A MINOR setback in the overall value of Australia’s farm sector did not dampen the enthusiasm of Federal Agriculture Minister David Littleproud, who opened proceedings at the Outlook 2018 conference, hosted by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) at Canberra on Tuesday.
A five per cent decline in the sector’s gross value is forecast for 2017-18, down to $59 billion from last year’s bumper crop haul of $60b, according to ABARES.
Exports are expected to fall 4pc to $47b.
The new Agriculture Minister David Littleproud said the future was optimistic with 1.2pc growth forecast for both the overall sector and exports, tipped to reach $63b and $50b by 2023, respectively.
“This shows we’re headed in the right direction,” Mr Littleproud said.
He highlighted the importance of trade agreements to improve agricultural market access to Japan, China, Korea and more recently, Indonesia
“Exports are key to farmgate returns,” Mr Littleproud said.
“We are a trading nation and that is our future.”
Mr Littleproud said that 70pc of Australian produce was exported, 52pc of which go to Asia – a figure forecast to grow to 69pc on the medium term.
“I’m passionate about the future prosperity of regional Australia and I’m excited about the social and economic benefits decentralisation can deliver,” he said.
“We’ll have more to say on the relocation of government agencies (from Canberra to regional centres) in coming months.”
ABARES executive director Dr Steve Hatfield-Dodds said the price projections delivering the muted farm outlook was influenced by two key factors – a weak global crop market and increasing US beef production.
The majority of ag sector growth will be driven by increased demand in our from population and economic growth in out key markets.
“Global crop production is trending down from the very high levels of 2016-17, but is expected to be enough to keep stocks high and prices low out to 2022-23,” Dr Hatfield-Dodds said.
“The US beef cycle has moved to a phase of increased production, intensifying competition in Australia’s export markets.
“For the period to 2022-23, we project this will keep prices below the recent highs associated with US production bottoming out in 2015-16.”
The value of the livestock industry is expected to grow 2pc in 2017-18, driven by global demand.