The recent Productivity Commission report on Australian Agriculture recognised the importance of appropriate levels of regulation in agriculture in supporting important social goals such as food safety, biosecurity and a safe working environment. This edition of AgriThinking follows that theme looking at water rights, food safety in China and agricultural work place safety. We also share the insights of our Beijing partner (currently based in Sydney), Jingchuan Zhao on Chinese M&A agricultural drivers and provide summaries of major news items and recent deals in the sector.
While regulation in the agriculture and food sector is important, significant reform is needed globally to reform or remove regulation that does not achieve sound policy objectives or which does not support productivity growth and profitability. Unfortunately the recent political uncertainty in Australia, the nascent state of regulation in Asia and the protectionist and self-centred political themes emerging from Europe and the USA risks the creation of barriers to change. Given the challenges that the world faces with food security this century, hopefully policy and law makers will prioritise regulatory change which supports more productivity and profitability in food and agriculture.
In this issue:
- What’s in the news? Productivity Commission releases Draft Report on the Regulation of Australian Agriculture; changes in Chinese regulations affecting imported food items; a call for greater FIRB clarity; favourable results for GM crops in CropLife Australia report; Murray Goulburn under scrutiny from ASIC, ACCC and its shareholders; and other news items.
- Recent food and agribusiness deals: WCB launches $142 million capital raising; Du Pont invests in Australian agribusiness, Pioneer Australia Seeds; new bidders enter fray for S. Kidman & Co; and more.
- Water rights and trading in Australia: Water access rights are core assets for most agribusinesses. Trading in water has become commonplace, not only for water users but increasingly for speculators or companies whose core business is not water or land related. This article looks at the benefits and challenges of trading water and what we might expect Australian regulators to do next.
- Recent regulatory changes to Food Safety Laws in China: Many Chinese consumers have lost confidence in the supply chain of domestic food products and turned to foreign imports. This has prompted significant regulatory reforms in food safety law in China. The recent changes discussed in this article have significant implications for both domestic and foreign firms involved in the food business in China.
- Work health and safety in Australian agribusinesses: Significant safety challenges in the agricultural industry are created due to its high risk environment. This article considers the effectiveness of drug and alcohol policies, and draws out key lessons for employers in the agricultural industry.
- Q&A: Jingchuan Zhao on China’s interest in the Australian agribusiness sector: Finally, we meet Jingchuan Zhao, a partner from our Beijing office, who is currently on secondment in our Sydney office. Jingchuan specialises in M&A, foreign direct investment and outbound investment. Jingchuan provides some insights about what has driven the surge of Chinese interest in deals in the Australian agribusiness and food sector.