Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Disclaimer: The Parliamentary Library does not warrant the accuracy of closed captions. These are derived automatically from the broadcaster's signal.
Landline -

View in ParlView

(generated from captions) with police in Europe overnight as anti-government demonstrators clashed

G-20 finance ministers wrapped up

their latest meeting in Paris. And

protestors have also taken to the

streets in Australia with dozens

gathering in Sydney and Melbourne

last night. Inspired by the 'Occupy

Wallstreet' movement the group plan

to camp out indefinitely in Sydney's

Martin Place. Similar gatherings

seen across the Asia Pacific region. Martin Place. Similar gatherings were

Queenslanders are cleaning up after

three days of wild weather in the

state's southeast. Severe

thunderstorms and hail has battered

the region, with the state emergency

service receiving hundreds of calls

for help. And Casey Stoner will

today's Australian Grand Prix in for help. And Casey Stoner will start

position. As he attempts his fifth today's Australian Grand Prix in pole

straight win at Phillip Island.

Stoner finished qualifying almost

half a second ahead of Spaniard

Lorenzo. The Australian currently half a second ahead of Spaniard Jorge

leads the championship by 40-points

and could clinch the title with two

races remaining. Those are the

headlines. Our next full news races remaining. Those are the latest

bulletin is tonight at 7 o'clock. This Program is Captioned Live.

# Theme music On Landline today is in for an upheaval the world market for rice the price of this food staple. after Thailand decides to double are poor The majority of the rice farmers the majority of the rice. but the poor do not supply And we examine the origins natural advantage in wool. of Australia's and their ilk The real heroes are the Peppins

this new animal type that re-engineered in Australia's pastoral country that survived the big expansion and then went internationally. in Tasmania And join Chinese fashion designers with some of our finest fleece. as they get up close and personal welcome to Landline. Hello, I'm Anne Kruger, First up today we head to Thailand, monsoonal flooding in decades. battered this week by the most severe

is protected by levees Although Bangkok have spent the past few days residents in outlying areas sandbagging their properties inundated farms, factories as a swollen Chao Phraya River

around the capital. and low-lying areas the Thai Government's bold decision The disaster coincides with of rice on the domestic market. to effectively double the price set of policies It's part of a controversial and to increase incomes, designed to appeal to the poor are among their key targets. and rice farmers exporter of rice But Thailand is the world's largest to artificially inflate the price and the move of the international export market. has created concern about distortion Zoe Daniel, reports. South East Asia correspondent, of the wet season in Thailand It's nearing the end central district and farmers in the rain-fed rice is inundated by flood water. are harvesting early before their in the dryer north-east Most of Thailand's rice is grown on small-scale irrigated family farms supports large scale production. and here, where the high rainfall there's a rush on to save the crop, This year, though, while there's no rush to sell it. their rice Farmers have been stockpiling that kicked in this week. ahead of the new pricing policy with the minister of commerce TRANSLATION: I had a talk and he told me no problem, without distorting the market they can do it will not be in trouble. and the farmers Association, Prasit Boonchuay, Chairman of the Thai Farmers is visiting members from the new system. explaining how they can benefit about it. But he has major reservations it will distort the market. TRANSLATION: Our concern is for our competitors It will become an opportunity their prices are lower than ours. to have more customers, since will buy rice from farmers Under the scheme, the Government

or just under Australia $500 per ton. at a set price of 15,000 Thai baht,

millers and marketers The rice will be handled by preferred and warehoused by the government,

it domestically or to exporters. which will either sell the middle of the process. TRANSLATION: The mill will be in

We take rice from the farmer to the mill rice and transport from the paddy rice

and then we take this rice pledging scheme. with the Government's

according to the scheme price. The farmer then receives a payment

goes directly to the farmer. The real benefit But the Government's new fixed price the current world price for rice is almost double of between $250 and $350. (Thai funk music) took office Prime Minister Yingluck Shinawatra at landmark elections in July. riding a wave of popularity of former prime minister, Thaksin, She's the glamorous sister like a business for his own gain, who was accused of running Thailand was ousted in a coup in 2006 a conflict of interest conviction and is now self-exiled to avoid was politically motivated. that he says

the red-shirt backed Thai Party, In his stead, Yingluck heads by increasing the minimum wage, which is targetting Thailand's poor incentive schemes introducing first home and car to farming households and increasing the price of rice than a quarter of the population. who make up more (Screaming) First thing we have to aim move forward into both area. for how we make Thailand The first area is by economy. and the will of people back Make sure that the economy is restore the democracy back. and the second thing from the free market approach It's a shift away for the economic and class divisions but some argue that's partly to blame in Thai society led to violent civil unrest. that have recently Intervention by the State stage of Thai economic development. is absolutely essential at this free market economy for some time We have been following a very distribution of income and wealth and the outcome has been that the and everything is really screwed up is important. so intelligent intervention what is intelligent intervention? The problem is that between 1970 and 1990 World bank figures show fell almost four times faster poverty in urban Thailand

a sore point among rural people than in rural areas - is trying to address. and something the Government It's certainly believe that in agriculture, particularly in rice, we must find a way to help the farmers. If done properly, it's very positive.

