Australia can’t feed the world but it can help

Food production in Australia is challenging. Why? Because our soils are largely ancient and infertile, and our climate is variable and frequently harsh. Many food producing regions are degraded through soil erosion, acidification and salinity. But effective application of research, an innovative culture…

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The food Australia produces – including wheat – contributes to the diets of 60 million people. Jim Champion

Food production in Australia is challenging. Why? Because our soils are largely ancient and infertile, and our climate is variable and frequently harsh. Many food producing regions are degraded through soil erosion, acidification and salinity.

But effective application of research, an innovative culture, and low government subsidies have made agriculture a major industry.

Australia currently produces enough food – mostly beef, wheat and dairy – to contribute to the diets of about 60 million people. Australia is a net exporter of food, and exports around 70% of its production.

Value by destination of Australian food exports in 2010-11. Upper chart shows all regions; lower chart shows countries within the key destination region of Asia. ABARES (2011)

Through food production and the overseas application of Australian agricultural research and expertise, we contribute to the diets of up to 400 million people, mainly in Asia. In addition, we earn over $30 billion annually from food exports.

Food security is an increasingly critical issue, with food prices that are both high and volatile. In October 2012, the Food and Agriculture Organisation’s cereal price index was over 2.5 times the value of its 2002-2004 baseline. By 2050, the value of the global food market is projected to increase by over 70%.

In this context, Australia should consider how best to make use of our agricultural expertise to strengthen our farming sector while contributing to regional and global food security.

Global market for food

The annual value of global food imports was almost $300 billion in 2007, and this is estimated to grow to over $750 billion by 2050. The greatest growth is expected in Asia, particularly in China.

Overall food consumption will also grow. Projections suggest that demand in China will account for 43% of the global increase in consumption, with India responsible for 13% and the rest of Asia for an additional 15%. The largest growth is likely to be for fruit and vegetables, followed by meat and cereals.

In our main food market China, meat imports will be particularly important. It is expected that as the Chinese population becomes more affluent, the demand for beef and other meats will grow rapidly. There is a significant opportunity for Australia to contribute to meeting the projected increase in global demand for food.

Projected changes in regional and global demand for food between 2007 and 2050. Lineman et al (2012)

The trade environment for food is an important element in strengthening food security. Only a small proportion of global food production is traded. In 2009, 2.5 billion tonnes of cereals were produced worldwide, but only 330 million tonnes or 13% was traded. The traded proportion for rice was less than 4%.

Food production in Australia

More than half of Australia’s land area is committed to agricultural activities such as livestock grazing, cropping and horticulture. The largest proportion (46%) of agricultural land is used for grazing of natural vegetation. However, most profits are derived from more intensive cropping and horticultural activities, especially through the use of irrigation.

Australia is a major food exporter and is globally seen as a reliable supplier of high quality food. We are the world’s second largest beef exporter and fourth largest wheat exporter. But as most food is not traded, we account for only a small part of total global production: 2.9% of beef and 3.4% of wheat.

Future increases in food production will be dependent on gains in productivity, which gives an indication of our capacity to harness human and physical resources to generate output growth. For example, we will need to better use limited, and in some cases diminishing, resources such as arable land and water.

Changes in total factor productivity in Australian broadacre agriculture from 1960 to 2008, compared to 1953 baseline Sheng et al. (2011)

The Australian agriculture sector has historically experienced relatively strong productivity growth, typically above the average productivity growth in the broader economy. Within the agriculture sector, productivity growth has been particularly high among large or broadacre cropping farms. However, after four decades of over 2% per year average growth in total factor productivity in broadacre agriculture, the last decade has seen a reversal of this trend.

Increasing our food production

We have some scope to increase food production by bringing more land into production and by increasing the intensity of farming. However, the amount of land suitable for agricultural production is limited and we are also strongly constrained by access to water and our sensitivity to climate and its variability.

Food production in Australia could be increased mainly through increases in cropping intensity and more efficient use of the available resources. It has been estimated that by 2050, the real value of Australian agrifood production could be almost 80% higher than in 2007, representing an average annual increase of 1.3%. The largest increases are expected in beef, wheat and dairy products.

Increases in food production will need to be managed carefully to avoid environmental and social disruption. For example, in Australia we currently produce wheat on around 13 million hectares of land with an average yield of only 1.5 tonnes per hectare. Analysis of our production potential has suggested that about 47 million hectares could be used for wheat production and average yields could grow to 4.4 tonnes per hectare. This suggests Australia could lift wheat production from just under 20 million tonnes to over 200 million tonnes.

