Factors Influencing Farmer Decisions to Grow Poppies

Department of Primary Industries, Parks, Water and Environment
& Poppy Growers Tasmania

Factors Influencing Farmer Decisions to
Grow Poppies

January 2013

Factors Influencing Farmer Decisions to Grow Poppies

Macquarie Franklin Administration Office
112 Wright Street | East Devonport | Tasmania | 7310
Phone: 03 6427 5300 | Fax: 03 6427 0876 | Email: [email protected]

Web: www.macquariefranklin.com.au

Report author: Thom Goodwin, Lance Davey & Michael Lehman

An appropriate citation for this Macquarie Franklin, 2013, Factors Influencing Farmer Decisions
report is: to Grow Poppies in Tasmania, Devonport TAS

Document status: DRAFT

Date Status /Issue number Reviewed by Authorised by Transmission
method

This report has been prepared in accordance with the scope of services described in the contract or
agreement between Macquarie Franklin and the Client. Any findings, conclusions or recommendations
only apply to the aforementioned circumstances and no greater reliance should be assumed or drawn
by the Client. Furthermore, the report has been prepared solely for use by the Client and Macquarie
Franklin accepts no responsibility for its use by other parties.

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Factors Influencing Farmer Decisions to Grow Poppies

Contents

1 Introduction .................................................................................................................................... 3
2 Potential Poppy Area ...................................................................................................................... 4
3 Company interviews ....................................................................................................................... 7
4 Farm survey..................................................................................................................................... 9

4.1 Questionnaire, survey sample and response rate .................................................................. 9
4.2 Survey Results .......................................................................................................................12
5 Current Poppy Grower Survey Results..........................................................................................15
5.1 Area of poppies grown..........................................................................................................15
5.2 Reasons for growing less than maximum annual poppy area ..............................................17
5.3 Factors that would encourage farmers to grow more poppies............................................19
6 Non-Poppy Grower Survey Results...............................................................................................21
6.1 Reasons farmers do not grow poppies .................................................................................21
6.2 Factors that would encourage farmers to grow more poppies............................................22
7 New Irrigation Schemes ................................................................................................................24
Appendix A – Regional breakdown of revisions made to TIA and DPIPWE mapping ...........................25
Appendix B – Revised Annual Potential Poppy Area ............................................................................26
Appendix C – Current grower survey responses...................................................................................27
Appendix D – Non-grower survey responses........................................................................................30

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Factors Influencing Farmer Decisions to Grow Poppies

Executive summary

The Tasmanian Institute of Agriculture (TIA) and the Department of Primary Industries, Parks, Water
and Environment (DPIPWE) previously identified a total area of 349,000 hectares as potentially
suitable for growing poppies in Tasmania. Based on this they concluded that around 60,000 hectares
of poppies could be grown in Tasmania on an annual basis.

This report revisits at the TIA and DPIPWE land use mapping work, and presents the results of a
survey of poppy company field staff and farmers to obtain a better understanding of the factors that
might limit the expansion of total poppy area in Tasmania - beyond the 30,000 hectares being grown
this year.

Revised Land Use Mapping

After adjusting for a range of factors the potentially suitable poppy growing area identified by
TIA/DPIPWE was revised down to 251,000 hectares – with the annual potential area revised from
65,000 hectares to around 45,000 hectares.

In the current 2012-13 season around 30,000 hectares of poppies are being grown throughout the
state. This represents over 60% of the 45,000 hectares of practical annual potential area identified
by the revised land use mapping.

Company Interviews

Prior to undertaking farmer interviews, poppy company staff for Glaxo Smith Kline (GSK) and
Tasmanian Alkaloids (TA) were interviewed to gain a better understanding of issues which they
believe might limit the area of poppies grown in the state. Field officers were also asked to provide
their understanding of the main reason why some previous growers no longer grew poppies.

A frequent comment made by field officers was that most farmers who could potentially grow
poppies had in fact grown at some point in the past. The main reasons given as to why individual
farms were no longer growing poppies was the unsuitability of land in some areas, specialised dairy,
specialised beef and part-time farmers not interested in cropping, as well as land used for other
crops over an extended period – e.g. land leased to BRA for pyrethrum.

Farm Survey

Two farm surveys were designed - one for current poppy growers and the other for non-poppy
growers (past growers & farmers who have never grown poppies). Farmers were asked to indicate
what they considered to be their potential poppy ground if there were no constraints other than soil
type, and what they could potentially grow on an annual basis – as well as the area devoted to other
land uses during 2012-13.

Non-poppy growers, and current poppy growers that were not growing at their suggested annual
potential area, were asked to nominate the main reason they are not growing (more) poppies and
what it would take to get them to grow (more) poppies.

The survey results suggest that poppy growers are generally cropping farms, whereas non-poppy
growers tend to be mainly grazing farms. A large proportion of non-poppy growers, for example,

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Factors Influencing Farmer Decisions to Grow Poppies

have less than 20% of their total farm area under crop. On the other hand almost 80% of them have
over 80% of their total area under pasture.

Current Poppy Grower Survey Results

Around 70% of current poppy growers surveyed reported growing less poppies in 2012-13 than their
suggested annual potential area. Calculations based on grower estimates of their actual area versus
their estimate of potential annual sustainable area suggest it may be possible to grow another
15,600 hectares on current poppy grower farms.

Returns being too low and a lack of irrigation capacity accounted for over 80% of the ‘missing area’.

Unsurprisingly, increased price was frequently nominated as a factor that would encourage more
poppy production. However, this response needs to be seen in the context of other reported factors
such as access to irrigation infrastructure, more reliability and increased yield.

