10AG4: Current Issues in Agriculture

Raymond Han 10AG4

Plant Issue: Carbon Trading
Carbon trading is the primary method of emissions trading, in which carbon is
given an economic value, and sold, or traded, in a marketplace. It was
established in response to the Kyoto Protocol in 1997, a pledge for
industrialised nations to reduce their greenhouse gas emissions to levels that
are 5.2% lower than those of 1990, according to Climate Change Australias
publication on the agreement. The purchasers of carbon would be entitled the
rights to burn it, and the sellers would be giving up their rights to burn carbon.
This system of trading carbon serves to be a method of controlling the
emission of greenhouse gases through rewarding nations that do not
produce as much carbon dioxide, as they will be able to sell off their excess
carbon permits to industrialised nations. Australia currently operates under a
carbon tax system, although prospects of implementing a carbon trade
system are being considered, and carbon trading scheme may be in place in
the near future.
Carbon trading is effective due to its ability to be an economic driver for the
reduction of emissions. Through placing a certain cash value on each permit
of carbon, the management of emissions will be factored into a companys
profitability. Hence, companies and corporations will be inclined to seek
methods of minimising their carbon emissions in order to reduce production
costs, promoting the development of environmentally friendly equipment (in
terms of carbon emissions only). By issuing permits, the government also
acquires a source of revenue, which in turn, could provide funding for
businesses and transitional assistance for supporting the development of lowemissions technologies.
Carbon trading also allows for a certainty in the amount of carbon dioxide
emissions produced, thereby directly limiting carbon pollution through
imposing a restriction on the amount of permits issued. Through setting caps
to carbon emissions, nations are able to monitor and reduce their emissions
by a set amount, thereby meeting their international obligations, namely the
Kyoto Protocol (for developed nations), with greater ease. Limiting the
amounts of carbon emissions in Australia by the use of the carbon trade will
be effective for preventing or minimising the chances of an overall growth in
the amount of emissions produced by companies, as companies will be
struggling to purchase permits for their emissions and cop heavy penalties.
However, the system of carbon trading requires a complicated system of law,
including the implementation of additional regulation to ensure companies
comply with the system and its goals are met. Trading carbon may only serve
to be a means of curbing carbon emissions for companies with high
emissions, due to the fact that low-emission companies do not have much of
an incentive to reduce their emissions. Selling their excess carbon permits
may provide a source of additional income, but will not necessarily result in
these companies becoming cleaner, as the excess carbon permits a
company holds may serve to be an indication of the ability to expand the
company and produce more carbon emissions, without exceeding the
threshold.
As well as that, the scheme of carbon trading is ineffective if the profits a
company reaps surpass the cost of carbon, potentially allowing high emissions

companies to opt for even higher carbon emissions. Hence, an unintended

consequence may arise, that the total emissions of a country could actually
rise, with large companies simply buying up more space for pollution. The
price of carbon is also uncertain and varies over time, posing a carbon price
risk to businesses that do not secure carbon price futures contracts or forward
contracts that impose a predetermined price to carbon emission units in the
future. This, in turn, may lead to an uncertainty in investments and add
another risk component into business ventures, thereby resulting in an
uncertainty in wages and pay rates for workers in the company.
In my opinion, carbon trading is a risky venture due to the problems and
difficulties needed to be overcome, including additional regulation, imposing a
carbon price, as well as ensuring companies comply with the system and do
not engage in fraudulent conduct, such as reporting lower amounts of
emissions than their actual carbon emissions, in a manner akin to tax evasion.
However, despite these shortcomings, I think that carbon trading should be
implemented in Australia as it is effective in reducing the emissions of a
nation as a whole and promoting the sustainable and eco-friendly
development of Australia. An overall reduction in the carbon emissions
produced by Australia is particularly important to ensure the nation meets its
pledge in the Kyoto Protocol. Carbon trading, provided that it is scrutinized
and regulated by government officials, will encourage companies and
businesses to seek methods of production resulting in lower emissions, and
serves to be a useful source of funds for the government, which can be used
to further support and aid the development of the nation.
Bibliography:
What is the carbon trade?, Investopedia, 26/02/2009,
http://www.investopedia.com/ask/answers/04/060404.asp, (Accessed
19/07/13)
Cap-And-Trade Emissions Trading, Climate Change Australia, 2013,
http://climatechange.gov.au/sites/climatechange/files/files/reducingcarbon/mpccc/cap-and-trade-pdf.pdf, (Accessed 19/07/13)
Kyoto Protocol, Climate Change Australia, 2013,
http://www.climatechange.gov.au/international/negotiations/historynegotiations/kyoto-protocol, (Accessed 19/07/13)
Cap and Trade vs Carbon Tax, Carbon Share, 13/01/2013,
http://www.carbonshare.org/docs/capvscarbontax.pdf, (Accessed 19/07/13)
Carbon Management, Australian Carbon Traders, 15/05/2013,
http://www.australiancarbontraders.com/about.html, (Accessed 19/07/13)