However, such an increase would come at a great cost. It would involve massive land clearing, and directing all available land and all water available for irrigation towards wheat production and would reduce our production and export of other types of food. This is unlikely to be an effective way of contributing to food security.

A number of challenges will need to be addressed if we are to sustainably increase food production. These are among the factors being considered as part of the Australian Government’s first ever National Food Plan.

Agricultural research and development

Australian research in agriculture has been highly successful and is well regarded internationally. The standard and quality of research in Agricultural and Veterinary Sciences and their sub-disciplines rated highly in the Excellence in Research for Australia assessment. This research is increasingly linked with research in Asia, South America and Africa.

However, agricultural research spending has been stagnating. Agricultural R&D intensity has fallen from a peak of five per cent of the value of agricultural production in the 1970s, to just above three per cent in 2007.

The decline in Australian broadacre agricultural productivity has been linked to this slowdown in research activity, together with the impacts of a changing climate. Support for research is important over long timescales: there is a lag effect from R&D investment to productivity gain, with the effects often continuing beyond 35 years after initial investment. Revitalising investments in agricultural R&D will be crucial to lifting our food output.

Workforce

Australian agriculture has an ageing workforce. From 1976 to 2001, the number of farmers aged in their 20s declined by over 60%. Many individuals are moving from rural Australia to larger regional centres or cities in search of greater work options, better health and education services. This in turn has dramatic effects on the regional skills profile, its labour pool, and the general health and vitality of rural and regional communities.

Also, there is considerable attrition among university students studying subjects in agriculture. This has implications for the future supply of researchers, scientists and professionals in the field of agriculture.

Infrastructure

Infrastructure plays a major role in moving commodities in an efficient and cost-effective manner, and access to adequate infrastructure will be critical in ensuring Australian agriculture remains competitive. Competition for road, rail and port infrastructure leads to difficulties and delays in transport and increases costs, particularly where goods are perishable or live animals are involved.

Optimising usage of our water resources will require substantial improvements in current irrigation schemes. These issues will be particularly important if we explore the opportunities for intensive agricultural production in northern Australia.

Conclusions

Australia is a stable producer of food in the world market, and food exports are important to our economy. However, the world population is already over 7 billion and is projected to grow to over 9 billion by 2050. We produce enough food to contribute to the diets of less than 1% of those people, and less than 2% of people living in Asia.

Neither Australia nor any other country can directly act as the “food bowl” of the world or a large, populous region. Our most valuable assets to support food security in our region and the world are our knowledge of agricultural science, and the ingenuity our farmers have used to produce food on a continent fraught with environmental challenges. We are well placed to apply the outcomes of agricultural R&D in Australia and developing countries, across a range of commodities.

Australia may not be directly able to feed Asia or the world. But our know-how in food production has the potential to contribute to the diets of hundreds of millions of people around the globe.

Acknowledgements

We thank Dr Kim Ritman, Dr Brian Keating, and Professor Philip Pardey for comments on an earlier draft of this paper.

This is an edited version of an article that appeared in the Office of the Chief Scientist’s Occasional Paper Series.

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33 Comments sorted by

  1. Kim Peart

    Researcher & Writer

    This is quite a thorough article, but I am concerned that it does not adequately consider the full impacts of climate change and global heating.

    I read that the land Down Under will be hit rather hard, affecting our food production as the world gets hotter.

    Our amazing civilization is built on carbon energy, but pumping all that extra carbon into the air is now proving catastrophic.

    We could have entirely avoided the carbon crisis, if we had started building solar power stations in space…

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  2. Michael Lardelli

    logged in via Facebook

    The article is rather amazing in that it does not address the role that fossil fuels play in agricultural productivity. Despite the propaganda campaign by the oil industry (that currently has the world media entranced by the idea that marginal increases in oil production through drilling of "shale" make peak oil concerns obsolete) peak oil is already having a dramatic impact on the world economy. As the availability of liquid fuels begins to decline in the next few years, (as ongoing very significant…

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    1. Kim Peart

      Researcher & Writer

      In reply to Michael Lardelli

      Dianna Art ~

      Unlimited profit is possible, but not on Earth.

      Beyond Earth and among the stars, with stellar energy and celestial resources, there is no limit to growth.

