RIRDC - agrifutures.com.au · averaged $1.4 billion in the three years ended 2006-07, exceeding the gross value of sugar cane production ($1.1 billion), wine grapes ($1.1 billion)

The Australian Fodder Industry An overview of production, use and trade

RIRDCInnovation for rural Australia

© 2009 Rural Industries Research and Development Corporation. All rights reserved.

ISBN 1 74151 800 8 ISSN 1440-6845

The Australian Fodder Industry — An overview of production, use and trade

Publication No. 09/001 Project No. PRJ-000806

The information contained in this publication is intended for general use to assist public knowledge and discussion and to help improve the development of sustainable regions. You must not rely on any information contained in this publication without taking specialist advice relevant to your particular circumstances.

While reasonable care has been taken in preparing this publication to ensure that information is true and correct, the Commonwealth of Australia gives no assurance as to the accuracy of any information in this publication.

The Commonwealth of Australia, the Rural Industries Research and Development Corporation (RIRDC), the authors or contributors expressly disclaim, to the maximum extent permitted by law, all responsibility and liability to any person, arising directly or indirectly from any act or omission, or for any consequences of any such act or omission, made in reliance on the contents of this publication, whether or not caused by any negligence on the part of the Commonwealth of Australia, RIRDC, the authors or contributors.

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Researcher Contact DetailsPeter Martin ABARE GPO Box 1563 CANBERRA ACT 2601

Phone: 02 6272 2047 Fax: 02 6272 2001 Email: [email protected]

In submitting this report, the researchers have agreed to RIRDC publishing this material in its edited form.

RIRDC Contact DetailsRural Industries Research and Development Corporation Level 2, 15 National Circuit BARTON ACT 2600

PO Box 4776 KINGSTON ACT 2604

Phone: 02 6271 4100 Fax: 02 6271 4199 Email: [email protected]. Web: http://www.rirdc.gov.au

Published in July 2009 Printed by Union Offset Printing, Canberra

The Australian Fodder Industry An overview of production, use and trade

July 2009

by Peter Martin

RIRDC Publication No 09/001

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AcknowledgmentsThe contributions of Colin Pearce from AFIA and Dale Ashton from ABARE for their comments on the draft report are gratefully acknowledged together with Sarah Crooks, Thuy van Mellor, Walter Shafron and Veronica Rodriguez from ABARE and Maria Meers from the Australian Bureau of Statistics for their assistance in compiling the statistical data in this publication.

Abbreviations$b billion dollars (Australian)$m million dollars (Australian)A$ dollar (Australian)AAGIS Australian Agricultural and Grazing Industries SurveyABARE Australian Bureau of Agricultural and Resource EconomicsABS Australian Bureau of StatisticsADIS Australian Dairy Industry SurveyANZSIC Australian and New Zealand Standard Industry ClassificationDAFF Australian Government Department of Agriculture, Fisheries and ForestryEU European UnionEVAO estimated value of agricultural operationsFAO Food and Agriculture Organisation of the United Nationsfas free alongside shipfob free on boardGDP gross domestic productkg kilogram 2.20462 poundskt kilotonne 1000 tonnesnc not calculatednec not elsewhere classifiednes not elsewhere specifiedp provisionalRIRDC Rural Industries Research and Development Corporationse sheep equivalents approximate calculation using sheep = 1, beef cattle = 8, dairy cattle = 12 and horses = 12t tonne 1000 kilogramsUN United Nations OrganisationUS$ dollar (United States)US$b billion dollars (United States)US$m million dollars (United States)WTO World Trade Organisation

Small discrepancies in totals are generally caused by rounding.0 is used to denote nil or a negligible amount.

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ForewordFodder is a key input to Australia’s multi-billion dollar livestock industries. The efficiency and reliability of fodder production and distribution are critical to the productivity and competitiveness of these industries.

Around one-third of Australia’s commercial farms harvest either hay or silage. Some farms specialise in the production of fodder for sale, but for many more, fodder production is one of a range of farm enterprises or a component of on-farm livestock enterprises. Together, these farms and the market they supply constitute the Australian fodder industry which is the focus of this publication.

The fodder industry ranks amongst the most important agricultural industries in Australia. The gross value of hay production averaged $1.4 billion in the three years ended 2006-07, exceeding the gross value of sugar cane production ($1.1 billion), wine grapes ($1.1 billion) and cotton ($0.9 billion). The value of the Australian livestock industries to which fodder is a substantial input, averaged $15.3 billion in the three years ended 2006-07.

Use of purchased fodder has increased over the past two decades, particularly in the dairy and feedlot sectors. Australian hay and straw have become important export commodities. The tonnage of hay exported has more than doubled in the past 10 years. Fodder exports were valued at $242 million in 2006-07. Drought has further boosted demand and, together with increasing competition for land and water resources, has changed the quantity and type of fodder produced as well as the geographic distribution of fodder production.

The recent drought in Australia has brought farmers’ reliance on the use of fodder to manage drought into sharp focus. Many farmers rely heavily on fodder stocks and the capacity to buy in additional fodder to manage drought. It is important to ensure farmers have access to adequate up-to-date information on fodder production, use and stocks to understand changes in their exposure to fodder supply and price risks. It is also important farmers are aware of the opportunities to increase farm income from the growing market for fodder.

The Australian fodder industry has received support for research and development from the Rural Industries Research and Development Corporation (RIRDC) since the early 1990s. In 1996 the Australian Fodder Industry Association (AFIA) was established out of the need to focus on issues specific to the industry and to disseminate industry information.

This publication, commissioned by RIRDC and AFIA, is designed to update and expand statistics available on the Australian fodder industry, outline the key trends in fodder production, utilisation and trade and contribute to a greater understanding of the industry’s structure and dynamics.

This report, an addition to RIRDC’s diverse range of more than 1800 research publications, forms part of our fodder crops research and development program, which aims to facilitate the development of a sustainable and profitable Australian fodder industry. Most of our publications are available for viewing, downloading or purchasing online through our websites:

Most of our publications are available for viewing, downloading or purchasing online through our website www.rirdc.gov.au.

