AS THE sun sets on the first decade of the 21st century, DAVID McKENZIE looks back on the events that defined agriculture's present and will shape its future

The decade began with the nation's quarantine boffins beavering away on a 1999 request from New Zealand to drop Australia's 80-year-old import ban on its apples.

Ten years later the issue remains unresolved.

The decade also saw other quarantine controversies and stuff-ups involving imported bananas, salmon, pork and chicken.

FOOT AND MOUTH, MAD COW AND NLIS

IN 2001, the world was shocked by a major outbreak of foot and mouth disease in the UK. Seven million sheep and cattle were slaughtered in a bid to bring the disease under control.

It was followed by an outbreak of bovine spongiform encephalopathy, or "mad cow" disease, in Canada in 2003, and further FMD outbreaks in China in 2005 and the UK again two years later.

The events sent shockwaves around the world, disrupting trade and prompting renewed emphasis on disease detection and prevention strategies.

In Australia, this led to a revolutionary electronic ear tag system to trace cattle. The National Livestock Identification system began in 2005.

DROUGHT, CLIMATE CHANGE

AFTER a wet start to the decade, Australia was plunged into its most prolonged drought on record in 2002-03. Seven years later, despite some relief over the past year, many rural areas are still badly affected.

The "big dry" has defined the shape of modern farm policy, with Exceptional Circumstances scheme funding, introduced in the 1990s, reaching billions of dollars in aid to farmers by the end of this year.

The Pacific Ocean phenomenon, El Nino, had been regarded as the cause of dry spells, but was a more fundamental climate shift occurring? Climate change gained prominence as international scientists warned of dangerous global warming, caused by a build-up of carbon in the atmosphere.

The Federal Government spoke of climate change and drought in the same breath, promised (but are still to deliver) reform of EC, and drew up plans for an emissions trading scheme to limit Australia's "greenhouse" emissions.

Those plans are now in political limbo, rejected by a Tony Abbott-led federal coalition amid concerns about the extra costs of an ETS, especially for rural Australia.

WATER

WATER shortages became a defining feature of the decade. Irrigation communities came under increasing stress as allocations dried up and alarm grew at the decline of major river systems.

A series of progressively bigger and bolder plans were hatched by federal and state governments to deal with the growing tension between irrigation and the environment.

The Living Murray plan in 2002 aimed to return 500 gigalitres to environmental "icon" sites along the river, while a rescue plan for the Snowy River was also enacted. Both had end-of-decade targets - and both have fallen short.

In 2004, the National Water Initiative attempted to bring a formal structure to water entitlements, sharing water between consumption and the environment, and reducing historic over-allocation of irrigation water rights.

Water trading was for the first time recognised as part of the solution, with a limit on out-of-area movements, and scientific work started on water availability across the Murray Darling Basin.

The decade also saw the urban thirst for water reach its ultimate expression in the form of the Victorian Government's decision to build the highly controversial north-south pipeline to send water across the Great Dividing Range to Melbourne.

OIL-FOR-FOOD SCANDAL

SHORTLY after the Federal Government converted the Australian Wheat Board into a semi-commercial, grower-owned monopoly in 1999, the grain marketer became engaged in some highly questionable dealings with key customer, Iraq.

The United Nations had slapped embargoes on Saddam Hussein's rogue regime, only allowing it to sell oil in exchange for humanitarian food supplies. But a UN investigation in 2004 accused AWB Limited of breaching UN sanctions by paying kick-backs of up to $300 million to Saddam's regime.

The Government was forced to set up a royal commission under retired judge Terence Cole in 2005 to investigate if international and/or Australian laws had been broken.

After months of often sensational evidence, the Cole inquiry delivered a damning indictment of AWB and a number of its senior executives, including former chief executive Andrew Lindberg.

DEREGULATION OF WHEAT EXPORTS

THE Cole inquiry tarnished AWB's international reputation and sounded the death knell for its monopoly hold over bulk wheat exports, or the "single desk", to the dismay of many farmers.

The new system kicked off in October last year, ending almost six decades of monopoly wheat exporting.

DAIRY DEREGULATION

THE year 2000 was a defining year for dairy farmers with the farmgate deregulation of the industry.

The Victorian industry - especially Murray Goulburn and the former Bonlac co-operatives and the United Dairyfarmers of Victoria - which accounted for more than half the nation's milk production, pushed for deregulation.

On July 1 all legislation supporting the price of drinking and manufacturing milk was scrapped. Farmers were eligible for a share in an industry compensation package worth up to $1.74 billion.

Since 2000, international commodity prices have played the biggest role in determining farmer returns.

The past two years, which saw record farmgate milk prices followed by a dramatic 40 per cent cut to dairy incomes, demonstrated how exposed farmers have become to the highs and lows of the world market. Since deregulation, the number of dairy farms in Australia has decreased dramatically, from 12,896 (in 2000) to 7924 (in 2009), while most of those who stuck with milking have increased their operations.

ALPINE GRAZING - END OF AN ERA

THE Victorian Government closed the door on one of rural Australia's most enduring traditions when it officially declared an end to the grazing of cattle in the Alpine National Park in May 2005.

The ban was met with howls of protest, the return of angry cattlemen and their horses to the streets of Melbourne and a shortlived Federal Government attempt to help overturn the decision, but to no avail.

ANIMAL WELFARE, MULESING AND LIVE EXPORTS

FOR the wool and sheep industry, the emergence of an organised international animal rights movement was a nightmare.

The US-based People for the Ethical Treatment of Animals, boasting more than two million members worldwide, targeted the mulesing practice used by most Australian wool growers to prevent fly-strike among their flocks. With the help of high-profile celebrities and graphic advertising campaigns, PETA pressured a number of EU and US retailers into boycotting Australian wool. At home, there was a controversial industry commitment to phase out mulesing by 2010, which led to upheaval in the industry marketing and R&D body, Australian Wool Innovation.

The live export trade, which reached almost $1 million at its high point during the decade, was also plagued by animal welfare problems.

Controversy regularly flared over fatality rates and cramped conditions on ships. But it was the Cormo Express incident in 2003, when Saudi Arabia rejected a shipment of sheep on disease grounds, that led to a major government review, an industry shake-up and big improvements in animal welfare standards and practices.

In the same year animal rights activist Ralph Hahnheuser infamously fed shredded ham to sheep at a Portland feedlot in a bid to thwart their export to Muslim countries. The high-profile case is still in the courts.

More recently, animal rights campaigns highlighting maltreatment of animals in the Middle East has forced Australia to help the region lift its animal handling practices.

MANAGED INVESTMENT SCHEMES

UP-FRONT tax breaks for managed investment schemes became one of the most controversial issues in rural Australia.

The rapid growth of MIS was fuelled by unfair tax leg-ups in rural property markets, forcing prices up and taking prime farming land out of production.

Amid calls for an end to the tax breaks, scores of investors were burnt by the collapse this year of MIS giants Timbercorp and Great Southern, which saw large volumes of their water and timber and horticultural assets sold offshore.

GENETICALLY-MODIFIED CROPS

CONTROVERSY over GM crops raged throughout the decade.

Opponents warned of the creation of "super" weeds, problems of market acceptance and untested threats to human health, while farmers saw the opportunities for productivity gains and herbicide reduction.

Towards the end of the decade, state governments began lifting their bans on GM canola, and commercial crops are now a reality in some regions.