      One of the fundamental laws of Nature is expansion, from the birth of the cosmos to the spread of life.

      Why, then, did we not run with Nature in expansion beyond Earth when this was possible in the 1970s?

      We would have kept a safe Earth, by running with stellar energy for power.

      We certainly had the resources, when…

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  3. pennie scott

    Senior Consultant - Food Security and Risk Manaagement

    I am bemused by the macro-definitions used in this article as they often bear little, if any, relevance to what is actually happening NOW.
    Yes, Australian farmers are incredibly innovative and productivity in broadcacre dryland cropping has increased three-fold since the 1960's HOWEVER, there is a critical missing link to this scenario.
    This missing link is profitability and is a primary reason why hundreds of farming families continue to make the wretched and heart-breaking decision to leave…

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  4. Daniel Boon

    logged in via Facebook

    Australia has trouble feeding itself, and with the projected unofficial 40 million population (we're at 52 percent now) courtesy of the likes of that half-wit Costello, we will move deeper into trouble from a current net importer food to an almost totally dependent importer of food when our own oil stocks (still being sold off) run out leading up to 2020 ...

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    1. Eric Ireland

      logged in via Facebook

      In reply to Daniel Boon

      I think the media reports of Australia being a "net food importer" a couple of years ago were wrong. E.g. in 2010-11 Australia exported 18639 kt of wheat, and consumed 6089 kt domestically (see p200 of the ABARES agricultural commodity stats). For most other foods (with the exception of fish) we are a net exporter as well. Worldwide, food security is a major issue, but I don't see how you can say that Australia has trouble feeding itself.

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  5. Dejan Tesic

    Former Lecturer at Charles Sturt University

    "... there is considerable attrition among university students studying subjects in agriculture. This has implications for the future supply of researchers, scientists and professionals in the field of agriculture." - Being only too aware of the existing difficulties of gaining employment in the all-too-granular ag job market and in as ever under-appreciated agricultural science profession, I reckon that the dropping out of ag students out of courses is a blooming good idea on their part. It's irritating to see the leaders shifting all the risk downwards (onto farmers and/or students) yet again.

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    1. Tim Scanlon

      Debunker

      In reply to Dejan Tesic

      Attrition rates for ag science were no higher than any other science course, as far as I was aware. Maybe that was just my university, where the first year was combined sciences, then specialisation started.

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  6. Jo Jackson King

    Pastoralist, Occupational Therapist

    ...his missing link is profitability and is a primary reason why hundreds of farming families continue to make the wretched and heart-breaking decision to leave…

    Penny is spot on, my family is agonizing over this right now. Two farms, one station, all four adults in the partnership working off-property in order to continue to run the properties and to live. Some people worry about having to subsidize farmers when the situation is in fact the reverse: Australian farmers are subsidizing the nation's eating and, indeed, agricultural export income.

    Prior to the industrial revolution it was many peasants supporting a small nobility - these days I feel I am part of a (increasingly exhausted) small peasantry supporting many (increasingly oblivious) nobles.

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  7. Max Bourke AM

    Thinker

    One of the key drivers of any improved, and I mean environmentally sensitive improvements in intensification of agriculture is people. Touched on lightly in this article it is not nearly addressed centrally and it is a thing which government can do something about. Prof Jim Pratley published a superb analysis 2 (?) years ago of the parlous state of teaching agriculture in Australia. I know from running a large scale farming business how difficult it is to find tertiary trained quality agriculture graduates. The fact that entrants can get into agricultural science course with very low HSC scores is another indicator of this issue. Without good people our prospects of replacing the ageing (like me) people in agriculture are negligible. I receive no sponsorship from anyone and am not an academic looking for a job.

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    1. Tim Scanlon

      Debunker

      In reply to Max Bourke AM

      When I was doing both my degrees I was always being asked if I was going back to the farm. Apparently doing science degrees focussed on agriculture is just a fill in for a few years before you go and drive a tractor.

      We do need a lot of skilled and knowledgeable people in the agriculture industry. Current production improvements are stalled (essentially only keeping track with current climate change), thus we need some expertise to take us forward.

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  8. Robert Tony Brklje

    Robert Tony Brklje is a Friend of The Conversation.

    retired

    Australia feed the world, now that really down to just being a choice. Nuclear power plants and water desalination plants stretching from Port Augusta in South Australia to Esperance in Western Australia. That's a huge amount of stable climate, sunny land. Add in water, their initial fertilizer and smart crop rotation and that's a lot of food.
    So really it is down to just being a choice, of whether to do or not to do.

