature of farming, as it is for all other industries. Increased costs of labour relative to capital equipment, as well as the scale bias of much farming technological change, favour the expansion of farm sizes over time. Drought subsidies work to hold up inevitable structural changes, including smart farmers who have planned for and adapted to drought buying out less successful operators.
Subsidies for farm outputs or inputs are a very blunt policy instrument to support farm families facing poverty. Direct household income measures, as discussed next, are more effective.
Farm household income support
Australia has long-established equity objectives of a minimum income and safety net for all citizens. Newstart is the policy for the unemployed, Age Pension for retirees, Disability Support Pension for the disabled, and so forth.
Because of poor decisions or bad luck, some farm households find themselves short of money to provide basic food, clothing, education and so forth for the family. The Farm Household Allowance (FHA) is a means-tested (assets and income) government-funded safety net to counter poverty of farm households.
This allowance raises horizontal equity issues. Initially, the FHA rate was the same as for Newstart. In an August 5 policy announcement, the government added additional lump-sum payments, described as a supplement. Arguably, the supplement can be interpreted as a form of farm subsidy.
Providing a minimum income support to the self-employed, including farmers but also many small-business people in other parts of the economy, has been a challenge. A key challenge is the difficulties of applying a means test. Why other small-business families experiencing a downturn in business income – including some who depend on the farm sector – are not eligible for an equivalent to the Farm Household Allowance remains an issue.
Government funding of mental health, social and other support for farmers and their families adversely affected by drought can be regarded as an important social equity instrument. These programs may also be a valuable investment in society.
A number of programs to support better farm plans to manage droughts are funded. This includes the provision of meteorological and other data on seasonal conditions to guide decisions.
Hands-on education and support to individual farmers in developing more appropriate decision strategies and plans are also available. This adds to a more robust and self-sufficient farming sector.
To summarise, government funding for farm household incomes to avoid poverty and to improve farm decision-making make sense. Subsidies for farm inputs or outputs have undesirable longer-term resource misallocation effects, and are relatively blunt income-support measures.
Already this week two fires on the south coast have escaped containment lines and destroyed houses. The weather during these fires was 6℃ warmer than the August average, dry and extremely windy. The wind speed peaked at 104 kilometres an hour in Bega and 85km/h in Nowra, two towns close to where fires broke out.
Under these conditions, bushfires will spread quickly, produce large numbers of embers and are hard to stop.
Our fire seasons now start earlier and last longer. This means we’re increasingly likely to see repeats of historically large fires threatening residential areas.
Fire seasons are longer
Current dry conditions are reflected in the maps of live fuel moisture produced by Dr Rachael Nolan of Western Sydney University.
This method tracks the weekly moisture content of the forests in southern Australia, as observed by NASA’s MODIS satellite. The latest map shows a patchy distribution of dry areas and a drying trend over recent weeks.
It looks like NSW’s fire season has already started, and it’s likely to be bad. Last year’s fire season also extended well into autumn, with serious bushfires burning in mid-April.
Fire agencies usually enjoy a six-month break from bushfires between April and September, but this year they had only three months’ respite.
This problem is being keenly felt in western United States, where fire agencies have warned that the fire season now lasts all year round. Not only that, there is clear evidence climate change is increasing fire activity in the United States; the record for the largest fire in California history has been broken two years in a row.
The most damaging fire season for NSW in the past 30 years was in October 2013 when the Linksview fire destroyed 200 houses in the Blue Mountains.
The build-up to that season was eerily similar to this year, with a winter drought and bushfires in September, but the moisture maps show that the forests are drier now than at the same time in 2013, and we have already seen serious bushfires in August.
As we move into September and October, the weather will warm, which means any remaining moisture in the ground and plants will evaporate even faster than at present, and fires will be more intense and spread faster. The only thing that will reduce the risk is soaking rain of at least 100mm.
Whether or not that will occur in the next two months is almost impossible to predict. At the moment it seems unlikely. The Bureau of Meteorology’s latest seasonal forecast, issued on August 16, considers it likely that dry conditions will persist for the next three months.
The heightened risk of bushfire this season should be a wake-up call for residents in bushfire-prone areas. Most people in really risky areas such as the Blue Mountains are well prepared, but many people who are a little more removed from the forests are not aware of the risk.
For example, many residents of Wollongong probably don’t know this October is the 50th anniversary of the great 1968 fires that swept down the Illawarra Escarpment into the suburbs of Figtree, Bulli, Austinmer and others.
