The Australian Bureau of Agricultural and Resource Economics and Sciences’ (ABARES) March update reinforces the industry’s strength, suggesting our agricultural exports will beat a path to major global markets over the coming years with contributions from across various commodities.
"It’s become increasingly clear that businesses need more support to be fit for export."
Christine Linden, General Manager, Regional Business Banking at ANZ Australia
Of course seasonal conditions will play a large role in this but underneath we need a continued focus on productivity gains.
This upward trend for agribiz has the capacity to drive confidence, optimism and opportunity in our regional communities both within and external to the sector – and around $A49 billion worth of export earnings from farm commodities in 2017-18 alone.
Where will this demand be generated? It’s hard to look past our own region with much of the international demand coming from Asia, where a burgeoning and more discerning middle class has a growing taste for protein rich diets, driving sales for our high-quality and traceable beef, lamb and dairy products.
China dominates the new Asian market horizon but emerging markets such as Vietnam, Philippines and Indonesia are also experiencing solid GDP growth, with Australia’s nearest neighbour projected to be the fifth-largest economy in the world by 2030. And of course they hold significant and growing populations.
Many Australian businesses are taking advantage already. Data released in 2016 by ANZ shows trade into Asia from regional businesses had increased 85 per cent in the past eight years and 75 per cent of agricultural businesses were gaining substantially larger profits from their Asian ventures than their domestic operations.
The same data highlighted a massive revenue opportunity of $138 billion if Australian business acts on its intention to expand into Asia.
With such strong international potential, and a strengthening domestic economy fuelled by agriculture and a buoyant regional commercial sector, there’s little doubt more regional Australian businesses will look to Asia to realise growth.
That’s the challenge. How can regional businesses be better equipped to seize this opportunity?