Tuesday, September 27, 2011
I wonder how they do it
A large retailer is reported today to have 'imposed' a 5 % cut on prices paid to suppliers for a 3 month period as an 'investment of mutual benefit to both our organisations'.
This is Orwellian.
If a consumer walked out of their store with 5% more than they had paid for, presumably they would want it to be called theft rather than a 'mutual investment'.
A farmer in the industrial system has to deal with these people. Even a farmer outside the industrial system has to deal with the consequences of consumers having access to product derived from exploitative systems.
People in the city should understand the level of abuse and economic distortion that underlies their access to 'cheapness'. These things don't last forever.
F
Thursday, July 21, 2011
Everything dies
The last few weeks has seen the Indonesian live cattle scandal explode and expire.
I think the main problem exposed by this affair is the disconnection most Australians have from animal reality - and the willingness of foolish bureaucrats and politicians to pander to nonsense - to the fairly immediate detriment of animals, farmers and common sense.
Let's get one thing clear at the start. I don't think it's ever a good idea for humans to mistreat animals. But it's an ill (at the extreme perhaps - an evil) just like a lots of other ills. We need to be careful that we don't turn our world upside down to solve one ill - at the cost of creating a series of other ills - worse than what we started with.
Let's remember that a domesticated cow is descended from what was always a prey animal. Its ancestors were chased, caught and killed by predators for millions of years - with nary a stun gun in sight. Cattle or sheep or chickens having a scary, gory, painful end is what they have always had.
When we kill domesticated (or other) animals 'humanely' we are doing it, I think, for two reasons:
- the meat of an animal that was not stressed at the time of slaughter tastes better; and
- in some way we (humans) are always diminished by cruelty.
My father and mother couldn't afford to be squeamish if they wanted to have the treat of what they then called 'poultry'. Between them, they had to kill a hen, pluck it, gut it, clean it, prepare it. Their grandchildren pick up the organic chicken from the supermarket or Deli - and just have to cook it.
The reality is that the life (and end) of the hen my parents put on our table in the 1960s was immeasurably better than that of the chicken my kids eat. Eight week life, unnatural food, unnatural housing, sub clinical dosing with antibiotics, grotesque body shapes, industrial slaughterhouses ... that's what produces the chicken we eat every day.
Sorry ... the organic chicken will have another week or two of life, slightly better food, slightly better housing, no antibiotics - and an industrial slaughterhouse.
I can't help but see the fuss over the way Indonesians treat cattle as ... mainly ... self indulgent (and hypocritical) squeamishness in a set of circumstances where the very real costs of that self indulgence are imposed on others.
[After discussing the following two paragraphs with my cultural adviser (my son), I've decided to add a warning. Only read on if you have heard of DH Lawrence.]
I'm reminded of the line in Lady Chatterley's Lover where Mellors observes to Connie (her in a state of undress) "An' if tha shits an' if tha pisses, I'm glad. I don't want a woman as couldna shit nor piss."
Mellors was enough in touch with reality to understand that humans (and animals) shit, piss ... and, one day, die.
F
Sunday, January 30, 2011
Nothing more to be said
Here is an article on why you should buy food from someone you know and, as much as possible, avoid buying 'cheap food' from a system that systematically abuses both its suppliers and customers.
F
Sunday, January 23, 2011
Coles and Growth Hormones
There is a big story running in Australian papers about how Coles (one half of the grocery oligopoly) is going 'hormone free' with it's beef.
Notice that the quote attributed to Curtis Stone says 'all the fresh beef'. What about the rest?
And try to guess who might have pressured their 'supply chain' into production systems that 'depend' on things like growth promoting hormones and antibiotics in the first place?
Supermarkets seem to me a bit like miners - except they don't do the remediation that even strip miners are now required to do as a condition of their licensing. Supermarkets are only 'cheap' because they have created a system that reduces costs that people pay at the checkout while driving costs people pay through other means.
They 'mine' their supply chains for 'efficiencies' that are only efficiencies if you ignore costs of land degradation and social dislocation caused by industrial agricultural systems.
They jam the health system with people sick from eating the food they sell.
They use advertising and lobbying to create a world in which 'cheap food' is an political necessity. Reality check! No one in human history has spent a lesser proportion of their income on food that the modern consumer!
We don't need cheap food. We need (as we always have) good food and systems that produce it reliably.
I don't like the idea of growth hormones or, more particularly, farming systems that make it necessary for animals to be fed drugs we don't fully understand. But Coles should get no credit for doing this. They should get condemnation for:
- hedging on products containing processed beef; and
- jerking around their suppliers - after encouraging them into such counter-productive systems in the first place.
