Productivity growth key for farms

IMPROVING productivity will be essential for the future of Australian agriculture as competition in export markets increases.

This was one of the key messages from Peter Gooday who was a speaker at this week’s Australian Bureau of Agriculture and Resource Economics and Sciences’ regional update in Devonport.

Over the past two decades productivity improvements have slowed in Australia and other developing countries are beginning to catch up.

Mr Gooday said this could affect the competitiveness of Australia’s agricultural prod- ucts in key export markets and was something farmers needed to be aware of.

“Improvements in productivity aren’t just about technology though,” he said.

“Some of our recent work identified that policy reforms and infrastructure investments by South American beef exporters are likely to boost their competitiveness in some of our key markets.”

Investment in research and development is one of the main drivers of increasing productivity.

Mr Gooday said in the future this research in Australia was more likely to be funded by the private sector than publicly funded.

The types of farming enterprises that make up the country’s agricultural sector have also changed significantly.

“Australian agriculture has previously been dominated by small and medium farms,” Mr Gooday said. “However ongoing increases in farm size means a small number of large farms now produce most of Australia’s agricultural output. These trends are expected to continue.”

Mr Gooday said because of this, it would be essential to understand the needs of these different operations when it came to suitable research, development and extension programs to drive productivity.

Consolidation in the processing sectors of different industries has also bought significant changes.

Mr Gooday said this was particularly evident in the beef industry.