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Agriculture, Fisheries and Forestry in Northern Territory, 2015

Research by the Australian Bureau of Agriculturaland Resource Economics and Sciences

About my region 15.56April 2015

Agriculture, Fisheries and Forestry in Northern Territory, 2015 ABARES

© Commonwealth of Australia 2015

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ABARES 2015, Agriculture, Fisheries and Forestry in Northern Territory, 2015, About my region 15.56, Canberra, April. CC BY 3.0.

ISBN TBAABARES project 43009

Internet

Agriculture, Fisheries and Forestry in Northern Territory 2015 is available at agriculture.gov.au/abares.

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

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The Australian Government acting through the Department of Agriculture, 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, 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 upon 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, Australian Dairy Industry Survey, and Australian Vegetable Growing Farms 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 state profile was updated by Therese Thompson, Peter Martin, Timothy Connolly, Lucy Randall, Kasia Mazur and Sharan Singh.

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Contents1 Regional overview.................................................................................................................................. 3

Employment.............................................................................................................................................. 42 Agriculture sector................................................................................................................................... 6

Value of agricultural production......................................................................................................6Number and type of farms.................................................................................................................. 6Farm financial performance—Northern Territory..................................................................7

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

4 Forestry sector.......................................................................................................................................14

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

TablesTable 1 Number of farms, by industry classification, 2012–13......................................................7

Table 2 Financial performance, Northern Territory beef industry, 2012–13 to 2014–15, average per farm...................................................................................................................................10

Table 3 Farm cash income of Northern Territory broadacre farms, by region, 2013–14 to 2014–15, average per farm..............................................................................................................11

FiguresFigure 1 Employment profile, Northern Territory, November 2014..........................................5

Figure 2 Value of agricultural production, Northern Territory, 2012–13.................................6

Figure 3 Distribution of farms by estimated value of agricultural operations, Northern Territory, 2012–13................................................................................................................................. 7

Figure 4 Real farm cash income, beef industry, average per farm................................................9

Figure 5 Farm cash income Northern Territory beef industry farms with greater than 10000 head of cattle, average per farm.........................................................................................9

Figure 6 Farm cash income Northern Territory beef industry farms with less than 10000 head of cattle, average per farm......................................................................................10

Figure 7 Area of native forest, by tenure...............................................................................................14

MapsMap 1 Broad agricultural land use of Northern Territory................................................................3

Map 2 Agricultural industries of Northern Territory.........................................................................4

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

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1 Regional overviewThe Northern Territory covers a total area of around 1 347 000 square kilometres and is home to approximately 211 940 people (ABS 2011). Agricultural land in the Northern Territory occupies 671 700 square kilometres, or around 50 per cent of the state. Areas classified as conservation and natural environments (nature conservation, protected areas and minimal use) occupy 660 100 square kilometres, or 49 per cent of the state. The most common land use by area is grazing natural vegetation, which occupies 670 000 square kilometres or 50 per cent of the state.

Map 1 Broad agricultural land use of Northern Territory

Source: Catchment scale land use of Australia – update March 2014 (ABARES, 2014)

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Map 2 Agricultural industries of Northern Territory

Source: Catchment scale land use of Australia – update March 2014 (ABARES, 2014)

EmploymentAustralian Bureau of Statistics (ABS) from the 2014Labour Force Survey indicate that around 133 100 people were employed in the Northern Territory. The Northern Territory accounts for 1 per cent of total employment in Australia and less than 1 per cent of all people employed in the Australian agriculture, forestry and fishing sector.

Public administration and safety was the largest employment sector with 22 900 people followed by health care and social assistance with 16 100 people (Figure 1). Other important employment sectors in the state were construction (15 500 people), education and training (11 500 people) and retail trade (9400 people). The agriculture, forestry and fishing sector employed 1500 people, representing 1 per cent of the state’s workforce.

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Figure 1 Employment profile, Northern Territory, November 2014

- 5 10 15 20 25

Agriculture, Forestry and FishingInformation Media and Telecommunications

Financial and Insurance ServicesRental, Hiring and Real Estate Services

Electricity, Gas, Water and Waste ServicesWholesale Trade

Arts and Recreation ServicesManufacturing

Administrative and Support ServicesMining

Transport, Postal and WarehousingOther Services

Professional, Scientific and Technical ServicesAccommodation and Food Services

Retail TradeEducation and Training

ConstructionHealth Care and Social AssistancePublic Administration and Safety

Employed total ('000 )

Note: Annual average of the preceding 4 quarters.Source: Australian Bureau of Statistics, cat. no. 6291.0, Labour Force, Australia

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2 Agriculture sectorValue of agricultural productionIn 2012–13, the gross value of agricultural production (GVAP) in the Northern Territory was $479 million, which was 1 per cent of the total gross value of agricultural production in Australia ($48 billion).