Farmers will gain from the policy, at least in the short term with the cost of growing rice currently around 6,000 baht per tonne or just under $200, a set price for un-milled rice of close to $500

represents a huge profit. But they doubt the motivation behind it. TRANSLATION: These policies are political, they're just to do with each major party beating its main rival. A similar policy was in place under Thaksin Shinawatra and then the last government replaced it with a less interventionist insurance scheme where it topped up returns to farmers if they didn't reach a minimum level or in times of seasonal variation. Now the system is changing again. It doesn't safeguard farmers against floods, drought or pests. TRANSLATION: When you harvest at the high water you have to be careful.

Nevertheless every farmer in Thailand is expected to sign up for the scheme because of the high price and they're expected to plant as much as possible for the sake of the guaranteed return. A record crop is forecast at the next harvest. TRANSLATION: It is the extra income we would like to have. We expected the new government to help us. We farmers have very high hopes from them in helping us from our hardship. But experts question whether poor farmers who have small land holdings and therefore low tonnages will be the true beneficiaries of the policy. Their excuse for all this heavy handed intervention is they want to help the poor rice farmers. Now, a majority of the rice farmers are poor but the poor do not supply the majority of the rice. The majority of marketable surplus

comes from the top 15% of the farmers. Ammar Siamwalla is a declared critic of Thaksin Shinawatra and his policies. He say a similar approach under Thaksin fostered corruption and the same thing will happen again. One or two or three selected exporters, who are the Government's cronies, OK, they only export through those people and they get to rake in a lot of money. Rice is the most important food for about half of the world's population. Yet only about 4% of the global production of rice is traded internationally, that's because most countries simply eat what they grow. Thailand is the world's largest exporter of rice Sending up to 10 million tonnes a year overseas which makes up a third of the international export market. If Thai rice is strategically released by the Government in small amounts analysts expect an increase in world prices due to the staggered supply but Thailand will then end up with a growing stockpile as farmers increase production to take advantage of the guaranteed price. If the Government then sends larger volumes onto the world market from its stockpile the world price will fall. Most concerning to exporters though is the fact that Thailand is at least initially

pricing itself out of the market and importers, particularly those in Africa and the Middle East, will look elsewhere. It is a scheme to buy outright every grain of paddy from the market at 50% higher than the market, and at the same time destroy the private sector that has helped building this rice industry

to be the champion in the world, over a long period of time, you could say a century, even. This is regrettable. Exporters expect other countries like Vietnam, Burma and Cambodia to increase production, particularly if world prices increase. That will erode Thailand's long-term market share which may be difficult to regain. You look at, let's say, we export eight to ten million tonnes a year, Thailand. And four million tonnes go to Africa.

That four million tonnes to Africa can be replaced immediately by the Indian surplus, just overnight, that's gone, and this is very serious that Thai Government is thinking that we have 30% share in the world, that we feel very comfortable that nobody can replace us. But I think that kind of attitude is too dangerous to take. In the short term at least the Government support scheme means Thai consumers will pay a lot more for their staple food - rice. Brisbane's just hosted the 5th Congress on Conservation Agriculture, an event that brought together around 500 of the world's leading agricultural and soil scientists, among them researchers who pioneered the techniques and equipment that have dramatically reduced and in some cases completely eliminated conventional cultivation. And it wasn't all Powerpoint presentations and speeches either. Landline dropped in on the congress field day at the University of Queensland campus at Gatton, in the Lockyer Valley. If the whole idea is to minimise the impact of food and fibre production on farmland, then this approach is about as light as a feather. This model helicopter is part of the burgeoning squadron of unmanned surveillance systems helping leading edge growers tweak their paddocks. The data they collect can significantly reduce the amount of water, fertiliser, herbicides and pesticides that need to be applied to get the crop over the line. And they were one of the star attractions at the field day organised in conjunction with the world Congress on Conservation Agriculture. John Kirkegaard is a plant scientist with the CSIRO. Very high adopts in Australia. We probably started playing with it in the '70s but since the '90s we've moved right up to now 80 to 90% of farmers would be using forms of conservation agriculture on up to 80 to 90% of their cropped land. So controlled traffic, no till, those kind of strategies? That's right. Retaining - the three principles are really

less disturbance of the soil, maintaining cover on the surface and having a diverse rotation. Controlled traffic is building on that by giving us more precision and more efficiency with our inputs and keeping wheel compaction after the cropped paddocks. And where would you put this revolution in terms of the great agricultural revolutions of the past? Well, I think we're seeing the start of perhaps the third revolution. The first agricultural revolutions were around new inputs like fertiliser and the green revolution - new varieties. What we need now is a revolution in efficiency of input use because we've got less land, we're going to be constrained with water, we need to double food production so what we really need is a revolution of efficiency and conservation agriculture is all about getting efficiencies of water use, labour, land and importantly inputs like fertilisers, and things like that. Apart from being early adopters, Australia has tended to drive a lot of the innovation in this area as well, hasn't it? Absolutely, Australians should be very proud of their innovative farmers and scientists because we are at the leading edge of this technology for large-scale mechanised agriculture, the sort of agriculture that's in North and South America. We're farming a difficult country - dry, variable climate, generally infertile soils so to make these sort of systems work under those conditions has been a real challenge, but the farmers have been up to it. And a lot of the people that are here attending this conference are in countries where Australia is actually extending that knowledge and giving and lending its expertise. That's right, Australia punches well above its weight in the international arena in this area. We have a lot of scientists who've headed up international centres for this kind of agriculture and we still have active programs in Africa, India, places like that, different systems but the same principles can be applied.