Peter O’Brien Managing Director Rural Industries Research and Development Corporation

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ContentsAcknowledgments ................................................................................................................................... ii

Abbreviations ........................................................................................................................................... ii

Foreword .................................................................................................................................................iii

Executive summary ................................................................................................................................vii

Introduction .............................................................................................................................................. 1Definition of fodder .............................................................................................................................................1Australian fodder data ...........................................................................................................................................1Data limitations ....................................................................................................................................................1History of Australian fodder production ...............................................................................................................2

Hay .......................................................................................................................................................... 5Production ............................................................................................................................................................5State and regional production ...............................................................................................................................6

Production by crop type ......................................................................................................................... 12Pasture ................................................................................................................................................................12Cereals ................................................................................................................................................................15Lucerne ..............................................................................................................................................................17Other crops ........................................................................................................................................................19

Hay sold ................................................................................................................................................ 21

Hay use and stocks ............................................................................................................................... 26

Silage .................................................................................................................................................... 31

Exports .................................................................................................................................................. 35

World trade in hay and hay products ..................................................................................................... 42

Prices..................................................................................................................................................... 45

Value of production ................................................................................................................................ 48

Domestic fodder market ........................................................................................................................ 49Fodder use by industry .......................................................................................................................................49Dairy industry ....................................................................................................................................................52Broadacre livestock farms ....................................................................................................................................58Feedlot sector......................................................................................................................................................64Horse industry ....................................................................................................................................................68

Appendices ............................................................................................................................................ 70Appendix A: State tables .....................................................................................................................................70Appendix B: Statistical division tables .................................................................................................................84Appendix C: ABARE farm survey methodology ...............................................................................................198Appendix D: Seasonal conditions maps ............................................................................................................199

References .......................................................................................................................................... 203

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TablesTable 1 Hay production, average for the period 1999-2000 to 2004-05 ...........................................................5Table 2 Fodder production, Australia ...............................................................................................................8Table 3 Fodder utilisation, Australia .................................................................................................................9Table 4 Annual rate of change in key hay measures, 1989-0- to 2004-05 .......................................................27Table 5 Silage, average for the period 1999-2000 to 2004-05 .........................................................................32Table 6 Fodder exports, Australia ...................................................................................................................36Table 7 Value of Australian fodder exports by destination ..............................................................................38Table 8 Volume of Australian fodder exports ..................................................................................................39Table 9 Value of Australian fodder exports by state .........................................................................................40Table 10 Exports of hay and hay products ........................................................................................................44Table 11 World trade in hay and hay products, excluding intra-EU trade. Average 2000 to 2006 ....................44Table 12 Japanese baled hay imports ................................................................................................................44Table 13 Republic of Korea baled hay imports .................................................................................................44Table 14 Estimates of fodder utilisation by industry .........................................................................................50Table 15 Roughages used by Australian feedlots ...............................................................................................67

MapsMap 1 Total hay production, 2005-06 by ABS statistical local area .................................................................7Map 2 Pasture hay production, average 1999-00 to 2004-05, by ABS statistical division ..............................14Map 3 Cereal hay production, average 1999-00 to 2004-05, by ABS statistical division ...............................15Map 4 Lucerne hay production, average 1999-00 to 2004-05, by ABS statistical division .............................17Map 5 Other crop hay production, average 1999-00 to 2004-05, by ABS statistical division ........................20Map 6 Hay sold, 2005-06, by ABS statistical local area .................................................................................22Map 7 Proportion of annual production sold, 2005-06.................................................................................22Map 8 Average hay stocks at 30 June, 2000 to 2005, by ABS statistical division ...........................................30Map 9 Average hay stocks per sheep equivalent at 30 June, 2000 to 2005, per sheep equivalent....................30Map 10 Silage production, 2005-06, by ABS statistical local area ...................................................................34Map 11 Average silage stocks at 30 June, 2000 to 2005, by ABS statistical division ........................................34Map 12 Dairy cattle at 30 June, 2006 .............................................................................................................52Map 13 Beef cattle at 30 June, 2006, by ABS statistical local area ...................................................................58Map 14 Sheep at 30 June, 2006, by ABS statistical local area ..........................................................................59Map 15 Horses on commercial farms at 30 June, 2006 ...................................................................................68Map 16 ABS Statistical Divisions of Australia .................................................................................................69

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FiguresFigure A Livestock numbers and crop areas, Australia .....................................................................................3Figure B Total hay production, Australia ........................................................................................................5Figure C Hay production and price, Australia .................................................................................................6Figure D Hay production by state .................................................................................................................10Figure E Total hay production - Average kilotonnes 1999–2000 to 2004–05 ...............................................11Figure F Hay production by crop type, Australia ..........................................................................................12Figure G Hay production by crop type, Australia ..........................................................................................13Figure H Pasture hay production (excluding lucerne), average 1999-00 to 2004-05 ......................................14Figure I Cereal hay production, average 1999-00 to 2004-05 ......................................................................16Figure J Lucerne hay production, average 1999-00 to 2004-05 ...................................................................18Figure K Other crops hay production, average 1999-00 to 2004-05 .............................................................19Figure L Hay sold, Australia .........................................................................................................................21Figure M Proportion of annual hay production sold ......................................................................................23Figure N Hay sales, average 1999-00 to 2004-05 ..........................................................................................24Figure O Proportion of annual production sold, average 1999-00 to 2004-05 ...............................................25Figure P Hay production, consumption, sales and stocks, Australia ..............................................................26Figure Q Hay stocks, Australia ......................................................................................................................27Figure R Hay stocks per sheep equivalent, by state ........................................................................................28Figure S Hay use per sheep equivalent, by state ............................................................................................28Figure T Total hay production, sales and stocks - average 1999-00 to 2004-05 .............................................29Figure U Silage production, use and stocks, Australia ....................................................................................31Figure V Silage production, by state ..............................................................................................................32Figure W Silage production and stocks – average 1999-00 to 2004-05 ..........................................................33Figure X Hay sold, Australia .........................................................................................................................36Figure Y Fodder exports, Australia ................................................................................................................36Figure Z Value of Australian fodder exports ..................................................................................................37Figure AA Ship and aircraft stores and livestock exported, Australia ................................................................37Figure AB Value of Australian fodder exports, by destination ..........................................................................37Figure AC Value of oaten hay (other hay) exports, by state ..............................................................................40Figure AD Average value of fodder exports 2002-03 to 2006-07, by state ........................................................41Figure AE Value of world exports in hay and hay products..............................................................................43Figure AF Value of world trade in hay and hay products – excluding intra-EU trade, Average 2000 to 2006 ..43Figure AG Indicator hay prices, New South Wales, Victoria and South Australia .............................................46Figure AH Monthly hay prices, Victoria ..........................................................................................................46Figure AI Monthly pasture hay prices .............................................................................................................47Figure AJ Monthly oaten hay prices ...............................................................................................................47Figure AK Monthly feed lucerne prices ...........................................................................................................47Figure AL Value of Australian hay production ................................................................................................48Figure AM Utilisation of fodder by industry, 2001-02 to 2004-05 ...................................................................51Figure AN Dairy cow numbers and milk production .......................................................................................53Figure AO Total hay and silage use by dairy farms ...........................................................................................53Figure AP Hay utilization by dairy farms ........................................................................................................54Figure AQ Silage utilization by dairy farms ......................................................................................................56Figure AR Hay utilization by broadacre farms .................................................................................................60Figure AS Silage utilization by broadacre farms ...............................................................................................62Figure AT Number of cattle on feedlots, Australia ...........................................................................................64Figure AU Number of cattle on feedlots, by state.............................................................................................64Figure AV Number of cattle on feedlots, by destination ..................................................................................65Figure AW Number of cattle on feedlots, by state.............................................................................................65Figure AX Roughages used by Australian feedlots - 1 October 2004 to 30 September 2005 ................................................... 66

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What the report is aboutThis report provides comprehensive, up-to-date information on Australian fodder production, use and trade.

