Snapshot of Australian Agriculture 2021 report shows production growth


Snapshot of Australian Agriculture report shows agricultural production growing, exports strong

March 1, 2021

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6 minute read

Click here to read the full report covering the eight key aspects of australian agriculture.

The role of agriculture in Australia

Australian agriculture represents:

  • 55% of Australian land use (427 million hectares, excluding timber production in December 2020) and 25% of water withdrawals (3,113 gigalitres used by agriculture in 2018-19)
  • 11% of exports of goods and services in 2019-2020
  • 1.9% of added value (GDP) and 2.6% of employment in 2019-2020

The composition of Australian agricultural activity is determined by climate, water availability, soil type and proximity to markets. Livestock grazing is widespread and occurs in most parts of Australia, while agriculture and horticulture are generally concentrated in areas relatively close to the coast (Figure 2).

Agricultural production increases

Australia has a diverse agriculture, fisheries and forestry sector, producing a range of plant and animal products (Figure 3). The gross value of agricultural, fisheries and forestry production has increased by 7% over the past 20 years in real terms (adjusted for consumer price inflation), from about $62 billion in 2000 -2001 to $67 billion in 2019-2020.

The drivers of output growth over the past 20 years vary by sector:

  • In the agricultural sector, long-term declines in real prices have been offset by volume growth as producers have improved their productivity by adopting new technologies and management practices.
  • In the livestock sector, higher prices were the main driver of growth, reflecting the growing demand for protein in emerging countries as well as some temporary factors, such as drought in the United States and epidemics such as African swine fever in meat importing countries.

Around 70% of agricultural production is exported

Australia exports around 70% of the total value of agricultural, fisheries and forestry production. The export orientation of each industry may vary depending on the type of product. Wheat and beef, which are large sectors, are more export-oriented than dairy, horticulture and pork (Figure 9).

In real terms, the value of agricultural exports has fluctuated between $40 billion and $60 billion since 2000-2001. Meat and live animals was the fastest growing export segment, growing 86% over the period, followed by horticulture up 64% and forestry products up 16%.

Global agricultural demand is growing very strongly, reflecting rising per capita incomes as well as population growth, but export competition is also intensifying. Asia is the fastest growing export region for Australia’s agriculture, fisheries and forestry sectors.

  • Exports to Australia’s eight largest markets in Asia grew by 62% to $33 billion in the 20 years to 2019-20 and accounted for 62% of the total value of agriculture, fisheries and forestry exports in 2019- 2020.
  • China is Australia’s largest export market for agriculture, fish and forestry products, worth $16 billion in 2019-20. Exports to China are about 5 times greater than they were in 2000-2001.
  • Asian demand is expected to double between 2007 and 2050, providing opportunities for exporters of high-value, high-quality agricultural and food products.

Agriculture held up well despite COVID-19 uncertainty

COVID-19 was a major event for Australia’s agriculture, forestry and fishing sector in 2019-20, but the sector has demonstrated its ability to adapt and transition to new opportunities (Greenville, McGillvray & Black 2020).

Because food is an essential good, demand does not drop significantly in times of crisis, although the types of goods in demand during the pandemic have shifted from the high-value products typically consumed in the hospitality industry ( for example, wine and seafood) to foods consumed at home. Disruptions to domestic and international food supply chains in early 2020 have largely been resolved, allowing agricultural trade to remain resilient during the pandemic. International food processors continued to operate and require Australian products as inputs; and the resurgence of international manufacturing of textile and wood products has bolstered export demand for these products throughout 2020-21.

One of the enduring challenges of COVID-19 travel restrictions has been the reduced availability of foreign agricultural workers and higher air freight costs for exporters of high-value commodities. Horticulture, certain intensive productions and the meat processing industries have been the most affected by the reduction in the number of foreign workers. This has resulted in increased production costs for these industries and a potential drop in horticultural production as growers struggle to harvest. Exports of high-value and highly perishable products, such as live seafood and fresh produce, have also faced cost increases given the reduced supply of cargo space on flights to main export markets.


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