Report: 39 November 25, 2004

Some paddocks have been cultivated after early November rain. (November 2004). Source: J. Quinlan Executive Summary

• The rains in early November have eased, particularly in the west of the state, allowing harvest of grains and hay to recommence. • Irrigators with low allocations have benefited from allocation increases in the last fortnight with Campaspe irrigators now receiving 29% of their usual allocation (up from 18%). • Federal Government extension of Exceptional Circumstance assistance to the Goulburn, Loddon/Campaspe Irrigation areas, and the Eastern Mallee has been well received. • The media has focussed on early harvest results (poor quality barley) and extension of Exceptional Circumstance assistance in Victoria. • Commodity prices have remained mainly stable despite the strengthening Australian dollar, with poor crop prices encouraging on farm storage. • Most regions are doing well following rains in early November, however there is some concern about the poor quality of hay which got wet while on the ground, and early barley harvests in the North West have proved to be very poor quality with additional receival categories offered down to malt 3 and feed 5.

DSC Report 1 Environmental Indicators

Rainfall

Rainfall for November has been significant with rainfall percentages to date being over 125% in much of the north and central regions. However, the tip of East Gippsland stands out as the only area with less than 80% of monthly rainfall so far. The majority of rain fell at the start of the month with the west of the state now drying out to enable harvest of grain and hay to recommence (Figure 1). Rain in November has brought “growing season rainfall” closer to average across most of the state, providing a challenge for future interpretation of data.

Low rainfall in October led to almost 60% of the state having streamflows below 10% of the long-term average.

Figure 1. Victorian rainfall (mm) week ending 24th November 2004

National Climate Centre Bureau of Meteorology

Water storages

Goulburn-Murray Water has updated water allocations for the 2004/05 season on November 15th; Goulburn 100% (up from 90% on November 1st), Loddon 100% (up from 86% on November 1st), Campaspe 29% (up from 18% on November 8th). Unchanged are Murray 100%, Broken 170%, and Bullarook Creek 190%.

Lake Glenmaggie spilled again following heavy rain in early November, giving Macalister irrigators extra water. Allocations for the Bacchus Marsh and Werribee districts have increased to 55% (up from 45%).

Coliban water has eased town water restrictions from stage 4 down to stage 3.

Storage Change in Capacity Storage Change in Capacity last 2 weeks 22/11/04 last 2 weeks 22/11/04 Goulburn Basin 5% 49% Thomson/ LaTrobe Basin 2% 61% Broken Basin 1% 41% Werribee Basin 2% 25% Campaspe Basin 3% 21% Glenelg/ Wimmera Basin 0% 15% Loddon Basin 2% 39% Maribyrnong 1% 9% Upper Murray Basin 3% 51% Barwon Storage 0% 78% Ovens Basin 0% 100% Source: http://www.fishvictoria.com/pnews/water_levels.php

Fire After a period of accelerating fire activity in October, widespread rain has significantly reduced the number and extent of new wildfires in the last fortnight. There were just 5 wildfires, and these only burnt 1 hectare. For this fire season there have been 86 wildfires that have burnt 1,248 hectares. This number of fires is about average for this time of year. Rapid drying has already returned fire danger conditions to very high to extreme levels in the

DSC Report 2 North West of the state. In the weeks ahead we can expect regular cycles of drying weather associated with increased fire danger. The onset of wet conditions in early November has slowed prescribed burning operations. 310 Project Firefighters are now engaged, equipped and have commenced training. Flora and fauna Gippsland: There is still a substantial long-term deficit in soil water, particularly along the coastal strip in East Gippsland. There appear to be areas of tree-die-back in some areas of coastal forests, which is suspected to be drought related. Social Indicators

Drought financial assistance

Rural Finance reports 2,045 applications for the Exceptional Circumstances Interest Subsidy have been received to date with 1,648 approved and 324 declined so far. Total value of the subsidies approved is $28,211,248 with an average of $17,118.

Minister Truss’ media release dated November 16th announced the 12-month extension of EC assistance to Goulburn, Loddon/Campaspe Irrigation areas, and also the Eastern Mallee EC area in Victoria. An EC application covering horticultural growers in Northern Victoria was rejected.

Rural Financial Counselling report Understanding and implementing changes to employment legislation from January 2005 is an additional challenge for farmers and their employees. Goulburn Valley & Upper Murray: Optimism and long-term confidence seems slow to return. Milk step-ups seem to have brought some level of reassurance but debts have caused some to exit/sell off assets/sub- divide/run beef, hay, agistment etc. Family/relationship issues are under increasing pressure. Some Campaspe system irrigators are questioning their ability to survive the next 12 months and the future of the Campaspe Irrigation District in the long-term. They see it as their 3rd tough year in a row.