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    1. Michael Lardelli

      logged in via Facebook

      In reply to Robert Tony Brklje

      Unfortunately not. Due to the rising cost of energy (i.e. increasing shortage of energy relative to demand) the cost of a nuclear power infrastructure is now beyond us. We simply do not have the tens of billions of dollars to build the infrastructure you describe and will be even less capable of doing it as time goes by. This is the problem with energy crises - they are not like other crises which we typically solve by throwing more energy at them. We cannot use an increased amount of energy to solve an energy shortage. Such crises can only be avoided by timely investment of energy surplusses in alternative energy infrastructure. But the surplusses are gone so it is a little late for that.....

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  9. Nev Norton

    Farmer

    Agriculture has many problems, profitability one of the greatest. Farmers are rapidly becoming an endangered species. Your average jo blow on the street is in a state of disconnect, I think it has largely escaped the populations notice that they owe their existence and indeed their continued existence to the endeavours of farmers and graziers.
    There are a myriad of things that are beginning to impinge on agrarian activities, and one can only assume will continue to escalate and constrain agriculture…

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    1. Michael Hay

      retired

      In reply to Nev Norton

      Nev, you are spot on ! I cannot see the logic of wordy politicians telling us that Australia's agricultural exports will have enormous markets in Asia and, in the next breath, reduce the ability to maintain out level of irrigated production - mush less expand it.
      One of your ENGO's (I like that encryption) stated on Conversation, that all rivers should be maintained in their natural states; no water should be added; the flows should be dictated by natural conditions. Therefore : No waters storages…

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    2. Ewen Peel

      Farmer

      In reply to Nev Norton

      Spot on Nev.

      With all the issues you have mentioned above I don't think we have any chance of taking our wheat production from 20m tonnes to 200m tonnes. All the good land has already been developed, most of the other land cannot be touched and with a more variable climate and erratic government policy who wants to take on the risk.
      In saying that, I am not leaving the industry any time soon and firmly believe that it has a bright future. Agricultures ability to adapt to the changing environment and productivity demands is why it is such a strong performer in the economy while a lot of other industry is failing.

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    3. Nev Norton

      Farmer

      In reply to Nev Norton

      It's an interesting statement you make Ewen " all the good land has already been developed" As it so happen's I came across an article in a Landcare in Focus magazine about a joint venture between Landcare and Greening Australia and a project they carried out in the Midlands of Tassie. This project involved the reforestation of 100Ha of land that the article proudly proclaimed as "degraded" thankfully they had a good photo that showed the soil and general layout of 100Ha valley that had been farmland…

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  10. Michael Croft

    logged in via LinkedIn

    Thank you and a few comments. Best estimates from people who are senior managers in the industries in Vietnam, Thailand and China indicate that over 50% of Australia's wheat and other grains ends up as stock feed - feeding pigs and meat birds (chicken). So we are price taking export producers of a bulk commodity with all the value adding done overseas.

    If you track the global price of grain and China's major purchases of our wheat, the graphs operate in tandem i.e. when our prices are low they…

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    1. Michael Lardelli

      logged in via Facebook

      In reply to Michael Croft

      A very interesting answer but your 2050 projections would seem to be based on an assumption of flat or growing fossil fuel supply. Unfortunately we can expect rather large decreases in fossil fuel access by 2050. See work by David Rutledge (on coal) and Kjell Aleklett (on all fossil fuels) for more info on that. As I stated above, oil on the international export market has been decreasing in availability since 2006 and this can only accelerate.

      Urbanisation itself requires large fossil fuel inputs (beyond the city size that can be supported by the solar-powered economies of 250 years ago) due to food production and distribution issues so the idea that Asia's continued urbanisation will continue through to 2050 is also dubious. I wrote another essay relating to that:

      http://www.onlineopinion.com.au/view.asp?article=12863&page=0

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    2. Michael Croft

      logged in via LinkedIn

      In reply to Michael Croft

      Hi Michael, no assumptions made about fossil fuel and I helped address this issue and the implications for agriculture in https://theconversation.edu.au/the-draft-national-food-plan-putting-corporate-hunger-first-8342 see Assumption 6

      Asia is urbanising, and right wrong or unsustainable there is little we in Australia can do to stop this trend - China is still adding a coal fired station a week to their grid and developing their own coal supplies in Mongolia just other supplies (Australia) become problematic.
      Cheers.