Non-Poppy Grower Survey Results

92% of the 51 non-growers interviewed said they had grown poppies in the past. This is in line with
the field officers suggestion that most people who could grow poppies had in fact grown at some
stage. As is the case for current poppy growers, non-growers listed ‘returns too low’ as a main
reason for not growing and this accounted for 35% of the ‘missing area’ on the survey farms. ‘Other
enterprises’ was the second most important reason and this was generally associated with dairy
farming.

Higher price was listed as a major factor that would encourage non-growers to grow, followed by
more reliable yield (and better yield) and prices falling for other enterprises – these are all factors
associated with the relative profitability of poppies and other enterprises.

Ten of the 56 growers indicated that there was nothing that would encourage them to grow poppies
– these tended to be lifestyle or retired farmers.

Irrigation constraints (irrigation infrastructure, water availability) did not appear to play a big role in
the decision not to grow poppies among non-poppy growers.

Impact of New Irrigation Schemes

The anticipated increase in poppy area from Tasmanian Irrigation schemes could increase the
current 30,000 hectares of poppies grown in Tasmania to around 36,000 hectares. The largest
expansions in poppy area associated with these irrigation schemes is expected to occur in the
Southern and Northern Midlands region

This is 10,000 hectares short of the 46,000 hectares identified as a practical maximum annual area
by the revised land use mapping – but does constitute a significant potential increase.

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Factors Influencing Farmer Decisions to Grow Poppies

1 Introduction

The Tasmanian Institute of Agriculture (TIA) and the Department of Primary Industries, Parks, Water
and Environment (DPIPWE) has previously identified a total area of 349,000 hectares as potentially
suitable for growing poppies in Tasmania1. Based on this they concluded that around 60,000
hectares of poppies could be grown in Tasmania on an annual basis.

The approach used by TIA and DPIPWE was based on land capability, using 1-4 class land as well as
setting upper bounds for annual rainfall and elevation. A number of scenarios were highlighted
where the annual 60,000 hectares area could potentially increase. For instance, the report found
that raising the altitude limit from 300 m to 400 m would increase the annual area to around 65,000
hectares, mainly due to the inclusion of additional land in the Bothwell and Oatlands areas.

The desktop land capability approach taken by TIA and DPIPWE did not consider socio-economic
factors such as the value of alternative land uses and farmer attitudes to growing poppies. As such
their estimate was intended to be a theoretical annual potential area.

This report revisits the TIA and DPIPWE land use mapping work, and presents the results of a survey
of poppy company field staff and farmers to obtain a better understanding of the factors that might
limit the expansion of total poppy area in Tasmania - beyond the 30,000 hectares being grown this
year. The farmer survey included current poppy growers and farmers not currently growing poppies
(but who potentially could).

This report also provides an analysis of the additional area of poppies that might be grown on the
basis of additional irrigation water from new Tasmanian Irrigation schemes.

1 Orr, R. Simmul, P. & Webb M. 2011 Potential Land Area Suitable for Poppy Production in Tasmania

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Factors Influencing Farmer Decisions to Grow Poppies

2 Potential Poppy Area

The Tasmanian Institute of Agriculture (TIA) and the Department of Primary Industries, Parks, Water
and Environment (DPIPWE) has previously identified a total area of 349,000 hectares as potentially
suitable for growing poppies in Tasmania1.

In fact, the evaluation of potential land area suitable for poppy production in Tasmania undertaken
by TIA and DPIPWE considered three main alternatives:

 Map 1 –potential poppy area of 349,000 hectares and an annual sustainable area of 60,000
hectares

 Map 2 –potential poppy area of 378,000 hectares and an annual sustainable area of 65,000
hectares

 Map 3 –potential poppy area of 410,000 hectares and an annual sustainable area of 71,000
hectares

All three maps were limited to Class 1 to Class 4 land.

Map 1 was restricted to land with an elevation of less than or equal to 300 m.

Map 3 removed the 1,250 mm rainfall limit applied for Maps 1 & 2.

Actual poppy production in Tasmania includes significant areas of poppies grown at an elevation of
greater than 300 m, particularly around the Bothwell and Oatlands areas. There is a limited area of
poppies grown where rainfall is greater than 1,250 mm because of issues associated with planting on
time and rainfall at harvesting.

As a result, Map 2 (with a potential annual area of 65,000 hectares) was adopted as the base
situation from the TIA/DPIPWE study. While we believe that this is a reasonable theoretical potential
there are a number factors which are likely to limit the practical annual potential area.

For this report the base TIA/DPIPWE area was adjusted by deducting some further areas and by
adding some Class 5 area around Tunbridge. Annual rainfall being less than 550 mm is one of the
reasons that Tunbridge land is classified as Class 5. Clearly with irrigation this is not a limiting factor
and in fact a significant area of poppies is grown in this location.

Areas subtracted from the TIA/DPIPWE base potential area were:

 Plantation on private land.
 Dairy farms.
 East Coast / Fingal Valley (top end) – Glaxo Smith Kline and Tas Alkaloids field officers

reported that this region frequently suffered from adverse weather events during the
harvest period.

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Factors Influencing Farmer Decisions to Grow Poppies

 East & West Tamar – the field officers reported that while the soil type might be Class 4 the
combination of soil type and weather in these regions mean that paddocks were frequently
too wet to plant poppies on time.

 Parkham / Dairy Plains – the field officers reported that the combination of soil type and
weather in these regions mean that paddocks were frequently too wet to plant poppies on
time.

 Redpa / Marawah – field officers reported that this region frequently suffered from adverse
weather events during the harvest period.

 South of Hobart – small areas in a distant location.

While some of the excluded areas listed have grown poppies in the past and currently do have some
crops, by and large the major companies’ experience is that the areas are too unreliable or too
remote for servicing to include in a practical annual estimate.

