AGRICULTURE INDUSTRY

This section includes detailed information on the Agriculture industry in Australia. It covers the type of agricultural activities undertaken by farm businesses, employment by the Agriculture industry and financial performance measures.

Data are sourced from ABS surveys (of agricultural businesses and of the labour force) and the farm surveys run by the Australian Bureau of Agriculture and Resource Economics and Sciences.

The section also includes a short article, Organic food and farming in Australia.

During 2009–10, there were approximately 134,000 businesses with an estimated value of agricultural operations (EVAO) of $5,000 or more (table 16.1). For the vast majority of these, their primary activity was agriculture, as defined in the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006. While the remainder (10%) were undertaking some form of agricultural activity, their main activity was not in agriculture. The majority of agricultural businesses were mainly engaged in beef cattle farming, grain growing, mixed grain/sheep/beef farming, sheep farming or dairy cattle farming.

16.1 BUSINESSES WITH MAIN AGRICULTURAL ACTIVITY, By state and territory—2009–10
	NSW	Vic.	Qld	SA	WA	Tas.	NT	ACT	Aust.
Agriculture industries(a)	no.	no.	no.	no.	no.	no.	no.	no.	no.
Nursery production(b)	^292	^235	^284	62	^88	34	8	1	1 005
Turf growing	^112	^14	^127	**5	*39	^2	2	–	302
Floriculture production(b)	^187	^163	*122	^38	*58	^23	6	–	597
Mushroom growing	^33	^8	^18	**13	*2	*2	–	–	^76
Vegetable growing(b)	1 079	801	952	^585	425	404	32	*1	4 279
Grape growing	1 113	1 678	*102	2 106	^478	^49	^5	^4	5 536
Other fruit and tree nut growing(c)	1 611	601	1 544	391	^475	123	157	*1	4 902
Apple and pear growing	^94	^196	^42	61	^85	^67	–	–	545
Citrus fruit growing	431	^99	76	^209	*100	**2	–	–	916
Sheep farming (specialised)	4 144	3 338	^249	1 559	959	441	–	^15	10 705
Beef cattle farming plus beef cattle feedlots (specialised)	14 324	8 763	12 619	1 368	2 313	1 240	201	26	40 854
Sheep-beef cattle farming	2 838	1 490	^436	^590	^313	^238	^1	*4	5 909
Grain-sheep or grain-beef cattle farming	4 971	2 569	1 089	1 796	1 872	^53	*1	*1	12 352
Rice growing	195	–	*3	–	–	–	–	–	197
Other grain growing	3 190	2 946	1 242	2 801	2 863	*17	–	–	13 059
Sugar cane growing	^374	–	3 259	–	*1	–	–	–	3 634
Cotton growing	150	–	^211	–	–	–	–	–	^361
Other crop growing n.e.c.	^569	^386	^712	^153	^147	^106	13	*1	2 088
Dairy cattle farming	1 425	5 295	764	^365	^286	459	–	–	8 594
Poultry farming (meat)	265	212	88	56	47	^19	–	–	687
Poultry farming (eggs)	*147	^86	^36	^22	^26	^14	–	1	^332
Deer farming	**4	**77	**5	**14	–	*1	^1	–	*101
Other livestock farming n.e.c.(d)	^831	^534	^570	^153	^252	*40	10	*1	2 391
Pig farming	^175	*147	^177	^118	^58	*14	–	–	687
Agriculture	38 554	29 638	24 726	12 464	10 889	3 348	437	56	120 112
Other industries	4 561	3 025	2 719	1 587	1 509	^582	72	^17	14 072
Total All industries	43 115	32 663	27 445	14 052	12 398	3 930	509	73	134 184
– nil or rounded to zero ^ estimate has a relative standard error of 10% to less than 25% and should be used with caution * estimate has a relative standard error of 25% to 50% and should be used with caution ** estimate has a relative standard error greater than 50% and is considered too unreliable for general use (a) The Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 edition (1292.0) has been used to categorise businesses according to their main activity. (b) Includes under cover plus outdoors. (c) Includes berry fruit, stone fruit and olive growing. (d) Includes horse farming and beekeeping. Source: Agricultural Commodities, Australia (7121.0).

