Factors Influencing Farmer Decisions to Grow Poppies Factors Influencing Farmer Decisions to Grow Poppies

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  • Department of Primary Industries, Parks, Water and Environment & Poppy Growers Tasmania

    Factors Influencing Farmer Decisions to Grow Poppies

    January 2013

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    Macquarie Franklin Administration Office 112 Wright Street | East Devonport | Tasmania | 7310

    Phone: 03 6427 5300 | Fax: 03 6427 0876 | Email: info@macfrank.com.au Web: www.macquariefranklin.com.au

    Report author: Thom Goodwin, Lance Davey & Michael Lehman

    An appropriate citation for this report is:

    Macquarie Franklin, 2013, Factors Influencing Farmer Decisions to Grow Poppies in Tasmania, Devonport TAS

    Document status: DRAFT

    Date Status /Issue number Reviewed by Authorised by Transmission method

    This report has been prepared in accordance with the scope of services described in the contract or agreement between Macquarie Franklin and the Client. Any findings, conclusions or recommendations only apply to the aforementioned circumstances and no greater reliance should be assumed or drawn by the Client. Furthermore, the report has been prepared solely for use by the Client and Macquarie Franklin accepts no responsibility for its use by other parties.

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    Contents 1 Introduction .................................................................................................................................... 3

    2 Potential Poppy Area ...................................................................................................................... 4

    3 Company interviews ....................................................................................................................... 7

    4 Farm survey ..................................................................................................................................... 9

    4.1 Questionnaire, survey sample and response rate .................................................................. 9

    4.2 Survey Results ....................................................................................................................... 12

    5 Current Poppy Grower Survey Results .......................................................................................... 15

    5.1 Area of poppies grown .......................................................................................................... 15

    5.2 Reasons for growing less than maximum annual poppy area .............................................. 17

    5.3 Factors that would encourage farmers to grow more poppies ............................................ 19

    6 Non-Poppy Grower Survey Results ............................................................................................... 21

    6.1 Reasons farmers do not grow poppies ................................................................................. 21

    6.2 Factors that would encourage farmers to grow more poppies ............................................ 22

    7 New Irrigation Schemes ................................................................................................................ 24

    Appendix A – Regional breakdown of revisions made to TIA and DPIPWE mapping ........................... 25

    Appendix B – Revised Annual Potential Poppy Area ............................................................................ 26

    Appendix C – Current grower survey responses ................................................................................... 27

    Appendix D – Non-grower survey responses ........................................................................................ 30

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    Executive summary

    The Tasmanian Institute of Agriculture (TIA) and the Department of Primary Industries, Parks, Water and Environment (DPIPWE) previously identified a total area of 349,000 hectares as potentially suitable for growing poppies in Tasmania. Based on this they concluded that around 60,000 hectares of poppies could be grown in Tasmania on an annual basis. This report revisits at the TIA and DPIPWE land use mapping work, and presents the results of a survey of poppy company field staff and farmers to obtain a better understanding of the factors that might limit the expansion of total poppy area in Tasmania - beyond the 30,000 hectares being grown this year.

    Revised Land Use Mapping

    After adjusting for a range of factors the potentially suitable poppy growing area identified by TIA/DPIPWE was revised down to 251,000 hectares – with the annual potential area revised from 65,000 hectares to around 45,000 hectares. In the current 2012-13 season around 30,000 hectares of poppies are being grown throughout the state. This represents over 60% of the 45,000 hectares of practical annual potential area identified by the revised land use mapping.

    Company Interviews

    Prior to undertaking farmer interviews, poppy company staff for Glaxo Smith Kline (GSK) and Tasmanian Alkaloids (TA) were interviewed to gain a better understanding of issues which they believe might limit the area of poppies grown in the state. Field officers were also asked to provide their understanding of the main reason why some previous growers no longer grew poppies. A frequent comment made by field officers was that most farmers who could potentially grow poppies had in fact grown at some point in the past. The main reasons given as to why individual farms were no longer growing poppies was the unsuitability of land in some areas, specialised dairy, specialised beef and part-time farmers not interested in cropping, as well as land used for other crops over an extended period – e.g. land leased to BRA for pyrethrum.

    Farm Survey

    Two farm surveys were designed - one for current poppy growers and the other for non-poppy growers (past growers & farmers who have never grown poppies). Farmers were asked to indicate what they considered to be their potential poppy ground if there were no constraints other than soil type, and what they could potentially grow on an annual basis – as well as the area devoted to other land uses during 2012-13. Non-poppy growers, and current poppy growers that were not growing at their suggested annual potential area, were asked to nominate the main reason they are not growing (more) poppies and what it would take to get them to grow (more) poppies. The survey results suggest that poppy growers are generally cropping farms, whereas non-poppy growers tend to be mainly grazing farms. A large proportion of non-poppy growers, for example,

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    have less than 20% of their total farm area under crop. On the other hand almost 80% of them have over 80% of their total area under pasture.

    Current Poppy Grower Survey Results

    Around 70% of current poppy growers surveyed reported growing less poppies in 2012-13 than their suggested annual potential area. Calculations based on grower estimates of their actual area versus their estimate of potential annual sustainable area suggest it may be possible to grow another 15,600 hectares on current poppy grower farms. Returns being too low and a lack of irrigation capacity accounted for over 80% of the ‘missing area’. Unsurprisingly, increased price was frequently nominated as a factor that would encourage more poppy production. However, this response needs to be seen in the context of other reported factors such as access to irrigation infrastructure, more reliability and increased yield.

    Non-Poppy Grower Survey Results

    92% of the 51 non-growers interviewed said they had grown poppies in the past. This is in line with the field officers suggestion that most people who could grow poppies had in fact grown at some stage. As is the case for current poppy growers, non-growers listed ‘returns too low’ as a main reason for not growing and this accounted for 35% of the ‘missing area’ on the survey farms. ‘Other enterprises’ was the second most important reason and this was generally associated with dairy farming. Higher price was listed as a major factor that would encourage non-growers to grow, followed by more reliable yield (and better yield) and prices falling for other enterprises – these are all factors associated with the relative profitability of poppies and other enterprises. Ten of the 56 growers indicated that there was nothing that would encourage them to grow poppies – these tended to be lifestyle or retired farmers. Irrigation constraints (irrigation infrastructure, water availability) did not appear to play a big role in the decision not to grow poppies among non-poppy growers.

    Impact of New Irrigation Schemes

    The anticipated increase in poppy area from Tasmanian Irrigation schemes could increase the current 30,000 hectares of poppies grown in Tasmania to around 36,000 hectares. The largest expansions in poppy area associated with these irrigation schemes is expected to occur in the Southern and Northern Midlands region This is 10,000 hectares short of the 46,000 hectares identified as a practical maximum annual area by the revised land use mapping – but does constitute a significant potential increase.

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    1 Introduction