In the end supermarkets are not sustainable - and some of us are more exposed to their unsustainability than others.
F
Sunday, October 17, 2010
Cross subsidies
I just watched this week's Landline program. It had 3 stories where there was a Bush / City conflict of significant dimension. No surprise ... the Bush is losing every one. I felt a lot of sympathy for:
- small scale timber mills producing hardwood sleepers and the like who are being driven out of business by a combination of big mills, imports and environmentalists;
- aboriginal and other people adversely affected by Queensland's Wild Rivers legislation; and
- Murray Darling irrigation towns who want some recognition of the consequences of water reallocation proposals.
I've been part of a world view that believes good pricing generally leads to good outcomes. I don't use the word 'efficient' as an economist would, but I mean many of the same things. This world view has, unfortunately, been a significant part of screwing the Bush blind for, at least, several decades.
Good pricing means people see the real price of things over the medium term. What I would term real prices are something between short run and long run marginal cost - with the excess distributed with some sort of equity.
Far too often over the last 30 years, the Bush sees too little equity - and precious little common sense besides. It has to sell into markets where it faces systemic (but usually) unacknowledged market power, but then faces heavy access and price discrimination on their inputs.
We should recall that Australia is built, right back to white settlement, on agriculture and mining. These are pretty much the only things we have ever produced on a consistently, globally competitive basis. Miners seem to be big enough to look after themselves, but for at least 50 years farmers have lacked the capacity to get a fair share.
I'm a bit sensitive to this point partly because of a conversation I had with a colleague last week. We were talking about my likely access to the benefits of the NBN - 50 km from the centre of Melbourne and 5 km from a reasonably substantial town. No fibre for me! Apparently I will likely (possibly) get access to the internet at 12 MB / sec (as against my current 0.16 MB / sec). My City (and town) friends are going to get 1 TB / sec via their fibre!
When I complained, my colleague looked at me with a resigned look that said I should be grateful of getting anything - and didn't I understand that I was just paying what it cost.
I've made a mental note to sell him some very expensive food if his food distribution system ever breaks down and he turns up at my gate.
I don't actually think the answer lies very much in any sort of political action. Farmers / rural people are just too few to ever win that way. People treat people like Bob Katter as a clown - when he is actually saying some things that are no more unreasonable than the rubbish my colleague thinks of as perfectly ok.
To me the answer has to be a market one - where we just don't sell through the industrial / supermarket system that has served us so poorly, but create parallel distribution channels that dis-intermediate food processors and supermarkets like they dis-intermediated the wholesale / retail system that used to serve producers a bit more equitably.
It may be that peak oil or other developments turns things in our direction at some stage. I don't really know that I hope for that. Another story on Landline was about the Bowen poisonings of the water of a tomato nursery. That nursery apparently supplied farms that produce (at least at certain times of the year) some 60% of Australia's tomatoes.
The poor sods directly affected by this I feel sorry for. The punters in the City who get to miss out on their tomatoes - or have to pay more for them - I feel somewhat less sympathy for.
E
Sunday, August 23, 2009
I want to be a peasant
Sunday, August 9, 2009
Bush fires
There is one from the Australian Forest Growers that makes a lot of sense. The person who wrote it is measured and careful, but the recipe for disaster comes through:
Psuedo science + Politics + Bureaucratic caution = Disaster
This recipe for disaster afflicts us in multiple spheres. To avoid the charge that I'm either right wing - or left wing - let me use three examples side by side (and try to offend everyone equally).
Example disasters | ||
Victorian bushfires | Industrial food | Global financial crisis |
Underlying ‘pseudo’ science | ||
Environmental sciences | High input, industrial agriculture | Modern finance and risk management theory |
Politics | ||
The green vote | Cheap food | Too big to fail |
Bureaucratic failure | ||
Inaction on fuel reduction | Skewing of the regulatory system in favour of industrial food | Deregulation and self regulation of financial sector |
Result | ||
Fuel build-up leading to catastrophic fires | Local food systems are disadvantaged by an excess of caution while industrial food systems are subsidised and their externalities socialised | The profits of excessive risk taking are ‘earned’ by the finance sector – while the inevitable losses are socialised |
In each case there are alternatives to the psuedo science that has come to dominate the politics - but we've exercised our democratic choices or allowed stakeholder manipulation of our democratic choices - to the point of disaster. Bureaucrats follow the politics - as, to a degree, they must.
In each case the system turns out to be more complex than we though - ahhh - complex systems again.
Saturday, June 13, 2009
Pointless hyperbole
Monday, March 9, 2009
Economic relevance - episode 6