The term fodder in this publication refers to conserved forage in the form of hay, hay products and silage – that is entire plants or the leaves and stalks of plants harvested specifically to feed animals, dried after harvesting (hay) or preserved as silage products (green fodder preserved by fermentation).

The report discusses the key trends in fodder production, use, prices and trade at the national, state and regional levels. In addition, the report quantifies the key fodder producing, selling and consuming sectors and discusses change in their characteristics over recent years. Finally the report provides a brief analysis of international trade in fodder and fodder products.

It has been eight years since the last comprehensive statistical compendium of Australian fodder statistics, the Atlas of the Australian Fodder Industry – outline of production and trade, was published in August 2000. In the period since 2000, there has been radical change in the scale and distribution of fodder production, use and trade in Australia.

Who is the report targeted at?This report is targeted to fodder producers and consumers, exporters, rural industry bodies including the Australian Fodder Industry Association, Dairy Australia, the Australian Lot Feeders Association and Meat and Livestock Australia. The report is also aimed at collectors and publishers of statistical and price data for the fodder industry including the Australian Bureau of Statistics, together with state and federal government policy bodies.

BackgroundThe Australian fodder industry has changed markedly over the past decade. Increasing intensity of livestock feeding, expansion in the export market, reduced irrigation allocations and increased climate variability have all contributed to a large increase in fodder demand. Drought, increased competition for irrigation water and land from agricultural and non-agricultural users, together with changes in the relative profitability of crops, livestock and livestock products have combined to reshape patterns of fodder production and use.

In adjusting to change, fodder producers and consumers,

industry and government all require access to comprehensive up-to-date information on fodder production, use and trade.

ObjectivesThe major beneficiary of this publication is the Australian fodder industry including farm businesses producing and consuming fodder, together with distributors and exporters, all of whom may utilise this information to strengthen the market links within the industry.

This publication may also provide benefits by informing the public policy debate on issues related to fodder production and demand including policies on drought management and assistance, water use and land use.

The specific objectives of the publication were to:1. Provide the Australian fodder industry with a compendium

of currently existing information on fodder production, trade and utilisation.

2. Expand information on fodder use in the key fodder using industries.

Methods used Data presented in this report are mainly drawn from the Australian Bureau of Statistics agricultural collections. These data have been augmented with additional data from ABARE’s annual Australian Agricultural and Grazing Industries Survey (AAGIS) and the Australian Dairy Industry Survey (ADIS), the Australian Lot Feeders Association / MLA feedlot survey and supplementary collections on fodder use.

Data available from the Australian Bureau of Statistics on fodder production, stocks and sales are broad. Hay production is aggregated into a number of broad classes. Typically these have been: pure lucerne; other pastures; cereals; and other crops. However, for 2005-06 and 2006-07, no disaggregated data of fodder types was collected – only total hay or silage production is available.

Australian Bureau of Statistics trade data have been used to analyse Australian exports and imports of fodder. Trade data from the United Nations Commtrade database have been used to evaluate the international trade in fodder.

Key findings

• The fodder industry ranks amongst the most important agricultural industries in Australia. The total value of

Executive summary

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Australian hay production is estimated to have been $1.6 billion in 2006-07 and is estimated to have averaged $1.5 billion a year for the five years 2002-03 to 2006-07. The increase in the value of hay production is because of rising production and record hay prices in the period since 2001-02, largely as a consequence of drought.

• Total Australian hay production increased from 4.9 million tonnes in 1989-90 to 8.1 million tonnes in 2005-06 – a growth rate of 2.6 per cent a year. Victoria accounts for around 39 per cent of total hay production on average, New South Wales 19 per cent, South Australia 17 per cent, Western Australia 13 per cent, Queensland 8 per cent, Tasmania 4 per cent and the Northern Territory 1 per cent. Total hay production dropped sharply in 2002-03 and again in 2006-07 as a result of widespread drought and irrigation water shortages.

• Pasture hay still accounts for the largest share of total production, but more than 75 per cent of the increase in production in the past 15 years has been in cereal hays. Cereal hay production has grown steadily at a rate of around 5 per cent a year since 1989-90, lucerne hay production by around 2.5 per cent a year and production of pasture hay has increased only slightly. Production of other hays such as sorghum hay and vetch, have also grown rapidly at around 13 per cent a year, but from a low base.

• Around one-third of Australian commercial scale farms (around 38 000) make hay each year. On average, around 70 per cent of fodder used on Australian farms is produced on-farm.

• There has been a large increase in the proportion of hay production traded over the past 15 years. In the early 1990s, only around 14 per cent of annual hay production was sold. In recent years, the proportion has been above 25 per cent in most years and rose to 55 per cent in 2006-07. While the advent of widespread drought from 2001-02 is a major factor causing this, there was an established trend of an increasing proportion of hay traded before the drought commenced. The rise in the proportion of hay traded has been strongest in South Australia where the proportion has increased from around 10 per cent in the early 1990s to around 50 per cent in recent years.

• In New South Wales, severe drought resulted in the proportion of hay traded rising more than 50 per cent in 2002-03 and 2006-07. In Victoria, severe drought, combined with extremely low irrigation water availability resulted in the proportion of hay traded rising to 61 per cent in 2006-07, compared with an average of just 19 per cent for the previous decade.

• Annual hay use exceeded hay production in five of the eight years from 1997-98 to 2004-05 and hay stocks have fallen markedly. In the early to mid-1900s, hay stocks at 30 June typically exceeded annual hay use by 10 to 15 per cent. However, by 1997-98, annual hay use had begun to

exceed stocks and hay stocks at 30 June have been below annual use since 1999-2000. At June 30 2005 hay stocks were only 50 per cent of annual use and are estimated to have declined further in the period since. Assessing current on-farm hay stocks is difficult as on-farm hay stock data have not been collected by the ABS since 2004-05. Hay production in 2006-07 was low relative to requirements and stocks are likely to have fallen further.

• Increases in silage production and use over the past 15 years have been dramatic. Silage production and use have increased by more than six times the level of use in 1989-90. The pattern of silage use has also substantially changed. Stocks at 30 June in the early 1990s averaged around double annual use. Stocks are now only around two-thirds of annual use. Change in production, use and stocks of silage over the past 15 years are a result of the change in technology toward the production and use of silage within the year of production and farmer’s needs to use fodder reserves and not put them aside for future years.

• The dairy industry is the largest single fodder using industry and is estimated to have accounted for 31 per cent of hay used and 57 per cent of silage for the period 2001-02 to 2004-05. Fodder use has increased because of drought on many livestock farms including dairy farms and broadacre farms in recent years. The increase in aggregate fodder use on broadacre farms has exceeded the increase in aggregate fodder use on dairy industry farms and, as a consequence, the dairy industry’s share of total fodder use has declined slightly. Broadacre industries, which include most grain growing farms as well as most sheep and beef cattle farms, accounted for 45 per cent of hay used and 21 per cent of silage used for the period 2001-02 to 2004-05. Exports accounted for 12 per cent of hay use and the horse industry accounted for an estimated 6 per cent of hay use. The feedlot sector is estimated to have used 2 per cent of hay and 13 per cent of silage.