Animal Issue: Live exports of cattle

The live export industry for cattle has contributed to an important part of the
growing livestock industry in Australia. Cattle are transported live, by both sea
and air routes, to other nations where they are either fattened in feed lots, or
slaughtered for food. Australia primarily exports its cattle to regions
throughout the Middle-East to South-East Asia, the major ones being
Indonesia, China and Israel, as these countries do not have the resources to
produce enough cattle in order to feed their population. As with all live animal
exports, animal welfare issues are greatly stressed, and though Australia is
recognized as having the worlds best animal welfare standards for livestock
export, animal cruelty is still prevalent in nations that import from Australia, a
concern out of reach from the Australian government that has sparked the
establishment of campaigns and organisations to put an end to live exports of
cattle.
The live export of animals has been seen as an efficient method for Australia
to reap profits from its vast expanse of land, capable of producing excess
cattle to sell to other nations. Through exports, cattle are able to be sold into
high-demand markets, hence at a much easier and cost-efficient ratio than
sales locally (where the demand is low due to the large supply of cattle).
Hence, these economic gains for Australia are able to facilitate and support a
rapidly growing agricultural industry and allow for an expansion in the sector
of cattle production. As a result of this, the live export industry for cattle
allows for increased employment opportunities in Australia, vital for the
growth of rural populations, such as in Queensland. According to the Meat
and Livestock Australia publication on livestock exports, the industry
employs 13,000 people across the rural and regional Australia, and is worth
$1.8 billion to the Australian economy. Live exports of cattle also serve to
provide much-needed protein (from red meat) for global communities, and
satisfy religious requirements of importing nations including Islamic countries,
in which live cattle are needed for a particular means of slaughter that the
Islams prefer to carry out themselves.
However, the fact that cattle are often transported over lengthy period of
time, crowded in small compartments, and may not be humanely treated in
other countries, has raised important concerns regarding animal welfare. The
journey by boat for cattle shipments to the Middle-East can take up to 3
weeks, during which cattle will need to endure all weather extremes, and live
in cramped conditions. According to the Australian Governments report on
livestock mortalities for exports by sea, this has caused the deaths of almost
3000 cattle in the past 3 years.
Despite the high standards and strict regulations imposed in Australia with
regards to animal welfare, the large majority of countries Australia exports to
have no laws governing the protection of cattle from animal cruelty. An
investigation carried out by Animals Australia on 30th May, 2011, documents
animal cruelty towards Australian cattle exported to Indonesia, where cattle
were involved in eye gouging, being whipped, hit and kicked, and cattle

suffered an average of 11 cuts to the throat and often many minutes of pain.
The investigation sparked unprecedented public outrage and serves to be a
powerful reinstatement of the shortcomings of the live exports of Australian
cattle. The pain and suffering experienced by the cattle would be greatly
reduced if they were to be slaughtered within Australia, where strict
regulations and laws are imposed with regards to the treatment of animals.
In my opinion, the live export of cattle in Australia should be banned due to
the numerous issues of animal welfare that arise and cannot be managed or
regulated by the Australian government. However, live cattle exports should
be gradually phased out in the time frame of a few years in order to allow
nations time to adjust and seek other methods of satisfying their needs for
cattle, minimising the effect of halting cattle trade, whereby also ensuring
that Australias trade relations with other countries still remains stable. The
exports of chilled and frozen meat to countries in need is a viable alternative
that will result in a much more humane treatment of cattle in Australian
territory, and will provide for the meat needs for nations the same way live
cattle does, without the need for cattle to undergo strenuous journeys and be
treated horrifically in countries that lack regulation.

Bibliography:
Live Animal Export Trade, Australian Govt: Department of Agriculture,
Fisheries and Forestry, 08/07/2013, http://www.daff.gov.au/animal-planthealth/welfare/export-trade, (Accessed 20/07/13)
Livestock Exports, MLA Meat and Livestock Australia, 2012,
http://www.mla.com.au/about-the-red-meat-industry/livestock-exports,
(Accessed 20/07/13)
About Australia Livestock Exports, Australia Livestock Exports,
http://www.australianlivestockexports.com.au/About-Australian-LivestockExports.html, (Accessed 20/07/13)
Australias Livestock Export Trade: Review, The Australia Veterinary
Association, 15/07/2011,
http://www.ava.com.au/sites/default/files/Submission_to_the_independent_Rev
iew_into_Australias_livestock_export_trade_FINAL.pdf, (Accessed 20/07/13)
Ban Live Export, Animals Australia, http://www.banliveexport.com/, (Accessed
20/07/13)
Livestock Mortalities for Exports by Sea, Australian Government: Department
of Agriculture, Fishery and Forestry, 2013, http://www.daff.gov.au/animalplant-health/welfare/export-trade/mortalities, (Accessed 20/07/13)