In addition, the TIA/DPIPWE estimate allowed an 80% useable on-farm land factor to arrive at its
65,000 hectare annual potential area – this allows a 20% deduction for land use inefficiencies such
as tracks, roadways, fence-lines, waterways, water storages, random trees, hollows and rocky
patches.

In our opinion this factor is too low for areas other than the intensive cropping areas of the North
West and parts of the North East. The more extensive areas of the state tend to concentrate on
larger paddocks and exclusively use centre pivot irrigators which do not always fit the croppable
area. For these reasons regional adjustments to the useable on-farm land factor were made as
follows:

 80% in the North West (unchanged)
 70% in the North East
 60% in the remainder of the state

After the adjustments outlined above, the 378,000 hectares potential area identified by TIA and
DPIPWE in Map 2 was reduced to a ‘practical potential area’ of 251,000 hectares – with the ‘annual
potential area’ reduced from 65,000 hectares to around 45,000 hectares.

The TIA/DPIPWE calculated their annual sustainable area of 65,000 hectares using a rotation factor
based on land classification (Table 1). The same rotation factor has been used in this project to
determine the revised annual potential area. Obviously, with a tighter rotation on land classes 3, 4
and 5 the potential annual area could be considerably expanded.

Table 1: Rotation factor associated with different land classes

Land Class Rotation
1-2 1 in 3 years
3 1 in 4 years
4 1 in 6 years
5 1 in 6 years

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Factors Influencing Farmer Decisions to Grow Poppies

A detailed regional breakdown of the factors used to revise the TIA/DPIPWE mapping is provided in
Appendix A and a map of the revised practical potential area is provided in Appendix B.

In the current 2012-13 season around 30,000 hectares of poppies are being grown throughout the
state. This area represents over 60% of the 45,000 hectares of the practical annual potential area
identified by the revised land use mapping (Table 2).

Table 2: Potential annual poppy area and actual area of poppies grown

Total Potential Actual area 2012-13
Potential Annual

Area Area

North West ha ha ha % of annual
Central NW 7,400 1,800 1,250 potential
Central North 27,200 6,100 4,190 69%
N. Midlands 35,600 6,700 3,090 69%
North East 108,900 18,600 14,400 46%
South 25,200 4,600 1,150 77%
46,800 7,800 4,540 25%
TOTAL 58%
251,100 45,600 28,620
63%

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Factors Influencing Farmer Decisions to Grow Poppies

3 Company interviews

Prior to undertaking farmer interviews, poppy company staff for Glaxo Smith Kline (GSK) and
Tasmanian Alkaloids (TA) were interviewed to gain a better understanding of issues which they
believed might limit the area of poppies grown in the state. To some extent their responses were
used in determining the revised 45,000 hectare annual potential area outlined in Section 2.
Interviews were held with management (Rick Rockliff (TA) and Rohan Kile(GSK)) and a number of
field officers.
Prior to the field officer interviews each company provided a list of current poppy growers for the
2012-13 season, as well as comprehensive lists of farmers who that have grown poppies in the past.
A list of farmers who had never grown poppies in the past was also supplied by DPIPWE and added
to by field officers. The list from DPIPWE did not cover all regions and many of the growers on the
list were in fact found to be either current or past growers.
The list of ‘previous growers’ included a large number of people who had sold up, retired, were
deceased or were in fact growing for one of the other companies. As far as possible these lists were
‘cleaned up’ prior to the random selection of famers for interview (Section 4).
As well as discussing general factors limiting the area of poppies grown in each region the field
officers were asked to provide their understanding of the main reason individual farms on the non-
poppy grower lists no longer grew poppies. The range of factors discussed and their frequency of
occurrence are displayed in Figure 1.
A common comment was that they believed that most farmers who could potentially grow poppies
had in fact grown at some point in the past. The main reasons for no longer growing were generally
as follows:

 Land not suitable – either the farmer and/or the company had decided not to continue.
 Dairy farmers – with larger herds, dairy farmers have tended to become more specialised

over time and few grow poppies any more. A reduction in milk price might change this to
some extent.
 Part-time farmers – not interested in cropping or may grow on an occasional basis.
 Grazing – some beef/sheep farmers just not interested in cropping.
 Leased to BRA – land taken out of cropping for an extended period for growing pyrethrum.

7

Share of non poppy growers Factors Influencing Farmer Decisions to Grow Poppies

Figure 1: Main reasons farmers stopped growing poppies, suggested by company field officers
50%
40%
30%
20%
10%
0%

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Factors Influencing Farmer Decisions to Grow Poppies

4 Farm survey

4.1 Questionnaire, survey sample and response rate

 Two questionnaires were developed following the company interviews and refinement of
the land use mapping:
o One was designed to collect information from farms currently growing poppies
o A further questionnaire was designed to collect information from non-poppy
growers (farmers who have grown poppies in the past and farmers who have never grown
poppies).

 Survey questions asked farmers to indicate what they considered to be their potential poppy
ground if there were no constraints other than soil type, and then what they could
potentially grow on an annual basis.

 Non-poppy growers, and current poppy growers who were not growing at their suggested
annual potential area, were asked to nominate the main reason they are not growing (more)
poppies and what it would take to get them to grow (more) poppies.

 The survey was based on two random samples:
o A sample of current poppy growers for the 2012-13 season drawn from lists
provided by the poppy companies (GSK & TA).
o A sample of non-poppy growers drawn from comprehensive lists of farmers who
don’t currently grow poppies but have grown poppies in the past, as well as a list of
farmers who have never grown poppies, supplied by DPIPWE and added to by field
officers.

Table 3 outlines the effect of ‘cleaning up’ the non-grower list, as well as the sample size and survey
response rate for both the current poppy growers and non- growers.