• The broadacre industries are by far the biggest sellers of hay, accounting for an estimated 70 per cent of hay sales and 92 per cent of silage sales for the period 2001-02 to 2004-05.

• Hay exporters are estimated to have been the biggest buyers of hay between 2001-02 and 2004-05, followed by the dairy industry, broadacre farms, the horse industry and feedlots. Feedlots were the largest buyers of silage with broadacre and dairy farms also significant buyers.

• Analysis of farmers’ preparations for drought indicates they rely heavily on on-farm fodder stocks and the capacity to buy in additional fodder (Topp and Shafron, 2006). Growth in the use of purchased fodder and greater reliance on irrigated pasture over the past two decades has probably led to an increase in the exposure of farms to the adverse effects of severe drought and reductions in irrigation water availability on production and fodder prices, particularly for the dairy industry.

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• In severe droughts the domestic price of fodder increases markedly. For producers of fodder the higher prices help to offset the impact of drought-reduced production for those able to produce a crop. However, for producers in livestock industries that depend on purchased fodder, the effects of higher fodder prices during severe droughts is almost universally negative.

• A large share of the increase in hay sales in Australia over the past 15 years has been for the export market. Two thirds of the increase in hay sales over the period 1994-95 to 2004-05 was for export. In 1994-95, exports accounted for 35 per cent of total sales by volume and in 2004-05 it accounted for almost 49 per cent.

• The majority of Australian fodder exports are cereal hays. Japan typically accounts for more than 85 per cent of Australian fodder exports and 99 per cent of exports to Japan are cereal hay or chaff (mostly oaten hay). Most of the balance is stores for ships and aircraft transporting livestock and sales volumes for these vary in direct proportion to the number of sheep and cattle exported live from Australia.

• World trade in hay and hay products was valued at US$1.2 billion in 2006. The United States is the world’s largest exporter and Australia is the second largest with around 19 per cent of the value of world exports between 2002 and 2006. Japan is the world’s number one importer of hay and straw. The volume of Japanese imports rose annually at a rate of around 3.6 per cent between 2002 and 2006.

• Western Australia accounted for 52 per cent of the total value of Australian fodder exports in the period 2002-03 to 2006-07, South Australia 29 per cent and Victoria 14 per cent. The Midlands and Upper Great Southern regions of Western Australia, the York Peninsula and Lower-north region of South Australia and Central Northern Victoria appear to provide a high proportion of the cereal hay and straw exported.

Implications for relevant stakeholdersThis publication highlights the increasing volume of hay traded within Australia in response to rising demand from livestock industries’ and the impacts of climate change, competition for irrigation water and changes in land use on fodder production.

Changes in the composition of hay production have also been significant. Around one-third of total hay production in recent years has been cereal hay. Prices for cereal hays are linked to prices for grains, which in recent years have been historically high.

This publication also highlights the rise of fodder as an agricultural export and the increased importance of fodder exports in Australia.

RecommendationsThe fodder industry plays a key role underpinning production in Australian livestock industries and is also an increasingly important export industry. The fodder industry has changed markedly in recent years. Farms and regions which traditionally provided all of their own fodder requirements now obtain part of the fodder required through trade.

Fodder demand has risen and in combination with the changes in fodder production, the risk profile of farms using fodder has also changed. Agricultural policy makers should recognise this change and the requirement of a higher level of information provision to facilitate better market operation and risk management strategies by farmers.

It is important to ensure that farmers have access to adequate up-to-date information on fodder production, use and stocks to understand changes in their exposure to supply and price risks. It is also important that farmers are aware of the opportunities to increase farm income which growing fodder demand is creating.

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Introduction

Definition of fodderIn this report, the term fodder refers generally to hay and silage – that is, entire plants or the leaves and stalks of plants harvested specifically to feed animals, dried after harvesting (hay) or preserved as silage products (green fodder preserved by fermentation). Grains are excluded from this definition, but straw, processed hay and feed pellets (hay products) made with hay or straw together with grain products, are included in some statistics where indicated. Production of “green chop” is also included in some instances where indicated. In general, this is a much narrower definition of fodder than that often used both within Australia and internationally where the term fodder is often used more broadly to include any crop or foodstuff that is used primarily to feed livestock (FAO, 2006).

Australian fodder dataAustralian data presented in this report are drawn mainly from the Australian Bureau of Statistics (ABS). Farm-level data on hay and silage production, stocks and sales have been collected via the Australian Agricultural Census conducted annually until 1997 and since then every five years. In the years between the Agricultural Census, the ABS conducts the Australian Agricultural Commodity Survey using a sample of around 30 per cent of Australian farms with an estimated value of agricultural operations (EVAO) exceeding $5000.

Data on fodder use is not included in the ABS collections. Fodder use at the national level has been estimated where appropriate as within year production plus change in stocks at 30 June between years.

ABS Agricultural Census and Agricultural Commodity Survey data have been augmented with data from ABARE’s annual Australian Agricultural and Grazing Industries Survey (AAGIS) and Australian Dairy Industry Survey (ADIS), including supplementary collections on fodder use. It should be noted estimates arising from both the ABS Commodity Survey data and the AAGIS and ADIS surveys, have greater uncertainty associated with them than data derived from the Agricultural Census. Indications of the reliability of data are provided in a number of tables. In addition, changes to data items collected by the ABS and ABARE result in incomplete data series in some cases. A description of ABARE survey methodology and the reliability of estimates is included in Appendix A.

ABS trade data have been used to analyse Australian exports and imports of fodder. Trade data from the United Nations Commtrade database have been used to evaluate international trade in fodder.

Data limitationsData available from the ABS on fodder production, stocks and sales are broad.

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Hay production is aggregated into a number of broad classes. Typically these have been: pure lucerne; other pastures; cereals; and other crops. Data are collected on areas cut and tonnes of hay produced. Data on hay sold and farm stocks of hay are aggregated across all crop types. For 2005-06 and 2006-07, no disaggregating of fodder types was collected – only total hay or silage production is available.

The ABS does not collect data on the quantity of straw baled (straw remaining after the removal of grain). Quantities of straw baled in Australia are significant and have been increasing in recent years according to ABARE survey estimates, commodity export data and anecdotal accounts.

Silage data are aggregated with the normal collection including only total tonnes of silage produced and total tonnes on hand. In addition, no distinction is made in the ABS or general ABARE survey data between types of silages such as direct-cut silage, wilted silage or reduced moisture silage (haylage) which have very different percentages of dry matter content.

At the national level it is possible to broadly estimate total hay and silage usage. However, because the ABS does not collect data on the use of hay and silage on-farm, fodder use cannot be estimated on a geographic or industry basis without making assumptions or reference to other data sources. The estimations of industry fodder use made in this report have used ABARE farm survey data and industry estimates in combination with ABS data.

There are also significant definitional differences between ABS and ABARE data. In particular, ABARE data record all crop and pasture types separately. ABS data include coarse grains and forage sorghum in the cereals category for hays.

