FARM OUTPUT A VALUABLE COMMODITY

If you’re looking for reasons why Australia’s economy has remained resilient over the past three years, one place to start is the relative strength of the agricultural sector.
 
Normally, Australia’s farm production has to be sustained in the face of droughts, floods and volatile world commodity prices.
 
But while the national economy has battled Covid-19 disruptions, rising inflation and severe flooding events, the output of the farm sector has remained relatively buoyant.
 
Figures for the 2021-22 year, released in mid-January by the Australian Bureau of Statistics underline the value of agriculture to the national and regional economies.
 
Last financial year, for example, the gross value of the nation’s wheat crop soared by 33 per cent to $13.1 billion, in a major recovery since the 2019-20 harvest, which yielded a value of just under $5 billion.
 
In production terms for 2021-22, Western Australia’s wheat crop jumped by 47 per cent to 13 million tonnes, offsetting reduced yields in NSW, Queensland and Victoria, which suffered flooding, hailstorms or both. South Australian wheat production also rose, by 19 per cent, to 4.8 million tonnes, as Australia’s total wheat harvest topped a record 36 million tonnes.
 
Annual canola and cotton crops also more than doubled their value, albeit each off a smaller base, with the gross value of canola jumping 105 per cent to $6 billion and cotton, by 186 per cent to $4.2 billion.
 
Even barley - the subject of trade restrictions in the Chinese market – enjoyed a 17 per cent increase in crop value, to $4.4 billion.
 
But a second year of La Niña conditions affected the horticultural sector in NSW and Queensland, while hailstorms in South Australia and Victoria contributed to a 30 per cent drop in the value of grape production for wine, to $853 million. National wine production fell 27 per cent, to 1.2 million tonnes.
 
Livestock producers in general continued their recovery from the 2019-20 drought, with the gross value of livestock disposals increasing 12 per cent to $25 billion in 2021-22; meanwhile the gross value of livestock products rose seven per cent to $9 billion.
 
The rise in farm output was achieve despite a five per cent fall in the area devoted to Australian farm production, to 369 million hectares.
 
Overall, the healthy farm commodity figures demonstrate the ability of Australia to source a wide range of agricultural produce from a diversity of regions and climate zones.
 
Meanwhile, the rising value of cereal and broadacre crop production points to rising global demand for food, especially in the wake of disruptions caused by the conflict in Ukraine.
 
Gavin Clancy is a Senior Consultant with Lunik