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Agriculture, Fisheries and Forestry in the Northern Territory, 2016

Research by the Australian Bureau of Agriculturaland Resource Economics and Sciences

About my regionJune 2016

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ABARES 2016, Agriculture, Fisheries and Forestry in the Northern Territory, 2016. About my region, Canberra, June. CC BY 3.0.

ABARES project 43009

Internet

Agriculture, Fisheries and Forestry in the Northern Territory, 2016 is available at agriculture.gov.au/abares/publications.

Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)

Postal address GPO Box 858 Canberra ACT 2601Switchboard +61 2 6272 3933Email [email protected] agriculture.gov.au/abares

Inquiries about the licence and any use of this document should be sent to [email protected].

The Australian Government acting through the Department of Agriculture and Water Resources, represented by the Australian Bureau of Agricultural and Resource Economics and Sciences, has exercised due care and skill in preparing and compiling the information and data in this publication. Notwithstanding, the Department of Agriculture and Water Resources, ABARES, its employees and advisers disclaim all liability, including for negligence and for any loss, damage, injury, expense or cost incurred by any person as a result of accessing, using or relying on information or data in this publication to the maximum extent permitted by law.

Acknowledgements

ABARES relies on the voluntary cooperation of farmers participating in the annual Australian Agricultural and Grazing Industries Survey to provide data used in the preparation of this report. Without their help, these surveys would not be possible. ABARES farm survey staff collected most of the information presented in this report through on-farm interviews with farmers.

This regional profile was updated by Clay Mifsud, Aruni Weragoda, Jeremy van Dijk, Peter Martin, Milly Lubulwa, Dale Ashton, Mark Oliver, Beau Hug, Robert Curtotti, Jacob Savage, Peter Lock, Geoff Dunn, Lucy Randall and Evert Bleys.

Agriculture, Forestry and Fisheries in the Northern Territory, 2016 ABARES

Contents1 Regional overview.................................................................................................................................. 1

Employment.............................................................................................................................................. 22 Agricultural sector.................................................................................................................................. 4

Value of agricultural production......................................................................................................4Number and type of farms.................................................................................................................. 6Farm financial performance—Northern Territory..................................................................8

3 Fisheries sector..................................................................................................................................... 12

4 Forestry Sector...................................................................................................................................... 14

References........................................................................................................................................................... 15

TablesTable 1 Value of agricultural production, Northern Territory, 2014–2015.............................5

Table 2 Number of farms, by industry classification, Northern Territory, 2013–14...........6

Table 3 Financial performance, Northern Territory, broadacre industries, 2013–14 – 2015–16, average per farm..............................................................................................................10

Table 4 Farm cash income of Northern Territory broadacre farms, by region, 2014–15 – 2015–16, average per farm..............................................................................................................11

FiguresFigure 1 Employment profile, Northern Territory, November 2015..........................................3

Figure 2 Value of agricultural production, Northern Territory, 2014–15.................................4

Figure 3 Distribution of farms by estimated value of agricultural operations, Northern Territory, 2013–14................................................................................................................................. 7

Figure 4 Real farm cash income, beef industry, average per farm, 2001–02 – 2015–16. . .9

Figure 5 Farm cash income, beef industry farms with greater than 10 000 head of cattle, average per farm, 2001–2002 – 2015–2016..............................................................................9

Figure 6 Farm cash income, beef industry farms with less than 10 000 head of cattle, average per farm, 2001–2002 – 2015–2016............................................................................10

Figure 7 Area of native forest, by tenure for Northern Territory...............................................14

MapsMap 1 Broad land use in the Northern Territory.................................................................................1

Map 2 Agricultural industries in the Northern Territory.................................................................2

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Map 3 ABARES Australian broadacre zones and regions...............................................................11

BoxesBox 1 Definitions................................................................................................................................................. 8

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1 Regional overviewThe Northern Territory covers a total area of around 1 349 129 square kilometres and is home to approximately 211 940 people (ABS 2011). Agricultural land in the Northern Territory occupies 615 028 square kilometres, or around 45.6 per cent of the state. Areas classified as conservation and natural environments (nature conservation, protected areas and minimal use) occupy 716 626 square kilometres, or 53 per cent of the state. The most common land use by area is grazing natural vegetation, which occupies 611 600 square kilometres or 45.4 per cent of the state.

