Murray-Darling water disaster escalates

July 20, 2007

The July 1 Sydney Morning Herald reported that the "southern part of the Murray-Darling Basin has seen some rainfall, but not enough to stave off zero water allocations when the new irrigation year begins on Sunday... Howard's grave warning in April of no water for irrigators from July 1 in Australia's food bowl has been realised, with soaring fruit and vegetable prices expected to follow."

The 50,000 farmers in the Murray-Darling basin produce 41% of Australia's agricultural output, much of which will now be endangered. The July 2 Melbourne Age, quoted as saying,

The SMH reported that some water "would be made available to keep citrus trees going for the fruit harvest and for major companies", but that grape and vegetable growers would get none.

AusVeg (Australian Vegetable and Potato Growers Federation) chairperson Michael Badcock told the SMH that consumers across Australia would soon notice shortages and high prices for broccoli, cauliflower, cabbage, lettuce and Asian vegetables. "Basically, Australia's in big danger of not being able to feed itself", he said

While media coverage of the irrigation season cut-off has been minimal, soaring food prices over the next few months will undoubtedly put the issue back on the political agenda.

Federal Labor leader Kevin Rudd has foreseen that this will likely become an important election issue. On July 11, Rudd pledged to strengthen the Australian Competition and Consumer Commission's ability to "police" supermarket grocery prices.

While Rudd's rhetoric may have appeal to working people who are struggling to make ends meet in the face of rising grocery prices, petrol prices and interest rates on home mortgages, there is little Rudd's promise that will help them.

Rudd's policy, which is limited to having the ACCC simply publicising grocery prices and "shaming" retailers who have high prices, will do nothing to weaken the price setting power of the two big supermarket chains — Woolworths and Coles. The National Association of Retail Grocers of Australia released a report in July showing that Coles and Woolworths control 79% of the grocery market.

ABC Radio National's July 11 PM program reported that grocery prices had risen by 12% since 2003, although farmers are not receiving similarly increased prices for their produce.

Queensland Farmers Federation president John Cherry, who was interviewed on the program, said that in the same period in his state grocery prices had increased 18% while farmers were only receiving 2% more for their produce despite higher drought-induced costs.

The potential for monopoly price-gouging is likely to increase in coming months as the big retail chains are forced to import food that was previously produced in the Murray-Darling basin.

The global move towards biofuels, as well increasing incidents of extreme weather due to global warming, are already increasing world food prices, particularly meat and dairy products, as farmers pay more for feedstock.

The deepening Murray-Darling water crisis has been created by governmental neglect and corporate greed — for decades state governments have allowed agribusinesses, farmers and mining companies to draw more water from the Murray-Darling basin than was sustainable, with little concern for the general environmental health of the river system or the needs of those further downstream.

And while no government can now easily fix the water-shortage problem — the federal government's $10 billion take-over plan being no exception as it is focussed on water trading when there is now little water to trade — the challenge is really to minimise the economic impact of the crisis on the livelihoods and living standards of working people.

Scarce water should be distributed according to a government-directed plan so as to ensure that basic food items can continue to be produced, rather than simply allowing "market forces" to allocate water to who can afford to pay the highest price for this commodity — the big agribusinesses and mining companies.

A government serious about ensuring that working people can maintain their living standards as well as undercutting the profits of the monopolistic corporations would set up a government-owned food distribution network that could sell basic food items at subsidised prices.

The government of Venezuela's revolutionary socialist President Hugo Chavez has done exactly that with its Mercal supermarket chain, allowing poor people to secure essentials cheaply as well as forcing the big privately owned supermarkets to lower their prices.

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