Media and Communication

Media releases 16 Nov 2004 - Third year of Australian Government drought support granted in areas of Victoria. Australian Agriculture Minister Warren Truss announced today that Exceptional Circumstances (EC) assistance would be extended for a further 12-months to the Goulburn, Loddon/Campaspe Irrigation areas, and also the Eastern Mallee EC area in Victoria. An EC application covering horticultural growers in Northern Victoria does not meet the eligibility criteria.

Media headlines Weather • Never rains but it pours AFR 16/11 - Some Victorian farmers whose grain crops were desperate for winter rains two months ago now find the same paddocks waterlogged, jeopardising hay-baling and potentially hampering harvesting. • Downpours delay harvest amid grain quality doubts Weekly Times 17/11 - This year’s grain harvest crawled into its second week, with rain delaying the activity on many farms. Farming and agriculture • ABC Western Victoria Horsham Rural Report 6:42AM 12/11 - Homer interviews Jack Tansley, Graincorp southern regional manager about the grain crops for the Wimmera Mallee this season. Tansley says the crops seem to be very variable this season. • Farmers on the move Country News 15/11 - The future leaders of dairying are leaving while the industry stagnates after the drought, a Cobram counsellor said. Murray Valley Rural Industry Assistance Group counsellor Jan Sneyd said she was seeing younger farmers, in their early 30s who are important to the future, leaving the industry • Dairy farmers leave industry Bendigo Advertiser 17/11 - Dairy Australia’s annual industry update, In Focus, reveals how deeply the 2002-03 drought-affected dairying.

DSC Report 3 • Rising dollar hits hard Weekly Times 17/11 - Australian farmers have lost almost $3.5b in the past 18 months. The strengthening Australian dollar and the falling US dollar have combined to eat into the profit margins of the nation’s export earners. • Ill winds could bring locust invasion Age 18/11 - Farmers in north central Victoria are facing their biggest threat from locusts in a generation. They have reported eggs hatching in the area for the first time in 30 years and numbers building up across the NSW border. • Harvest ‘disaster’ Swan Hill Guardian 22/11 - Low yields and poor grain quality have experts calling the region’s harvest a ‘disaster’. VFF said the start of harvest is producing ‘very, very poor barley’. • ABC MILDURA SWAN HILL Radio News 8:30AM 23/11 - Mallee farmers are trying to maximise returns by moving into wheat crop harvests, and leaving barley crops for later. • Crop quality variable Weekly Times 24/11 - The annual grain harvest is picking up pace and heading south. Grain and samples are being delivered as far south as Dimboola and Murtoa and many Wimmera paddocks have started withdrawing their canola crops. Water • BENDIGO WIN TV State Television News 6:04PM 15/11 - Coliban Water has revealed water restrictions will ease from stage four to stage three from Saturday, following the recent spring downpour that's helped send the Water authority's combined reservoirs to a new three-year high. However, Lake Eppalock is still struggling to register any significant inflows, with it's level still at around 12 percent of capacity. • Water boost Swan Hill Guardian 17/11 - Last week’s rain may have been only minor help to Mallee crops but was a huge benefit to Murray River storages. Irrigation allocations for the Goulburn, Loddon and Murray-Murrumbidgee regions have risen. • ABC GIPPSLAND Traralgon Rural Report 6:42AM 19/11 - Callinan interviews Arthur Allen, an estuarine fisherman who says the drought is far from over in the Gippsland lakes with a lack of flow in many of the rivers feeding the lake system. Allen says the commercial fishers in the lakes are continuing to struggle, with despite the recent rain not much of it is hitting the lakes. Drought • Income drought strikes Wimmera Mail Times 15/11 - Hugh Delahunty will seek talks with State Government leaders this week to impress on them the dire consequences of an ‘income drought’ because of an expected poor harvest. • ABC Western Victoria Horsham Western Victoria Rural Report 6:52AM 18/11 - Homer interviews Rod Williams, Victorian Department of Primary Industries drought response manager about the drought meeting at Birchip last night. • New drought study Wimmera Mail Times 24/11 - A Wimmera Farm Benchmarks study of more than 50 farm businesses by a Horsham accounting firm has shown higher than expected farm income during the 02-03 drought. • Call for urgent drought reform Weekly Times 24/11 - The NFF has called for urgent reform of drought policy, with changes in place by July. Federal and State Ag Ministers should put differences aside and make some decisions at their council meeting next month. Drought financial assistance • More federal help for drought areas Weekly Times 17/11 - Drought-declared farmers in eastern Mallee and the Goulburn and Loddon-Campaspe irrigation areas will get federal help for another 12 months. • Drought cash continues but Valley frosted out Age and Herald Sun 17/11 - Farmers in northern Victoria will receive drought support for a third year, but the Federal Government has knocked back please by Goulburn Valley fruit growers whose crops were hit by frost last spring. • Mallee-Millewa farmers to push for EC federal funding Stock and Land 25/11 – In light of a woeful harvest, Mallee and Millewa farmers are looking to apply for exceptional circumstances (EC) assistance from the Federal Government. Economic Indicators

Commodity prices and movements

Wheat prices have remained stable despite the pressure of the strong Australian dollar. However, as all prices are low it is estimated that more growers will elect to store grain on-farm rather than sell now. Early poor quality barley has meant grain silos have introduced new low quality categories down to malt 3 (usually only malt 1 & 2), and ranging down to feed 5 (usually only feed 1).