Map 1 Broad land use in the Northern Territory

Source: Catchment scale land use of Australia — update March 2015 (ABARES, 2015)

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Map 2 Agricultural industries in the Northern Territory

Source: Catchment scale land use of Australia — update March 2015 (ABARES, 2015)

EmploymentAustralian Bureau of Statistics (ABS) data from the November 2015 Labour Force Survey indicate that around 133 100 people were employed in the Northern Territory.

Public Administration and Safety was the largest employment sector with 23 000 people, followed by Construction with 15 800 people and Health Care and Social Assistance with 15 700 people (Figure 1). The Agriculture, Forestry and Fishing sector employed 1000 people, representing less than 1 per cent of the territory's workforce.

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Figure 1 Employment profile, Northern Territory, November 2015

Note: Annual average of the preceding 4 quartersSource: Australian Bureau of Statistics, cat. no. 6291.0, Labour Force, Australia (ABS, 2015)

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2 Agricultural sectorValue of agricultural productionIn 2014-15, the gross value of agricultural production (GVAP) in the Northern Territory was $834.93 million, which was 1.6 per cent of the total gross value of agricultural production in Australia ($53.62 billion). This is the most recent year for which ABS data are available.

The most important commodities in the Northern Territory based on the gross value of agricultural production (Figure 2; Table 1) were cattle and calves ($722.05 million), followed by melons ($42.24 million) and other livestock for meat ($25.27 million). These commodities together contributed 95 per cent of the total value of agricultural production in the jurisdiction.

Figure 2 Value of agricultural production, Northern Territory, 2014–15

Note: The graph shows aggregated values for all published data. a the "Other commodities" classification includes totals for commodities not shown elsewhere.Source: Australian Bureau of Statistics, cat. no. 7503.0, Value of agricultural commodities produced, Australia (ABS, 2016b)

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Table 1 Value of agricultural production, Northern Territory, 2014–2015

Agricultural Commodity Value of Production ($)

Rice 115 662Other broadacre crops 22 537Total broadacre crops 138 199Hay (cut) - lucerne 767Hay (cut) -pasture 7 275 574Hay (cut) - other 4 025 406Total hay and Silage 11 301 747Nurseries 4 075 675Cut flowers 1 052 312Turf 553 450Other citrus fruits 136 016Other stone fruit 168 326Mangoes 15 515 519Other orchard fruits 451 175Bananas 13 245Pineapples 47 590Other fruits 645 765Total fruit and nuts 16 977 635Grapes - other 3 659 707Total grapes 3 659 707Beans 322 101Capsicums 9 363Lettuces 146 314Melons 42 237 361Onions 866 693Tomatoes - to market 22 194Other vegetables 6 246 153Total vegetables 49 850 180Total crops a 87 608 904Eggs 4 038Cattle and calves 722 047 468Other livestock for meat 25 266 601Total livestock for meat 747 314 069Total livestock products 4 038Total agriculture b 834 927 011Note: Confidential data (and their aggregations) are included in tables as null values. Where possible unpublished commodity values are included in totals.a Total crops is the aggregation of: total broadacre crops; total hay and silage; total grapes; total nurseries, cut flowers and turf; total fruit and nuts; and total vegetablesb Total agriculture is the aggregation of: total crops; total livestock products; and total livestock for meatSource: Australian Bureau of Statistics, cat. no. 7503.0, Value of agricultural commodities produced, Australia (ABS, 2016b)

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Number and type of farmsABS data indicate that in 2013–14 there were 368 farms in the Northern Territory with an estimated value of agricultural operations of more than $5 000 (Table 2). The region contains less than 1 per cent of all farm businesses in Australia.

