Surviving big dry in cattle country

When Don's elder son Zanda fell to his death from a windmill last year, it must have seemed like fate and the elements had conspired. A favoured son passed in the midst of a terrible drought that has dragged on year in, year out for nearly a decade without relief.

Forty-one-year-old Zanda McDonald was running the family business, one that BRW estimates to be worth $366 million. This puts the McDonalds in the same league as other private pastoral businesses such as the Kidman family of South Australia, the Actons, McCamleys and Menegazzos of Queensland, and, from the west, miners Gina Rinehart and Andrew 'Twiggy' Forrest, who have both been adding to their land holdings.

Don McDonald, who stepped back in to run the business following his son's death, is talking about the long dry but he might as well be reflecting on the ups and downs of a family whose story mirrors that of Australia's rural settlement, stretching right back to the early 19th century.

"We're all optimists,'' he says. "It's always going to get better."

Out here on the fringes of white habitation, towards the Northern Territory border and up into the Gulf Country, a city visitor might not think so. Life is raw – and remote, and dusty, and hot.

If you mark on a map the place where the Flinders, Matilda and Barkly highways meet, you'll get Cloncurry, the notional centre of the vast land holdings of a few cattle barons, including the McDonalds.

You're 1703 kilometres from Brisbane, 1722 from Darwin, 2213 from Sydney, 2219 from Canberra, 2498 from Melbourne and 3796 from Perth.

Distance defines this town, as indeed it does Australia.

This is cattle country writ large. It's also a region with enormous potential if reports of a $1 billion deal involving shipments to China of a million live cattle a year are to be believed. Along with other big beef producers, the McDonalds are well placed to take advantage of the growing Chinese appetite for protein. The family's pastoral leases stretch across 3.8 million hectares, or about two per cent of Queensland. They include 11 properties accumulated over the years.

The canny McDonalds might sell stock, but they don't sell good grazing land. "We've never really sold anything in our lives apart from trading stock,'' says Bob McDonald, Don's younger brother and business partner. He sees merit in living by his father's adage: "Stick to what you know.''

The McDonalds have done their best over the years to drought-proof their holdings, trying to ensure they get the grazing mix right between higher rainfall properties towards the Gulf of Carpentaria, drier areas around Cloncurry and good beef-fattening country further south.

The family kills 600 head of cattle a week, exporting to five countries, including long-standing contracts with Japanese importers. Running 150,000 head of cattle on their various properties, these are smart business people.

"You've got to have economies of scale and a spread of property to guard against drought,'' Bob McDonald says. "But not so much property that you end up having an accountant running it. You've got to keep control.''

But no amount of planning can beat the elements entirely. Vast swathes of Queensland are drought declared, stretching from the NSW border north towards the Gulf and west towards the Northern Territory.

"This one is shocking,'' says Don McDonald, who recalls other bad spells but few as bad as this. "Every 10 to 20 years we go through these horrific events.''

Ask this former National Party president whether he believes in climate change and he responds carefully. "Over my 60 years living and observing the season I can't identify specific changes," he says.

"My view is we go through cycles. Is it worse or better now? It's too early to judge.''

Peter Hacon is another of Cloncurry's cattle barons who has been finding the going tough in an environment in which drought and rising costs have squeezed incomes.

"We're bobbing along with our heads above water," he says. "No one is making fair dinkum money."

If the drought and increasing costs are making life difficult, then a reduction in the size of Australia's national herd, down to 26.7 million from 29.3 million 12 months ago, is offsetting some of the pain.

Livestock agents report real competition in the marketplace for the first time in years. This is pushing up prices, which is good news for people like the McDonalds and the Hacons, who have managed through the drought to keep their breeding herds intact.

What is not in short supply is contempt for big city politicians.

Cloncurry mayor Andrew Daniels is from another of the region's biggest cattle-producing families, one with an estimated net worth of more than $200 million. A big man with big ideas, Daniels has difficulty comprehending why Canberra and Brisbane don't weigh in to build a dam outside the town to help develop the region.

Driving out of town, Daniels points out how easy it would be to dam the Cloncurry River. What's required is money – and imagination.

"We're a young country. We need to start building,'' he says.

He is more colourful in his views on the Gillard government's 2011 ban on live cattle exports, which followed an ABC TV Four Corners program that revealed abuses in Indonesian abattoirs. That ban has since been lifted.

On our travels around the town and its outskirts, we pass the original Qantas hangar, which had its roof ripped off in a storm. The words Queensland And Northern Territory Aerial Services are inscribed on the door.

Longreach, Winton and Cloncurry vie for the title of being the birthplace of the national airline but no such argument arises over the Royal Flying Doctor Service, formed in Cloncurry in 1928.

The town is proud of its role in aviation; it was a transit stop for some of the early London to Sydney races of the 1920s and 1930s, and served as a US military base during World War II.

In the dust and heat of the Cloncurry stockyards, Daniels's brother Sam is loading cattle for shipment to market. These vast, multi-deck cattle trains snake across dusty highways to ports such as Darwin for shipment to Asia and beyond.

Distance is a real killer. The price of fuel is a constant worry, the state of the roads another.

