Securing Australia’s Food Future

Preamble

Australia’s agriculture and horticulture industries are the backbone of our nation’s food security, rural communities, and economic vitality. Yet, these sectors face mounting pressures from rising costs, cheap imports, and government policies that fail to prioritize local farmers. 

This policy aims to preserve and grow these industries, encouraging farmers to stay on the land by tackling decline, boosting resilience, and protecting Australian produce from unfair competition. We envision a thriving, innovative, and sustainable future for Australian agriculture and horticulture.

State of the Industry: 

Decline and Rise

• Decline: The Australian Bureau of Statistics (ABS) shows agriculture’s share of GDP has fallen from 4% in 2003-04 to 2.2% in recent years, with horticulture production fluctuating due to climate and market pressures. Since 2019-20, broadacre farm numbers dropped 8% (ABARES), and dairy cattle numbers fell 10% by 2022 (ABS), reflecting exits from unprofitable sectors. Horticulture faced a mixed 2021-22, with floods and La Niña cutting fruit yields (e.g., blueberries down 16%), though almonds hit a 10-year high.
• Rise: Despite challenges, horticulture exports grew 8% to $2.9 billion in 2021-22 (DAWE), and total agricultural exports hit $64.9 billion in 2022-23 (DAFF). Victoria’s export value rose 2.2% to $19 billion in 2023-24 (Rural Bank), driven by sheep and cattle gains. Macadamia production increased 4% in 2021-22 despite wet conditions (DPI NSW).
• Causes of Decline: High input costs—fertilizer up 153% from 2020-22 (Austrade), diesel at $1.80/litre in 2023 (vs. $0.91 in 2020)—and labor shortages (e.g., post-COVID visa delays) squeeze margins. Cheap imports ($40 billion annually) undercut local produce, while regulatory burdens and water price spikes (Murray-Darling Basin) deter investment.
• Causes of Rise: Favorable weather (e.g., Western Australia’s bumper 2021-22 wheat crop, up 47%) and export demand from Asia (e.g., mandarins to China up 32.3% in 2023-24, Rural Bank) buoy some sectors. Government programs like the Pacific Labour Scheme have eased seasonal worker shortages.

Current Government Approach: What’s Lacking?

The Albanese government touts initiatives like the $300 energy rebate and $10.1 billion in infrastructure (KPMG Budget 2024-25), but these are stopgaps, not solutions:

• Subsidies Misaligned: Billions prop up renewables (e.g., $29 billion since 2013, CIS), yet little targets farm cost relief or competitiveness against imports.
• Import Tolerance: Free trade agreements (e.g., China-Australia FTA) slash tariffs for exporters but flood markets with cheap goods, ignoring local farmers’ plight.
• Labor Fixes Fall Short: Visa incentives for seasonal workers (2022) help, but delays and red tape persist, per DAWE forecasts.
• Neglect of Core Needs: Funding splurges on urban projects while rural roads crumble and irrigation infrastructure lags, per Infrastructure Partnerships Australia.

This scattergun approach fails to protect or incentivize farmers, driving some off the land.

Policy Vision: Preservation, Protection, and Prosperity

We propose a farmer-first strategy to preserve agriculture and horticulture, encouraging resilience and growth:

1. Cut Input Costs:
   • Energy Relief: Subsidize farm diesel to $1/litre and electricity to $0.10/kWh via a $2 billion Farm Energy Fund, funded by scrapping renewable subsidies ($3–$5 billion/year).
   • Fertilizer Support: Cap import tariffs on fertilizer at 5% and offer $500 million in grants for local production, reducing reliance on volatile global prices.
2. Protect Against Cheap Imports:
   • Import Adjustment Levy: Impose a 10% levy on non-essential food imports ($40 billion market), raising $4 billion annually to fund farmer grants, not tariffs that hurt consumers.
   • Buy Australian Mandate: Require 70% of government procurement ($150 billion/year, ABS) to source local produce, boosting demand.
3. Encourage Farmers to Stay:
   • Land Incentive Program: Offer $10,000/ha grants (up to $500,000/farm) for five-year commitments to cropping or horticulture, costing $1 billion/year from import levy funds.
   • Tax Breaks: Double the Farm Management Deposits cap to $1 million, tax-free, encouraging reinvestment.
4. Invest in Improvement:
   • Rural Infrastructure: Allocate $5 billion over five years (from subsidy cuts) to upgrade roads, irrigation, and storage, cutting transport costs (10% of farm budgets, Finder).
   • Innovation Hub: $1 billion for R&D in drought-resistant crops, precision farming, and bio-fertilizers, lifting our 1.8% GDP R&D spend (below OECD 2.7%).
5. Streamline Labor:
   • Ag Visa Overhaul: Fast-track permanent residency for skilled ag workers after two years, bypassing current visa churn, costing $200 million in admin but saving labor gaps.

Why Australian Produce Costs More—and How to Fix It

• Causes: Higher labor costs (minimum wage $23.23/hour vs. $1–$2 in competing nations), strict environmental and safety standards (e.g., chemical limits), and energy prices (30% above global averages, Austrade) make Australian produce pricier than imports like Chinese fruit ($182.3 million in 2022-23, DPI NSW).
• Impact: Imports undercut local prices—e.g., $2/kg imported apples vs. $4/kg Australian—pushing farmers out, with 48% of consumers cutting local buys due to cost (Finder).
• Solutions: Subsidize inputs to lower production costs by 20%, per industry models, and use the levy to level the playing field without raising consumer prices. Promote “Australian Grown” branding to justify premiums, as 50% of shoppers want “all natural” options (Privacy Shield).

Rectifying the Causes with a Positive Outlook

• Cost Relief: Energy and fertilizer aid slashes operational burdens, letting farmers compete globally.
• Import Balance: The levy funds local growth without trade wars, preserving export markets ($64.9 billion, DAFF) while protecting home turf.
• Farmer Retention: Incentives and infrastructure rebuild trust, reversing the 8% farm drop and adding 50,000 jobs by 2030 (multiplier effect, KPMG).
• Future Growth: Innovation and export focus (e.g., India’s tariff cuts by 2028, DPI NSW) promise a $100 billion industry by 2035, per Editorialge projections.

Conclusion

Australia’s agriculture and horticulture can thrive again—not just survive—with a government that backs its farmers, not foreign importers. Unlike current policies that prop up multinationals and neglect rural needs, this plan cuts waste, protects our produce, and invests in a future where farmers prosper. By 2030, we’ll see more Australians working the land, feeding the nation, and driving a resilient economy—all grown right here.