sure, farmer's lobby groups will seek to stiffle free trade through trumped up biosecurity bs, but that's a separate issue to farmers who can meet demand attracting more profit when a natural disaster constricts supply. of all the criticisms that could be directed at markets this seems the least credible.

the next thing saul will be suggesting is fixed prices and rationing.

Is it fair then for farmers to ask that they be able import cheap labour from the Phillipines(or wherever), instead of subsidising wages here?
Why does free marketeering only stretch so far.

Maybe we can import a few economists too.

Saul's central argument - that it is difficult to defend protectionism in the banana or horticultural industry when our broader economic and industry policy is firmly free-market - is hard to refute. Australia has been an unrelenting lobbyist for free trade in agricultural products for decades, setting us apart from all other affluent nations other than New Zealand. It is likely that other countries will eventually call our bluff when we try to use phytosanitary concerns to block imports - as New Zealand recently did successfully, by appealing to the WTO tribunal our decision to block NZ apples.

Nevertheless I think there are very good reasons that we should have some protectionist measures in place. Let's not hide behind quarantine concerns, let's just get out there and say that agriculture is not like all other industries, and warrants some special treatment. Because:
* Food is a basic essential - more like air and water than it is like flat screen TVs or shoes. Retaining domestic food production capacity is a national security issue.
* Food production can't start and stop in response to price signals. If land is retired from production, and the skills to grow food decline, there is an extent to which these changes are irreversible.
* The global food system is coming under enormous pressure from growing demand and a declining resource base, and faces enormous challenges due to climate change and peak oil. Maintaining local food production makes sense as a risk mitigation strategy in the face of these challenges.

Perhaps the National Food Plan that the Federal government is now preparing will map out the role of continued local food production?

Some comments in response, from Growcom - the peak horticulture organisation in Queensland:

From sucker to producing bananas takes 6-8 mths, not a couple of weeks. Crews are not out harvesting today.

Banana growers are in a price-taking industry and are not ‘amazingly wealthy’ by any stretch of the imagination.

Bananas only grow in certain tropical and sub-tropical regions. Most of these areas are cyclone prone.

Japan can import Philippine bananas because Japan does not have a domestic banana growing industry that would be harmed by diseases carried on them. There is no risk to human health from these diseases, just to the plants. Although Philippine bananas have been approved for import to Australia subject to biosecurity checks for some time, no one from the Philippines has thus far applied to import them into Australia.

As one of the commentaters notes, the diseases that affect bananas are air-borne and can affect the fruit, not just the plant.

Biosecurity for Australia is managed by an independent body, known as the Biosecurity Australia and funded by the federal government. Biosecurity Australia make their scientific decisions based on protecting Australia from disease, not economic competition. If countries believe that quarantine is being used as defacto protectionism, they can take a case to the World Trade Organisation (WTO) for a binding ruling. No such case has been taken on behalf of foreign bananas.

For a more detailed response to Mr Eslake's article, please see our media release

http://www.growcom.com.au/home/news_detail.asp?newsID=39

Sorry, the internet address given in the previous posting was missing a digit. The correct media release can be found here:

http://www.growcom.com.au/home/news_detail.asp?newsID=393

Perhaps Saul Eslake could research the components that make up the price of bananas or of any other primary product for that matter.

Given the farmer's exposure to all sorts of risks (weather, pests, diseases, highly variable costs of inputs, labour shortages, credit restrictions, highly flexible market prices, non-renewal of supply contracts, etc), the farmer should get the dominant share. It indeed would surprise if the farmer's share were greater than either the wholesaler's or retailer's share of the retail price of bananas.