Drought has severe impacts on agricultural production in Australia, particularly at local levels, affecting the financial and social well-being of farm families and local communities. Declining terms of trade and rising debt levels have eroded the capacity of rural families and communities to cope
with protracted drought. Severe production losses may be tolerated for one year or longer, but when dry conditions persist for several years as they did, for example, in northeastern Australia from 1991 to 1996, rural communities deteriorate, people abandon the land, and the suicide rate in rural areas increases (Stehlik et al., 1999). Impacts are also evident at a national scale, particularly when droughts are widespread or centered on the most productive regions at critical times. For instance, the extremely dry winters of 1902, 1914, 1940, 1944, 1982, and 1994 saw large reductions in national wheat yields (figure 29.2).
One of the most serious failures of the wheat crop occurred in 1982. It is estimated that the 1982-83 drought cost Australia in excess of U.S. $1.5 billion, resulting mainly from the failure of the 1982 wheat crop. Approximately 60% of all farms in Australia involved in cropping or grazing were affected by drought during this period (Purtill et al., 1983), and the yield o - V^^jstj^^^^J^^'V^ - o anomaly
Figure 29.2 A comparison of annual anomalies in the national wheat yield corrected for a rising trend in yields (bars) and percentile growing season (May-October) rainfall for the cropping region (figure 29.1).
quantity of wheat sold per farm declined by 45% (Bureau of Agricultural Economics, 1983). The net value of rural production in Australia during 1982-83 was 50% lower than the average of the previous five years (Bureau of Agricultural Economics, 1983), and there was an estimated overall reduction in cash operating surplus of 57% across all Australian farms (Purtill et al., 1983).
In extensive grazing lands, drought has led to high mortality of livestock and widespread deterioration of the land and pasture resources. Livestock losses during drought were highest during the first half of the 20th century, as illustrated by annual changes in livestock numbers in Queensland's grazing lands (figure 29.3), a major region of beef and wool production.
The dramatic stock losses that occurred in Queensland during the protracted drought from 1895 to 1902 (figure 29.3), for example, should no longer occur due to an improvement in water supplies and transport systems for livestock, the use of more drought- (and tick-) resistant Bos Indians cattle, and the improved options for supplementary feeding. Through such technological advances, increased stock numbers are now possible both in dry and wet periods. High grazing pressure (before, during, and after the drought occurrence) has led to reduction in pasture cover, accelerated soil loss, decline in pasture composition, and fewer opportunities to burn pasture. Pasture burning improves pasture quality and limits the infestation and expansion of weeds, including woody plants (Tothill and Gillies, 1992).
Despite the increasing value of agricultural production in Australia, diversification of the economy has caused the importance of agricultural production to decline in relative terms, reducing the impact of drought on the Australian economy. For example, the severe drought of 1982-83 resulted in a decline in agricultural output of approximately 24%, but only accounted for about one-half of the 2% decline in economic growth recorded in that year. A 1% decline in economic growth is nonetheless significant and, if forecast, could be mitigated to some extent by relaxing monetary policy to maintain growth targets. Other ways in which governments plan for and respond to drought are considered in the following section.
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