Drawing on the on-farm financial experience of John Mitchell, a grazier in New South Wales who saved his family farm, this article sets out strategies farmers can use to prevent wildfire damage and deal with its consequences
Recent major wildfires have burnt extensive areas of agricultural land in southeastern Australia. Based on our collective experience in farming, finance, and fire science, we believe there are some important things on a farm and in a farm business to limit fire risks and help with post-fire recovery.
One of the key factors driving fire behaviour in agricultural landscapes is wind speeds. One of the ways to reduce wind speeds in farmland is already well known to many farmers: that is, to establish shelterbelts or strips of trees. Shelterbelts between paddocks and along streams and creeks, with wider plantings and understorey plantings have the greatest dampening effect on the speed of winds in agricultural landscapes. Well-designed and properly established shelterbelt plantings can also improve lambing success, provide shade for livestock, enhance pasture protection, and boost the conservation of native farmland biodiversity. Gates at regular intervals through the fences typically constructed around shelterbelts facilitate farmer access to paddocks, including as part of rapid fire suppression efforts. It is critical not to establish shelterbelts too close to homesteads and other buildings in order to protect farm assets during a wildfire. Several studies have shown that ensuring native vegetation is not too close to homes and buildings reduces the risk that property is damaged in a fire.
Another key pre-fire farm management strategy is to have well-managed waterpoints such as tanks and farm dams that can be drawn upon for local fire suppression. Currently, many farm dams are poorly managed, limiting water supply, especially during extended dry periods and droughts. Renovating dams can not only boost water availability for fire fighting but also enhance water quality for livestock and boost drought resilience. The financial benefits of farm dam renovation have been well established from peer-reviewed and published benefit-cost analysis.
From a financial perspective, a critical part of fire preparation is to try to ensure farm finances are in good shape, with limited levels of debt if at all possible. Even if a farm has been completely burnt out, a bank will still want loan repayments. Beyond standard on-farm income, farm management deposits and off-farm investments can produce additional sources of income. To spread the financial risk, off-farm investments such as a share portfolio or a rental property should not be linked to farming or the agricultural sector. Of course, in dealing with the risks of fire, it is crucial that farmers have up-to-date insurance, even despite the steep rise in premiums in recent years.
Few parts of Australia, including the country’s agricultural landscapes are immune to fire. The recovery process is stressful, prolonged and expensive. Because fires cause financial stress, it is best if the farm is in good financial shape before a fire. This is especially important as pay-outs on insurance may take a long time (often a year and sometimes much longer). Farmers (and others) need to be aware of ‘claims chasers‘ who will offer to act as an intermediary with insurance companies yet can create many forms of additional financial and other stress. It is recommended that farmers deal with their insurer directly.
The workload in the months following a fire is substantial. It can include the destruction of fire-affected livestock, the purchase of stock feed for remaining livestock if all pastures are burnt, and the re-establishment of key farming infrastructure. Some of the farmers with whom we have worked have used the impacts of a fire to re-organise where their fences are located and reset their farm infrastructure to better suit their needs. Many of these post-fire activities should be guided by a reframed financial and business recovery plan, that encompasses the farm’s key priorities, how long particular tasks will take (and who will do them), cash flows and tax implications.
Some of the perspectives in this piece are drawn broadly from the book, Sustainable Farm Finance.
David Lindenmayer
Professor David Lindenmayer is a distinguished Australian scientist and academic, specialising in landscape ecology, conservation, and biodiversity. His research focuses on integrating nature conservation with agricultural production, improving biodiversity conservation in forestry and plantations, and enhancing fire management practices. With over 1000 peer-reviewed papers and 50 books, David is one of the most published ecologists globally. He leads large-scale, long-term research programs in south-eastern Australia. A Fellow of the Australian Academy of Science, he has received numerous prestigious awards, including the ESA Whittaker Award, multiple Eureka Prizes, and the Australian Natural History Medal.