Tough road towards ag's $100 billion goal, says ABARES

Tough road towards ag's $100 billion goal, ABARES tells Regional Conference

Multimedia
FUTURE: ABARES chief commodity analyst, Peter Gooday, says there is plenty to consider about Australian agriculture's potential to reach $100 billion of value by 2030.

FUTURE: ABARES chief commodity analyst, Peter Gooday, says there is plenty to consider about Australian agriculture's potential to reach $100 billion of value by 2030.

Aa

ABARES says it'll take hard work to crack ag's $100 billion target by 2030.

Aa

RURAL producers should take nothing for granted in terms of international trade, according to Australian Bureau of Agricultural and Resource Economics and Sciences chief commodity analyst, Peter Gooday.

Mr Gooday addressed the crowd of more than 100 delegates at the ABARES Regional Outlook Conference at Bundaberg last week.

Interestingly, a live survey taken at the event showed nearly a quarter of attendees were from a government body of some form, while those representing agricultural production/farming came in at 11 per cent.

The conference focussed largely on beef and broadacre production but also covered vegetation management issues, water, energy and forestry, along with question sessions.

Mr Gooday's presentation was on national and international issues affecting Australia where he said most of the enhancing productivity reforms had already been implemented in an attempt to reach the National Farmer Federation's (NFF) goal of lifting the value of Australian agricultural production to $100 billion by 2030.

"Things get more difficult from here," Mr Gooday said.

He said growth in production had been relatively modest and had been further slowing recently, with major issues such as a shift in the climate, plus reduced research capacity set to impact agriculture's performance.

RELATED READING

He made the point that prices for meat and animals had been much better in 2018/19 than in previous droughts.

That said, he also indicated that the value of meat and animal production was expected to decline.

"When we think about the longer term outlook for agriculture one of the key things to keep in mind is the export market," Mr Gooday said.

Exports to China now account for more than a quarter of agricultural trade. - Peter Gooday, ABARES

"What happens on export markets plays a big role on our incomes and prices.

"China is now as important to our agricultural exports as Japan was in the early1990s.

"Exports to China now account for more than a quarter of agricultural trade."

But that pull from China would not last forever, with Mr Gooday saying China's growth was expected to peak in 2029.

"It is important to understand that China's agricultural policies are changing," he said.

"Not only is China a major agricultural importer, they are one of the world's largest producers and exporters.

Thinking back to the opportunities that come from growth in Asia, it's obvious we need a good understanding of what those consumers care about so we can position ourselves accordingly. - Peter Gooday, ABARES

"The emphasis of China's agricultural policy is now on supply side structural reform and the revitalisation of rural areas."

He said China was specifically looking at increasing beef and sheep meat production as well as improving food safety.

"That improvement in food safety is expected to benefit countries like Australia that readily comply with high standards," he said.

"Thinking back to the opportunities that come from growth in Asia, it's obvious we need a good understanding of what those consumers care about so we can position ourselves accordingly," he said.

The current trade war between China and the United States was set to have ongoing impacts for Australian agriculture outputs.

Mr Gooday provided figures showing that due to China's refusal to take some US agriculture products, the US government had propped up its agriculture industry, providing a $US12 billion support package to farmers in July 2018, followed by a $US16 billion package in May this year.

But even though this may create opportunities for Australian exporters in the short term, Mr Gooday said the China-US trade tensions could have negative ripple effects throughout key export destinations such as Malaysia, Singapore, Vietnam and Thailand which would make things harder for Australian exporters in the future.

He said it was interesting to watch how "trade finds a way around" such political situations, indicating China had increased its imports of soybeans from South America.

The story Tough road towards ag's $100 billion goal, says ABARES first appeared on Good Fruit & Vegetables.

Aa

From the front page

Sponsored by