Table 3: Random sampling from list ‘populations’ of current and non-growers

Current-growers Non-growers

Lists supplied by poppy companies & DPIPWE 835 1,516

After ‘clean-up & removal of duplication 835 707

Calls made from random samples 141 180

Responses 94 56

Adjustments based on responses + 6 'non-growers' - 6 still growing

- 1 non-grower + 1 'current grower'

- 1 invalid response

Total sample size 98 (17% of list) 51 (7% of list)*

*Of the 180 calls made from the non-grower list: 6 were current growers; 6 were no longer farming; 1 was deceased; and

21 were wrong numbers. Based on this number of invalid non-growers and the fact that the sample was random, it is likely
that the ‘true’ list of non-growers would contain around 570 farms – suggesting a 9% sample.

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Factors Influencing Farmer Decisions to Grow Poppies

Figure 2 and Figure 3 show the percentage of sample farms versus the total ‘population’ for both
growers and non-growers, by region. The results indicate that the farms surveyed are representative
of the underlying population lists from which the random samples were drawn.

Figure 2: Comparison of current growers surveyed with current grower list

Current grower sample Current grower list
50%

40%

Share of farms 30%

20%
10%

0% Northern North East South
North West Central NW Central Midlands
North

Figure 3: Comparison of non-growers surveyed with non-grower list

Non grower Sample Non grower list
50%

40%

Share of farms 30%

20%
10%

0% Northern North East South
North West Central NW Central Midlands
North

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Factors Influencing Farmer Decisions to Grow Poppies

On an area basis the response rate of the combined poppy grower and non-poppy grower surveys
represents 15% of the 45,600 potential annual area identified by the revised land use mapping
(Table 4).

Table 4: Share of the annual potential poppy area within the survey samples, by region

Potential Area surveyed
annual
Zone area* ha %
ha 280 16%
North West 1,800 2,080 34%
Central NW 6,100 1,090 16%
Central North 6,700 2,320 12%
N. Midlands 18,600 440 11%
North East 3,900 690
South 7,800 9%
TOTAL 6,910
44,900 15%
* See Section 2

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Factors Influencing Farmer Decisions to Grow Poppies

4.2 Survey Results

Participating farmers were asked to provide the following information for the 2012-13 season:

 Total farm area.
 Farmer estimate of total potential poppy land.
 Farmer estimate of potential annual poppy area – with no constraints other than land

quality.
 Area of poppies grown in 2012-13 (current growers only).
 Area of other crops grown.
 Number of other crops grown.
 Area of pasture.

Table 5 and Table 6 present a summary of the survey results. Detailed survey results are contained in
Appendices C and D.

Table 5: Land use for current poppy growers

Total Farm Area Average Minimum Maximum
Potential Poppy Area (ha) (ha) (ha)
Annual Potential Poppy Area 643 0
Area of Poppies Grown in 2012-13 295 6 8,500
Area of Other Crops Grown 59 5 4,350
Area of Pasture 40 3
82 0 500
253 0 480
1,820
4,000

Table 6: Land use for non-poppy growers

Total Farm Area Average Minimum Maximum
Potential Poppy Area (ha) (ha) (ha)
Annual Potential Poppy Area 396 6
Area of Poppies Grown in 2012-13 115 4 8,000
Area of Other Crops Grown 21 1 900
Area of Pasture - - 100
11 0 -
329 0 200

8,000

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Factors Influencing Farmer Decisions to Grow Poppies

Figure 4 and Figure 5 suggest that poppy growers are generally cropping farms, whereas non-poppy
growers are mainly grazing farms. A large proportion of non-poppy growers, for example, have less
than 20% of their total farm area under crop. On the other hand almost 80% of them have over 80%
of their total area under pasture.

Figure 4: Crop area as a share of total farm area – poppy growers versus non-growers

100% Poppy Growers Non poppy growers

80%

Share of farmers 60%

40%

20%

0% 20-40% 41-60% 61-80% 81-100%
<20%

Cropping as a share of total farm area

Figure 5: Pasture area as a share of total farm area – non-poppy growers

100% Poppy Growers Non poppy growers

80%

Share of farmers 60%

40%

20%

0% 20-40% 41-60% 61-80% 81-100%
<20%

Pasture as a share of total farm area

13

Factors Influencing Farmer Decisions to Grow Poppies

Figure 6 shows the average rotation assumptions underlying the farmers’ estimates of annual
potential poppy area from their total potential poppy area - compared to those used to calculate the
revised theoretical area in Section 2.

In general terms the farmer estimates are similar to those outlined in Section 2. However, for the
North East and South, rotations appear to be somewhat tighter than suggested in the calculation of
the theoretical annual potential area (land class mapping).

Figure 6: Predicted and actual average poppy rotation length, by region

Land class mapping Survey results

1 in 7 years

1 in 6 years

1 in 5 years

1 in 4 years

1 in 3 years

1 in 2 years

1 in 1 years

1 in 0 years Northern North East South
North WestCentral NW Central Midlands
North

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Factors Influencing Farmer Decisions to Grow Poppies

5 Current Poppy Grower Survey Results

This section summarises the survey results for the 98 current poppy growers surveyed.

Because the actual number of farms surveyed in some regions was relatively small the figures
presented are for the state as a whole rather than for individual regions. Further detail is provided in
Appendix C.

5.1 Area of poppies grown

 71% of current poppy growers surveyed reported growing less poppies in 2012-13 than their
suggested annual potential area.
o This group of farmers were asked further questions about the reason for growing a
smaller area – analysis provided in Section 5.2.

 12% of current poppy growers surveyed reported growing their suggested annual potential
area in 2012-13.

