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ABARE reviews economic impact of OJD



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HON WARREN TRUSS MP MINISTER FOR AGRICULTURE, FISHERIES AND FORESTRY

AFFA01/16WT 9 February 2001

ABARE REVIEWS ECONOMIC IMPACT OF OJD

The Federal Minister for Agriculture, Fisheries and Forestry, Warren Truss, today released an Australian Bureau of Agricultural and Resource Economics (ABARE) review on the economic implications of a number of management options for Ovine Johne’s disease (OJD).

"This review was initiated following concerns from sectors of the industry that the application of current control measures are too severe and have caused excessive hardship to affected producers," Mr Truss said.

Mr Truss said the report confirms that the sheep industry, at both State and national levels, needs to work closely with State governments to achieve consensus on a national approach to dealing with OJD infections.

"There are different policy approaches to the disease. In Victoria and South Australia, the States have chosen to de-stock, supported by industry-funded compensation," he said.

"In NSW, the policy enforces quarantine, and farmers can choose to voluntarily de-stock without compensation.

"The ABARE report examines the economic impact of three policy options: eradication, quarantining and no intervention.

"In summary, the report confirms the findings of previous studies that the major impact of the disease on affected producers is the loss of market access.

"These losses are much more severe for stud producers than to wool and fat lamb producers.

"In the case of NSW, ABARE estimates that the net present value of annual production losses from OJD over the next 30 years ranges from $11 million (with a 1 per cent mortality and 1 per cent spread rate) to $236 million (with a 5 per cent mortality rate and 15 per cent spread rate).

"The equivalent values for Victoria are $0.6 million and $21.3 million."

Key findings of the ABARE 2000 report are:

under assumptions about the mortality impact of OJD (4 per cent losses), and the rate at which the disease might spread between properties over time (3 per cent annual spread), the total cost of the disease to the sheep industry in the absence of the current control measures could be around $60 million (the net present value of production losses from OJD over 30 years);

●

control measures for OJD should only be introduced or maintained if they cost less than $60 million to implement and operate, otherwise the cost of the disease control will exceed the maximum potential benefits;

●

the livestock movement and selling restrictions currently in place to control OJD are estimated to be costing the sheep industry around $7.2 million a year. If existing controls are kept in place, it will take around 11 years before the direct losses to the sheep industry from OJD control measures exceed the potential benefits.

●

eradication via de-stocking is likely to be a cost-effective control option for OJD if both the on-farm ●

mortality impacts of the disease are relatively high and the rate of inter-property disease spread is high. If these conditions do not hold, eradication via de-stocking will not be cost-effective.

"The report also states that likely costs to the sheep industry over the longer term, in the absence of formal control or government intervention, will depend on the scale of the production losses caused by OJD and the number of properties affected by the disease over time," Mr Truss said.

"The review provides an evaluation of revised information on the prevalence of OJD, available from surveillance activities undertaken as part of the National OJD Control and Evaluation Program (NOJDP).

"The ABARE report will be a valuable resource document for the mid-term review of the NOJDP that Animal Health Australia is proposing to undertake in the second quarter of 2001.

"The findings of that review will be considered at the ARMCANZ meeting in Darwin in August this year."

The report is titled Ovine Johne’s Disease: Evaluation of Control and Eradication Strategies and a copy is available on the AFFA web site at:

http://www.affa.gov.au/corporate_docs/publications/pdf/animalplanthealth/chief_vet/ojdpaper.pdf

Minister's office: Yvonne Best (02) 6277 7520 or 0418 415 772

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Last updated 9 February 2001

URL: http://www.affa.gov.au/ministers/truss/releases/00/0116wt.html Commonwealth of Australia 2000