Table 2 Number of farms, by industry classification, Northern Territory, 2013–14

Industry classification

Northern Territory Australia

Number of farms

% of Territory

Number of farms

Contribution of NTto Australian total

%

Beef Cattle Farming (Specialised) 175 47.6 36 730 0.5

Other Fruit and Tree Nut Growing 103 28.0 2 733 3.8

Vegetable Growing (Outdoors) 42 11.5 3 089 1.4

Other Crop Growing nec 12 3.3 5 491 0.2

Vegetable Growing (Under Cover) 7 1.8 530 1.3

Other Livestock Farming nec 5 1.4 648 0.8

Floriculture Production (Outdoors) 5 1.4 309 1.6

Stone Fruit Growing 4 1.0 600 0.7

Total agriculture 368 100 113 553 0.3

Note: Estimated value of agricultural operations greater than $5000. Industries contributing less than 1 per cent to the region total are not shown, but are included in the total. nec “not elsewhere classified”.Source: Australian Bureau of Statistics

Farms in Table 2 are classified according to the activities that generate most of their value of production. Beef cattle farms (175) were the most common, accounting for 47.6 per cent of all farms in the Northern Territory.

Estimated value of agricultural operations (EVAO) is a measure of the value of production from farms and a measure of their business size. Around 23 per cent of farms in the Northern Territory had an EVAO of less than $50 000 (Figure 3). These farms accounted for only 1 per cent of the total value of agricultural operations in 2013–14. In comparison, 20 per cent of farms in the region had an EVAO of more than $1 million and accounted for an estimated 73 per cent of the total value of agricultural operations in the Northern Territory in 2013–14.

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Figure 3 Distribution of farms by estimated value of agricultural operations, Northern Territory, 2013–14

Source: Australian Bureau of Statistics, Value of Agricultural Commodities Produced, Australia, Industry classification, 2014–15 (ABS 2016c)

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Farm financial performance—Northern TerritoryEach year, ABARES interviews Australian broadacre producers as part of its annual survey program. Broadacre industries covered in ABARES survey include the grains, grains–livestock, sheep, beef and sheep–beef industries. The information collected provides a basis for analysing the current financial position of farms in these industries and expected changes in the short term. This paper uses data from the ABARES Australian agricultural and grazing industries survey (AAGIS) to provide estimates of financial performance of Northern Territory beef industry farm businesses (Box 1).

Box 1 DefinitionsMajor financial performance indicators Total cash receipts: total revenues received by the business during the financial year. Total cash costs: payments made by the business for materials and services and for permanent and casual hired

labour (excluding owner manager, partner and family labour). Farm cash income: total cash receipts – total cash costs Farm business profit: farm cash income + changes in trading stocks – depreciation – imputed labour costs Profit at full equity: return produced by all the resources used in the business, farm business profit + rent +

interest + finance lease payments – depreciation on leased items Rate of return: return to all capital used, profit at full equity * 100 / total opening capital Equity ratio: Farm capital minus farm debt expressed as a percentage of farm capital Beef: farms mainly engaged in running beef cattle.

Performance of beef industry farms—Northern TerritoryMany farm businesses in the upper Northern Territory derive a large share of their total cash receipts from selling cattle for live export, particularly to Indonesia. Numbers of cattle sold for live export declined between 2009–10 and 2012–13, before rebounding strongly in 2013–14 and 2014–15. As a result of the expansion of the live export trade in 2013–14 and 2014–15, cattle for this market are now also being sourced from a much expanded area of northern Australia.

In 2014–15 farm cash income more than doubled to average $767 600 a farm (Figure 4) as a result of a 19 per cent increase in average cattle prices received and a large increase in cattle turn–off. Overall, total cash receipts are estimated to have increased by around 35 per cent. Increase in total cash receipts was partly offset by an increase in total farm cash costs – mainly as a result of increased transfer of cattle on to Northern Territory properties by farm businesses with properties interstate. Despite these transfers, the overall herd size is estimated to have been reduced.

