New ANZ report optimistic for Australian agriculture
Australia’s agricultural sector will require investment of up to $417 billion by 2030 to achieve its full potential, according to a new report released by ANZ today.
The report, ‘Greener Pastures 2: Critical Pathways to Capture Global Agricultural Opportunities’, found Australian agriculture is in the strongest and most competitive position it has been in recent history.
ANZ Executive Director for Agricultural Insights and the report’s lead author Michael Whitehead said: “The industry is in a robust position because of a combination of factors. Extended high prices for most commodities and good production seasons, combined with the evolution of the overall sector, has meant Australian agriculture has reached greater structural efficiency, resilience, and innovation.
“The resurgence of the family farm is also a major driver of industry growth, as leading farms become multi-generational, more innovative, and grow through consolidation.”
’Greener Pastures 2’ comes a decade after ANZ’s inaugural report on the agricultural sector. The latest release aims to enhance industry discussion, giving Australian agriculture the best chance of reaching its full potential in the coming decade.
The report identifies five areas which will require major focus into the future: improving capital flows, embracing agri technology, fully utilising sustainability, improving trade relationships, and boosting advocacy and industry cohesion.
It sees a strong future for Australian agri exports, forecasting a cumulative gain to 2030 of between $82 billion to $153 billion – however investment in the sector is required.
“ANZ estimates Australia will require around $240 billion investment to meet current forecast agricultural growth,” Mr Whitehead said.
“If Australian agri is to reach the optimistic benchmark of $100 billion of production by 2030, as targeted by some in the industry, then we estimate around $471 billion investment will be required.
“This is not out of reach. The sector achieved $212 billion investment in the 2010s, exceeding ANZ’s 2012 prediction of $151 billion.”
Listen to a podcast discussing the report here.
Please see a summary of the report’s key points below.
Five focus areas for Australian agri across the next 10 years
Improving capital flows to agriculture
- Capitalise on the growth of domestic super funds;
- Enhance farmer education to be ‘investment ready’;
- Accelerate the marketing of Australian agriculture investment opportunities globally;
- Build agricultural investment education across Australian services.
Embracing agri technology
- Widespread utilisation of agtech must move into mainstream agri;
- Enhance opportunities to accelerate agtech implementation, analyse progress and create pathways for others in the agri sector;
- Accelerate the opportunities for agtech to relieve labour shortages.
Fully utilising sustainability
- Investors, both Australian and global, as well as Australian agriculture’s global customer base, will require sustainability and carbon metrics;
- Provide the environment for producers to adapt their farming practices and operations to include new aspects of sustainability;
- Ensure the agri sector is proactive in the climate conversation, including highlighting opportunities for it to play a positive role.
Improving trade relationships
- Streamlining trade flows, including trade bureaucracy, quarantine, infrastructure, technology, and payments;
- Enhance established trading relationships, including pursuing new free trade agreements;
- Seeking new trade markets, as well as developing new opportunities in markets such as India and the Middle East;
- Providing differentiated export offerings, such as tailored grain and meat varieties.
Boosting advocacy and industry cohesion
- With farms growing in size while overall farmer numbers decline, peak agri bodies will need to plan for the future;
- Planning could involve exploring the option of consolidation, as well as including more commercial partners and not compromising the interests of primary producers.