Why the Next Three Months Could Decide the Future for Western Australia Farmers

Wet conditions in 2016 led to smaller than average olive crops for Western Australian farmers. With the next three months a critical period, many are hoping for better outcomes, but remain at risk due to lack of insurance.

By Mary Hernandez
Jan. 19, 2017 10:46 UTC

After months of bad weather and tor­ren­tial down­pours in the most impor­tant olive-grow­ing months of 2016, olive farm­ers in Western Australia are hop­ing for the start of 2017 to be dry, in order to com­bat the losses expe­ri­enced from wet con­di­tions the year before.

Australia, as a whole, expe­ri­enced sev­eral months of wet con­di­tions in 2016 — some­thing that’s proved a boon for live­stock farm­ers but a curse for many involved in agri­cul­ture. And while cur­rent weather con­di­tions are opti­mal, many farm­ers remain at high risk of mas­sive losses due to a lack of insur­ance.
See Also:Complete Coverage of the 2016 Olive Harvest
There are an esti­mated 1.5 mil­lion olive trees in Western Australia alone, which thrive best in dry, mod­er­ate-to-warm tem­per­a­tures and func­tion poorly in weather extremes. In areas where rain is usu­ally scarce, a dis­rup­tion to the usual pat­terns of rain­fall can also cause incon­sis­tent crop­ping issues.

Olive farm­ers were forced to har­vest their crops early due to the warm and wet weather expe­ri­enced in the last year’s first quar­ter and had smaller yields to show for it.

Overly moist and warm cli­mate leads to pre­ma­ture ripen­ing, cre­at­ing poor fruit set and destroy­ing plant tis­sue. Early and heavy rain­fall is absorbed by the olives which swell and fall off the tree, and the per­sis­tent mois­ture can lead to the trees devel­op­ing sooty mold, a black pow­dery coat­ing that envelops the tree, taint­ing the fruit and its oil as well as neg­a­tively impact­ing the tree’s abil­ity to pho­to­syn­the­size.

While heavy rain proves ben­e­fi­cial for the grove itself, it does not bode well for the suc­cess­ful pro­duc­tion of olive oil. In instances where the olives become spoiled, some farm­ers bring in wild goats to con­sume the over­ripe water­logged olives car­pet­ing the grove floor.

Despite last year’s out­comes, farm­ers are opti­mistic about 2017, with gen­eral farm­ing pro­duc­tion set to exceed $60 bil­lion for the first time, thanks in part to increas­ing cat­tle and sheep exports. The wet weather that spells dis­as­ter for olive farm­ers is one that actu­ally ben­e­fits live­stock farm­ers, as it increases the amount of nat­ural grow­ing feed for their ani­mals.

Another rea­son for opti­mism is that the call for warm weather seems likely to be heeded, with the Bureau of Meteorology fore­cast­ing tem­per­a­tures exceed­ing 45°C (113°F) in cer­tain parts of the state. However, experts are still strongly rec­om­mend­ing that farm­ers take up insur­ance, as cur­rent fig­ures show that only one per­cent of Australian farm­ers have cov­er­age.

This low level could be attrib­uted to the fact that Australian farm­ers pay stamp duty per­cent­ages exceed­ing 10 per­cent on their insur­ance pre­mi­ums. In addi­tion, most multi-peril crop insur­ance poli­cies (which are taken out at the begin­ning of each farm­ing sea­son as a safe­guard against the entire season’s loss) do not cover nat­ural events such as flood­ing and heavy rain­fall.

An alter­na­tive is index insur­ance, which cov­ers events ver­i­fied by weather bureau data, but this pol­icy is unpop­u­lar with cer­tain under­writ­ers due to the high vol­ume of pay­ments it has incurred over the years.


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