Price – Michmutters

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Australia

Energy ministers from across the country meet to establish a new framework for transition away from coal

Energy ministers from across the country meet to establish a new framework for transition away from coal

State, territory and federal energy ministers have started the process for significant reforms to Australia’s energy future.

The ministers met on Friday in Canberra where they received a briefing from energy market operators and the consumer watchdog on expected gas and electricity shortfalls in 2023 and 2024.

On top of the agenda was the establishment of a new National Energy Transformation Partnership (NETP) to better collaborate on Australia’s transition to greater reliance on renewables in the electricity grid.

Federal Climate and Energy Minister Chris Bowen announced that as part of the new NETP, emissions reduction would be included in the national energy objectives for market operators.

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Mr Bowen said the decision would send a “very clear” message of certainty to investors and would ensure emissions reduction is at the forefront of every aspect of energy market operators’ functions.

“This might not sound much, this is the first change to the national energy objectives in 15 years this is important,” he said in Canberra on Friday.

“It sends a very clear direction to our energy market operators that they must include emissions reduction in the work that they do.

“And the message of certainty to investors in renewable energy and transition and storage around the world that Australia is open for business, Australia is determined to reduce emissions.

“And we welcome investment to achieve it and we will provide a stable and certain policy framework.”

The ministers also agreed to extend the powers of the Australian Energy Market Operator (AEMO) to better manage east coast supply shortfall risks.

It will also provide AEMO with the option of direct market participation ahead of winter 2023.

In its interim gas report, the Australian consumer watchdog warned of a serious shortfall in natural gas in 2023.

The Australian Competition and Consumer Commissions (ACCC) said LNG exporters needed to redirect excess supplies to the domestic market or Australia would risk its energy security heading into next year.

It comes after AEMO intervened in the Victorian gas market to redirect excess supply from Queensland producers to avoid mass shortages in the southern state – using its emergency mechanism for the second time in history.

The ministers joined the ACCC in calling for producers to redirect excess gas to the domestic consumers rather than the lucrative export market.

NSW Energy Minister Matt Kean said it was a “non-negotiable” for his state when it came to protecting households and businesses.

“What we don’t want to see is domestic gas producers prioritizing profits and exports ahead of local users, that is a non-negotiable for us in New South Wales,” he said.

“There is going to be a shortfall in gas in 2023 and 2024. That shortfall needs to be met.

“And what we need to do is prioritize Australian gas for Australian gas users ahead of companies making super profits and exporting that gas offshore.”

His Victorian counterpart Lily D’Ambrosio shared the concerns and said the country produced “more than sufficient gas” to meet domestic needs but “too much of it was sent overseas”.

“And that’s got to change and that’s really the task of all of us and we’re all up for it. And we’ve all agreed about how we can go about doing that,” she said.

On top of the gas market reforms, the ministers also discussed a future capacity mechanism to ensure firming power in the grid during the transition away from coal.

Senior federal and jurisdictional officials have now been charged to provide options for a framework which delivers “adequate capacity, ensures orderly transition, and incentivises new investment in firm renewable energy.”

“Ministers intend to take a more active role in delivering the firming capacity needed as the system transforms and consider the best means to manage the risks of a disorderly exit of coal generation,” the joint communique said.

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Categories
Business

Fresh food prices may be soaring, but how much of your cash is making it back to the farm?

A person shopping at Australian grocery store, with a basket full of sparkling water, fruits and vegetables.

Lettuces have crossed the $10 mark, milk prices are being bumped up by the major supermarkets and strawberries are $6 a punnet.

Nearly everywhere you look, the price of food and other farmed goods is on the rise.

You would be forgiven for thinking this must be a great time for Australian farmers, preferably while gazing out the window at gentle rain.

Not remove.

Prices on the rise

Understanding what’s driving the price of any commodity can be a mind-bending exercise at the best of times.

The current situation is broadly due to a number of issues, the first of which has to do with the nature of the Australian growing season.

Australian vegetables come from different parts of the country depending on season. At the moment the primary supplier is Queensland.

Earlier this year some of its growing regions were smashed by two floods in 11 weeks.

Flooding of field at Mulgowie School Road in Lockyer Valley showing brown flood water through a field
Queensland’s Lockyer Valley flooded earlier this year and destroyed large vegetable crops.(Supplied: Lockyer Valley Regional Council)

Belinda Frentz is a herb grower on the state’s Gold Coast and deputy chair of Australia’s peak body representing vegetable growers, AUSVEG.

She said the damage to crops caused already high prices to climb even further.

“When you get a loss of that magnitude, it’s not the price that’s significant, it’s the production loss that’s associated with that,” Ms Frentz said.

“Anything that increases in price is usually associated with a loss somewhere in the supply chain.