And in countries with similar difficult climates such as Australia has. For these serious scientific tyre-kickers the trade displays cover the whole range of equipment from tractors, seeders and sprayers with pinpoint accuracy worth hundreds of thousands of dollars down to more basic models aimed at subsistence farmers who according to the Food and Agricultural Organisation, need to be the next big adopters of conservation agriculture.

We have now entered at a global level into an exponential growth phase. We are now about about 8% of the crop land. Just to give you a comparison we have out-paced organic farming in a much shorter time, actually, when we started - when conservation agriculture as a brand, as a concept, started - we were half of the area of organic farming and in the meantime we are, I think, multiple of organic farming area in the world. We have now reached more than 120 million hectares and I think organic farming is still around the 30 million. So what have been the big drivers? Big drivers originally were pressures on farmers. Basically erosion. Well, the original history is from the dust bowl in the United States but also Brazil, for example, southern Brazil had tremendous erosion problems and then drought here in Australia,

drought problems in central Asia drought problems. But also profit. Farming is not really profitable in many parts of the world and economic pressures have also forced farmers. Originally conservation agriculture

was very much a farmers-driven movement. Is it necessarily a function of just how much money is thrown at it or is it an education thing or a combination of all those things? It's mainly educational. It's in the heads. It's knowledge, it's a change of mindset. The plough in agriculture has been a tradition. It's a culture. And this is difficult to take out of the heads of the people. So, simply, many people don't know about it.

They don't even imagine that you can do farming without ploughing. And the basic input in to spreading conservation agriculture is actually knowledge. Then comes technology, equipment, all that, that is needed to actually do it but the start is really the knowledge. At this congress we've seen examples of, I imagine,

technology initially developed for major food producing countries like Australia and North America, but which have now been modified to suit, as you say, much smaller, more modest agricultural settings. Right, well, actually we have now the technology available for all levels of farmers, from the hand farmer doing the job with the hand hoe up to the big farmer for animal traction farmers. There are noted technologies, conservation agriculture technologies available at all levels. Unfortunately not in all countries yet. We have in Brazil a strong industry doing this small equipment, in Paraguay we have a strong industry and we are now trying to promote this also in Africa and we see now African manufacturers popping up, we see Indian manufacturers doing no-till equipment and increasingly conservation agriculture-fit equipment. Chinese manufacturers are really struggling to get conservation agriculture equipment on the market. We see this happening but that is still a big bottleneck, the availability of affordable equipment for conservation agriculture for smaller farmers in most countris.

Thanks for talking to us on Landline. Thank you.

To our news summary now and Australia this week moved a step closer to putting a $23-a-tonne price on carbon when the Federal Government's controversial clean energy bills cleared the House of Representatives. Their passage through the Senate next month is assured. The Opposition has promised to repeal the laws if it wins the next election. (Chanting)

This chapter in the carbon saga ended

with the same sort of acrimony that's marked so much of the debate. This lying scrag that's running this country hasn't got the guts to put it to an election! From the middle of next year hundreds of big companies will pay $23 for each tonne of carbon they produce. It's Australia's biggest economic and environmental shake up in decades. This parliament today has grabbed the future with both hands. This will be remembered as the day the Gillard Government broke faith with the Australian people and gave itself a round of applause for doing so, Mr Speaker. To the Leader of the Opposition, I say you are being marooned by the tide of history. The crossbench alliance of Rob Oakeshott, Tony Windsor,

Andrew Wilkie and Adam Bandt voted with the Government. Ayes 74, nos 72 - the question is therefore resolved in the affirmative. These bills, as amended, have been agreed to. (Cheering) The Government, the Prime Minister, the Minister should be out there promoting what the end result of this is in terms of sustainable renewable energy resources.

Not the politics of it. And I think that's been the failing, in a sense. They haven't been able to get across what this is really about. It's about transitioning from one form of economy to another and this is where, I think, regional people have missed the argument as well. The opportunities in this are mostly in the regions. All of the sustainable renewable resources whether they be wind, solar, solar thermal, geothermal, bio-mass to biofuel, all of those things will be activities that will happen in country locations. To Sydney's appropriately-named Farm Cove and the official launch of 2012 - The Year of the Farmer, a 12-month celebration of all things agricultural. I mean, if you eat or if you wear shoes or wear a woolly jumper, you're connected to farming

and so we just want to make sure that everyone is aware of that. Events will include an education roadshow, a photography competition and an expo focussing on agricultural technology. The ailing Snowy River is getting a reviver. It's not the end - we've still got a lot of work to do but this is a significant milestone in the recovery of the Snowy River.

