GINA Rinehart’s pastoral vehicles Hancock Agriculture and S. Kidman plan to sell three prized grazing assets in the Roma region of southern Queensland – with frustrations aligned with the State Government’s damaging land tax policies understood to be a principal reason.

Coming to market shortly will be Kidman’s highly productive Rockybank aggregation near Roma, along with Hancock’s Holyrood and Forestvale properties in the Maranoa region – used principally within the companies’ pastoral networks for bull breeding and backgrounding work.

The surprise move follows the introduction some years ago by the former Labor Queensland state government Foreign Land Tax on freehold land assets.

Key stakeholders in the ag sector have lobbied both the former Labor Queensland Government and the current Coalition Government over the inequity and damage caused by the tax – which while being targeted primarily at metropolitan residential and commercial investments, has through unintended consequences also badly impacted agriculture.

While acknowledging the tax’s impact, the current Coalition State Government elected in 2024 has so far proven reluctant to make changes in the current tight fiscal climate.

Beef Central has written extensively on Queensland’s foreign land tax and its impact on the property market and investment confidence – most recently in this item published last July,  and this item last June.

S Kidman paid $7.4 million for the 14,600ha showcase Rockybank aggregation in the Mount Abundance area near Roma at auction in 2013, bought from the estate of the late John Quintana.

Gina Rinehart is the majority owner of  S Kidman, along with one-third minority shareholder, China’s Shanghai Cred, however this minority holding still qualifies Rockybank under the provisions of Queensland’s foreign land tax.

Kidman and Hancock also operate large Queensland Channel Country grazing properties Durham Downs and Morney Plains, but because they are held under Leasehold tenure, they are not exposed to the tax – which is specific to Freehold property.

Over recent years the size of the foreign ownership tax on Rockybank has grown dramatically, as the state government revalues to asset in their favour. The bill this financial year will reach $500,000, and is likely to exceed $600,000 next year.

“This is unsustainable from a business perspective, and the decision has been made, after a year of consideration, to divest the property,” Kidman said.

“We are not the only ag business subject to this tax, and many other foreign-owned (or partially-owned) ag companies have already divested out of Queensland for the same reason,” Kidman and Hancock Ag said in a statement.

“We are advised that there are more to come. Any company that has even an 0.1pc foreign ownership, including ASX listed companies, is subject to this terrible tax.”

“It should be noted that this tax is not applied to agricultural land use anywhere else in Australia, except Queensland. In fact, other jurisdictions welcome investment from outside their local area, their shire, their state and their country.”

The statement said the high-taxing policy applied by the Queensland Government had already seen S. Kidman pull out of other potential investments in Queensland. As a result the company has within the last 12 months purchased two significant grazing properties in New South Wales.

“We anticipate this approach may continue unless the Queensland Government changes its high tax approach,” the Kidman/Hancock statement said.

Economies of scale compromised

In a snowball effect, the original decision to sell Kidman’s Rockyback aggregation due to the punitive land tax had compromised the economies of scale of Hanckcock Ag’s adjoining Hollyrood and South Maffra holdings, which have been run as an integrated unit with Rockybank.

Hollyrood 4844ha and South Maffra 1,567ha had become too marginal to continue to operate in isolation, particularly without substantial capital investment. This had led to the decision to divest  of those properties also – in addition to Rockybank.

Analysis was done into the benefit of Kidman selling Rockybank to sister-company, Hancock Ag to escape the foreign ownership tax, however capital gains tax on the sale as well as associated stamp duty made the concept unviable.

“This is why we fight so hard against taxes, bureaucracy, red tape and regulation,” the statement said.

Hancock in 2017 spent more than $50 million purchasing Hollyrood and South Maffra  – quality improved scrub country properties – as well as Forestvale at Mitchell, totalling around 21,000ha with some 4750 Wagyu breeders and calves.

• Beef Central anticipates providing more on the listings of Rockybank and Hollyrood aggregations in the next couple of weeks. Marketing agents are yet to be appointed.

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