Ground Cover West : Ground Cover 052 October-November 2004 - West
COMMENT/NEWS 3 OCTOBER 2004 Special bonus rates Landmark's deposits rates are always highly competitive, and for a limited time we are offering bonus rates* for 3, 4 and 12 month terms (minimum of $25,000). At call accounts and Term Deposit accounts (1 to 48 month terms) are also available with competitive rates. To find out how Landmark's bonus term deposit rate can help grow your business, just contact your local Landmark location or call 1800 622 015. 5.75 % p.a. up to Effective 1 June 2004 *Special rates for a minimum of $25,000 are 5.45% p.a. for 3 months, 5.65% p.a. for 4 months and 5.75% p.a. for 12 months. This offer is for a limited time only and rates are subject to change without notice. For up-to-date deposits rates, visit www.landmark.com.au; contact your nearest Landmark location or call 1800 622 015. LM0073 Landmark Operations LimitedABN 73 008 743 217 AWB1009GC Australia needs to keep investing in the development of new grain varieties, to maintain its international competitiveness and address environmental issues. Grower funding through the GRDC levy is a crucial part of this -- but only part. The GRDC invests in most, but not all, breeding programs in Australia. Through the levy, growers pay about 27 percent of the direct cost of the breeding programs in which the GRDC invests. Governments, universities and private companies pay the other 73 percent (or 100 per cent where GRDC does not invest). In 2004-2005 about $58 million is being invested in Australia to breed new grain varieties in GRDC-supported programs. Of that $58 million, $25.5 million (44 percent) comes from the GRDC. Of the GRDC's $25.5 million, 61 percent (about $15.6 million) comes from growers through the levy. The other 39 percent is primarily from the Australian Government's matching funding. So growers' investment of $15.6 million is 27 percent of the direct cost of those breeding programs. Other organisations are investing about $32.5 million. The private companies need returns on that investment, as well as to earn enough to fund future breeding; and even public sector breeders are today under increasing pressure to recover more of their costs. The Australian Seed Federation (ASF) and GRDC both believe that End Point Royalties (EPRs) are the fairest and most effective way of attracting investment into the development of improved crops. The main advantage of EPRs, over seed royalties, is that they are only collected after a grower harvests a crop, and the amount relates directly to the tonnage of grain produced. Unlike a seed royalty, the breeder and grower share the risk. The ASF says that higher yields will increase the breeder's reward due to the increased return received by the grower. Conversely, poor seasonal conditions or lower yielding varieties will reduce the royalty received by the breeder due to lower grower returns from the area sown to the variety. However, EPR requirements can vary between breeders and seed companies. Not all breeders charge for farm-saved seed, so contracts need to be read carefully. One downside of the EPR system is it relies on a chain of contracts. This requires a lot of paperwork for growers, breeders, retailers and marketers in the middle. It means that much of the royalty paid by growers is chewed up in administration costs. For this reason, the GRDC generally requires that the administration costs and EPRs be identified separately, so that growers can see how much the breeder actually gets. Several options are being investigated to reduce costs -- such as common templates for contracts, greater industry cooperation, and changing the point at which the levy is collected. A common concern expressed to the GRDC is the idea that EPRs are "double dipping" -- that growers are paying for grain varieties through the levy and again through EPRs. But as outlined above, growers pay only a small part of the cost of developing a new variety. Also, the share of EPRs received by the GRDC is small -- $607,000 last year -- and that is reinvested in research. Where the GRDC invests in breeding through a company, such as Australian Grain Technologies, the EPRs are being used to build up the company. In a few years, EPRs will hopefully provide breeders of major crops (such as wheat and barley) with enough income to survive without further direct GRDC investment in breeding. But the GRDC will still need to fund related activities, such as gene discovery, germplasm development and variety testing, if Australia is to have effective breeding programs. This year the GRDC is investing $30.5 million in those activities. EPRs will not pay for them in the foreseeable future. Also, for many of the smaller crops such as pulses, the GRDC will probably need to invest directly in breeding for many years to come. EPRs are becoming important, but will not replace the need for the GRDC levy, and other sources of research funding, for some time yet. Grower feedback on this issue is welcome. For more information: www.graintrust.com/epr.htm www.planttech.com.au/epr.php www.sunprimeseeds.com/html/ royalty_info.html www.dovuro.com.au/pbrepr.html For 16-year-old Ben Roberts, it was a chance to learn the skills he needs to give his father a hand at harvest. University student Stephen Rodger hoped to equip himself to find a contracting job over the summer, while Margaret Cowan wanted to be on more equal terms with her father and brother this harvest. The reasons were many and varied, but the overall outcome of a new Course in Header Operations in Victoria is a batch of very handy graduates for the grains industry. With concerns around the country about a growing skill shortage on farms and the industry's ad hoc approach to professional development, the header course run by the University of Ballarat may be an important step forward. The course covers all aspects of header operation -- maintenance, setting up and operating, cleaning, occupational health and safety, and effective workplace communications. Ben Roberts believes the skills he learned will widen his employment options when he finishes a welding apprenticeship, and in the long run help him stay on the family farm. Stephen Rodger also did the course with an eye to the future. He is studying agricultural science at Melbourne University and, though he plans initially to work in chemicals research, says he will eventually return to the farm. Margaret Cowan says that learning how to maintain the equipment and set up a header for different crops will now make her a valuable contributor to this year's harvest, and the money earned will help pay for university. The course started with one week's full-time instruction, and will resume at harvest when the students will receive further on-the-job training and assessment. It was established after a report by the Grains Industry Training Network in 2003 raised concerns about the availability of skilled labour. It was noted that more harvesting was being done by contractors, who tended to provide unaccredited training, and this left a considerable variation in the level and quality of instruction. The report said that training needed to meet national accreditation standards, and to ensure young people were trained to the point of being work-ready. The first program to come from this study has been the Course in Header Operations because harvesting was identified as having the most immediate need of skilled operators. Peter Sudholz, head of programs -- primary industries at the University of Ballarat's Horsham Campus, says the aim is to deliver a practical skills-based course to young people who will be driving their parents' or neighbours' headers or who are looking for work with contract harvesters. He says the program is practical, but is not just about the exciting aspects of maintaining and driving a large machine. He says it is essential that the participants also gain skills in occupational health and safety and communication. The Grains Industry Training Network hopes to follow up the header course with other training programs covering grain handling, seeding, and spraying. GRDC RESEARCH CODE PIG 00003, program 6 For more information: Nickie Berrisford, 03 5226 4075, firstname.lastname@example.org. gov.au End Point Royalties (EPRs) are charged on most new grain varieties. How does this fit with the one percent R&D levy that growers pay? The GRDC's board secretary and general counsel, GEOFF BUDD, explains the case for EPRs. Why EPRs don't double-dip On course to harvest new skills Ins and outs: while some students look for inside knowledge on a Case header (left), instructor Stuart Gowlett (above) takes a broader view with trainees Ben Batters and Ben Roberts.
Ground Cover 053 December-January 2005 - West
Ground Cover 051 August-September 2004 - West