For decades most of its natural flow has been diverted into the Snowy Hydro Scheme, leaving the river silted and sluggish.

It's a great present to future generations that they will get the opportunity to see some of those flows that used to really be part of this landscape. Over two weeks 84,000 megalitres is being flushed through the Snowy, the most the river's seen in 50 years. This is the start of the end of a long wait to see health restored to the Snowy. To Queensland where there's been another outbreak of the deadly Hendra virus, this time near Caboolture north of Brisbane. Authorities put down a sick horse this week. It's the 12th in Queensland this year to suffer from the virus. And they suspect another horse at the property may have also had the disease before it was put down last week. It certainly fits the pattern of Hendra virus.

The focus has been on checking anyone who handled the horses. Very, very preliminary advice from the people that they have been able to speak to over the phone, said not a large number of people have come into contact with this horse or the horse a week ago. Meantime authorities still aren't sure what killed 21 horses at Kooralbyn, west of the Gold Coast. Two of the four surviving quarter horses are also showing signs of the mystery illness. Biosecurity Queensland is conducting tests on the dead animals and hasn't ruled out poisoning from paralysis ticks, weeds or water contamination. And finally, Queensland's rural community is mourning the death of Peter Kenny, the former president of the State's agricultural peak lobby group, AgForce. The 68-year-old former teacher died last week

after a long battle with cancer. During his time at Agforce he helped develop the successful Every Family Needs a Farmer campaign. Every action he took, particularly in the last 10 or 15 years was all about making sure that agriculture was a sustainable industry for Queensland and that the issues that we were dealing with were recognised by government. Peter Kenny is survived by his wife, Hillary, four children and grandchildren. The word is out for wheat - the world has plenty of it and there's more to come. World wheat stocks have been revised higher to 202-million tonnes, way above previous estimates of 195-million. This will mean little else other than weaker prices, especially as the Australian harvest moves forward. One significant feature of the Australian harvest at present is the lack of protein.

The Queensland harvest is about 40% complete and already it's apparent there'll be a shortage of the higher wheat grades. Here's the movement of the contract for January delivery of milling wheat on the East Coast. It peaked close to $350 a tonne earlier in the year and is now just over $225. The American picture was confusing because we thought the massive use of corn for ethanol might have led to a lift in feedlot wheat. But no, lotfeeders are actually using a corn/ethanol bi-product called DDG - Dried Distillers Grain. That's another reason why there's so much wheat around. Two other wheat figures to note - Black sea exports, especialy from Russia, continue to dominate the Middle East market. And how about this, the wheat crop in India this season is tipped to be 86-million tonnes.

Our crop will be around 27-million. Prices -And ASX Futures have reacted to all this news. East Coast Milling Wheat for January fell $12.50 while the important indicator for West Australian Wheat slumped almost $20. Chicago saw buyers assume the waiting position.

There's a realisation that with so much wheat around, there'll be no problems sourcing wheat for months to come. So the contract for December remained steady. Corn lifted because supplies remain tight while soybeans had a nice kick over the week after a downward revision of the size of the American crop. Local spot prices are very soft. Wheat was clipped, canola remains OK without being flash while sorghum is steady. That $15 fall for wheat puts the price around July 2010 levels. Canola of course is largely dependent on what's happening in Winnipeg. Now to livestock and Beef Central Newsletter had some interesting statistics in Friday's newsletter. Firstly, Australia's beef exports to the Middle East in September were close to a record. The tonnage was close to 4,000 - up 44% on the same month last year. And that's the same lift in calendar-year-to-date volumes. Our biggest customers - Saudia Arabia, Jordan and Kuwait. And surprisingly, Iran. That's the good news, the bad news comes from America with predictions of further cutbacks in beef imports. The USDA is tipping a fall in beef imports in 2012 of a massive 145,000 tonnes or more than 13%. What this might do to Australian exports, that's for next week. Now prices - and further rain in cattle country has kept restockers active although producers are becoming very inclined to hang on to young cattle. And the fluctuating dollar is giving headaches to exporters. That trade cattle price tends to yo-yo like that from one week to the next. Other prices - steady to firm.

This places the eastern states young cattle indicator marginally ahead of last week's figure - $3.99 cents a kg.

Sheep and lamb markets remain strong. Quality is reported to be excellent, demand is up. And numbers too have improved. Our indicator for trade lambs is off a fraction but mutton has lifted. In the west, export demand is said to be very, very consistent. Now back to New York for a quick check on sugar and cotton. Cotton remains the mystery crop. Traders describing business as directionless. While sugar is getting some sweetness back. Cotton remains above a dollar a pound - but only just. Volumes traded are described as extremely thin. And that flooding in Thailand has given sugar a filip, up over 2 cents for the week.