History of Australian fodder productionIn 1788, along with its load of convicts and their gaolers, the First Fleet brought to Sydney in seven horses, six cattle, twenty-nine sheep, twelve pigs, and a few goats. Livestock flourished, and a century later, in 1888, there were 1.2 million horses, and 8 million cattle and 80 million sheep (ABS 2001, figure A). In the early years of settlement, animal production was focused mainly on extensive grazing. On occasions, native grasses were harvested for hays together with oats and wheat, but hay-making and other forms of fodder conservation were not widely practiced and hay was expensive (Atkinson, 1826).

The rise of the horse as the dominant form of personal transport and traction (draft) power for agriculture, construction and land transport led to the first major increase in demand for fodder in Australia from the first half of the 19th century. Muscle, both human and animal, provided the means of traction in the first century after European settlement in Australia. Bullocks provided much of the muscle for heavy haulage in the early years of settlement being better suited to a lack of roads as well as being more robust and cheaper than

horses. Importantly, bullock fodder was free until settlement became denser after the 1860s. However, from as early as the 1830s as horse numbers increased and horse prices fell, draught horses began to replace bullocks (AHC, 2003).

Import of draught breeds, road building, and the increasing availability of fodder were major factors behind the shift to horses. Draught horses were more powerful than bullocks but required far higher quality and more expensive feed to maximise performance. In the earliest year’s hay was expensive and supplementation with grain was all that was available. However, over time production of chaff (coarsely chopped, dried whole plants), made mainly from oats together with hay became the main supplements to boost the performance of working horses (Kennedy 1992). Steam traction engines also entered the agricultural scene, where they were used baling hay, threshing grain and cutting chaff. From the 1830s, areas outside major urban settlements shipped fodder to the nearby cities and the arrival of railways and river steamers promoted change because hay, oats and chaff are relatively light and rates for their carriage were low. In remote areas, horse teams would often return to stations with their own fodder as a significant element of the back-loading freight (Kennedy 1992).

From the early 1860s to around the turn of the century, the broad pattern of Australian land use was firmly established through the closer settlement legislation such as the Robertson Land Acts of New South Wales, and, areas under cultivation expanded in all colonies. In this period, transportation systems were developed for moving agricultural products including fodder from source to market. Australia became an important exporter of a wide range of agricultural products and more intensive livestock industries such as dairying developed further, boosting demand for fodder.

The motor age began in Australia with the new century. However, motor vehicles at first were too fragile to be of much use on rough country roads and so for the first two decades of the twentieth century, horses continued to dominate the road transport and farming scene. Throughout Australia, horse populations peaked around 1920, but are estimated to have fallen continuously since (figure A). Uncertainty surrounds estimates of horse numbers on non-commercial scale farms and non-farm holdings, but these are also believed to have declined (Gordon, 2001).

The severe drought in eastern Australia which began in the last years of the nineteenth century continued into the twentieth and, combined with the rabbit plague, wreaked havoc on the agricultural economies of the eastern states. Upon cessation of drought in 1910, national livestock numbers increased steadily until the mid-1940s, although not as rapidly as in the previous period. There were also notable regional droughts in the 1930s and 1940s which, together with the Great Depression and World War II, had significant impacts on the regional structure of agriculture. The Soldier Settler Schemes post-World War I and II, together with expansion in irrigated agriculture to around 3 per cent of Australia’s crop and pasture lands further intensified land use and expanded

3

industries such as dairying, boosting fodder production. Dairy cattle numbers increased 5-fold between 1900 and 1964 (figure A).

The 1950s heralded a large expansion in Australian crop and pasture areas through increased use of mechanisation and the adoption of a wide range of technologies. New crop types and improved crop varieties were cultivated and livestock to suit varying regional conditions were bred. Land use intensified throughout the higher rainfall areas of the southern and eastern portions of the continent. Over the same period, road trucking of livestock and fodder connected national markets and reduced the impact of both local and widespread droughts.

The area planted to grain crops increased four fold between 1950 and 1984. Over the same period, there was a 40 per cent increase in sheep numbers and a 90 per cent increase in cattle numbers. Dairy cattle numbers began to fall from the mid-1960s, when Australia’s principal customer, Britain, announced that it was joining the closed European Union market. Beef cattle numbers increased in the late 1960s and early 1970s on the back of strong export demand particularly from Japan, a run of good seasons in southern Australia and a shift by many dairy farms to beef cattle production (figure A).

However, in 1974 the Japanese beef market collapsed and beef cattle numbers entered a decade-long decline only

Figure A Livestock numbers and crop areas, Australia

Beef cattle and sheep numbers, Australia

0

5

10

15

20

25

30

35

1885 1890 1895 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Bee

f cat

tle (m

illio

n)

020406080100120140160180200

Shee

p (m

illio

n)

Beef cattleSheep

Beef cattle and sheep numbers, Australia

Dairy cattle and horse numbers, Australia

0.0

0.5

1.0

1.5

2.0

2.5

3.0

1885 1890 1895 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Hor

ses

(mill

ion)

01122334455

Dai

ry c

attle

(mill

ion)

Horses a

Dairy cattle

Includes an estimate of horses on non-commercial farm holdings from 1942

Dairy cattle and horse numbers, Australia

Area planted to grain, Australia

0

5

10

15

20

25

30

1885 1890 1895 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Are

a pl

ante

d to

gra

in (m

illio

n ha

) Area planted to grain, Australia

Total stocking, Australia

050

100150200250300350400450500

1885

1888

1891

1894

1897

1900

1903

1906

1909

1912

1915

1918

1921

1924

1927

1930

1933

1936

1939

1942

1945

1948

1951

1954

1957

1960

1963

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

Mill

ion

shee

p eq

uiva

lent

s

Beef cattle Sheep

Horses Dairy cattle

Source: ABSa ABARE estimate of total horse numbers including horses on farms from 1941 with EVAO exceeding $5000 and non-commercial holdingsbut excluding feral horses.

Total stocking, Australia

4

reversing the downward trend in the late 1980s (figure A). The 1950s and 1960s were characterised by a large increase in broadacre stocking rates in southern Australia, sustained by an increase in improved pastures and fodder crops and an increase in fodder conservation. The proportion of grain crop area planted to oats and mainly used for livestock feed increased from around 8 per cent at the turn of the century to around 25 per cent in the mid-1960s, before declining to less than 5 per cent in the 2000s.

Total stocking stabilised in the 1990s. Falling wool prices and increased sales of lamb on export markets reduced sheep numbers while rising cropping productivity increased crop returns and encouraged crop planting in southern Australia. Beef cattle numbers continued to increase steadily, particularly in pastoral northern Australia where introduction of bos Indicus cattle, live cattle export, better pastures, grain finishing and a range of improved management practices boosted farm productivity and profitability. Fodder conservation in pastoral areas were minimal with control of stocking rate and livestock movement generally the most common practices to deal with drought and seasonal feed shortages. Opportunities for fodder conservation in pastoral areas were limited, although fodder production increased in localised areas of northern Australia, the increase was small in absolute terms. Beef cattle now account for a larger proportion of total national stocking than at any other time in our history (figure A).

