AUSTRALIAN Rural Leadership Foundation chief executive officer Matt Linnegar’s recent comment that Australians need to drop the city-country divide stereotype may be stating the obvious, but it’s a necessary message all the same.
This country has one of the most urbanised populations in the world, which is also largely clueless to the potential sitting on its doorstep, simply due to a lack of understanding of how agriculture works.
Our urban population represents a sink of untapped capital which could help grow agriculture, but ag’s profile at present is one of a high risk, drought-ravaged industry plagued with image issues about welfare.
That’s not exactly an attractive sector to sink your hard-earned dollars into.
Furthermore, where do you start investing in ag if you wanted to? It’s a confusing prospect for the average punter.
If the ag sector is concerned about foreign investment it needs to get off its backside and turn this image around, because with the amount of debt in the ag sector, investment isn’t going to come from within.
If the industry can’t see this, foreign investment (which will still be needed anyway) will be doing all the heavy lifting and the more investing overseas interests do, the less control we have over where the money goes.
Investors like Andrew “Twiggy” Forrest, who have the necessary resources and connections, might be able to bypass most prejudices toward agriculture and have the existing capital to develop their own supply chains.
However, for the average farmer, overcoming these hurdles will increasingly rely on investment in processing and supply chain infrastructure.
The better these are operating, the more profitable the farm will be and the more likely Australian farmers will be able to hold on to Australian farms.
It’s broadly known the global area of arable land is in decline and demand for quality food is increasing as the affluence of developing nations improves.
However, in Australia, this message is lost and an investment in agriculture looks like a mug’s game.
This image needs changing, and fast.
If there wasn’t money to be made in ag, the likes of mining billionaire “Twiggy” Forrest and new CSIRO boss Dr Larry Marshall wouldn’t be jumping on board.
Now is the time Australian investors can get in on the ground floor, but we need to let them know.