Finally to wool where it was an odd sort of week. The indicator fell but because of the swinging dollar, in US Currency terms, prices actually went up quite a bit. Buyers from China were dominant, as usual, with support from India, Europe and Korea. The Eastern market indicator closed at 1,160 - down 4 cents but against the American dollar, that was actually a lift of 61 cents. And it's also about 28% above the price for this time last year. Bbuyers and sellers will be keeping a close watch on the auction of some excellent wool in Newcastle this coming week. Now before I finish let's check 'the running of the bulls'. No, not the famous run in Pamplona but a new event in the Riverland comunity of Barmera where the runners are not actually bulls, they're sheep. 350 sheep ran down Barmera's main street to mark the 30th anniversary of the town's famous sheep dog trials. It appaeard to be somewhat of a stop-start affair but that didn't seem to worry locals who lined the street to watch the spectacle. Organisers are hoping 'the running of the sheep' will become an annual event. Three years ago Australian Wool Innovation launched a massive publicity campaign with a big international push, with Europe as its main target. The campaign is continuing

but the focus has shifted to one of the world's most rapidly modernising economies.

China's set to overtake the United States as the number one consumer of luxury goods and AWI wants ultra fine wool to be part of it. Martin Cuddihy reports from Tasmania. The woolshed in Tasmania's Midlands is not exactly the first place you'd expect to find Chinese fashion designers

but there's nothing stand-offish about these two who are keen to get into the yards and handle the fleece. Have a look here, give her a kiss! She got good teeth? These designers dress some of China's most well-heeled women and now they're learning about where the wool comes from.

When they're in China they have no idea where the wool comes from so to bring them to the farm, to see the animals to meet the people who actually grow the fibre, the farmers to put them at the forefront of this story is really compelling and really interesting to the Chinese market,

particularly the Chinese female consumer who is looking for more than just a brand.

TRANSLATION: Everything here is so, including the natural landscape, and also the sheep is so natural and pure

so when I do my design, these are all my inspiration. Australian Wool Innovation has brought six designers to Tasmania

as part of its aggressive push into the wealthy Chinese market. In partnership with the China Business Network they're filming a documentary that charts the origins of high-end fashion fibre.

A little like red meat story of paddock to plate, this campaign follows fleece from woolshed to catwalk and today they're at Georgie and Hamish Wallace's place. Yeah, lovely young fellows and great to see what they're doing with wool and I was so thrilled for them to be here to see how we grow our wool and, you know, so that they can go home and tell their story and I think it's very important that they do that, yeah. TRANSLATION: I have never been to a place like this before. There's such big farm and a big scale. What impressed me most is the relationship between Georgie and her sheep. There is just a lot of care and the love and harmony. It's important to our design because we respect life, no matter as human beings or animals. However, some of the story might just get lost in transation. I said one of the first things is I look for I look in the sheep's mouth to check its teeth meaning it's got all its teeth and they were meaning they thought that I meant whether their teeth were clean or not. So I can tell you, I don't go and brush, floss all the sheep's teeth every day. Yes, so it was quite entertaining. ADVERTISEMENT: ..when you began to care about the way you dressed, somehow you always chose wool... Woolmark has been pedalling its wears to the pointy end of the market since it was formed in the 1960s but it also disappeared into obscurity before AWI took over Woolmark four years ago. (Smooth music) It relaunched the brand the next year with a big push into Europe, creating the Australian Merino Wool Prize for emerging fashion designers. The inaugural winner was 30-year-old Qui Hao from Shanghai. The win gave him international exposure and $100,000 worth of support from AWI. I think it's a good chance to get to, you know, present myself, present my work and in front of the people all over the world. The aim was to build long-term relationships with designers. Today, Qui Hao is still working with AWI in China. We work closely with Qui Hao. He's a boutique designer at the moment so he doesn't have the volume that resonates with this particular program. However he has been shown our wool lab and is looking to source some fabrics from that as well. So, our Shanghai team is working very closely with him as well. Understandably, it's good news for AWI. The industry has had its fair share of bad publicity in recent years. The mulesing debate dominated coverage in recent years. But they've worked hard to produce a positive image. The Woolmark Gold Standard was launched last year focussing on fashions for men. On Saville Rowe in London

Chinese businessman were fitted with ultra fine Merino suits. From the campaign last year our partners reported back on a 15% increase on their wool sales into China. This year the partners, on signing on, to come on to be a part of this campaign have committed to a 5% increase in the first year in their wool consumption and 30% next autumn/winter as well. So it's a big commitment for them but I think that shows their passion for the fibre and the industry. China has become the main focus for AWI simply because of the growth in the luxury market. It will soon overtake the US as the biggest consumer of high-end products in the world. Growth in female luxury spending alone increase ed by 22% in the three years to 2010. Male spending increased as well but by less than half that amount. AWI wants to tap into that growth