EMPLOYMENT

The Agriculture industry is an important source of employment in regional and rural Australia. The number of people employed in the industry decreased in 2010–11 to a yearly average of 306,700 persons (table 16.2).

16.2 AGRICULTURE INDUSTRY(a), Employment(b)(c)
	Males	Females	Persons
	'000	'000	'000
2007–08	206.3	96.6	302.9
2008–09	217.1	104.6	321.7
2009–10	218.7	106.1	324.8
2010–11	206.0	100.7	306.7
(a) Classified according to Subdivision 01 (Agriculture) of the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 edition (1292.0). Excludes services to agriculture industries. (b) Includes persons who worked without pay between 1 and 14 hours per week in a family business or on a farm (i.e. contributing family workers). (c) Annual average of quarterly data ended May quarter. Source: Labour Force Australia, Detailed, Quarterly (6291.0.55.003).

SELECTED FINANCIAL PERFORMANCE MEASURES

Statistics on the financial performance of farm businesses provided in this section are based on information collected in the annual Australian Agricultural and Grazing Industries Survey and the Australian Dairy Industry Survey, conducted by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES). The collection covers farm businesses engaged in the sheep, beef cattle, dairy cattle, wheat and other crop industries.
Selected financial performance measures – expressed as annual averages per farm – for all broadacre farm businesses for the years 2007–08 to 2009–10 are shown in table 16.3.

16.3 BROADACRE FARM BUSINESSES(a)
Annual average per farm		2007–08	2008–09	2009–10(b)
Total cash receipts ($)		338 650	336 640	^341 400
Total cash costs ($)		274 430	260 660	^282 500
Farm cash income ($)		64 220	75 980	^58 900
Farm business profit ($)		–11 310	–1 510	*–20 500
Profit at full equity
	excluding capital appreciation ($)	29 380	36 640	*19 900
	including capital appreciation ($)	84 360	40 620	**2 300
Farm capital at 30 June ($)(c)		3 898 150	3 800 320	4 005 500
Rate of return(d)
	excluding capital appreciation (%)	0.8	1.0	*0.5
	including capital appreciation (%)	2.2	1.1	**0.1
Total non farm income ($)(e)(f)		34 030	35 820	32 200
^ estimate has a relative standard error of 10% to less than 25% and should be used with caution * estimate has a relative standard error of 25% to 50% and should be used with caution ** estimate has a relative standard error greater than 50% and is considered too unreliable for general use (a) Classified according to Group 014 of Subdivision 01 (Agriculture) of the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 edition. (b) Preliminary estimates. (c) Excludes leased plant and equipment. (d) Rate of return to farm capital at 1 July. (e) Average per responding farm. (f) Collected for owner manager and spouse only. Source: Australian Bureau of Agriculture and Resource Economics and Sciences, Australian Farm Survey Results 2007–08 to 2009–10 and Australian Farm Survey Results 2008–09 to 2010–11.

Farm cash income is a measure of the cash funds available for farm investment and consumption after paying all costs incurred in production, including interest payments, but excluding capital payments and payments to family workers. It is a short-term measure of farm income because it takes no account of depreciation on assets. Average farm cash income for broadacre farms declined from $75,980 in 2008–09 to $58,900 in 2009–10 (graph 16.4 and table 16.3).




A measure of longer-term profitability is farm business profit, as it takes into account capital depreciation and changes in inventories of livestock, fodder, grain and wool. Average farm business profit was a negative amount in 2009–10 at –$20,500 (graph 16.5 and table 16.3). This was a decline on the 2008–09 figure of –$1,510.