Sam Daniels is not whingeing when he points out the difficulty of keeping a business with 30 employees, three helicopters and two light aircraft afloat.

"In the past seven years, the cost of transport, fuel and wages have nearly doubled at the same time as a ban on live exports kicked the cattle industry in the guts.

"The live export ban depreciated the value of every beast sold in the country.''

Since the dawn of white settlement in the mid-18th century, when an entrepreneurial explorer-pastoralist called Ernest Henry discovered gold in the Selwyn Range outside Cloncurry, the shire has produced its share of mavericks and chancers.

This is the birthplace of Bob Katter, the eccentric member for the vast electorate of Kennedy who has made a career of poking the Canberra establishment in the eye.

It was Robert O'Hara Burke who gave Cloncurry its name on his fateful journey north in 1861, naming it after his cousin Lady Elizabeth Cloncurry of County Galway in Ireland.

Among its various claims to notoriety, the town may have witnessed Australia's biggest bank robbery of cold, hard cash. On state election night in 1932, thieves breached the strong room of the National Bank and made off with £11,000.

Much to their surprise, the burglars also found the keys to the nearby Bank of NSW, where they helped themselves to another £3000.

The miscreants were never caught, despite a £500 reward, but in the public bar of Billie Telford's Leichhardt Hotel they will tell you, hand on heart, that some of the town's more prominent families were involved. This may be apocryphal, but that doesn't matter. People believe it.

A well-preserved woman in her eighties, Telford is the keeper of many secrets. She runs her hotel from the lounge bar with a gimlet eye on comings and goings. Over dinner she tells stories about the town, its history and its characters.

"These are strong-minded individuals," she says, gesturing to a bar full of locals, many of whom have brought their families in for beef and trimmings from a well-stocked bain-marie.

A savvy businesswoman, Telford understands that quantity is sometimes just as important as quality. Local councillor and real estate agent Keith Douglas would agree with her when she talks about Cloncurry's resilience. "This is a town that never dies,'' he says. You're inclined to believe him.

Meanwhile, back in the mayor's office, Daniels continues to press his argument state and federal governments have passed up opportunities to harness the vast potential of that part of Australia north of the Tropic of Capricorn.

The reality is there are not many votes in Cloncurry, which has a population of about 3000, or its environs, which include Charters Towers to the east, Winton to the south, and much space in between.

What there is, however, is a lot of cattle and mineral wealth. If cows could vote, Daniels would have his dams, roads, bridges and more.

And if the mining companies clustered in the region paid a bigger whack of their royalties to the local shire, the sort of facilities and services Daniels dreams of might be possible. Money tends to travel in one direction, to the immense frustration of office bearers such as the shire mayor.

The uptick in beef cattle prices is better news for struggling cattle producers such as Jacqueline Curley, who operates the 48,500-hectare Gipsy Plains spread outside Cloncurry in the shadow of the giant Ernest Henry copper mine.

"I've always loved the industry. I've always loved it out here,'' says Curley, who takes us on a motorbike tour of her property.

"It's a hard life,'' she adds. "You find yourself running even harder to maintain a financially viable business.''

Curley produces a sheet of paper on which is a quote from Wendell Berry's Bringing it to the Table: On Farming and Food.

"Why do farmers farm, given their economic adversities on top of the many frustrations and difficulties normal to farming? And always the answer is: 'Love. They must do it for love.'?"

Curley's spread is a minnow compared with those of the McDonalds, Daniels and Hacons, but she hangs in there despite the challenges of drought, ever-rising costs including escalating prices for fodder to keep her prize Brahman herd alive, and the uncertainty of when and whether the drought will break. This is heartbreaking stuff.

Droughts do break, eventually, but not before a long dry crushes the spirits of a lot of people, especially smaller operators who might be labouring under big mortgages.

Suicide is a well-documented problem in remote areas, especially among farmers who find themselves broken in spirit, with no choice but to sell up or simply walk off their properties, handing their keys to the mortgagees. Smaller properties in marginal country are difficult to sell.

John Bourke, of the National Australia Bank, finds foreclosing on farmers one of his toughest jobs. To his mind, the stories of mental stress leading to breakdown and suicide are not exaggerated.

"If you haven't got grass, you haven't got assets to sell,'' he says.

Bourke echoes the views of others when he says cost pressures are squeezing businesses that have few reserves. "We've really started to see limited opportunities for operations to become any more efficient," he says.

Scale is important, and for families such as the McDonalds which have it, there is no thought of giving up. Their history in the cattle business goes back to 1827, when the original 19-year-old Don McDonald travelled from Scotland as head stockman for the first shipment of cattle to Tasmania. He took up a sheep run in South Australia in 1829 and moved to Queensland in 1862 as part of that State's pastoral expansion.

Jim McDonald, great-grandson of the original Don McDonald, bought land around Cloncurry in 1946, helping to make it the centre of the beef cattle industry in north-west Queensland.

Jim McDonald drove a car until he was 104 and, according to family legend, was indulging his interest in physics and Voltaire until weeks before his death, aged 105, in 2012.

The Don McDonald of 2014 is not overstating things when he says Cloncurry and its history are "critical to the culture of Australia''. In good times and bad.