Winners and losers: What's in the budget for agriculture

The funding, announced in tonight's 2024-25 Federal budget, will be used to kickstart the long-awaited Agriculture and Land Decarbonisation Plan.

Details were scant in the papers, however ACM Agri believes Agriculture, Fisheries and Forestry Minister Murray Watt will provide a breakdown on how the money will be carved up at a special summit with farm leaders to be held in Toowoomba later this month.

The funding is also a very thin slice of a $22.7 billion Future Made in Australia package announced on Tuesday night by Treasurer Jim Chalmers.

The centrepiece policy is seeking to make the nation a renewable energy superpower by attracting and enabling the private investment needed to unlock critical mineral wealth and invest in domestic innovation and technology.

The budget also suggests regional Australia would reap some benefits from the government's green metals agenda, as well as its renewables rush and battery and solar manufacturing plans, through infrastructure spend and localised economic stimulation as much of the activity will occur outside the peri-urban fringes.

However, it appears that Labor did not meet farm leader calls for the made in Australia agenda to increase domestic food processing and help firm up local suppliers of critical farm inputs.

Many farm businesses continue to struggle under input cost pressures with total spend more than doubling over the past decade, coupled with increasing farm debt levels, high interest rates and increased machinery investments impacting profitability.

Meanwhile, Mr Chalmers said the "number one priority" of the budget, delivered amid weakening commodity prices, a cash rate of 4.35 per cent and worsening global growth forecasts, was relieving cost-of-living pressures.

Relieving measures ranged from stage three tax cuts that will cost more than $240b over a decade, rent support, extending the $300 energy bill rebate and freezing the cost of some medicines.

"It's framed in fraught and fragile global conditions. This budget shows we are realistic about the pressures people face now - and optimistic about the future," he said.

"To make Australians the primary beneficiaries of a world of churn and change."

The budget also added $6b to an already existing $32b housing fund to accelerate the building of homes, including an unspecified number in the regions.

It also came with new settings to increase skills training and skilled migration, particularly to attract tradies who are needed to build the houses.

In fact, hundreds of millions will be spent to accelerate the development of the clean energy workforce including $10,000 incentive payments to help hit a target of 10,000 new energy apprentices.

Conversely, an agriculture industry that has been labouring under a worker shortage for several years was given just $1m over two years for a skilled agriculture work liaison pilot to attract university graduates to work in agriculture, along with a spend on targeted grants to industry-led projects, such as $500,000 over two years for the AgCAREERSTART pilot.

The workforce crunch could also somewhat be eased with an increase in the permanent Migration Program that includes a record 33,000 places for permanent regional visas.

Overall, Mr Chalmers announced what is a second consecutive budget surplus of $9b this year, crafting a set of numbers that has limited real spending growth to 1.4 per cent.

The government though expects a deficit of $28b in 2024-25.

Meanwhile, the $63m spend on the ag and land sector plan was one of few surprises in the agriculture portfolio after a raft of spending announced in recent weeks across government.

This includes $107m revealed in a snap announcement last weekend by Mr Watt to phase out the live sheep by sea export trade by in 2028, and $500m going into the Future Drought Fund stealing the headlines.

However, little else has been publicly revealed about what the government plans to include in the ag and land sector plan.

Mr Watt has emphasised that farmers will not be required to hit net-zero emissions but will be expected to reduce emissions to help hit economy-wide targets, and that there will not be emissions reductions targets applied to individual commodities.

While producers have said a green transition at the scale and speed the government needs to meet its mandated emissions targets must better help producers adapt low-carbon practices and technologies without compromising farm viability, trade and global and regional food security.

Many agriculture industry groups have already committed to playing their part, however a barrier to progress identified by many is that many emissions reduction solutions currently involve substantial upfront investment and system level investments are needed to improve things like greenhouse gas accounting.

Agriculture, unlike other heavy emitters such as the fossil fuel industry, will not be captured under regulatory frameworks like the Safeguard Mechanism.

But, as that mechanism takes effect in coming years, agriculture's share of the National Inventory of total emissions will increase.

The budget papers also reveal that $24.5m of the $63m package will go to the Department of Climate Change, Energy, the Environment and Water.

As government policy increasingly intertwines, the agriculture industry no longer just eyes agriculture's books as the policy of other ministries increasingly impact farm operations, including environment and water, workplace relations, foreign affairs, climate change and energy and infrastructure.