 17% of current poppy growers surveyed reported growing more than their suggested annual
potential area.
o Overwhelmingly these growers indicated that they would not grow poppies at all for
the next several years – this is how they manage their rotation.

Figure 7: Area of poppies grown relative to farmer estimate of annual potential area – share of
growers

> annual
potential

17%

= annual
potential

12%

< annual
potential

71%

The area of poppies grown relative to farmer estimate of annual potential area is further elaborated
in Figure 8. It shows a large proportion of farm area growing less than the maximum annual
potential, a small proportion at the maximum, and a proportion growing up to 300% of the potential
annual area – these later farms are unlikely to grow in the next few years.

15

Factors Influencing Farmer Decisions to Grow Poppies

Figure 8: Area of poppy production compared to maximum annual potential on current poppy
grower farms

300%

Actual area grown as a share of Greater than maximum
maximum annual potential
200%

Less than maximum Equal to maximum

100%

0% 20% 40% 60% 80% 100%
0% Area utilised by current poppy growers

Around 30,000 hectares of poppies are being grown in Tasmania during the 2012-13 season. Figure 9
illustrates calculations undertaken which suggest that it may be possible to grow another 15,600
hectares on current poppy grower farms – based on grower estimates of actual area versus their
estimate of potential annual sustainable area. This does not include scope for additional area on
non-poppy grower farms.

Figure 9: An estimate of additional potential poppy area on current poppy grower farms

300%

Actual area grown as a share of 200%
maximum annual potential
100%

0% 20% 40% 60% 80% 100%
0% Area utilised by current poppy growers
.

16

Factors Influencing Farmer Decisions to Grow Poppies

5.2 Reasons for growing less than maximum annual poppy area

The 68 current poppy growers (out of 98 surveyed) who grew a smaller area of poppies than their
indicated maximum annual potential were asked to indicate the main reason they are growing less
poppies than they could (see Figure 10).
Given they were asked for the main reason only – the total number of responses is 68. ‘Returns too
low’ and lack of irrigation capacity accounted for over 80% of the ‘missing area’. The most important
reasons nominated on a per hectare basis were:

 ‘Returns too low’ – this is a combination of yield and price and, for the North West in
particular, returns from other competing enterprises.

 ‘Irrigation capacity’ – this is a combination of water supply and/or irrigation infrastructure.
For some growers this limitation might be overcome with higher returns, and may be
addressed by new Tasmanian Irrigation schemes (See Section 7).

 ‘Other enterprises’ – other cropping enterprises compete for potential poppy area and if
returns are higher are given a higher priority. In some cases the other enterprises have
differing rotation lengths (eg 5 years), which makes it difficult to fit the maximum poppy
area at say a 3-year rotation. Other grazing enterprises such as dairying might also grow a
small area of poppies as part of a pasture renovation phase.

 ‘Couldn’t get enough contract’ – only 6 growers listed this as a reason and only relates to
around 5% of the ‘missing area’. Mostly associated with suitability of land and soils being too
wet to plant on time.

 ‘Lifestyle’ – again only 6 growers and around 2% of the ‘missing area’.
 ‘Other’ – 4 growers and around 1% of the ‘missing area’.

17

Factors Influencing Farmer Decisions to Grow Poppies

Figure 10: Proportion of potential annual poppy area not used for poppies this year – main reasonsShare of maximum poppy area not used to
for current growers.grow poppies

50% 20 Growers
20 Growers
40% 12 Growers
6 Growers
30% 6 Growers
4 Growers
20%

10%

0%
Returns Irrigation Other Couldn't Lifestyle Other
too low capacity enterprise get enough
contract

Table 7 provides further details in relation to the ‘missing area’. Because of the sample size there are
few growers represented in some of the regions.
Interestingly, the Central NW which accounts for around 15% of the total area in 2012-13 has a
combined 18 growers listing ‘returns too low’ and ‘other enterprises’ as the main reasons. In the
Central North and Northern Midlands which are growing around half of the total crop this year, a
large number of growers (12) listed ‘irrigation capacity’ as the main reason for not growing their
maximum area.

Table 7: Main reason current poppy growers gave for growing less than their maximum poppy
area - by region and number of growers

Returns too low North Central Central Northern North South
Irrigation capacity West NW North Midlands East
Other enterprises 2
Couldn't get enough contract 1 8 2 4 3 4
Lifestyle 0 4 7 5 0 0
Other 0 10 2 1 0 0
0 3 1 2 0 0
1 2 0 2 1 1
0 1 0 2 0

18

Share of maximum poppy area not used Factors Influencing Farmer Decisions to Grow Poppies
to grow poppies
5.3 Factors that would encourage farmers to grow more poppies
26 Growers
19 GrowersCurrent poppy growers, who grew a smaller area of poppies than their maximum annual potential,
14 Growerswere asked to indicate what it would take to get them to grow more poppies. There was commonly
11 Growersmore than one reason given. The results are outlined in Figure 11 and Table 8 .
5 GrowersUnsurprisingly, increased price was frequently nominated as a factor that would encourage more
6 Growerspoppy production. However, this response needs to be seen in the context of other reported factors.
17 GrowersFor instance, during the phone survey several farmers explained that with current price, yield, and
reliability it was often difficult to justify investing in irrigation infrastructure. So, in fact, price,
irrigation infrastructure, more reliability and yield are all related.

Figure 11: Factors that would encourage current poppy growers to grow more
50%

40%

30%

20%

10%

0%

Higher Irrign More Better More Other Nothing
price infr.* reliability yield water** prices***
Multiple responses were permitted so shares do not sum to 100%
*More of better irrigation infrastructure
**Access to more irrigation water
***Prices fall for other enterprise(s)

Higher price is a common factor across all regions (Table 8). Overall, irrigation infrastructure appears
to be a greater limiting factor than access to more water.

