Economy, Rains Beset Australia Farmers

The problems that overwhelmed rice farmer Brent Linton were the same as those affecting thousands of Australian farmers--mounting debts, falling commodity prices and fickle weather.

With debts totaling almost $400,000, Linton could take the financial strain no more. As night fell on his property near Moulamein, in southern New South Wales, last October he killed his wife, two young sons and then himself.

“I believe that he could not bear to leave his wife and children to do battle with what he could no longer cope with,” Ian Linton said of his son. “The sheer futility of it all. There was just no hope.”

The Linton family was among the most tragic victims of the latest rural crisis to hit Australia.

A survey of 4,000 farmers by the National Farmers’ Federation in February predicted a 67% fall in pretax net income this financial year for Australian farmers.

Federation executive director Rick Farley says Australian farmers are caught in a cost squeeze that is leaving many broke.

While international prices are falling because of dwindling markets, trade wars and worldwide overproduction, domestic costs are rising.

“Over the past 40 years the costs in Australian agriculture have risen three times faster than in America,” he said. “It is quite clear in our view that agriculture is the victim of an uncompetitive cost structure in Australia.”

Across the border from Moulamein is Mittyack, in northwestern Victoria, where Scotty McLean, 56, has been forced to put Scotdale, his 4,000-acre sheep and wheat farm, up for sale.

He took over running the farm when he was 21, after his father died in an accident on the property. Now McLean is about to lose it all. He has been hit by a fatal combination of soaring interest rates and plummeting wheat prices.

In the early 1980s, when interest rates were around 10% to 12%, McLean, like many farmers, borrowed to expand his property.

But by the mid-1980s rates had started to climb and McLean is now paying about 23%--of which six percentage points is a penalty imposed on him by the bank because he is now deemed a high risk.

At the same time, his income has declined. This year it will cost McLean about $125 to grow a ton of wheat, for which he will be paid about $95 at the market.

He sold a 2,000-acre section of Scotdale last September to try to keep the bankers at bay, but with interest repayments of $27,000 to $31,000 due every three months there is now only one option--auction.

“I’ve lost it. I can’t see any future in the next 12 months. It’s like a death in the family. It tears the guts out of you,” he said.

About 370 miles to the north, in central western New South Wales, sheep farmer Tony Johnson is struggling to keep his family home, a 5,000-acre property called Belerada.

“I am up a creek without a paddle,” Johnson said. “Last year’s wool check didn’t even pay my interest bill.”

Wool prices have fallen 34% since 1988 and in early February wool sales were suspended.

The government suspended sales to put a cap on debt of $2.2 billion caused by the purchase of 4.8 million bales of wool by the industry’s governing body through a wool price support scheme.

When sales resumed Feb. 25--the first free-market wool auctions in 17 years--the average price for a pound of wool was $1.64, about half what it was when sales were suspended.

Another 870 miles north, in Queensland, cattlemen, riding the only prosperous sector of the rural economy, have been hit by floods that have left half the state a disaster area.

Thousands of head of stock have been lost, but most cattlemen should survive and take advantage of expanding markets in Japan and Korea, says cattleman Ken Jeppeson from Bloomsbury, 18 miles northwest of Mackay.