For Western Australian farmer Greg Mengler, walking away from the land his family has worked for more than 110 years was one of his toughest decisions.
In a quiet corner of his farm in Tenterden, in WA’s Great Southern region, Mr Mengler sat beside a plaque that reads ‘In loving memory of Kenneth Mengler. Sadly missed by all his family’.
It is the place he spread his late father’s ashes, and one of the last times he will sit there as the owner of the land his father and grandfather toiled on at the base of the Stirling Range since 1908.
His choice to sell is one being made in greater frequency by small and medium-scale farmers across Australia as the industry pursues enterprises of scale.
Scale is everything
Between 2000–01 and 2016–17, the number of farming enterprises has fallen from about 140,500 to 85,000.
In the same period, the average broadacre farm size has increased from about 6,000 to 7,000 hectares, according to data from Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
Melbourne University doctoral candidate Mike Stephens, an experienced agricultural consultant, said succession was a financial reality for only a third of Australia’s broadacre farms.
While at least 90 per cent of Australian farming businesses are still family owned, Mr Stephens said small to medium sized farming businesses — between $2 million and $5 million in capital value — were increasingly being absorbed by bigger enterprises owned by corporations, or other families looking to secure their own succession plans.
“We’ve got 53,000 broadacre farms in Australia, of those farms only 30 per cent have got a gross farm income of over $500,000, and 48 per cent of them have a gross farm income below $250,000. you might be talking about a profit or disposable income of $50,000,” he said.
“They’re very small businesses when it comes to being able to raise a family and expand the farms.
Near the south coastal town of Gnowangerup, about 350 kilometres south of Perth, Michael Lance recently sold his 1,600-hectare farm as one parcel to one farmer looking to expand.
“It’s happening more now; the whole farms are going to one buyer. When I was younger, it was able to be split up and people bought small portions,” Mr Lance said.
Mr Lance left school in 1972 and worked every day since on the farm his father purchased in 1950.
A smaller-scale farm such as his was harder to divide equally between his two sons who want to continue farming, making the sale an easier option.
However, Mr Lance said the concentration of farm ownership had consequences for the nearby town and community, already battling against a dwindling population.
A new generation
Mr Mengler’s children have pursued careers outside of agriculture.
“I went away to boarding school and all I wanted to do was leave the city and come back and be a farmer.
“But these days kids experience a lot more away from the farm when they go away for education and university.”
Last year, Mr Mengler suffered from a bleed in the pituitary gland, a non-fatal condition causing impaired vision, but it brought his priorities for his twilight years into focus.
“I just thought, ‘well there’s a lot of other things to do in life, just in case something did happen to my wife or me, we want to have a good look around and experience life a bit more’,” Mr Mengler said.
His farm was sold privately to another farming family, giving Mr Mengler some solace that a new family would replace his own in the local community.
With the average broadacre farm worth around $4 million, opportunities for young people and new industry entrants to independently own and operate properties are increasingly scarce.
In WA’s south coastal farming area of Denmark, cattle farmer Tony Pedro is finding it very difficult to pass his property on to his son without undermining his own retirement plans.
With the help of his parents, he purchased his farm in 1970 for about $30,000; now it is worth about $2.5 million.
“I am unable to gain a pension because the land is worth too much. My son is unable to buy it off me because it is worth too much,” he said.
His succession plans have also been stymied by a regional planning strategy which prevents the creation of a smaller lots on ‘priority agricultural land’, which Mr Pedro could sell to provide funds for a comfortable retirement.
The guilty sale
Guilt is a common emotion for the older generation faced with the daunting decision of whether or not to sell.
After a life of living on and taking care of his land for 50 years, Mr Pedro said he could not sell.
“I’d leave a broken man,” he said.
Mr Lance said the sale of his property was bittersweet.
“I always looked at it as a family asset that has been built up by many generations, and it should be used for the future generations as far as possible because it has been built up by efforts of other people in the past,” he said.
Mr Mengler said the decision to stop farming was necessary, but not easy.
“You’re only entitled to what you earn yourself, not to sell up something you were a custodian of,” he said.
Staring at the plaque honouring his father’s legacy, Mr Mengler admitted some things had to be left behind.