In 2015–16 total farm cash receipts are expected to increase further, mainly as a result of further increase in average prices received per head sold and continued high cattle turn–off. Average total cash costs are projected to increase, partly offsetting higher farm receipts – with higher expenditure on fodder and hired labour and beef cattle purchases. High cattle turn–off is projected to result in a further reduction in herd size.

Overall, Northern Territory farm cash incomes are projected to increase to average $1.2 million a farm in 2015–16, almost three times the 10–year average to 2014–15 of $407 000 a farm.

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Figure 4 Real farm cash income, beef industry, average per farm, 2001–02 – 2015–16

Note: y Provisional estimate.Source: ABARES Australian Agricultural and Grazing Industries Survey

The average financial performance of beef industry farms in the Northern Territory is heavily influenced by the performance of very large herd size businesses, mostly corporate farms. These farms are found in all Northern Territory Regions, but predominantly in the Barkly and Victoria River—Katherine districts. These businesses dominate cattle turn–off and financial performance estimates for the Northern Territory and typically have financial performance that is well above the average for other smaller herd size businesses in the region.

Farm cash income of businesses with greater than 10 000 head of cattle averaged $1.4 million over the 10 years ending 2014–15 (Figure 5).

Figure 5 Farm cash income, beef industry farms with greater than 10 000 head of cattle, average per farm, 2001–2002 – 2015–2016


In contrast, farm cash income of businesses with less than 10 000 head of beef cattle averaged just $70 000 per farm over the same period with substantial variability between years (Figure 6).

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Figure 6 Farm cash income, beef industry farms with less than 10 000 head of cattle, average per farm, 2001–2002 – 2015–2016


Table 3 Financial performance, Northern Territory, broadacre industries, 2013–14 – 2015–16, average per farm

Performance Indicator units 2013-14 2014-15p RSE 2015-16yTotal cash receipts $ 1 610 570 2 199 400 (13) 2 720 000Total cash costs $ 1 252 700 1 431 800 (11) 1 482 000Farm cash income $ 357 870 767 600 (20) 1 238 000Farms with negative farm cash income % 51 19 (32) 4Farm business profit $ 463 190 472 100 (38) 956 000Profit at full equity f $ 541 590 589 100 (29) 1 078 000Farm capital at 30 June a $ 18 950 860 19 553 300 (10) naFarm debt at 30 June b $ 1 249 020 1 391 900 (22) naFarm equity ratio b d % 84 85 (3) naRate of return e f % 2.9 3.1 (24) 5.8Off-farm income o $ 64 800 64 600 (45) na

Source: ABARES Australian Agricultural and Grazing Industries Survey RSE Standard errors expressed as a percentage of the estimate provided. a Excludes leased plant and equipment. b Average per responding farm. c Rate of return to farm capital at 1 July. d Equity expressed as a percentage of farm capital. e Rate of return to farm capital at 1 July. f Excluding capital appreciation. o Off-farm income of owner manager and spouse. p Preliminary estimate. y Provisional estimate.

The average farm cash income of beef industry farms in 2014–15 and 2015–16 varies across regions, partly as a consequence of the differences in average herd size within the regions. Farm cash income in the Barkly region, which is dominated by large herd size farms, is estimated to have averaged $2.9 million a farm in 2014–15 and is projected increase to $4.7 million 2015–16 (Table 4). Farm cash income is projected to increase in all Northern Territory regions in 2015–16, with the largest percentage increases in the Victoria River District–Katherine and the Top End (Table 4).

Table 4 Farm cash income of Northern Territory broadacre farms, by region, 2014–15 – 2015–16, average per farm

Region 2014–15p RSE 2015–16y

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$ $711: Alice Springs District 414 000 (27) 614 000712: Barkly Tablelands 2 897 000 (30) 4 718 000713: Victoria River District – Katherine 402 000 (37) 705 000714: Top End Darwin and the Gulf 199 000 (72) 342 000

Source: ABARES Australian Agricultural and Grazing Industries Survey RSE Standard errors expressed as a percentage of the estimate provided. p Preliminary estimate. y Provisional estimate.