“When we’re processing less than half of the volumes that we usually would, obviously the demand for that product increases exponentially and there’s just not the availability of the products.”

Farmers with hidden costs

Like every industry, farming has costs. There are start-up costs, such as the price of crop seed for the year, the cost of land, or the price of buying livestock.

Then there are input costs, things like fertilizer, fuel, chemicals, water and labour.

In short, they are the products necessary to do business — similar to fixed costs for personal budgets, such as rent and electricity.

These costs fluctuate naturally, but recent world events have thrown a spanner into the works.

small white urea pellets spill form an augur into a large trailer as a woman watches from the side
Common fertilizer, urea, jumped from $750 a tonne in 2021 to $1,300 in 2022.(Rural ABC: Clint Jasper)

Fertilizer costs began to spike in mid-2021 when China announced restrictions on exports, but the war in Ukraine has driven that price even higher.

The price of fuel has also been abnormally high, particularly for diesel, which is not just used in tractors, but also fuels the trucks that haul produce from the farm to processors, wholesalers and supermarkets.

The ongoing global hangover from the pandemic has also slowed Australian imports of these commodities to a crawl.

Creating a perfect storm

While each of these costs may have been manageable on their own, together they have created a perfect storm.

Ms Frentz said the costs were eating into what little profits many producers were making.

“We all know what our costs of production are and we know that they’ve increased,” she said.

Woman kneels down amongst rows of green and red lettuce. She smiles at the camera holding loose lettuce leaves in her hands.
Belinda Frentz says flood damage to crops caused already high prices to climb further.(Supplied: Belinda Frentz)

“I think the new pricing of fresh [food] will be around the input pressure costs that we’ve got, and that we can’t do anything about.

“Like everybody at the moment under household pressures about the cost of living, growers are experiencing that across the board.

“For us to be sustainable, we have to be profitable.”

A tale of two growers

But with prices so high, how much of that money is actually making it back into the pockets of growers?

Melbourne-based wholesaler Michael Piccolo believed the situation had divided growers into two distinct groups.

“You’ll get a certain grower that doesn’t have the yield, so basically whatever they’re producing is only covering the cost of production,” Mr Piccolo said.

“Then you’ll have a grower who has a full crop and they just base their sales on what’s going on around the Australian market.

A man is standing in front of a sign that says Piccolo Fresh
Melbourne vegetable wholesaler Michael Piccolo believes the market is over inflated.(Supplied: Michael Piccolo)

“Certain markets like Melbourne, Brisbane and Sydney will compete against each other, so when one sets a price, everyone else has to follow suit.”

Mr Piccolo also believes that, while input costs are a large part of current costs, it is competitive bidding from buyers that is driving up prices.

“I think it’s a contributing factor. My opinion, though, is that it’s a bit too inflated and we’re about 20-30 per cent above where we really need to be.”

When will prices come down?

The good news is that relief is on the horizon.

Mr Piccolo believes prices will fall as the season shifts away from Queensland growers and back towards those in southern Australia.

“The changeover of seasons happens around September to October, so a lot of these products that we have to purchase from Queensland start to come down during the Victorian season,” he said.

“My prediction is that we’ll start to see prices reduce more towards the mid-to-end of September, and then the Victorian growing season will kick in.

“However, I can’t see it making it’s way back down to the prices we’ve gotten used to,

“I think it will probably settle around at 10 to 20 per cent above what we are traditionally used to pay.”

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Categories
Australia

Solomon Islands shell money is the price some grooms still pay for love. But first they have to find the traditional currency

Solomon Islands shell money is the price some grooms still pay for love. But first they have to find the traditional currency

Strings of seashells, coils of red feathers and dolphin teeth are traditional currencies that are used to say “I love you” in parts of the Solomon Islands.

The shells play a significant role in traditional bride price ceremonies, which are used to mark when a woman leaves her family to settle with her husband.

But for Australian-based Solomon Islander Terry Wong, tracking down the shell money for his bride-to-be — my sister Azalea — was no easy feat.

For generations, strings of shells have been used to trade and settle disputes, long before cash was introduced.

Shell money is still used in provinces including Malaita, Makira and Guadalcanal and families often have a treasure box of the currency hidden in their homes.

Piles of shell money on traditional mats.
Ten strings of shells makes one “tafulia’e” and its value varies depending on the length.(Supplied)

Solomon Islands is home to a range of traditional currencies, and some are easier to find than others.

Some provinces use large disc-shaped clam shells called “bakiha”, while others use dolphin teeth or red feather money.

While the red feather money from Santa Cruz Islands in the eastern part of the country is no longer in use after the small scarlet honeyeater bird became difficult to find, dolphin teeth and shell money are still commonly used.

To create shell money, the seashells are broken, smoothed and collected in strings of 10 to form a “tafulia’e”.