Export demand for fodder, particularly from Japan, and demand for fodder on ships undertaking the export of live sheep and cattle from Australia has also expanded since the 1980s, with exports now accounting for a substantial proportion of hay production traded each year.

Grain finishing of beef cattle first appeared in the 1960s, but it was from the early 1990s that the proportion of Australian cattle finished on grain really began to accelerate. By 2003, almost 30 per cent of Australian beef production was finished in feedlots (ABARE 2004). Roughage based on hay and silage in feedlot rations has become an important sector of demand for fodder.

The use of hay and silage on Australian dairy farms has always been high relative to other livestock industries and during the 1990s utilisation of fodder increased again as Australian dairy production expanded. From the early 1990s, dairy farms began to use intensive feeding practices for cows, taking advantage of relatively low feed-grain prices. Increased volumes of hay and silage were also used for dairy feed as more intensive management was adopted in the face of rising land prices and increasing competition for irrigation water. While milk production has declined slightly in recent years in response to industry restructuring and reduced profitability, the dairy industry remains Australia’s largest fodder consumer.

Since the 1970s, there has also been a significant change in livestock feeding practices. The use of grain as a supplement and for drought feeding, increased, and there has been an increase in the number of farms buying fodder as part of their normal feed management and as a reserve for periods of

drought. As a consequence, the proportion of annual fodder production traded has increased.

Widespread drought from 2002 and an expanding hay export market have increased fodder demand, while production has fallen in some regions. In combination with high world grain prices, this has resulted in unprecedented hay prices (seasonal conditions maps are in Appendix D). This has led to substantial shifts to utilisation of cereal and other crop-based hays and expanded the use of grain, oilseed and legume crops for hay and silage production.

5

Hay

ProductionAustralian hay production grew by 2.6 per cent a year between 1989-90 and 2005-06 (figure B), increasing from 4.9 million tonnes in 1989-90 to 8.1 million tonnes in 2005-06, before falling sharply to 5.2 million tonnes in 2006-07 because of severe drought.

From 1999-2000 to 2004-05, an average 39 per cent of Australian hay production was produced in Victoria, with

the majority being pasture hay (table 1). New South Wales accounted for a further 19 per cent, with production evenly divided between pasture, cereal and lucerne hay. South Australia accounted for 17 per cent and Western Australia 13 per cent, with cereal hay dominant in both these states. Meanwhile, Queensland accounted for 8 per cent of total production, with lucerne hay being the main type produced. Tasmania accounted for 4 per cent of production and the Northern Territory 1 per cent.

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

1989-90 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06

Mill

ion

tonn

e's

Figure B Total hay production, Australia

1 Hay production, average for the period 1999-2000 to 2004-05Pastures Cereals Lucerne Other crops Total

kt kt kt kt ktVictoria 1696 357 261 47 2361New South Wales a 339 352 420 25 1136South Australia 343 617 36 9 1005Western Australia 268 411 109 15 803Queensland 131 146 196 24 496Tasmania 206 8 20 4 237Northern Territory 20 1 16 12 49

Australia 3002 1891 1058 136 6088

Source: Australian Bureau of Statistics Australian Agricultural Census 2000-01 and Agricultural Commodities Survey for other years.a Includes the ACT.All data are for farms with an estimated value of agricultural operations exceeding $5000

Table 1 Hay production, average for the period 1999-2000 to 2004-05

6

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1989-90 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06 2007-08

kt

0

50

100

150

200

250

300

350

400

$/to

nne

in 2

006-

07 d

olla

rs

Hay production Hay price

Figure C Hay production and price, Australia

ABS data indicate around one-third of Australian commercial-scale farms, or an average of 38 400 farms, made hay each year between 1999-2000 and 2004-05 (table 2). More than 60 per cent of these farms made pasture hay, 30 per cent made cereal hay, 20 per cent lucerne hay and just 3 per cent made hay from other crops. Widespread drought in eastern states in 2002-03 caused a sharp reduction in the number of farms making pasture hay (table 2). Total hay production fell to 4.9 million tonnes in 2002-03 a million tonnes lower than 2001-02. Almost 90 per cent of the reduction in production was because of reduced pasture hay production. Pasture hay production fell by around 400 000 tonnes in Victoria, 300 000 tonnes in New South Wales and 90 000 tonnes in both Tasmania and South Australia (figure C, tables A1 to A7 in appendix A).

Drought conditions resulted in a sharp increase in demand for fodder in most states from mid-2002. Pasture hay production was sharply reduced and hay stocks were drawn down. Hay prices rose and resulted in an increase in the area of cereal crops cut for hay.

In 2003-04 and 2005-06, improved seasonal conditions and high hay prices resulted in the number of farms making pasture hay rebounding strongly. Continued high hay prices resulted in an increased number of farms making cereal hay in all states and an increase in the area of cereals cut for hay in 2003-04, 2004-05 and 2005-06.

In 2006-07, hay production was severely reduced by drought in all states. The largest reduction occurred in Victoria (38 per cent) and New South Wales (25 per cent). Production of hay fell in the major pasture hay producing regions of southern Victoria and irrigated hay production was also severely reduced due to a shortage of irrigation water in the southern Murray Darling Basin regions.

State and regional productionTables detailing hay and silage production and utilisation for the period 1999-00 to 2005-06 are presented by state

and ABS Statistical Division (region) within each state in appendix A. Table names include the Statistical Division name. For example table A150 is the production table for Statistical Division 150 Murrumbidgee NSW.

While a significant amount of hay production occurs in most agricultural regions (excluding semi-arid pastoral regions) (Map 1), production is concentrated in high-rainfall, irrigation and cereal cropping regions (figure D). Together, the following 25 regions accounted for more than 90 per cent of aggregate hay production in the period 1999-2000 to 2004-05:

New South Wales: Murray, Central West, Murrumbidgee and Northern.

Victoria: Western District, Goulburn, Gippsland, Central Highlands, Loddon and East Gippsland, Mallee, Wimmera and Barwon

Queensland: Darling Downs

South Australia: South East, Yorke and Lower North, Outer Adelaide and Murray Lands.

Western Australia: South West, Midlands and Upper Great Southern.

Two regions, the Western District and Goulburn regions of Victoria, each produced an annual average of more than 0.5 million tonnes of hay. Together, these regions produced almost 20 per cent of total Australian hay production.

The contribution of all Australian states and regions to average annual hay production for the period 1999-2000 to 2004-05, together with the composition of hay production is shown in figure D. Note the vertical scale, total production, is different for each state.

Annual hay production by state and region, together with the composition of that production is shown in figure E.

7

kt0< 5 5%5 - 20 20%20 - 33 25%33 - 57 20%

Source: ABS AgriculturalCensus 2005-06

> 57 30%

Share of totalproduction

Map 1 Total hay production, 2005-06 by ABS statistical local area

The reduction in New South Wales pasture hay production in 2002-03 was mostly offset by an expansion in cereal hay production in that state. In 2003-04 and 2004-05, cereal hay production expanded in the other states, boosting total hay production to around 400 000 tonnes, well above pre-drought production.

