RISING farm production costs are eroding Australia's competitive position in global agricultural markets and highlighting the danger of another troubling farm economy black spot - our slowing rural productivity growth.
The rising competitiveness of low-cost food and farm export competitors from regions such as South America and the Black Sea should be sounding a stark warning to the Australian industry, particularly government authorities responsible for research and telecommunications connectivity, according to agribusiness bank Rabobank.
In 15 years Australia's annual farm productivity growth has halved from around 3 per cent to 1.4pc.
That's noticeably below the average for other high income members of the Organisation of Economic Co-operation and Development (OECD) at 1.7pc, and well below developing nation Brazil's average of 3.4pc in the decade to 2011.
Even New Zealand, which is also under pressure to broaden its productivity gains and control farm costs, has solidly outstripped Australia's growth, while The Netherlands, despite extreme land use constraints, has used big technology gains to achieve 3pc growth in the past decade.
Rabobank's research report on the Australian and NZ food and agribusiness sector noted how it was crucial to get productivity growth re-ignited to drive farmer profitability and ensure the industry remained globally competitive in coming decades.
Global demand for sustainable food production was also climbing fast as population growth zoomed towards nine million within 30 years.
"It's a beast of an issue," said research analyst and co-author Georgia Twomey.
She said individual farmers were constantly worried about their ability to maximise enterprise productivity and profitability so they could have long-term sustainability on their farms and in other businesses in the food and agriculture supply chain.
Recent productivity gains had largely been achieved by farmers scrimping on labour costs and using bigger machinery and consolidating farm holdings, but more sophisticated and innovative solutions were now required.
Ms Twomey noted there were some helpful signs the wider community acknowledged agriculture's economic potential and the value of productivity growth.
The federal government's recent and much-anticipated Agricultural White Paper had identified the need to prioritise access to premium-paying export markets, as well as initiatives to "farm smarter" through better research and farm efficiency and better business models for producers.
Continued investment in research and development (R&D) corporations was also highlighted in the white paper as important.
"However, continuing with the research status quo has not really been enough to drive our productive growth in the past decade," she said.
"And there's no indication governments are changing their attitudes on the need for public investment in research and development.
"State government spending in agricultural research and extension is declining and federal budget limitations have created challenging times for national organisations at a time when government funded research into innovation and technology is critical to our food sector's improved performance."
While the private sector may be able to play a bigger research role and should be encouraged to do so, Ms Twomey noted the priorities of many agribusinesses were not necessarily relevant to important aspects of Australian agriculture.
"Yes, big global players like Monsanto, Bayer or DuPont spend a lot of time and money on research, but it's directed at projects that work to their best advantage, often in other parts of the world - GM corn for the northern hemisphere, or Africa or Asia, for example," she said.
"In many respects Australia's not a big market and we really need research focused to our best advantage, including money for R and D in livestock industries, or pastures and other systems unique to our environment and productivity priorities."
Ms Twomey said Canberra's recent investment in identifying and fixing mobile phone network black spots was welcomed by farmers and farm support services desperate to get better real-time information connectivity in the field.
Everything in the bush, from weather data to technical feedback, from farm advisors and marketers or "cloud"-based accounting activities, required metropolitan standard internet and telephone capabilities to enable farms to perform effectively.
"Digital agriculture in the form of precision farming, big data, sensor technology and drones presents uncharted potential for productivity gains and improved management practices," she said.
Better connectivity also helped living standards and education options for farm families and other rural businesses, creating conditions which encouraged qualified people to stay in country areas and build vibrant communities.
Rabobank's report said reversing farming's productivity slowdown required Australia to make the most of any under-utilised land and water resources, and drive productivity gains across the entire supply chain, including value-adding for export.