Murdoch Commission

Australia in Global & Regional Food Systems

High levels of economic growth in Asia’s densely populated nations over the last decade have boosted demand for imports of natural resources and farm products in these economies. Australia as a resource-rich nation has benefited from this demand, its significant levels of economic growth directly linked to the fortunes of the Asian ‘economic miracle.’ While the mining sector has been the overwhelming leader in Australia’s export earnings, farm exports have also experienced rapid growth in value in the 1990s and in the period following the 2008 food price hikes. Albeit, the value growth in farm exports pales in comparison to the effect that mining export activity has had on the appreciation of the Australian dollar.

Nonetheless, Australia is already a part of the global food system as a major exporter of food produce. Western Australia is a significant player in this trade, exporting up to 80% of its agricultural production with its largest markets in North East and South East Asia. As a consequence, the growing market potential in Asia for Australian agricultural produce is receiving increased attention in industry and policy circles, especially in relation to the expanding middle classes in nations such as China and Indonesia.  

Across 2014 the Australian government has undertaken a major white paper review of the competitiveness of Australian agriculture.  It is set in the context of Asia’s economic growth and the ‘food bowl’ challenges associated with demographic trends in the region. There is a strong sense in the submissions to this review of how Australian agriculture can make the best of the opportunities emerging in the region. The issues under consideration include policy and regulatory settings, domestic structural adjustment and productivity, investment in agricultural research and development, national and regional trade policy choices, and foreign direct investment.

Australia is well placed to contribute to regional food security. Aside from proximity to Asian markets, Australia has a ‘clean and green’ reputation in food production and a relatively quarantined environment with Western Australia as one of the most pest-free and disease-free areas in the world. Australian farm producers are among the most efficient globally and are leaders in sustainable agricultural production. Australia is a major centre of agricultural innovation and an exporter of technical expertise in areas such as dry land farming. There are thus great opportunities to develop the Australian export food trade in the region as well as assisting in the development of agricultural production on the ground in the region. Western Australia in particular has a significant part to play through its agricultural exports as well as through its leading science and technology research.

The Second Murdoch Commission will consider how these issues can be approached to best address the challenges of meeting the food needs of our rapidly growing region.