If the same footprint of fire were to occur again, some 5,000 houses would be affected. The present indicators suggest a repeat of this event is more likely than at any time for decades.
Residents need to prepare a bushfire survival plan, which includes a decision on whether to stay and defend or to leave as soon as they learn about a nearby bushfire.
Current research at University of Wollongong suggests that the biggest influence on the risk of house loss during a bushfire is the actions that the residents themselves take. This includes ensuring that natural and man-made fuels are kept to a minimum in the garden, especially close to the house, and also defending the house from spot-fires caused by embers.
The Rural Fire Service has a wealth of advice for preparing for bushfires on its website.
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We’re look at a torrid upcoming fire season, dependent on the vagaries of the Australian climate. Either way, now is the time for people to brace themselves and get prepared.
To best support the well-being of farmers and farming communities, we need to support them not just when they are in the middle of a drought, but also when the rain comes and the dust has settled. An emergency response is important, but on its own is not enough – our farming communities deserve more. It needs to be accompanied by long-term coordinated support, delivered through the whole drought cycle, that helps farmers prepare for drought, cope with drought when it is happening, and recover rapidly afterwards.
Providing farmers with emergency assistance when drought is at its worst helps to alleviate the most acute hardship. But multipleinquiries and research studies (see here, here and here) have concluded that this approach is not enough.
To truly support the well-being of farming communities facing the threat of drought, we need to invest more in actions that support their preparedness and resilience before drought hits, rather than waiting until conditions are at their worst before offering help.
The hydro-illogical cycle
Doing this requires breaking the “hydro-illogical cycle”, in which a severe drought triggers short-term concern and assistance, followed by a return to apathy and complacency once the rains return. When drought drops off the public and media radar, communities are often left with little or no support to invest in preparing for the next inevitable drought.
Farmers need proactive, long-term access to drought preparedness schemes well in advance, before the effects of drought begin to bite. Farmers who use programs such as the farm management deposits scheme, which allows them to put aside surplus income in good years and draw on it in difficult ones, have higher well-being during droughts than those who access emergency assistance provided during drought.
Our research has also identified some other ways to protect farmers’ well-being during challenging times. These include investing in forward planning for drought, supporting farmers to invest in “drought-proofing” measures suitable to their farm, and creating networks through which farmers can share their knowledge about what works to cope best with the financial, psychological and social challenges they face.
These things are not a “fix” for drought; a drought will always have significant impacts. But they can help reduce the severity of impacts, and the time taken to recover. However, to really be effective, these actions need to be invested in between droughts, in addition to investing in emergency support during drought.
We can learn a lot from the actions that farmers are already taking. Thousands of farmers have spent years investing in drought resilience, for example by changing pasture types and water management practices, and by changing how they plan for and manage periods of low rainfall.
This investment often goes unsupported and unrecognised, and has to be done among the ever-present pressures of challenging market conditions, low profit margins, rising costs, the need to repay debts incurred in the last drought or flood, and the myriad daily pressures of farming. We need to better reward farmers who make these investments, and to offer incentives for continued investment in this type of action between droughts.
One investment being made by many farmers across Australia is the adoption of regenerative farming, in which the entire farming system is re-oriented with a goal of better using natural ecosystem processes to support production, and of better matching production to land capacity through different climatic conditions.
Early research findings suggest that engaging in regenerative farming can improve drought resilience. But shifting to use of this approach to farming takes a lot of time and investment; before asking farmers to make fundamental changes to the way they farm, we need more research that critically examines when, where and how different farming systems can help safeguard against drought.
As well as helping farmers invest in actions to increase resilience to drought, we also need to consider the best ways to support those who are suffering severe psychological and financial stress. For many farmers, supporting them to cope with drought and stay in farming is the best decision. But for others, the best decision can be to leave farming altogether.
The decision to leave farming is understandably one of the most challenging times in a farmer’s life, and often happens when their well-being is low and they are experiencing psychological distress. This means that the quality of help they receive during this time can make a big difference in how well they cope. Services such as the Rural Financial Counselling Service have a vital role to play at all times (before, during and after drought) in giving advice to farmers weighing up the agonising decision to stay or leave.
If you want to help farmers, keep supporting relief funds – they provide essential help during the worst of drought. But also tell your local politician that you support investment in long-term programs that help farmers improve their resilience to the next drought, and the one after that, and that recognise and reward the investments farmers are already making in doing this.
If we truly have our farmers’ well-being at heart, we should be taking drought action in wet years as well as dry, and in good times as well as bad.