Increase in cereal hay production post-2002 was greatest in the New South Wales regions of Murrumbidgee, Central West, Murray and Northern (tables A130, A140 and A150 and A155 in appendix A), together with Goulburn and Wimmera in Victoria (tables A240 and A225), Fitzroy in Queensland (table A330), Upper Great Southern in Western Australia (table A520) and South East South Australia (table A425).

Cereal hay production increased post-2002 by diverting dryland cereal grain crops to hay production, cutting failed cereal crops for hay and by growing cereal crops under irrigation. Production of hay from dryland cereal grain crops increased in Central Western New South Wales, Northern New South Wales, the Victorian Wimmera, South Eastern South Australia and Upper Great Southern of Western Australia. Drought reduced irrigation water availability and changed the timing of irrigation allocations, making it difficult or impossible for many irrigators in the Murrumbidgee and Murray regions to grow rice and high hay prices encouraged irrigators to use some of the available water for hay crops.

Despite an increase in lucerne production in Victoria, South Australia and Western Australia, overall lucerne production

declined by around 11 per cent post-2002. In the major lucerne growing region of Central Western New South Wales, little change was recorded in total lucerne production. In contrast, cereal hay production doubled in this region (table A140).

Production of hay from other (non cereal) crops increased post-2002 in the irrigated regions of New South Wales and in the Northern Territory.

8

2Fo

dder

pro

duct

ion,

Aus

tral

ia 1999

-00

2000

-01

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

Pure

luce

rne

- ar

ea c

utha

. 1

81 4

00

202

900

2

06 1

00

168

800

2

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00

245

900

na

na -

prod

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1

096

100

9

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00

956

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1

203

600

1

220

100

na

na -

farm

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200

7

980

7

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7

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9

210

8

910

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ding

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rne

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. 7

87 6

00

857

200

7

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571

500

8

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00

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25 0

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Sour

ce: A

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Agric

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s 20

00-0

1 an

d 20

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l Com

mod

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Sur

vey

for o

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rs.

All d

ata

are

for f

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alue

of a

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^ Es

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f 10%

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autio

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Tab

le 2

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dd

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, Au

stra

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9

3Fo

dder

utili

satio

n,A

ustr

alia

1999

-00

2000

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2001

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2002

-03

2003

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2004

-05

2005

-06

2006

-07

Cro

psan

dpa

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ted

forh

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533

090

06

432

600

586

440

04

912

800

766

260

06

322

300

8 06

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05

197

368 730

330 41

6405 5

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1 4048

1 3084

73039

83082

14. on

yahgn it tuc

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anan

0028 44

3000

88 93

00 3663

2004

1893

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400 2

4083

senno tenu J

03task cot s

yaH Fa

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with

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ks a

t30

June

no.

47

200

58

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58

890

5101

053

990

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na 6 2958

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1002

38 71

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348.

334

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5.9

338.

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323.

8

Sour

ce:A

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alia

nBu

reau

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tatis

tics

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tral

ian

Agr

icul

tura

l Cen

sus

2000

-01

and

2005

-06

and

Agr

icul

tura

l Com

mod

ities

Surv

eyfo

roth

erye

ars.

All

data

are

for

a

farm

sw

ith a

nes

timat

edva

lue

ofag

ricul

tura

l ope

ratio

ns e

xcee

ding

$50

00.

bA

BARE

estim

ate.

No

colle

ctio

n of

data

on h

orse

s b

y A

BS.

^Es

timat

eha

sa

rela

tive

stan

dard

err

or o

f 10%

tole

ssth

an 2

5% a

ndsh

ould

be

used

with

caut

ion.

aPr

oduc

tion

adju

sted

forc

hang

ein

stoc

ksat

30Ju

ne.

Tab

le 3

Fo

dd

er u

tilis

atio

n, A

ust

ralia

10

D Hay production by state New South Wales

0200400600800

100012001400160018002000

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Victoria

0500

10001500

20002500

3000

3500

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Queensland

0100200300400500600700

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

South Australia

0

200

400

600

800

1000

1200

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Western Australia

0200400600800

1000120014001600

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Detailed data unavaliable

Tasmania

0

50

100

150

200

250

300

350

400

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Northern Territory

0

10

20

30

40

50

60

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

Othercrops

Cereals

Lucerne

Pasture

Australia

0100020003000400050006000700080009000

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

tonn

es

NT

Tas

WA

SA

Qld

Vic

NSW

Figure D Hay production by state

11

E Total hay productionAverage kilotonnes 1999-2000 to 2004-05

0 500 1000 1500 2000 2500

Northern Territory

Tasmania

Queensland

Western Australia

South Australia

New South Wales a

Victoria

kt

Pastures Cereals Lucerne Other crops

a includes ACT

0 100 200 300 400 500 600

Australian Capital TerritoryDarwin - NT

Northern Territory - BalGreater Hobart - Tas

Southern - TasNorthern - Tas

Mersey-Lyell - TasPilbara - WA

Kimberley - WAPerth - WA

Central - WASouth Eastern - WA

Lower Great Southern - WAUpper Great Southern - WA

Midlands - WASouth West - WA

Adelaide - SAEyre - SA

Northern - SAMurray Lands - SA

Outer Adelaide - SAYorke & Lower North - SA

South East - SACentral West - Qld

Brisbane - QldNorth West - QldSouth West - Qld

Far North - QldMackay - Qld

Northern - QldFitzroy - Qld

Wide Bay-Burnett - QldMoreton - Qld

Darling Downs - QldMelbourne - Vic

Ovens-Murray - VicBarwon - Vic

Wimmera - VicMallee - Vic

East Gippsland - VicLoddon - Vic

Central Highlands - VicGippsland - VicGoulburn - Vic

Western District - VicFar West - NSW

Sydney - NSWRichmond-Tweed - NSW

Illawarra - NSWMid-North Coast - NSW

Hunter - NSWSouth Eastern - NSWNorth Western - NSW

Northern - NSWMurrumbidgee - NSW

Central West - NSWMurray - NSW

kt

Pastures Cereals Lucerne Other crops

Figure E Total hay production - Average kilotonnes 1999–2000 to 2004–05

12

Production by crop type

PasturePasture hay is still the main type of hay produced, but over the past 15 years, production of pasture hay has increased only slightly. In the early 1990s, pasture hay accounted for around 60 per cent of total hay production, but by the mid 2000s this share had fallen to 45 per cent (figure F).

Pasture hay production is heavily concentrated in Victoria which accounted for 57 per cent of total Australian pasture hay produced in the period 1999-00 to 2004-05, New South Wales and South Australia 11 per cent, Western Australia 9 per cent, Tasmania 7 per cent, Queensland 4 per cent and the Northern Territory 1 per cent (table 1).

The geographic extent of pasture hay production is indicated in Map 2. Major pasture hay producing regions are indicated in figure H with production dominated by the high rainfall regions of Victoria, the Western District and Gippsland together with the irrigated Goulburn region and the South West region of Western Australia. Other high rainfall regions in Victoria, Tasmania and South Australia together with southern inland irrigation regions of New South Wales Murray, Murrumbidgee and Central West are also significant producers. All of these regions have substantial numbers of dairy cattle (Appendix A tables B215, B255, B240 and B510 etc), but a large quantity of pasture hay is also used to feed beef cattle in these regions.

