How will the carbon price affect farming? Research Brief

Jul 26, 2012 - 8:00am

Like climate, the carbon price is a reality that producers will have to manage, but it also sets up new opportunities. By raising efficiency, using clean energy, and tapping into new sources of funding the smart operators will find the carbon-constrained world one in which they can diversify, lift productivity, and maximize profits.

Much of the current commentary is on the relatively minor impacts of the carbon price on farming. It is important to keep the carbon price in perspective: compared to the swings of commodity prices, electricity network upgrades, and rising oil and fertilizer prices, most producers will find the impact small and manageable. Australian agriculture has a good record of finding ways to cut costs, and a focus on carbon is already spurring new efficiency savings. Different producers will face different risks, but the value of Australia’s farm sector will continue to grow overall, driven by soaring demand for Australian food and fibre.

It is important that our farmers understand that carbon pricing is highly unlikely to disappear: the world is shifting into low-carbon gear and producers cannot afford not to be carbon savvy.

For full details, download the Research Brief below.

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