so the focus this year is on what women want. TRANSLATION: Hm, I feel like I will make a lot of beautiful clothes because as a designer you need to be sensitive to things that you have seen so not just a sheep but also, like, the cloud here and beautiful scenery so there are a lot of inspiration for me. Has that been a real shift in the Chinese market, to want to know what's behind the brand? Most definitely, and in the female luxury market that's definitely the case. From our studies it's shown they're a lot more educated these days about what they're buying and they will spend money on products that have a backstory and that's what we're trying to tell here today. The Tassie trip is an important part of that backstory and an important part of educating the Chinese

about what goes into producing first-class fleece. TRANSLATION: Mm, it's important to let consumer know it's also, for designers it's important because before I come to here I'm not much very familiar with all these things, like farmland, how you take care of sheep, and how do you produce wool. There's a lot of effort behind and also the natural environment here, there's harmony that I can feel between the people and also the sheep so in terms of like this, like, eco-friendly is also a big trend. Georgie Wallace runs Trefusis in Tasmania's Midlands, she reckons AWI is on the right track. I'm more than happy to see them direct our marketing money to projects like this with the Chinese designer because if it has some outcomes. And I think most growers would feel the same that if, you know,

if it's a well directed campaign and it has outcomes which means that we're selling more wool, a bit more money, I think I don't think you'd get any arguments. She also believes wool's sheer versatility should be pushed a lot harder. I think a lot of young people think it's, you know, it's wearing that awful scratchy jumper that, you know, grandma knitted me in the winter time. It's very trans-seasonal now, you can wear wool all year round. They can weave this type of wool to as thin as any cottons. So I think it's important to get that message across. So, what are you looking for? We're looking for nice length. Georgie Wallace is in charge of the ultra fine Merino wool program on Trefusis.

Like many others in this area the drought has taken toll on its flock. They usually run 22,000 sheep on more than 7,000 hectares but that number nearly halved during the lean years. Since spring 2009 we've had some really good springs and autumns since then so we're gradually starting to build our numbers back up. I think we're up to about 16,000 sheep again now but we've still got a lot more capacity to grow that again.

So there's capacity for Trefusis to grow and that means they will be producing more wool. Considering China's insatiable demand, that's a good yarn in anyone's language. Staying with wool, and one of Australia's most famous sheep studs, Wanganella, in the Riverina region of southern NSW has just celebrated its 150th birthday. The story of how the Peppin family developed a Merino that could thrive in the harsh, dry inland is an epic. Indeed, until recent years, more than 80% of Australia's Merino flock could trace its origins to Wanganella. It's the annual on-property ram sale in the Boonoke Station in the southern Riverina.

Boonoke stud is one of the most famous in Australia but the buyers have driven in or flown in from all over the country. The quality of the sheep here today is, you know, quite outstanding. There's very good quality wool - soft, tests very well, the microns are probably ranging between 17 and 22. AUCTIONEER: A magnificent lineup of beautifully grown rams, bearing in mind a lot of studs have their rams up on platforms. these sheep are standing on the terra firm, and they really fill these pens up with a bulky body and a beautiful soft handling wool of tremendous staple length.

the Merino sheep here are large by any standard. Some of these prize rams weigh 120kg. They may vary in the length or strength of their wool but all of them share a common DNA and a prestigious ancestry which makes them part of a much feted flock. They are known as Peppin Merinos,

named after the family that developed this type of Merino a century and a half ago.

They developed a type of sheep that will thrive in this area, they increased the length of staple to about six inches probably going from, in those times, sort of an 80mm or sort of three-inch staple, put more nourishment in the wool, more guts in the wool so it could handle the droughts, the tough times. In the Riverina there have always been tough times. Periodic decade-long droughts punctuated by flooding rains that bring lush pastures, exactly what region has seen in the past two years. Such climatic extremes made settlement on these inland plains a forbidding prospect. The early settlers found this country dreary, monotonous and utterly inhospitable. Away from the creek and river frontages it was virtually waterless and in 1861 it was considered too harsh for sheep let alone Merino. Until then this was cattle country and the herbage of the salt bush plains was unsurpassed in fattening stock for markets such as Melbourne in the south. And that's what the Peppin family did initially

in 1858, when it settled on nearby Wanganella Station. But margins were slim. Facing financial ruin the Peppins, George Senior and sons, George Junior and Fred, skilled livestock breeders originally from Somerset in England, realised that they had to breed a tougher type of Merino. Mother nature was a very good sheep classer and they found that a sheep out on that pastoral country had to walk 10 to 12 miles a day, up to 20kms, had to probably had to raise a lamb, grab a feed while it was on it, come back, and survive in tough conditions and a little tight, small Merino animal the traditional Saxon on Spanish wasn't going to do it, and this new composite breed, which was still Merino but had strong bone and carcass and survivability, they were the ones that survived the tough years. In 1861, with an eccentric genius sheep classer, Thomas Shaw, to help them the Peppins began to select and breed from the finest imported sheep that money could buy. Family legend has it that he left home without telling his wife and children where he was going, he kept clothes stacked away somewhere or other which he collected, he just disappeared and came back from time to time quite unannounced. And ultimately he basically went out doing his job of classing sheep and ultimately he died, as his biographer said, in a haze of alcoholism.