The different lengths of string have different value and a single tafulia’e can be worth anywhere between $100 and $500.

Dancing, music and shouting on the big day

Bride price traditional dancing
Traditional dancing is part of farewelling the bride as she begins the next chapter of her life.(Supplied)

On the day of the bride price ceremony, Terry and his family arrive at our home in Honiara in a convoy of vehicles to a chorus of tooting horns, laughing and shouting, and we welcome them with plenty of music and dancing.

It’s a big deal for Azalea’s loved ones, who have come out in large numbers to witness her bride price and farewell her with traditional dances.

Terry’s family bring items to pay the bride price: live pigs, bags of rice, root crops, traditional mats and a small black box of shell money — the most valuable item of all.

“It was a hard time [finding the shell money] but we just endured it,” Terry says.

“It’s for someone I love and also, as shown today, my family loves her too.”

A bride and groom stand together smiling at a bride price ceremony.
The day is filled with cultural exchanges and words of encouragement for the new couple.(Supplied)

Terry’s family is from the province of Temotu in the eastern part of the Solomons. It’s closer to Vanuatu and shell money isn’t part of their culture.

Terry’s grand uncle Solomon Palusi says finding the shell money was “very difficult but wasn’t impossible.”

“We tried our very best to take the shell money.”

It’s for people like Terry that a shop has recently opened in Honiara’s Chinatown, selling shell money for cash, targeting three of the nine provinces in the country that use the traditional currency.

Why is shell money so hard to find?

Shell money shop owner Mary Sifoburi is from Langa Langa in Malaita province, a community known for crafting the currency.

“Basically, the process of making shell money involves 10 steps before the product comes to completion,” Mary says.

The shells are smoothened and ground flat before a small drill is used to create a hole in the center of the shell, and a tuna tin is used as a makeshift scale to weigh them.

A mother and daughter sit outside. The two women are grinding and drilling shells.
Mary’s sister Angella and their mother Veronica start the long process of making shell money.(ABC News: Chrisnrita Aumanu-Leong)

“In the past it would take two to three days because of the manual drill used. But now with the introduction of the new drill, a person can drill three to four tins [worth] per day,” Mary says.

The shells are placed on hot rocks to change color before final grinding is done.

It’s not an easy task and it can take up to two weeks to find a single shell.

Some of the shells used in the shell money making process
The process of making shell money is slow and the shells can be hard to find.(ABC News: Chrisnrita Aumanu-Leong)

“There are different kinds of shells involved in the process of shell money, so we have black shells, white shells and red shells,” Mary says.

The harder the shell is to find, the higher the value.

“For now, I can say that the value is based on the people who produce the shells but because right now… we do not have any standard regulations to guide the value of the shells, the prices vary,” she says.

Concerns currency will fall out of circulation

Father of the bride Steve Aumanu has noticed the monetary value of shell money shift over the decades but the cultural value has so far endured the test of time.

“It’s being commercialized, the value of the shell is called by those who produce it and those who are price takers, we don’t have much choice,” he says.

With shell money now so difficult to find and its price increasing, community elders fear it will some day lose its place in the three provinces.

“I don’t know whether it will cease to be recognized but for the time being, the value has been ascending,” Steve says.

A young woman stands with her cousins ​​during a bride price ceremony in Solomon Islands
The bride and her cousins ​​on traditional mats.(Supplied)

Back at the bride price ceremony, the bride stands with her cousins ​​on traditional mats called “kaufe”, which in the Malaitan custom recognizes her leaving her family home with dignity and pride.

An honoring ceremony of Azalea’s closest aunties and grand aunties also takes place where the groom’s side hands over monetary gifts in red envelopes that reflect Terry’s father’s Chinese heritage.

And elderly woman and a man shake hands.
Azalea’s grandmother was among those thanked for helping raise her, as part of the bride ceremony.(ABC News: Chrisnrita Aumanu-Leong)

The moment of truth

The most anticipated part of the ceremony comes when the bride’s father either accepts or declines the bride price from the groom’s side — there have been instances where it has been rejected.

But not this time around.

During the ceremony, more than 20 tafulia’e are given to the bride’s father by the groom’s father.

Groom's father passing on the shell money to bride's father at a bride price ceremony.
Waiting to see if the bride price will be accepted is the most anticipated part of the ceremony.(Supplied)

“Traditionally when there’s a marriage ceremony between two people, that’s a significant event in the life of a family or tribe and this one is no different,” Steve says.

“When we are all together to witness, it’s a manifestation of a great valuable cultural undertaking.”

And on the occasion of my sister’s bride price ceremony, the enduring value of the shell money and the traditions that come with it, are clear.

A young woman hugs her father.
Azalea’s father Steve says coming together for the bride price ceremony is a “valuable cultural undertaking.”(Supplied)

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