Wheatbelt farmers face mounting debt crisis
A Liberal backbencher has revealed the extent of the financial crisis facing WA farming in an explosive speech to State Parliament.
South West region MLC Nigel Hallett said banks were preparing to write off $100 million in loans in addition to farmers writing off up to $700 million in assets.
Mr Hallett warned that 15 per cent of the farmers left standing in the Wheatbelt were under considerable financial stress and that a third were financially vulnerable.
He said the average farm debt was more than $2.5 million.
The pending bank write-offs would put the farmers who remained under even more pressure as equity levels fell and the cost of lending increased.
Mr Hallett backed crop mitigation insurance as a means of providing greater financial certainty for farmers and called on the State Government to consider lowering stamp duty on the policies.
It is estimated about 4300 farmers remain in the Wheatbelt.
Peak lobby group WAFarmers has warned that 500 could be forced out of the industry and the Rural Financial Counselling Service has 800 clients in the Wheatbelt.
Allianz-backed Latevo began selling income protection insurance for grain growers this year, while Swiss Re and its US-based partner The Climate Corporation were on the brink of launching a yield-based policy.
Latevo chief executive Andrew Trotter held a series of meetings with Wheatbelt farmers last week.
Swiss Re and TCC are understood to have put their plans on hold because of concerns about a lack of weather-tracking technology in WA.
Mr Hallett's warning came as the leaders of the Wheatbelt-based Muntadgin Farming Alliance concluded two days of meetings with 11 Liberal backbenchers.
Alliance spokesman Jeff Hooper praised Mr Hallett and Eyre MLA Graham Jacobs for drawing attention to the rural debt crisis.
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