The papers also showed that DAFF resourcing will decrease from $4.1b in 2023-24 to an estimated $3.3b in 2024-25, while staffing levels are predicted to increase from 5896 employees to 6166 over the same time.

Total payments made to corporate entities within the portfolio are also estimated to fall from $492m to $402m, with the Grain R&D Corporation alone dropping $90m from $323m to $242m.

FUTURE DROUGHT PREPAREDNESS

The government's Future Drought Fund will get a $519.1 million boost over eight years to fund a range of programs and better support farmers and communities manage drought and adapt to climate change and improve climate resilience. However, the National Farmers Federation have claimed that less than $50m of this boost is new money.

There will also be $13.9m provided over four years for communities to be better prepared for and responsive to future droughts, with the bulk of the money to be used on a range of drought initiatives, such as the National Drought Agreement.

PHASE OUT OF LIVE SHEEP EXPORTS BY SEA

A total package of $106.9 million will be spent over five years from 2024-25 to assist impacted sheep producers, the supply chain and communities to transition away from the live sheep by sea export industry when the trade is forcibly ended on May 1, 2028.

The money will be provided to businesses, particularly in Western Australia, to help adjust and include expanding domestic processing capacity, market development and "continuing to improve sheep welfare to meet Australian community expectations".

NATIONAL DISASTERS AND EMERGENCY MANAGEMENT

More than $138m has been earmarked to improve response and resilience to national hazards and disasters.

The funding includes money for the National Emergency Management Agency to supply communities with vital goods, equipment and temporary accommodation during an emergency, aerial firefighting capability and mental health support.

A pilot program for Australia's Strategic Fleet will also be developed, with the vessels being used to improve Australia's response and supply chain resilience during crises.

FORESTRY STRATEGY

The government will invest $3.4m over four years to finish and roll-out a long-term Timber Fibre Strategy.

It will also be used to review the 1992 National Forestry Policy Statements in collaboration with state and territory governments.

However, the government will terminate the Plantation Development Concessional Loans program and redirect its $37m loans provisions to the Regional Investment Corporation.

INFRASTRUCTURE AND ROADS

As part of the 10-year infrastructure investment pipeline of over $120b, $605m will be allocated for road upgrades in northern Australia, as well as the $137m Nelson Bay Road - Williamtown to Bob Farm project in NSW and $80m to the Lyell Highway - Granton to New Norfolk project in Tasmania.

In addition, $177m will be spent on two projects along the Warrego Highway, west of Brisbane.

From July 1, $200m will also become available per year under an umbrella program targeting bridge renewal, safety and resilience, or betterment, works.

The government has also committed $84.5m over five years towards its New Vehicle Efficiency Standard which aims to limit the average carbon dioxide emissions across the range of light vehicles sold by each supplier, to incentivise uptake of more fuel-efficient and electric vehicles.

More than $100m will also be used to upgrade regional airports and remote airstrips.

WATER AND ENVIRONMENT

The budget includes an undisclosed amount for progressing controversial water buybacks in the Murray Darling Basin.

The government has provided a further $40m in additional funding over two years to continue its implementation of the Nature Positive reforms to the Environmental Protection and Biodiversity Conservation Act and deliver the Nature Repair Market.

The funds build on the $121m allocated last year.

More than $174m will also be spent over six years on new water infrastructure projects, including $119m for five separate construction projects, $26m for 11 First Nations infrastructure projects and $18m on nine business cases.

The government has also committed $48m over four years to continue reforms to the Australian Carbon Credit Unit Scheme.

It also allocated $27m to expand the Resilient Rivers Water Infrastructure Program as part of implementing the Murray-Darling Basin Plan in full, and $32m over four years for programs protecting water security in the Great Artesian Basin.

WORKFORCE

The Government has cut the Harvest Trail Services and Harvest Trail Information Service programs to save $47.3 million and it's slashed funding for the gap-year program AgCAREERSTART, the program will receive $500,000 over two years, conveners were asking for $4.4m.

An agriculture industry that has been labouring under a worker shortage for several years was given just $1m over two years for a skilled agriculture work liaison pilot to attract university graduates to work in agriculture.

TRADE

$2m increase to assist agricultural exporters rebuild trade with China and diversify into other markets, along with a $14m allocation to expand the Australia-India Business Exchange to promote Australia's trade and investment with India and across South Asia.