Whatever his failings, Shaw had helped spark one of the greatest revolutions in world agriculture. The first time in human history a sheep breed has been reengineered to suit the new industrial machines. So what the Peppins and others did was convert this short fibre into a long fibre that could be combed and was much stronger and made superb fabrics that at last could compete with cotton. So it was a world revolution in genetics and textiles really largely attributed to these brothers down in the Riverina out on the wild country near Deniliquin. Within a few years the long stapled wool, dense enough to keep out the ruinous dust of the inland, was displacing cotton and making woolen clothes in the form of tweeds a worldwide fashion. Obviously developing the wool types that suited the Riverina, length of staple, they had to get away from those finer, thinner wools that actually came out from the Spanish Merinos to start with. They were only cutting a couple of pounds of wool. Peppin sheep were in great demand. They were sent to the expanding inland pastoral areas. They won prizes at prestigious sheep shows. By 1873 the Peppins' vast holdings included neighbouring Boonoke Station. But just as fortune beckoned George Peppin junior died in 1850 and in 1778, the Peppins sold up. Elbert Austin and his brother in law, Thomas Millear, brought Wanganella stud and the pick of stud sheep. Franc Falkiner brought Boonoke and his share of the Peppin flock. Equipped with such elite bloodlines they established pastoral empires. You think, wow, there was real wealth in the area,

but we wouldn't understand it because we were trying to contemplate in today's terminology. When these people came out from England. And we just can't fathom how successful they were. Albert Austin, who really was my great grandfather, a great entrepreneur, saw this opportunity to actually get into the stud job,

he has five sons who were all fantastically enthusiastic about growing Merinos and it was those five sons that put together something like 70,000 Peppin Merino ewes which when they contributed their bloods collectively together as Charles Massie said in his large book, The Australian Merino, it was one of the most powerful collective groups in genetic history. Under Franc Falkiner, who became a colossus of the pastoral industry, Boonoke was acclaimed as the world's largest Merino stud. At that time and around the 1900s people were acquiring land and developing land and they wanted sheep and they needed them now and here was the man who had the best rams in the country.

He wouldn't sell ewes, he only sold rams and so he kept expanding. But he also had very good wool men and very good sheep men with him. By the 1920s Falkiner and Sons was annually selling up to 10,000 rams within Australia and overseas. And Wanganella stud set world-record prices for its stud sheep. We got some marvellous prices in those days, didn't we? Well, I mean, my father jackerooed at Wanganella in 1924, I think he delivered 91 to Sir Sam McCackney for 5,000 Guineas then which is worth over $100,000 now. He was just a wonderfully wooled ram. The Wanganella sheep were sent to more than a dozen countries. It's incredible. In Australia, South Africa, Argentina, probably Russia, you know, China, really, the bloodlines have gone everywhere.

But very capable men developed the sheep. There was fierce rivalry.

The Falkiners and the Austins didn't like each other. The Austins complained the Falkiners grazed their sheep on Wanganella when they were moving from Boonoke to Zara. There was great rivalry. That was simply a commercial advantage, was it? That whose sheep - you would spruik that your sheep were better

or you didn't want to, you know - We were sure ours were better. Those traditional rivalries have dissolved with the years. I'm thrilled to be able to say that there's those three families,

the Austins, the Millears and the Falkiners are represented here today. This is an awesome anniversary, it's an amazing stud and it's an amazing Merino sheep. And, of course, the fleeces from these sheep they were part and parcel of Australia becoming a modern industrialised country. The money that was made in wool was phenomenal. It's very exciting to be part of today's celebrations. An exceptional day in Australia's history from the ram sale to the historical display to the mannequin display. A captivating retrospective parade... It was a day of nostalgia, even featuring woolen fashions of times past. Boonoke homestead once rang to the sound of lavish parties and visiting ram buyers. By 1958 the Falkiner family company has brought the Wanganella stud

from the Austin family. Once was the wealth of wool that these big stations employed dozens of workers. Boonoke resembled a small village. Much has changed about Peter Falkiner's boyhood home. It's totally different - back in those days there were so many people who were here and now it's run far more efficiently and on different lines. That's simply the way it is today. The economics are not such that you can support so many families and things in an enterprise like this. Boonoke, Wanganella and other Falkiner properties moved into corporate hands in 1971 at the height of a crippling drought and the crash of the wool market. Then Rupert Murdoch's News Limited bought the famous studs in 1978 and sold them in 2000 to the current owners, Bell Commodities, a division of the stockbroking firm, Bell Potter Securities. Remarkably, the original Peppin properties remain together under one owner, but it's not by coincidence. In the sale contract Rupert Murdoch stipulated that the studs and their heritage had to be kept intact. We were very agreeable to that clause being in the contract.

By nature, we're not, sort of, assett players. We've never, in any business, bought something and then carved it up and made a quick turn. This is a fabulous property aggregation. The News Corporation people, I think, they bought Beratta

which added to the thing. And that what we've already done - we bought one property up at the Murrumbidgee called Burrabogie,

and then we bought and another one next door. So we're into aggregations, we love them.