19

Factors Influencing Farmer Decisions to Grow Poppies

Table 8: Factors that would encourage current poppy growers to grow more poppies - by region
and number of growers.

Access to more water North Central Central Northern. North South
Irrigation infrastructure West NW North Midlands East
Higher price 1
Better yield 0 1 12 0 5
More reliability 0 5 53 1 1
Other enterprise(s) price 1 13 45 3 0
Nothing 0 7 13 0 1
0 8 32 0 0
0 3 11 1 1
1 8 15 1

20

Factors Influencing Farmer Decisions to Grow Poppies

6 Non-Poppy Grower Survey Results

This section summarises the survey results for the 56 non- growers surveyed.
Because the actual number of farms surveyed in some regions was relatively small the figures
presented are for the state as a whole rather than for individual regions. Further detail is provided in
Appendix D.

6.1 Reasons farmers do not grow poppies

Non-poppy growers were asked to indicate the main reason they are not growing the crop.
The non-grower list include farmers who have previously grown poppies as well others who had
never grown. Interestingly 92% of the 51 non-growers interviewed had in fact grown in the past. This
supports company field officer indications that most farmers in Tasmania who could grow poppies
have grown the crop at some stage.
So, apart from the possibility (probability) that the non-grower list is incomplete, additional area is
unlikely to come from attracting completely new growers. Rather it will come from increasing the
area on current farms and possibly enticing past growers ‘back to the fold’.
As is the case for current poppy growers, non-growers listed ‘returns too low’ as a main reason for
not growing and this accounted for 35% of the ‘missing area’ on the survey farms (Figure 12). ‘Other
enterprises’ was the second most important reason and this was generally associated with dairy
farming.
Farmers nominating lifestyle as a reason for not growing poppies were often older farmers who
previously ran cropping enterprises. These farmers had semi-retired, still owned their farm, but
found grazing enterprises easier to manage. The majority of these farmers were not interested in
cropping (even at higher prices).

21

Factors Influencing Farmer Decisions to Grow Poppies

Figure 12: Proportion of potential annual poppy area not used for poppies – main reasons for
non-growers.

40%
Share of maximum poppy area not used
to grow poppies30%

16 Farmers20%
15 Farmers
11 Farmers10%
6 Farmers
3 Farmers
0%
Returns too Other Lifestyle Couldn't get Irrigation
low enterprises a contract capacity

6.2 Factors that would encourage farmers to grow more poppies

As a follow up to the reasons they were not growing poppies, non-growers were asked to indicate
what it would take to get them to grow the crop. The results are shown in Figure 11. It should be
noted that many respondents indicated more than one factor so proportions add to greater than
100%.

As is the case for current poppy growers, higher price was listed as a major factor that would
encourage non-poppy growers to grow the crop, followed by more reliable yield (and better yield)
and prices falling for other enterprises – these are all factors associated with the relative profitability
of poppies and other enterprises.

Ten of the 56 growers indicated that there was nothing that would encourage them to grow poppies
– these tended to be lifestyle or retired farmers.

Irrigation constraints (irrigation infrastructure, water availability) do not appear to play a big role in
the decision not to grow poppies among non-poppy growers.

22

Factors Influencing Farmer Decisions to Grow Poppies

Figure 13: Factors that would encourage non-poppy growers to grow poppies

60%
Share of maximum poppy area not used
to grow poppies50%

30 Farmers40%
14 Farmers
7 Farmers30%
10 Farmers
20% 7 Farmers
2 Farmers
3 Farmers10%

0%

Higher More Other Nothing Irrign Better More

price reliability prices*** infr.* yield water**

Multiple responses were permitted so shares do not sum to 100%
*More of better irrigation infrastructure
**Access to more irrigation water
***Prices fall for other enterprise(s)

23

Factors Influencing Farmer Decisions to Grow Poppies

7 New Irrigation Schemes

Tasmanian Irrigation (TI) is in the process of greatly expanding irrigation potential throughout the
state. This is in addition to the recently completed Meander Scheme and its associated pipelines,
which is yet to reach its full potential.

Surveys undertaken as part of the socioeconomic assessment for these schemes suggest that
prospective irrigators combined are planning to grow an additional 6,445 hectares (Table 9). The
largest expansions in poppy area associated with these irrigation schemes are expected to occur in
the Southern and Northern Midlands regions.

The anticipated increase in poppy area from these schemes would increase the current 30,000
hectares of poppies grown in Tasmania to around 36,000 hectares. This is 10,000 hectares short of
the 46,000 hectares identified as a practical maximum annual area by the revised land use mapping
in Section 2 – but does constitute a significant potential increase.

Table 9: Planned increases in poppy area associated with new irrigation schemes

Additional irrigation area Poppies (ha) Other land uses (ha)

North West 490 2,920

Meander Valley 650 5,270

Central North 155 1,550

North East 940 4,075

Northern Midlands 1,450 4,075

Southern Midlands 2,510 4,385

South East 250 1,345

Total 6,445 23,620

Source: Macquarie Franklin analysis of Tasmanian Irrigation Socioeconomic Assessments.