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    3. Michael Lardelli

      logged in via Facebook

      In reply to Michael Croft

      Hi Michael, Your assumptions on fossil fuel use are implicit since the projections you make (e.g. on population, urbanisation etc.) are based on current trends that will not apply by 2050 (since we can expect declines in conventional oil to overtake the marginal increases in unconventional oil well before 2020. However, thanks for pointing out your essay on the national food plan. I missed it when it came out and it is a good one! Regards,ML

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    4. Michael Croft

      logged in via LinkedIn

      In reply to Michael Croft

      Hi Michael, I guess all I am doing is extrapolating the existing evidence and responses. So as peak oil increasingly bites, biofuels (with all their comparative inefficiencies) will be increasingly used to fuel the machinery of industrial agriculture (think mandated or tax favoured ethanol and biodiesel). The other equally inefficient responses will be to liquefy coal and switch some machinery to CNG. Although inappropriate responses, the momentum of industrial ag is such that these things are…

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  11. pennie scott

    Senior Consultant - Food Security and Risk Manaagement

    Some very insightful and interesting perspectives on this topic - enjoyable reading and ruminatiion!

    Michael Croft - very interesting information about which mouths Australian grain is feeding and, I suspect, not widely known.

    In my earlier comment I expressed my concern about macro-economics dictating what will happen and using the lowest common denominator of cheap 'stuff' as the desirable outcome. If that's the (continuing) situation then we won't be surprised to have more of the same…

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    1. Michael Croft

      logged in via LinkedIn

      In reply to pennie scott

      Hi pennie, always bear in mind that a niche market such as your "very specific markets in specific Asian countries" is a direct response to market saturation of a commodity. And a niche only exists until lower cost producers beat you at your own game. Australia exports commodities (fungible products) and we have no branding, therefore we will remain price takers even as we develop niches. A recognition of Australia 'clean and green' can be easily replicated and offers no market protection.

      Branding is the only thing that gives a product the potential for consumer loyalty, hence the no brand (home brand) push by supermarkets - it removes bargaining power pushing food producers to commodity provider status, simultaneously transferring the brand loyalty to the supermarket.

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  12. Michael Croft

    logged in via LinkedIn

    Some Q&As to ponder.

    Q. Productivity gains for an individual farm or farmer are seen as a good thing (doing more with less), but what happens when productivity gains are shared by all farmers across the industry, and all are 'doing more with less'?
    A. Prices fall - a win for consumers and at best no gain (but usually a loss) for farmers. As price takers selling into a saturated market, farmers will lower prices to reflect lower costs of production to remain competitive.

    Q. Given that Australian…

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  13. Comment removed by moderator.

  14. Patrick Francis

    Editor Moffitts Media at Moffitts Farm

    There are so many articles written these days by scientists who should be able to analyse data and interpret it far more accurately. This is one of them. To start with this article fails to address the major factor limiting crop and livestock production in Australia - profitability. Dr John Williams, a Melbourne based wheat marketing specialist told last year's Global Agribusiness conference in Perth that "It is not under-supply and high prices that is ruining grain producers and causing high occurrences…

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  15. STABLE POPULATION PARTY

    Written & authorised by William Bourke, Sydney

    A stable population will, among many other positive things, protect food, water and energy security. This will make it mush more likely that we can continue to export food to countries that need it, instead consuming it all onshore by a bloated population.
    We also need these exports to pay for ever more consumer imports - did anyone see our latest trade deficit numbers?

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  16. Daniel Boon

    logged in via LinkedIn

    The stable population party is as delusional as the proposed 40 million population ...

    Erik ... the reality is that factual data is not possible as it may run against corporate government policy ... the following is from a thesis I just completed.

    'In July 2008, oil reached $147 a barrel (Reuters, 2008) the price of fuel and food rose to such a degree that food riots took place in roughly forty countries (CNN.com 2008), causing regime changes in some. The global financial crisis (GFC) was…

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  17. wilma western

    logged in via email @bigpond.com

    "Over 50% of Aus wheat and other grain end up as stock feed" - might be accurate but it does not follow that Aus producers are therefore and always selling at unprofitable prices. Wheat is bought from the farmer at prices that depend on the quality of the grain and also on the local and world supply. When world prices are low , the grain can be stored and later sold if the price has improved. We need some detail about all this. And of course many "other grains " are specifically grown as stock feeds…

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