Map 3 ABARES Australian broadacre zones and regions

Note: Each region is identified by a unique code of three digits. The first digit identifies the state or territory, the second digit identifies the zone and the third digit identifies the region.Source: ABARES

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3 Fisheries sectorIn 2013–14 the gross value of Northern Territory managed fisheries production (both aquaculture and wild-catch) was $45.9 million, a decrease of 21 per cent ($12 million) from 2012–13. The Northern Territory contributed 2 per cent of the total value of Australian fisheries production in 2013–14. In value terms, the wild-catch sector accounted for 67 per cent ($30 million) of the territory’s total production and the aquaculture sector accounted for the remaining 33 per cent ($15 million).

The Northern Territory’s wild-catch fisheries sector provides a range of fisheries products. The highest contribution is from crabs (primarily mud crabs), which account for 15 per cent of the total value of wild-catch fisheries with a value of $4.6 million. Other important wild-catch fisheries products are gold band snapper (14 per cent; $4.3 million), mackerel (13 per cent; $4.1 million) and barramundi (8 per cent; $2.6 million). Over the past decade the value of the Northern Territory’s wild-catch fisheries products has decreased by 26 per cent to $30 million in 2013–14. The products for which the real value of production declined most over the past decade are shark and sea perch, falling by $9 million and $5 million respectively between 2003–04 and 2013–14. In 2013–14 the value of the Northern Territory’s aquaculture production is estimated to have decreased by 38 per cent from $24 million in 2012–13 to $15 million in 2013–14.

The Commonwealth managed Northern Prawn Fishery was the most valuable fishery in the Northern Territory, with a gross value of production in 2013–14 of $115 million, across the entire fishery (some of which is landed in Queensland). In 2013–14, the gross value of production for the Commonwealth Northern Prawn Fishery increased by 62 per cent because of a 69 per cent increase in volume. Darwin is a major landing site for this fishery.

In 2013–14, the Northern Territory’s seafood product exports were valued at around $0.05 million by the Australian Bureau of Statistics. This amount will not include Northern Territory production that is exported from ports elsewhere in Australia. The main export products include live and fresh, chilled or frozen fish, and crabs, with Japan and Hong Kong being the main export markets. The main non-edible fisheries product produced for the export market in the Northern Territory was pearls.

It is estimated that Northern Territory residents and visitors spend nearly $51 million annually on recreational fishing, with the purchase of vessels and vehicles and their associated running costs making up the bulk of the expenditure (West et. al. 2012). According to the most recent survey of recreational fishing activity in the Northern Territory (West et. al. 2012), the main target fish species are barramundi, followed by golden snapper, small bait fish, catfish, saddletail and crimson snapper, and mullet. Mud crabs dominate the crustacean catch, followed by cherabin, the giant freshwater prawn.

The Northern Territory also has a significant indigenous customary fish sector. The 2000–01 National Recreational and Indigenous Fishing Survey (NRIFS) aimed to better understand the level of fishing undertaken by the Indigenous fishing sector (Henry and Lyle 2003). The survey collected fisheries catch statistics from Indigenous people aged five years and older, living in coastal communities across the north of Australia, from Broome in Western Australia to Cairns in Queensland (excluding those living in the Torres Strait). The survey showed that an estimated 37 000 Indigenous people living in the north of Australia fished at least once during the survey year. This was equivalent to 92 per cent of the Indigenous population in the region.

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The survey indicated that Indigenous fishers in northern Australia harvested approximately 900 000 finfish, 1 million molluscs, 660 000 prawns and yabbies, 180 000 crabs and rock lobsters and smaller numbers of other species during 2000–01. The most prominent finfish species groups were mullet, catfish, tropical snapper, bream and barramundi. The most prominent non-finfish species groups were mussels, freshwater prawn, mud crabs, prawns and oysters.

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