The most important commodity in the Northern Territory based on the gross value of agricultural production was cattle and calves (Figure 2). In 2012–13, cattle and calves contributed 67 per cent ($320 million) to the value of agricultural production in the territory. Melons ($49 million) and mangoes ($48 million) each accounted for 10 per cent of the value of agricultural production in the territory.

Figure 2 Value of agricultural production, Northern Territory, 2012–13

$m 50 100 150 200 250 300 350

Other

Hay

Other livestock

Mangoes

Melons

Cattle and calves

Source: Australian Bureau of Statistics, cat. no. 7503.0, Value of agricultural commodities produced, Australia

Number and type of farmsIn 2012–13, there were 463 farms in the Northern Territory with an estimated value of agricultural operations of more than $5000 (Table 1). The state accounts for less than 1 per cent of all farm businesses in Australia.

Farms are classified in Table 1 according to the activities that generate most of their value of production. Beef cattle farms (176 farms) were the most common, accounting for 38 per cent of all farms in the Northern Territory.

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Table 1 Number of farms, by industry classification, 2012–13

Industry ClassificationNorthern Territory Australia

no. % no. %

Beef Cattle 176 38 39 380 31

Fruit and nuts 127 27 10 136 8

Vegetable 44 9 3 980 3

Other Crop growing 14 3 1 519 1

Other livestock 11 2 4 123 3

Nurseries, Cut Flowers and Turf 11 2 1 558 1

Other 76 16 32 894 26

Total Agriculture 463 100 128 682 100

Note: Estimated value of agricultural operations greater than $5000.Source: Australian Bureau of Statistics

There is a large percentage of small farms in the region in terms of their value of agricultural output. Estimated value of agricultural operations (EVAO) is a measure of the value of production from farms and a measure of their business size. Around 24 per cent of farms in 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 2012–13. In comparison, 41 per cent of farms in the state had an EVAO of more than $350 000 and accounted for an estimated 92 per cent of the total value of agricultural operations in the territory.

Figure 3 Distribution of farms by estimated value of agricultural operations, Northern Territory, 2012–13

%

10

20

30

40

50

60

70

80

< $50k $50k to $150k $150k to $350k $350k to $500k $500k to $1 m > $1 m

Share of farms Share of value of agricultural operations

Source: Australian Bureau of Statistics

Farm financial performance—Northern TerritoryEach year, ABARES interviews Australian broadacre producers as part of its annual survey program. Broadacre industries covered in this 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

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(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. They are expected to remain high in 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 2013–14 farm cash income increased to average $382 100 a farm (Figure 4 and Table 2). While turn-off of cattle increased slightly, average prices received were lower than in 2012–13. Total cash receipts declined slightly as a result, but total farm cash costs declined by much more—mainly as a result of reduced purchases of cattle and transfer of cattle on to Northern Territory properties by farm businesses with properties interstate.

In 2014–15 total farm cash receipts are expected to rise by around 30 per cent, resulting from an estimated increase in turn-off of cattle and higher average prices received per head sold. Average total cash costs are projected to increase by around 20 per cent, partly offsetting higher farm receipts—with higher expenditure on fodder, hired labour and beef cattle purchases. With increased cattle turn-off, expenditure on freight and marketing is also expected to rise. The high turn-off is projected to result in a reduction in herd size.

Farm cash income is projected to increase in all Northern Territory regions in 2014–15, with the largest increases in the Victoria River District–Katherine and the Top End (Table 3).

Overall, Northern Territory farm cash incomes are projected to increase to average $680 000 a farm in 2014–15, well above the 10-year average to 2013–14 of $312 000 a farm.

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Figure 4 Real farm cash income, beef industry, average per farm

–500

2014–15 $’000

500

1000

1500

Australia Northern Territory

p Preliminary estimate. 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, 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 as well as performance that is very variable from year to year.