Oversupply and the strong Australian dollar have seen a decrease in cattle prices. The dollar has also seen the Southern Wool Indicator drop to 723c/kg.

DSC Report 4 Commodity prices This Week Last Week Last Month Last Year Wheat APW pool 1 189.05 189.05 214.48 Wheat APW cash 1 190 190 200 Malting barley 1 181 174 170 Feed barley 1 160 158 165 Feed oats 1 120 120 120 Field peas 1 240 240 250 Canola (42% oil) 1 326 330 338

Yearling steers (C3 180-220 kg) 2 342 352 374 334 Bullocks (C4 340-420 kg) 2 320 333 339 314 Cows (D3 180-260 kg) 2 294 301 297 272 Lambs (16-20 kg) 2 341 346 359 367 Sheep (18-24 kg) 2 174 183 196 210

Old pasture hay (Bairnsdale $/t) 2 75 75 75

Water rights (Greater Goulburn $/ML) 3 75.00 75.80 85.75 96.50

Grains are Portland cash price (except for APW pool) Stock prices are ¢/kg cwt Sources: 1 Weekly Times 2 Stock and Land 3 www.watermove.com.au Regional Reports

There are no new drought related issues in the North East, South West, West Gippsland or Port Phillip. Mallee Early harvest results are showing low yields, high screenings and downgrading of barley to low grade feed at poor prices. Little barley is making malt 3 grade. Many farmers will store feed barley on-farm. Some areas near Swan Hill which had storm rainfall are producing good yields. Mechanical weed control will generate future erosion risks. Wimmera Early harvest results in the northern Wimmera are showing poor results with barley making malt 3 at best, some as low as feed 5. Canola oil content down to 26% (usually 40%). Growers are reluctant to see their yields assessed. Most hay has now been baled, but some bales retain excess moisture from rain in early November presenting a fire risk for the future. North Central Early harvest reports of pinched barley grain. Some crops are still to benefit from recent rains. Rain caused some canola crops to resprout since windrowing which will cause problems at harvest. Pastures are reasonably good. Rain damaged hay on the ground has had to be turned an extra time and will be downgraded. Northern Irrigation Early harvested barley has low density grain, but high protein. Most will be feed quality and stored on-farm as prices are low. Canola harvest has low yield and oil content, but high protein. Wheat is expected to be better. Hay has been damaged by rain. Some locust hatchings reported. East Gippsland Spring is average for most of East Gippsland, with good pasture growth. Pasture growth in the Maffra region is slow. Fodder reserves may not be sufficient for the summer. Fisheries Potential for fish kills in the Campaspe and Broken Creek systems over summer remain high and are being monitored. Many larger lakes in the South West are still dry or too low for restocking and the eel industry is

DSC Report 5 severely affected. Low flows in East Gippsland may exacerbate the sand slug’s interference with migration of native species, particularly Australian Bass. DPI response

Drought related activities held this month Mallee • DPI Mallee has provided a forum to encourage trialing of summer millet, based on rains in early November. Three growers in the Millewa/Carwarp area are trialing millet as a groundcover and better quality stock feed. This has given growers some hope and self worth within a bad year. • 17th Nov – Birchip “We will survive” Drought Forum attended by DPI Drought Response Manager who acknowledged the difficult conditions. The community discussed practical steps to support each other and stressed their need to be self-reliant. Wimmera • 17th Nov – Horsham Rural City Council drought meeting – provided information on grains industry and encouraged plan to hold community Christmas events throughout shire. • 25th Nov – Yarriambiac Shire drought response meeting.

Local workshops planned Wimmera • 26th Nov – DPI will run a Wimmera Drought Service Providers Forum in Horsham to fully brief key service providers, local government, agri business etc. of the impact of the seasonal conditions and harvest outlook across the Wimmera and help coordinate response. 40+ people expected. Northern Irrigation • 3rd Dec - Social support/Christmas get-together for Campaspe Irrigators.

Dry season related staff training activities • 17th Nov – Physiological First Aid Workshop for staff dealing with communities under stress. • 26th Nov - "Occasional Counsellor" workshop planned for DPI extension staff in Northern Victoria to help staff deal with stressed farmers.

Compiled & edited by Katherine Hollaway, and proofed by Drought Operations & Communication Managers.

DSC Report 6