With the potential to add $250 billion to Australia’s economy over the next two decades, according to a 2014 report by global consultancy Deloitte, agriculture has been deemed one of our five “super growth sectors”.
The Deloitte report, the final in its Building the Lucky Country series on future prosperity, says agriculture could be “as big as mining” for Australia, thanks to a combination of factors that include an increase in global population, rising food demand, food security issues and the changing dietary demands of Asia’s growing middle class in countries like China, India and Indonesia.
“Essentially, we have what the world wants and will increasingly need over the next 20 years,” says Rob McConnel, Deloitte’s Agribusiness National Leader.
“The global opportunity becomes obvious when you see the numbers, and the numbers are compelling. The world’s population is around 7 billion and this is forecast to increase to 9 billion by 2050, which is a 28% increase.”
The world will need to increase global food production by around 75% and Australian agribusiness “has the goods” to be a major player in meeting this demand, he says. But our challenges include investing more in research and development, improving tertiary education courses to produce more agribusiness and food science graduates, and “having a mature conversation” about foreign investment in agribusiness assets.
Also in 2014, economic consultants McKinsey & Company published a report on actions needed to build Australia’s international competitiveness across all sectors of the economy. The report, Compete to Prosper – Improving Australia’s Global Competitiveness, concludes that only one economic sector – agriculture – “stands out as strongly competitive”, but warns that its future contribution to the national economy should not be taken for granted.
While Australia is well-positioned, geographically and economically, to gain access to new markets in Asia, this growth is not assured, the McKinsey report says. Australia faces a “pervasive competitiveness problem” and many sectors of its economy lag behind international benchmarks.
The report argues that disruptive technologies such as robotics and digital communications are redefining economies and global trade, with supply chains fragmenting and becoming more specialised. The report uses Apple’s iPod as an example of a high-demand product that contains 451 distinct components sourced from around the world.
This means the global flows of those components, or “intermediate goods”, are more than three times greater than for the final product, and competition is moving from the level of industry sectors like manufacturing or retail to areas like design and logistics.
“Tools for file sharing and collaboration allow engineering plans to be drafted by teams in multiple countries; more sophisticated logistics allow construction firms to prefabricate everything from bathrooms in multi-storey dwellings to steel structures for liquefied natural gas processing plants,” the McKinsey report points out.
WHAT DOES THIS mean for Australian agriculture? Future farm research teams will include data analysts, software programmers, agronomists, statisticians, engineers, geneticists, cell biologists, hydrologists and atmospheric physicists. Farmers will use geo-location data to analyse climate, water tables and soils, and calculate inputs such as fertilisers and chemicals for weed and disease control. Farm robotics, from drone surveillance of livestock and crops to sophisticated digital systems that track soil moisture and farm water management, will be a major growth area.
The Australian Government has announced $100 million in new grants for rural industries research. At the Australasian Research Managers Society conference in Canberra in September 2014,
the Department of Agriculture Senior Executive Richard Webb said “non-traditional areas” such as farm robotics will be funded by grants offered through Australia’s 15 Rural Research and Development Corporations. Australia is already a world leader in this area, Webb emphasised, adding that there was “plenty of scope” to work across industries and to adapt mining and defence robotic systems to farming.
Precision agriculture research, which involves the use of satellite mapping and remote sensors, is another area where Australia can lead. The Australian Centre for Field Robotics at the University of Sydney has developed a world-first robot sensor for vegetable farming – a solar-powered robot called Ladybird that will help farmers collect crop data, detect pests and control weeds.
The Plant Biosecurity CRC is working with researchers at the Queensland University of Technology (QUT) on the use of drones to detect diseases in wheat and other crops, as well as the spread of the myrtle rust fungus in Australia’s national parks.
Sustainable grazing systems also have the potential to improve farm productivity and profitability, while making Australia’s farms more resilient to climate variability. The Future Farm Industries CRC recently ended its seven-year research program with a string of successes, including two Eureka national science awards for its use of native perennials and shrubs to create drought resistant pasture systems. These new pastures can improve nutrition for livestock and help control intestinal parasites in sheep, reducing drenching and chemical costs. Following trials by the CRC with farmers in WA and NSW, these systems are in use across more than 1 million hectares of farmland, and estimates suggest they could increase farm profitability by around $1.6 billion by 2030.
The Future Farm Industries CRC also explored the possibility of planting woody crops, such as oil mallees, to diversify farm income from new industries such as aviation biofuels. In 2013, it won a CRC Association national award for innovation excellence for a low-emissions mallee harvester (capable of continuous harvesting) developed with Richard Sulman, Principal Engineer in Australian consultancy Biosystems Engineering.
AUSTRALIA’S GLOBALLY competitive agronomists will also make greater use of genetics to improve crops and livestock. The Sheep CRC is using full genomic sequencing to improve the effectiveness of DNA tests used by wool and sheep meat producers when selecting breeding stock. The Dairy Futures CRC is involved in a global collaboration of more than 20 international participants led by Australian scientists to collect more than 1000 DNA sequences of bulls to identify gene mutations that cause embryonic death in dairy cattle (see page 20).
Four years ago, Australia’s Chief Scientist Professor Ian Chubb led a review of Australia’s international agricultural research programs and found that when national investments in agricultural science, technology and training were taken into account, the number of people benefiting from Australian agricultural expertise was around 400 million a year.
“We are good at this,” he wrote in an introduction to the report. “Australia has a longstanding worldwide reputation for excellence in science related to food and agriculture. This is an area where Australia can show leadership.”