Archive media release

23 August 2007

Carbon trading strikes confusion among agribusiness owners

Less than half of Australia's agribusiness operators are aware of the financial opportunities a carbon trading scheme could bring to their business, according to the latest Westpac & Charles Sturt University (CSU) Agribusiness Index.

While 78 per cent of agribusiness operators were aware of Federal Government plans to introduce a carbon trading scheme, only 41 per cent had an understanding of how a proposed scheme would operate and the opportunities available to landowners.

Westpac's Head of Regional and Agribusiness Banking, Graham Jennings said the Index results showed some farmers were concerned about the cost and land management implications of carbon trading.

"Many farmers were quick to identify risks such as rising fuel prices, yet they were not as aware of the opportunities carbon trading could bring," Mr Jennings said.

"These opportunities include additional revenue streams, such as income from maintaining native bush land; energy efficiency gains and harvesting clean energy, such as switching to bio fuels"

Overall, only 34 per cent of respondents who had some understanding of how a carbon trading scheme would operate indicated that it would significantly impact on their business. Of those respondents, 59 per cent said carbon trading would have a positive impact on their business

Mr Jennings said Westpac, a member of the newly formed Agricultural Alliance on Climate Change, is keen to work with the agribusiness sector on best practice approaches to sustainability.

"Westpac supports market-based schemes that assist farmers reduce their greenhouse gas emissions," Mr Jennings said.

"Importantly, we also see these schemes as an opportunity to help farmers diversify their income and may assist them in their post-drought recovery plans. Westpac Agribusiness specialists are out in the field engaging with their customers on opportunities relevant to their businesses.

"Earlier this year, Westpac announced a partnership with Landcare Australia to establish CarbonSMART, an innovative carbon trading pool and brokering service. We're also actively involved in research commissioned by the Agricultural Alliance on Climate Change.

"We want to show farmers that carbon trading schemes can be more than just a burden on their land management practices, but may actually help them to reduce their burden around land management."

Respondents' awareness of carbon trading differed depending on their industry sector. Mixed farming (91%), beef (85%), sheep (84%) and cropping (84%) business operators had the greatest awareness of a proposed carbon trading scheme, compared with agribusiness-related manufacturing and processing business owners (56%).

However, despite having one of the highest levels of awareness of a proposed scheme, only 38 per cent of both beef and sheep farmers understood how carbon trading operates.

While the agricultural sector may initially be exempt from any proposed scheme, one third of producers (32%) indicated that they would voluntarily participate in a carbon trading scheme.

With more than 450 staff in Regional and Agribusiness banking across Australia, including 150 experienced Agribusiness specialists who are passionate about their work, Westpac is committed to delivering the right long and short term solutions for its rural and regional customers.

For more information on Westpac's products and services for agribusiness owners talk to your local Westpac Agribusiness Banker or call 1300 134 979.

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