For the broadacre industries, rate of return (excluding capital appreciation) averaged 0.5% per farm in 2009–10 (graph 16.6), down from 1.0% in 2008–09.

ORGANIC FOOD AND FARMING IN AUSTRALIA This article was contributed by Dr Andrew Monk, Biological Farmers of Australia. The retail value of the ‘organic market’ in Australia was estimated to be at least $1 billion in 2010 ‒ with annual growth projections ranging from 10% to 25% for the years ahead, depending on the market segment.[Endnote 1] IBIS World has noted organic farming and organic products as growth sectors to watch in the coming years.[Endnote 2] The Australian Organic Market Report 2010 estimated that just under 3,000 Australian business operations are certified to organic standards, with over 2,000 of those being primary production businesses and the remainder processors, wholesalers and retailers. The ‘organic food and farming industry’[Endnote 3] in Australia is diverse in terms of sectors represented (from cosmetics and composts to chickens and corn), market outlet types (from farmers’ markets to supermarkets) and size of operations (from niche gourmet trail operations to large-scale operations supplying supermarket chains and export markets). In terms of government standards and industry certification programs, the Australian organic food and farming industry has been in existence for over 20 years. Internationally, the organic marketplace has Codex Alimentarius [Endnote 4] specifications for organic production and marketing. Many trading partners (including the United States of America, Japan and the European Union) also have regulatory arrangements in place for the production and sale of products claiming organic status. The progressive simplification of labelling of organic foods at retail level is making it easier for consumers to identify and choose certified organic products. Consumers appear to perceive a range of benefits from eating organic foods. The top five consistently identified benefits are ‘chemical free’ (82%), ‘additive free’ (77%), ‘environmentally-friendly’ (70%), ‘no genetically modified organisms’ (65%) and ‘hormone and antibiotic free meat’ (64%). [Endnote 5] Organic produce is currently a niche offering in the Australian market, at an estimated 1% of retail turnover. However, expansion is anticipated, in particular with continued growth in distribution by the major supermarket chains. There has also been growth in more direct market routes, such as farm gate sales, farmers’ markets and co-operative marketing schemes. The ongoing presence of independent single store organic retailers underscores the inherent diversity of this market segment. [Endnote 5] The resilience of the organic food and farming industry over the past decade has surprised many. For example, in the face of the global financial crisis (GFC), growth continued to be registered for the organic market, both domestically and at the international level. While more mature markets, such as the USA and the United Kingdom, saw a slowing of growth between 2008 and 2009, the Australian market experienced an estimated 50% growth (between 2008 and 2010). World sales of organic products are now estimated at about US$50 billion and growing. [Endnote 6] The Australian Organic Market Report 2012, published by the industry group, Biological Farmers of Australia, will include key findings from the Australian Bureau of Statistics 2011 Agricultural Census. These include: number of Australian farming businesses with organic or bio-dynamic certification and land area under certification. Endnotes 1. Australian Organic Market Report 2010, Biological Farmers of Australia Ltd, Brisbane. <Back> 2. IBIS World 2011, Organic Farming in Australia: Market Research Report IBIS World. <Back> 3. While not an ‘industry’ in the technical sense, the organic food and farming movement, which has evolved as a market sector in the past three decades across the developed world, is defined by its cohesion around clearly articulated standards for the production and sale of organic products. The ‘industry’ encompasses fertiliser and biopesticide producers, farming sectors, processors, wholesalers and retailers with an involvement in the production and/or sale of organic products. <Back> 4. Codex Alimentarius is the organisation jointly established by the Food and Agriculture Organization (FAO) and the World Health Organization (WHO) in 1963 to assist in the establishment of standards and regulation of food traded internationally. <Back> 5. Biological Farmers of Australia 2010, Australian Organic Market Report 2010. <Back> 6. Willer, Helga and Kilcher, Lukas (eds) 2010, The World of Organic Agriculture – Statistics and Emerging Trends 2010, IFOAM, Bonn and FiBL, Frick. <Back>