Australian agricultural industry to reach $100 billion value by 2030

Key points:

  • Australian agricultural industry to generate $73 billion according to ABARES
  • Australian agricultural exports expected to be $54.7 in 2021–22
  • The livestock industry is expected to generate $33.5 billion, up 8% on 2020–21 financial year

ABARES has released the September update of its Agricultural Outlook report, which estimates that Australian agricultural output will be $73 billion for the 2021–22 financial year.

This will be the first time the value of the Australian agricultural industry will exceed $70 billion, and places it well on the way to reaching its goal of $100 billion by 2030.

The livestock industries, including beef, sheep (meat and wool), goat, pork and chicken, will generate $33.5 billion in economic output in the 2021–22 financial year. This accounts for 46% of all agricultural economic output.

The growth in the livestock sector’s output is forecast to rise by 7%, while the cropping sector is tipped to grow by 8%. Slaughter of both sheep and cattle has fallen in 2020 and 2021 as herds and flocks rebuild.

Concurrently, last year’s improved seasonal conditions resulted in a record grain harvest, with another bumper harvest expected for this summer. For these reasons, the livestock industry’s contribution to agricultural output has been below that of the cropping sector since 2019 when cropping yields were low and the drought induced large livestock turn-off.

The outlook forecasts the export value of lamb and beef to only increase marginally, rising 2% and 1%, respectively, due to the high export prices of these commodities last year. It also expects that restocker demand will subside and predicts that current record prices will be subdued by mid-2022.

ABARES expects more cattle to hit the market in 2022 as the herd rebuild matures, providing markets with much-needed supply.

Key takeaways for the beef industry:

  • Average saleyard prices in 2021–22 are forecast to rise by 12% to 702¢/kg.
  • Favourable weather conditions are expected to support continued herd rebuilding.
  • Production is forecast to rise by 7% to over 2,000KT, but cattle availability and labour shortage constraints are likely to continue.
  • Australia’s exports are forecast to rise by 3% to almost $10.1 billion in 2021–22.
  • Demand for live cattle exports is expected to remain subdued.

Key takeaways for the sheepmeat industry:

  • Lamb and sheep saleyard prices are likely to remain high in 2021–22.
  • Demand for lamb is expected to strengthen in the United States and the Middle East.
  • Chinese demand for mutton is expected to weaken due to greater availability of pork in China.
  • Flock rebuilding in the eastern states is expected to continue, following high rainfall in sheep-producing regions.

Resources:

Agricultural overview: September quarter 2021

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