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1989-90 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06

kt

Other crops

Cereals

Pastures

Lucerne

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1989-90 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06

kt

Other crops

Cereals

Pastures

Lucerne

Figure F Hay production by crop type, Australia

13

The area of pasture cut for hay nationally has fallen slightly over the past 15 years (figure G) and the relatively small increase in production of pasture hay recorded since 1989-90 has been the result of growth in hay yields averaging around 0.8 per cent a year.

The area of pasture cut for hay has declined in New South Wales, South Australia and Tasmania, but has increased slightly in Victoria and Western Australia. In part, this change

reflects the relocation of commercial dairy and beef farms away from high rainfall near coastal parts of New South Wales and a contraction of the Tasmanian and South Australian dairy industries in some areas.

More importantly, the total area cut for pasture hay is sensitive to seasonal conditions with the area cut falling markedly in 1994-95 and 2002-03 when drought was severe in southern Australia.

Australian hay production

0500

1000150020002500300035004000

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

kt

Lucerne

Pastures

Cereals

Othercrops

Linear(Cereals)

Area cut for hay, by crop type

0100200300400500600700800900

1000

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

'000

ha

Lucerne

Pastures

Cereals

Othercrops

Hay yield, by crop type

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

1989-90 1992-93 1995-96 1998-99 2001-02 2004-05

tonn

es /

ha

Lucerne

Pastures

Cereals

Othercrops

Figure G Hay production by crop type, Australia

14

200 400 600 800 1 000 1 200 1 400 1 600 1 800

Northern Territory

Queensland

Tasmania

South Australia

New South Wales a

Western Australia

Victoria

kta includes ACT

Major pasture hay production regions1999-00 to 2004-05

100 200 300 400 500 600

OtherMelbourne - Vic

Lower Great Southern - WACentral West - NSW

Murrumbidgee - NSWOvens-Murray - Vic

Wimmera - VicMallee - Vic

Outer Adelaide - SACentral Highlands - Vic

Northern - TasMersey-Lyell - Tas

East Gippsland - VicBarwon - Vic

South East - SAMurray - NSW

South West - WAGippsland - VicGoulburn - Vic

Western District - Vic

kt

Named regions together account for 90per cent of Australian pasture hayproduction

Figure H Pasture hay production (excluding lucerne), average 1999-00 to 2004-05

kt< 1717 - 8181 - 122122 - 322> 322

Source: ABS AgriculturalCensus and AgriculturalSurvey Data

Map 2 Pasture hay production, average 1999-00 to 2004-05, by ABS statistical division

15

kt< 1313 - 5757 - 7373 - 176> 176

Source: ABS AgriculturalCensus and AgriculturalSurvey Data

Map 3 Cereal hay production, average 1999-00 to 2004-05, by ABS statistical division

CerealsCereal hay production accounted for 31 per cent of total hay production in the period 1999-00 to 2004-05. South Australia produced 33 per cent of total Australian cereal hay production in this period, Western Australia 22 per cent, Victoria and New South Wales each 19 per cent and Queensland 8 per cent (table 1). It should be noted that the cereal category, as defined for the ABS collection data used here, includes all cereals (wheat, oats etc) and also includes forage sorghum.

The geographic extent of cereal hay production is indicated in Map 3 and the major cereal hay producing regions are listed in figure H. Production is dominated by major grain farming regions, particularly Western Australia’s Midlands and Upper Great Southern regions, South Australia’s York Peninsula and Lower North, the Darling Downs of Queensland, Central Western New South Wales and the Wimmera region of Victoria. The irrigation regions of Goulburn Victoria, Murray New South Wales, Murraylands South Australia and Murrumbidgee are also very important production regions and were particularly so in the period following the onset of widespread drought in 2002.

Most importantly, more than 75 per cent of the increase in total Australian hay production since 1989-90 has been

increased production of cereal hay. Cereal hay production has doubled in the past 15 years as a result of a doubling in the area of cereals cut for hay (figure G) combined with growth in average hay yields over this period of around 1.5 per cent a year.

Cereal hay production grew at a rate of around 5 per cent per year between 1989-90 and 2001-02, before widespread drought resulted in lower total production in 2002-03. A sharp increase in production then followed in 2003-04 as farmers started to rebuild drought-depleted stocks in all states (figure G).

Cereal hay production has increased steadily in South Australia since 1989-90, and from 1994-95 in Queensland. However, in New South Wales and Tasmania, cereal hay production declined between 1989-90 and 2001-02 and in Western Australia and Victoria there was little change. Cereal hay production increased sharply in New South Wales in 2002-03 and has remained high through to 2004-05 as widespread drought increased fodder demand. Resulting high fodder prices led to irrigated cereal hay crops planted in irrigation areas of New South Wales and Victoria and diversion of grain crops to hay production, combined with the use of cereal grain crops for hay production in Western Australia, South Australia and Victoria. As a result, cereal hay production and yields (figure G) increased sharply in 2003-04.

16

I Cereal hay production, average 1999-00 to 2004-05

0 100 200 300 400 500 600 700

Northern Territory

Tasmania

Queensland

New South Wales aVictoria

South Australia

Western Australia

kta includes ACT

Major cereal hay production regions1999-00 to 2004-05

0 50 100 150 200 250

OtherFitzroy - QldCentral - WA

South East - SAWimmera - Vic

South Eastern - WANorth Western - NSW

Northern - South AustraliaSouth West - WA

Loddon - VicOuter Adelaide - SA

Central Highlands - VicNorthern - NSW

Central West - NSWMurray - NSW

Darling Downs - QldLower Great Southern - WA

Murray Lands - SAMurrumbidgee - NSW

Goulburn - VicYorke and Lower North - SAUpper Great Southern - WA

Midlands - WA

kt

Named regions together account for 90per cent of Australian cereal hayproduction

Figure I Cereal hay production, average 1999-00 to 2004-05

17

LucerneLucerne accounted for 17 per cent of total Australian hay production between 1999-00 and 2004-05. New South Wales produced 40 per cent of total Australian lucerne hay production in this period, Victoria 25 per cent, Queensland 18 per cent, Western Australia 10 per cent and Tasmania and the Northern Territory 2 per cent each (table 1).

The geographic extent of lucerne hay production is indicated in Map 4 and the major lucerne hay producing regions are listed in figure I. Central Western New South Wales (which includes the Lachlan Valley irrigation area) is the most important production region in terms of total tonnage produced (figure J and table A140). However, a large number of regions produce a significant quantity of lucerne hay. These include the Northern, Murray, Hunter, Murrumbidgee and North West regions of New South Wales, together with the Goulburn, Loddon, Mallee and East Gippsland (includes McAlister irrigation area) regions of Victoria and the Moreton (includes Lockyer Valley irrigation area), Darling Downs and Wide-Bay Burnett regions of Queensland. All major producing areas have acc

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