24

Factors Influencing Farmer D

Appendix A – Regional breakdown of revisions made to

Region Theoretical
Potential
Poppy Area* Less Dairy Less Private
Plantations
Un

North West 20,600 -6,500 -1,000

Central NW 39,400 -2,100 -3,200

Central North 83,600 -3,500 -4,000

N. Midlands 177,700 -700 -1,700

North East 58,600 -4,900 -3,500

South 91,400 -800 -800

TOTAL 471,300 -18,500 -14,200

*Map 2 as reported in: Orr, R. Simmul, P. & Webb M. 2011 Potential Land Area Suitable for Popp
Unsuitable areas include: East & West Tamar; Parkham / Dairy Plains; Redpa / Marawah; and So
Unsuitable farm area factor: 20% North West and Central Northwest; 30% North East; and 40%

Decisions to Grow Poppies

o TIA and DPIPWE mapping

Less Adjustments Less Unusable Revised Practical
nsuitable Farm Area Potential Annual
Add Midlands Poppy Area
Area Class 5 Potential
7,400
-3,900 0 -1,800 27,200 1,800
35,600 6,100
-100 0 -6,800 108,900 6,700
25,200 18,600
-16,700 0 -23,800 46,800 4,600
251,100 7,800
-15,900 22,200 -72,700 45,600

-14,200 0 -10,800

-22,400 10,600 -31,200

-73,200 32,800 -147,100

py Production in Tasmania
outh of Hobart. For a detailed explanation see Section 6.
all other regions.

25



Factors Influencing Farmer D

Appendix C – Current grower survey responses

Sample Size & Location State North West Ce
Number of growers on list 845 41
Regional share 5%
Sample size 98 3
Regional share 3%

State North West Ce
Average (SD) Averag
Average (SD)
260 (244) 227
Farm area Total farm area 737 (1,372)
205 (172) 120
Potential poppy area 0 (0) 57
205 (172) 175
Owned land capable of growing poppies 291 (498) 46 (39) 43

Leased land capable of growing poppies 41 (211)

Total potential poppy area 328 (530)

Maximum annual poppy area 64 (85)

Farm program this year

Poppies this year 44 (67) 33 (26) 23
(211) 37 (38) 83
Other crops 94 (18) 2 (2) 3
(575) 169 (193) 84
How many crops? 3 Yes Yes
(SD) 67% (SD) 72%
Pasture area 279 (45) Average (16) Averag
13 20
Is the area of poppies less than the Yes

maximum that could be grown? 70%

Number

Maximum area less area this year 19

Decisions to Grow Poppies

ntral NW Central N N Midlands North East South
290 150 227 54 83
34% 18% 27% 6% 10%
39 16 25 6 9
40% 16% 26% 6% 9%

ntral NW Central N N Midlands North East South
ge (SD) Average (SD) Average (SD)
Average (SD) Average (SD)
(429) 368 (324) 1,458 (1,960)
1,297 (2,210) 334 (221)

(168) 234 (223) 536 (888) 141 (126) 292 (227)

(320) 3 (13) 18 (46) 100 (245) 0 (0)

(343) 237 (224) 554 (886) 241 (330) 258 (181)

(84) 49 (37) 91 (114) 55 (76) 69 (65)

(30) 36 (30) 72 (117) 34 (43) 40 (36)

(288) 86 (92) 108 (195) 77 (98) 18 (31)

(2) 3 (3) 3 (2) 2 (1) 1 (1)

(155) 191 (202) 588 (1,033) 173 (168) 246 (285)

Yes Yes Yes Yes

75% 64% 67% 78%

ge (SD) Average (SD) Average (SD) Average (SD) Average (SD)

(56) 13 (23) 19 (40) 21 (34) 29 (53)

27

Factors Influencing Farmer D

What is the main reason you are growing less poppies than you could?

State North West Ce
Numb
Number % Number %
4
(1) Irrigation capacity 20 20% 0 0% 0
1
Lack of water 8 40% 2
1
Lack of irrigation infrastructure 9 45% Numb
8
Type of irrigation infrastructure 5 25% 2
0
Other 1 5% 3
4
Number % Number % 1
Numb
(2) Returns too low 20 20% 1 50% 10
8
Price too low 6 30% 0 0% 1
1
Yields too low in this area 1 5% 0 0% 5
0
Too risky 8 40% 0 0%

Not profitable enough 10 50% 1 100%

Other 1 5% 0 0%

Number % Number %

(3) Suitable land occupied by other enterprises 13 13% 0 0%

Other annual crops 10 77%

Pyrethrum 1 8%

Dairy 2 15%

Beef/Sheep 6 46%

Perennial horticulture 0 0%

Number % Number % Numb

(4) Couldn't get enough contract 7 7% 0 0% 3

Didn't get in early enough 0 0% 0

Rotation 4 57% 3

Other 3 43% 0

Number % Number % Numb

(5) Lifestyle 6 6% 1 50% 2

Not interested in cropping 0 0% 0 0% 0

Semi-retired 3 50% 1 100% 1

Land leased out 0 0% 0 0% 0

Other 3 50% 0 0% 1

Number % Number % Numb

(6) Other 4 4% 0 0% 1

Decisions to Grow Poppies

ntral NW Central N N Midlands North East South
ber % Number % Number % Number % Number %

14% 7 58% 5 31% 0 0% 4 57%
0% 4 57% 3 60% 1 25%
25% 3 43% 2 40% Number % 3 75%
50% 2 29% 1 20% 3 75% 0 0%
25% 0 0% 0 0% 2 67% 0 0%
ber % Number % Number % 0 0% Number %
29% 2 17% 4 25% 0 0% 2 29%
25% 0 0% 1 25% 1 33% 1 50%
0% 1 50% 0 0% 0 0% 0 0%
38% 2 100% 2 50% % 1 50%
50% 0 0% 3 75% Number 0% 1 50%
13% 0 0% 0 0% 0 0 0%
ber % Number % Number % Number %
36% 2 17% 1 6% 0 0%
80% 1 50% 1 100%
10% 0 0% 0 0%
10% 1 50% 0 0%
50% 1 50% 0 0%
0% 0 0% 0 0%

ber % Number % Number % Number % Number %

11% 1 8% 2 13% 0 0% 0 0%

0% 0 0% 0 0%

100% 0 0% 1 50%

0% 1 100% 1 50%

ber % Number % Number % Number % Number %

7% 0 0% 2 13% 1 25% 0 0%

0% 0 0% 0 0%

50% 1 50% 0 0%

0% 0 0% 0 0%

50% 1 50% 1 100%

ber % Number % Number % Number % Number %

4% 0 0% 2 13% 0 0% 1 14%

28

Factors Influencing Farmer D

What would it take to get you to grow more poppies?