Farm cash income for businesses with greater than 10 000 head of cattle averaged $1.2 million over the 10 years ending 2013–14 with substantial variability between years (Figure 5).

Figure 5 Farm cash income Northern Territory beef industry farms with greater than 10000 head of cattle, average per farm

–2000

2014–15 $’000

2000

4000

6000

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In contrast, farm cash income for businesses with less than 10 000 head of beef cattle averaged just $71 000 per farm over the same period and has generally trended downwards since 2004–05 (Figure 6).

Figure 6 Farm cash income Northern Territory beef industry farms with less than 10000 head of cattle, average per farm

–200

–100

2014–15 $’000

100

200

300


Table 2 Financial performance, Northern Territory beef industry, 2012–13 to 2014–15, average per farm

Performance indicator units 2012–13 2013–14p RSE 2014–15yTotal cash receipts $ 1 754 990 1 580 900 (11) 2 067 000Total cash costs $ 1 390 010 1 198 800 (11) 1 387 000Farm cash income $ 364 980 382 100 (24) 680 000Farms with negative farm cash income % 63 54 (20) 17Farm business profit $ 524 360 429 200 (18) 422 000Profit at full equity excluding capital appreciation $ 598 120 500 200 (15) 492 000Farm capital at 30 June a $ 16 358 900 17 825 700 (8) naFarm debt at 30 June b $ 1 074 970 1 070 200 (24) 980 000Equity ratio bd % 84 85 (4) naRate of return excluding capital appreciation e % 3.5 2.9 (14) 2.8Off-farm income of owner manager and spouse b $ 56 310 74 700 (43) na

a Excludes leased plant and equipment. b Average per responding farm. c Farm capital minus farm debt. d Equity expressed as a percentage of farm capital. e Rate of return to farm capital at 1 July. p Preliminary estimates. y Provisional estimates. na Not Available. Figures in parentheses are standard errors expressed as a percentage of the estimate providedSource: ABARES Australian Agricultural and Grazing Industries Survey

The average farm cash income of beef industry farms in 2013–14 and 2014–15 varies across regions, partly as a consequence of the differences in average herd size within the regions. Farm

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cash income in the Barkly region where large herd size farms predominate is estimated to have averaged $2.6 million in 2013–14 and is projected increase to $3.3 million 2014–15 (Table 3). Farm cash income is projected to increase in all regions, not just those traditionally most reliant on live cattle exports, such the Victoria River District-Katherine and Top End Darwin and the Gulf, but also the Alice Springs District which has low reliance on live cattle exports.

Table 3 Farm cash income of Northern Territory broadacre farms, by region, 2013–14 to 2014–15, average per farm

Regionunit

s 2013–14p RSE 2014–15y

711: NT Alice Springs District $ 117 300(122

) 242 000712: NT Barkly Tablelands $ 2 555 700 (19) 3 348 000

713: NT Victoria River District - Katherine $ –27 500(345

) 264 000

714: NT Top End Darwin and the Gulf $ 22 700(263

) 129 000p ABARES preliminary estimates. y ABARES provisional estimates. na Not available. Figures in parentheses are standard errors, expressed as a percentage of the estimate provided.Source: ABARES Australian Agricultural and Grazing Industries Survey

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 2012–13 the gross value of the Northern Territory’s fisheries production (both aquaculture and wild-catch) was $58 million, an increase of 13 per cent ($7 million) from 2011–12. The Northern Territory contributed 2 per cent of the total value of Australian fisheries production in 2012–13. In value terms, the wild-catch sector accounted for 59 per cent ($34 million) of the territory’s total production and the aquaculture sector accounted for the remaining 41 per cent ($24 million).

The Northern Territory’s wild-catch fisheries sector provide a range of fisheries products with the highest contribution being from crabs (primarily mud crabs), which account for 19 per cent of the total value of wild-catch fisheries with a value of $6.4 million. Other important wild-catch fisheries products are gold band snapper (15 per cent; $5.1 million), mackerel (12 per cent; $4.1 million) and barramundi (11 per cent; $3.6 million) and. Over the last decade the value of the Northern Territory’s wild-catch fisheries products has decreased by 21 per cent to $34 million in 2012–13. The products for which the real value of production declined most over the past decade are shark and mackerel, falling by $7 million and $2.5 million respectively between 2002–03 and 2012–13. In 2012–13 the value of the Northern Territory’s aquaculture production is estimated to have increased by 39 per cent from $17 million in 2011–12 to $24 million in 2012–13.