The Bell brothers are now major players in the Australian agricultural sector. But like many, they're mystified why the story of the Peppin Merino is not better known. Author and historian, Charles Massie, has his theory. It's largely an iconic myth that's regurgitated that Macarthur was the founding father. He might have opened up the wool market a bit but the wool industry didn't explode in Australia until the 1840s and the real revolution came after that and it was led by people like Peppin and the South Australian breeders and others in NSW, and they've been forgotten because, whatever reason that journalists and writers and historians choose secondary sources they've regurgitated this John Macarthur stuff.

The real heros are the Peppins and their ilk that really engineered this new animal type and survived the big expansion in Australia's pastoral country and went internationally. By a long way, Australia' evolved the world's greatest wool industry, by a long way, and the foundation of it were these new sheep types suited to the market and to the Australian environment. I think it's hugely important and the place has an incredible history of where do you start, where do you finish, it's a huge story. Many are amazed when they first encounter the story at the Peppin heritage centre in nearby Deniliquin. The museum tells the story of how the pioneer pastoralists like the Peppins, built the wool industry. At Wanganella itself, where the Peppin originated, the memorial of a bronze ram also marks that achievement. In 1861 the average wool yield for Merino was about 2kg and Australia had 20 million sheep. A century later it was around 5kg and the national flock was more than 150 million.

Today, through continual genetic improvement, Peppin Merino ewes can cut up to 10kg a head. They're just large and cut a lot of wool. These sheep here will cut probably averages 9kg and rare a lamb so it's not bad money today. Indeed there could be no better way to celebrate Wanganella's 150th anniversary than this year's strong resurgence in the wool market and several successive lush seasons.

We've had no problems this year so the yield should be good. You know, it's been dry for the last 12, 15 years but this year and last year has just been unbelievable. Cut plenty of wool and it's keeping the dust out which is good, yeah. It's great to see wool after all this time and sheep prices after 20-odd years of depressed prices and droughts and, you know, we've had a pretty long ordeal but it's just been wonderful in the last 18 months and probably is a bit more money around now for people getting money from their wool cheques. The impact of fatter wool cheques was reflected in the sale ring. I've got 26,000... (Continues to auction) 26,000, thank you, sir. By a number. Goes to Corralin stud, thank you very much, ladies and gentlemen. was reflected in the sale ring. That price of 26,000 was the highest in some years but the top price was made not by one of the traditional horn Merinos but but by a poll, or hornless ram. Could make him 25 or 30,000.

Make it 46,000. No, it's way out over here. I've goth 48,000, last call out at 50,000 done, finished. All over, done. 50,000 buys him, thank you, bye. A syndicate of four South Australian stud breeders landed the prize animal, an indication of the growing appeal of poll Merinos. It was another fitting milestone on a day of celebrations. Starting in the 1930s Boonoke was the most influential stud in the development of the poll Merino, another offshoot of the illustrious Peppin bloodline. What we like about this sheep is its ability to cut a lot of fine wool. Regardless of where the market is they always pay more the lower the micron you get and one of the problems with the lower micron wool is to keep the staple and keep it cut but he's got both and he's got both in abundance. We hope he stamps that staple on all his progeny and like his good micron and all his good virtues, yeah. It's hard to overstate the importance of the Peppin Merino. The history made here lives on in flesh and blood. In the world's most influential ovine bloodline. Wonderful today to see a stud like Wanganella after 150 years still at the forefront of the industry. Obviously a magnificent sale today but a testimony to the breed and to the type of sheep that are here. The season seems to be getting better and better, good rain in the right places at the right time and the southern oscillation index is staying friendly as well. Here's the SOI. It's up a fraction from last week but the at that level it should not cause too many worries. It's about 20 or more points below the SOI this time last year. Now rainfall for last week. Here's the national map. If you're a grazier you'd be really happy but farmers would actually like some dry, hot conditions especially south from the Downs through into NSW. Numbers now. Dalby farmers would be hoping that's their lot for a while, 55mm last week.

Over the border Mungindi had just 2mm, Rosebud in Victoria scored 17mm, 39mm was the reading at Pioneer in Tasmania, Penong in South Australia had just 4mm while that rain in the Top End could be the first signal of the coming wet season. Mataranka picked up 35mm. While Quadney in the WA central wheat belt recorded 21mm.

And that's the Landline check on rainfall. Next week the rise and rise of private conservation. It's 20 years since Bob Brown started with a plan to safeguard two parcels of Tasmanian forest from the woodchippers. Bush Heritage Australia now protects more than 1 million hectares and along the way it's become a philanthropic phenomenon. People just took to it, they liked it, its time had come in Australia where people who had a bit of spare money could put something away for the saving of the natural environment so that their children and posterity could enjoy it too. From little things big things grow, one of our stories when Landline returns next week. I hope you will join us then.

Bye for now. Closed Captions by CSI.