State North West Central N
Number % Number
Number %
0 0% 1
Access to more irrigation water 5 7% 0 0% 5
1 50% 13
More/better irrigation infrastructure 19 28% 0 0% 7
0 0% 8
Higher price 27 39% 0 0% 3
1 50% 8
Better yield 11 16%

More reliability 12 17%

Prices fall for other enterprise(s) 6 9%

Nothing 15 22%

Decisions to Grow Poppies

NW Central N N Midlands North East South
% Number % Number % Number % Number %
4%
18% 1 8% 2 13% 0 0% 1 14%
46% 5 42% 3 19% 1 25% 5 71%
25% 4 33% 5 31% 3 75% 1 14%
29% 1 8% 3 19% 0 0% 0 0%
11% 3 25% 2 13% 0 0% 1 14%
29% 1 8% 1 6% 1 25% 0 0%
1 8% 5 31% 1 25% 1 14%

29

Factors Influencing Farmer D

Appendix D – Non-grower survey responses

Sample Size & Location State North West
707 72
Number of growers on list 10%
Regional share 51 6
Sample size 12%
Regional share

State North West

Average (SD) Average (SD) A

Farm area Total farm area 396 (1,149) 151 (105)

Potential poppy area Potential poppy area 115 (148) 110 (75)
Farm program this year Maximum annual poppy area 21 (20) 24 (17)

Crops 11 (31) 0 (1)
How many other crops? 1 (1) 0 (0)
329 (1,109) 133 (94)
Pasture 345 (1,132) 100 (100)
Total

Have you grown poppies in the past? 92% 67%

Decisions to Grow Poppies

Central NW Central N N Midlands North East South
278 94 91 60 112
39% 13% 13% 8% 16%
21 9 3 6 6
41% 18% 6% 12% 12%

Central NW Central N N Midlands North East South
Average (SD) Average (SD) Average (SD) Average (SD) Average (SD)

148 (144) 344 (346) 2,683 (4,605) 299 (268) 543 (919)

86 (102) 239 (278) 68 (80) 89 (56) 84 (84)
20 (22) 34 (24) 13 (11) 18 (12) 12 (10)

8 (17) 29 (66) 5 (8) 5 (6) 14 (11)
0 (1) 1 (1) 1 (2) 1 (1) 2 (1)
139 (147) 293 (251) 2,678 (4,609) 247 (175) 155 (138)
141 (148) 322 (294) 2,683 (4,605) 254 (173) 143 (150)

95% 100% 100% 83% 100%

30

Factors Influencing Farmer D

What is the main reason you are not growing poppies this year?

State North West
Number %
Number % N
1 17%
(1) Irrigation capacity 3 7% 1 100%
0 0%
Lack of water 2 67% 0 0%
0 0%
Lack of irrigation infrastructure 2 67% 3 50%
3 100%
Type of irrigation infrastructure 0 0% 0 0%
1 33%
Other 0 0% 1 33%
0 0%
(2) Returns too low 16 36% 1 17%
0 0%
Price too low 6 38% 0 0%
1 100%
Yields too low in this area 3 19% 0 0%
0 0%
Too risky 9 56% 0 0%
0 0%
Not profitable enough 4 25% 0
0
Other 1 6% 0
0
(3) Suitable land occupied by other enterprises 15 33% 1 17%
1 100%
Other annual crops 1 7% 0 0%
0 0%
Pyrethrum 1 7% 0 0%

Dairy 7 47%

Beef/Sheep 2 13%

Perennial horticulture 2 13%

Other 2 13%

(4) Couldn't get a contract 6 13%

Companies not interested in this area 2 33%

Didn't get in early enough 1 17%

Rotation 2 33%

Other 1

(5) Lifestyle 11 24%

Not interested in cropping 6 55%

Semi-retired 6 55%

Land leased out 3 27%

Other 1 9%

Decisions to Grow Poppies

Central NW Central N N Midlands North East South
Number % Number % Number % Number % Number %

0 0% 0 0% 0 0% 1 17% 1 17%
1 100% 0 0%
5 24% 4 44% 1 33% 1 100% 1 100%
2 40% 1 25% 0 0% 0 0% 0 0%
2 40% 0 0% 0 0% 0 0% 0 0%
1 20% 3 75% 1 100% 2 33% 1 17%
1 20% 1 25% 0 0% 0 0% 0 0%
1 20% 0 0% 0 0% 0 0% 1 100%
7 33% 3 33% 0 0% 2 100% 1 100%
1 14% 0 0% 1 50% 0 0%
1 14% 0 0% 2 67% 0 0% 0 0%
3 43% 2 67% 1 50% 1 17% 3 50%
1 14% 0 0% 1 50% 0 0% 0 0%
0 0% 0 0% 0 0% 0 0% 0 0%
1 14% 1 33% 0 1 100% 0 0%
2 10% 1 11% 0 0% 0 0% 1 33%
1 50% 0 0% 0 0% 2 67%
0 0% 0 0% 0 0% 0 0%
1 50% 0 0% 0 0% 1 17%
0 1 0 0%
7 33% 1 11% 2 33% 0 0%
2 29% 1 100% 2 100% 1 100%
4 57% 1 100% 1 50% 0
2 29% 0 0% 1 50% 0 0%
1 14% 0 0% 0 0% 0
0
0
0

31