Rice industry struggles hit small town Deniliquin

The recent layoff of nearly 80 workers at a major rice processing plant in southern NSW has sent shockwaves through the small town of Deniliquin, with many residents struggling to make ends meet.

Deniliquin, with a population of 7,500, is home to the largest rice mill in the southern hemisphere, and the loss of 68 jobs at the plant has had a significant impact on the community.

Affordable housing in short supply

Vinnies Services manager Meghan Fisher said that affordable housing was already in short supply in Deniliquin, making it difficult for people who have lost their jobs to find alternative accommodation.

"Not only are they dealing with [not] being able to pay the rent while they're looking for another job or waiting for government allowance … they won't be able to find one that's going to be more affordable."

Rice industry is 'backbone' of the community

Edward River Council Mayor Ashley Hall said that the rice industry is a key economic driver in the region, with one in five jobs directly linked to the industry.

"It's a backbone of this community, our retail sector, our health precinct, our education systems, rely on that rice industry," he said.

Mayor Hall fears for the long-term future of rice processing in the region without a change in government water policy.

Downstream businesses feeling the pinch

Downstream businesses, such as Downes Rice Hulls, are also feeling the effects of the decline in rice production.

Jenny Downes said that the shortage of rice meant they have to mix in straw to produce bedding for intensive animal industries, costing her business hundreds of thousands of dollars.

"We've had to put some staff off already," she said. "That's why we bring in the top straw to try and keep our people employed, gives us something to put on the trucks and deliver to the client."

Fears of more job losses to come

The SunRice mill in Deniliquin is operating at a fraction of capacity, and the company has shed 68 jobs at the plant and another 10 at its milling operations in Leeton.

SunRice CEO Paul Serra said that the low crop production was due to dry seasonal conditions and government policy of buying water entitlements for the environment in the Murray Darling Basin.

"One in every three litres of water that was available for irrigation over a decade ago is now no longer available and that pushes the [water] prices up, which makes it less economical for … crops such as rice," he said.

With a 22 per cent fall in rice production predicted this summer, the industry and local One Nation MP David Farley have been calling for Commonwealth environmental water to be unlocked for agriculture.

"We think the government can do that very quickly and the funds from that can be used to help fix the river, which enables a working river to also be an environmentally sustainable river," Mr Serra said.

He said he hoped there would be no more cuts to rice processing but wasn't prepared to rule it out.

"We're waiting to see what the season brings for us, we're really hopeful that the government can release water in a timely manner … for growers."

Adding value to safeguard future

SunRice has a $70 million plan to modernise its 50-year-old infrastructure and increase value-adding, such as rice cakes, high-protein rice and snack products.

"The more profit we make from selling high-valued rice around the world, the more we can afford to pay for rice in Australia," Mr Serra said.

A statement from the federal government said an application from SunRice for co-investment in a rice cake facility is being considered, as is help for affected workers.