Farm production value hits record high

With a near record harvest in 2020-21 comes the highest farmgate output of all time, with ABARES forecasting this fiscal year’s production value to reach a record-breaking $65.9 billion.

The figures were released at this week’s virtual Outlook 2021 conference, further proving that the industry is not only bouncing back strongly from consecutive poor seasons but also defying the pandemic to produce record results.

“2020-21 is forecast to be an excellent year for Australian agriculture, with an expected eight per cent lift in production value on last year,” said ABARES’ acting executive director, Jared Greenville.

“The rebound from drought has been exceptional – in terms of the three consecutive years of decline and the sheer scale of the turnaround.

“Australia’s second largest winter crop of 55.2 million tonnes has catalysed this growth. Combined with favourable conditions and continued strong meat prices, the short term outlook is very positive, with the average national farm income projected to increase by 18 per cent to $184,000 a farm.”

Exports are forecast to fall four per cent to $46.3 billion in 2020–21 – mostly due to lower livestock numbers as herd and flock rebuilding leads to lower slaughter and meat production.

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The National Farmers Federation (NFF) said the pleasing result means its target for a $100 billion agriculture sector by 2030 is well within reach.

"Today’s forecast demonstrates that, despite such challenges, Australian farmers are an economic powerhouse and their success will be key to our nation’s economic recovery,” said NFF Chief Executive, Tony Mahar.

"Agriculture is already on a firm trajectory of growth. With investments, innovations and policy changes, this growth can be supercharged."

Despite the good news of recovery and growth, ABARES’ Dr Greenville said there are still challenges that lie ahead for the sector.

“Shifting trade, along with macroeconomic and production uncertainties, will provide the backdrop for what we expect to be a more difficult environment in which to grow production and trade value,” he said.

“But over the longer term, we cannot forget that the fundamentals remain strong - middle income growth, urbanisation, population growth – will all be positive forces shaping sector fortunes.

“What will be important is creating the conditions to maximise the sector’s growth and contribution to the economy.

“Innovating and meeting consumer expectations around what we produce and how we do it, along with ensuring our export systems are efficient and reward producers for the quality of their product, will all be important in growing value in an uncertain future.”

NFF’s Mahar echoes Dr Greenville’s sentiments and is urging the Government to provide solutions to counter trade disruptions forecasted to cost $36.9 billion this decade.

"The NFF is calling on government to develop a long-term trade strategy that deepens access to existing markets, diversifies export destinations, improves supply chains and builds domestic value-adding capabilities,” he said.

"Biosecurity is also key to maintaining and expanding our export markets. Alarmingly, our current system risks not being up to the job, without adequate investment in its expansion and modernisation. The cost of a single outbreak of disease or pest has been conservatively estimated to exceed $50 billion."

Mahar said COVID-19 restrictions had exacerbated farm workforce shortages and added the NFF is eagerly awaiting the Government’s National Agriculture Workforce Strategy.