- two substantial production activities - pastured meat and vegetables;
- two smaller production activities - eggs and truffles;
- a need to process what we grow and present it in a marketable form; and
- a marketing system.
- selling other people's produce through our marketing system;
- adding other mini crops as seasonal add ins - we already have an asparagus bed, we will plant walnuts and plums (chilli plum sauce). Just today we thought of establishing a big rhubarb patch - cooking apples go with that;
- selling some form of hospitality - which will have the benefit of bringing potential customers to the farm; and
- selling some form of education - which will also bring potential customers to the farm.

Saturday, March 7, 2009
Economic relevance - episode 5
Last Monday was said to be the second worst day in terms of risk - after the terrible Saturday when the lives were lost. In mid afternoon a fire started about 10 km to the south west of our McKerrels tree farm. It is at Grenville 20 km south of Ballarat. The fire started in the worst possible place for us - just ahead of a south westerly wind change. Within an hour or two it had been 'controlled'. Thank heavens - there were only blue gum plantations between the fire and an important component of our superannuation.
Back now to the search for economic relevance for Moora. Here is where we have got to.I've grown vegetables on a hobby or 'feed the family' basis for 35 years, but my only attempt at a commercial venture was as a 15 year old when I grew pumpkins in the Pretty Paddock at home. We got a good crop - but a good crop when everyone else had one meant low prices. We put them aside in a corner of George's Whare - where most rotted before we sold the good ones for, as I recall it, not very much.

Tuesday, February 3, 2009
Economic relevance - episode 4


Sunday, February 1, 2009
Economic relevance - episode 3

- the amount to be invested;
- what must be done well to produce a good crop - and can it be done;
- the net revenue outcome of such a crop - using current market prices and current costs; and
- the fundamentals in the marketplace that might affect costs and prices in the future.
- For the whole of the period to maturity, the trufferie will add at least its investment cost to the capital value of the farm - were we to sell it; and
- Even if it turns out that there are no truffles, I'll have had a heap of fun trying - and more than enough fun to justify the the investment cost in my mind.

Thursday, January 29, 2009
Germs - and common sense
- dirt doesn't hurt you very much or very often; but
- excessive cleanliness hurts you definitely and quite seriously.
What a useful call for moderation and common sense over misapplied psuedo science.
Farming has suffered significantly from scientific over-reach during my life time - a little of this looks good, therefore a lot must be better. Isn't gorging on a 'good thing' at the heart of the industrial food system and its failings?
I'm rarely (if ever) attracted to conspiracy theories that say Monsanto or Gunns or some other corporate hate magnet is bent on doing the devil's business. It always strikes me as much more likely that they're just doing more of what has succeeded for them in the past - and, in doing more of it, they've gone past the point where it's still a good thing.
A bit like cleanliness really ....