The Commonwealth Northern Prawn Fishery was the most valuable fishery in the Northern Territory region, with a gross value of production in 2012–13 of $71 million, across the entire fishery. In 2012–13, the gross value of production for the Northern Prawn Fishery increased by 10 per cent due to a 38 per cent increase in average prices and 55 per cent increse in catches of tiger prawns but despite 38 per cent decrease in catches of banana prawns. Darwin is a major landing site for the Northern Prawn Fishery.

In 2012–13, the Northern Territory’s seafood product exports were valued at around $0.1 million. 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 were 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 dominates 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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4 Forestry sectorIn 2012–13, the total plantation area in the Northern Territory was approximately 43 500 hectares, comprised of approximately 41 100 hectares of hardwood plantations and 2 400 hectares of softwood plantations. The main hardwood species planted are mangium (Acacia mangium) and African mahogany (Khaya senegalensis). Plantations in the Northern Territory are predominantly located on Melville and Tiwi Islands and some northern parts of the mainland.

In 2011, there were approximately 15.2 million hectares of native forests in the Northern Territory, comprised mainly of Eucalypt medium woodland (5.8 million hectares), Eucalypt medium open (5.0 million hectares), Acacia (957 600 hectares), Melaleuca (896 000 hectares), Eucalypt low woodland (855 400 hectares), Eucalypt low open (472 800 hectares), Mangrove (333 800 hectares) and Rainforest (259 700 hectares) forest types. Approximately 9.6 million hectares of the native forests are privately owned and 5.2 million hectares are leased forests (Figure 7). There are no major timber processing industries in the Northern Territory.

Figure 7 Area of native forest, by tenure

Source: ABARES Australia’s State of the Forests Report 2013

Total sales and service income in the Northern Territory’s forest and wood product industry is estimated at approximately $69 million in 2010–11. Sales and service income from the wood product industry in 2010-11 was valued at approximately $45 million, and $24 million was derived from paper and paper product sales. In 2012–13, wood products generated $22 million, but data for income from paper and paper products were not available for this period. Woodchips are not exported from the Northern Territory. In 2011, the Northern Territory forestry sector employed 244 people (0.3 per cent of the total employed workforce in the Northern Territory) compared with 197 (0.3 per cent) in 2006 (number of people employed includes forestry support services and timber wholesaling).

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ReferencesABS 2011, Census of Population and Housing, Australian Bureau of Statistics, Canberra.

ABS 2014a, Agricultural Commodities, Australia, 2012–2013, cat. no. 7121.0, Australian Bureau Statistics, Canberra.

ABS 2014b, Labour Force, Australia, Detailed, Quarterly, Nov 2014, cat. no. 6291.0.55.003, Australian Bureau Statistics, Canberra.

ABS 2014c, Value of Agricultural Commodities Produced, Australia, 2012–13, cat. no. 7503.0, Australian Bureau Statistics, Canberra.

Australian Bureau of Agricultural and Resource Economics-Bureau of Rural Sciences 2010, Land use of Australia 2005-06, Version 4, Department of Agriculture, Fisheries and Forestry, Canberra.

ABARES 2014, Catchment scale land use of Australia – update March 2014. Department of Agriculture. http://data.daff.gov.au/anrdl/metadata_files/pb_luausg9abll20140506_11a.xml

Australian Bureau of Agricultural and Resource Economics and Sciences 2014, Australian forest and wood products statistics: March and June quarters 2014, Australian Bureau of Agricultural and Resource Economics and Sciences, Canberra.

Henry G.W. and Lyle J.M. 2003, The National Recreational and Indigenous Fishing Survey, FRDC Project No. 99/158.

Montreal Process Implementation Group for Australia and National Forest Inventory Steering Committee 2013, Australia’s State of the Forests Report 2013, Australian Bureau of Agricultural and Resource Economics and Sciences, Canberra.

West, L. D., Lyle, J. M., Matthews, S. R., Stark, K. E. and Steffe, A. S. (2012). Survey of Recreational Fishing in the Northern Territory, 2009–10. Northern Territory Government, Australia. Fishery Report No. 109, available at http://www.nt.gov.au/d/Content/File/p/Fish_Rep/FR109.pdf.

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