If someone asked me five or ten years ago I would be publishing an article on the topic of Agriculture. I would have said you are crazy!
Well, times have certainly changed. Over the past six to twelve months you would have seen various videos from Morpheus Asset Management on social media discussing Agriculture and other industry growth segments.
“The UN estimates that the world population will reach ten billion by 2050. Who is going to feed them?”
For the non-Australians reading this article. Australia traditionally has been a heavy mining and property focused economy. Mining contributes around $110+ billion dollars to Australian GDP annually, while Agriculture contributes $40-$60 billion dollars annually of GDP when considering farming output to the farm-gate. Beyond the farm-gate to consumers and other value-added processes the contribution to GDP is around $150-$200 billion dollars. (This article will focus on farming output to the farm-gate)
With a large land mass and geographical association with Asia one would assume agricultural GDP would contribute well over $100 billion dollars to Australian GDP annually?
Unfortunately this is not the case.
Australian beef exports to china dominate the agricultural demand and will continue for some time one would assume.
“The question now is……what other areas of agriculture in Australia need particular focus and investment to push GDP over $100 billion dollars annually for decades to come?”
Australia’s land mass is extremely large, but does suffer from a lack of irrigation access and seasonable drought conditions in many areas. It is debatable, but a mix of innovative product and service investment is the key to driving the next generation of growth. In many cases increased efficiencies in the way fertilisers are applied can save the economy billions of dollars before adding new export revenue channels.
The potential areas of focus to support GDP growth can consist, but not limited to the below:
- With the use of locally developed AI technology identify and support farmers to make predictive decisions around planting and crop maintenance. Many farmers outline there is plenty of data, but how does one make use of it?
- Research & development facilities for foreign companies to test their product in many different conditions that the Australian landscape offers. This can come in the form of data based collaboration between governments and private business.
- Better use of ground and air data collection in the form sensors, drones and satellites to name a few.
- Increased use of 24 hour greenhouse facilities around Australia which is similar to the Dutch model.
- Farmer to consumer real-time logistics solutions that support market pricing decisions and inventory management. The use of blockchain technology is certainly a driver in this area.
- On a basic level increased focus on traditional product area efficiencies for beef, wheat, dairy, wool, cotton etc.
- Food security solutions is a significant area of opportunity that every economy wants to address.
- Robotics in the form of livestock management, plant management and harvesting.
- Genetic plant investment for customised food requirements or climate conditions.
The list is truly endless and only limited to the imagination with current technological access and advancements. It is encouraged that businesses in all areas collaborate to achieve their desired goals across all agricultural segments.
“The sharing of data is critical to success in the new economy”
The challenge is the find the balance between what the economy requires locally and what can be exported internationally on scale.
At the end of the day it comes down to Australian innovative intellectual property supporting the following three key factors:
- Feeding the world
- Creating local jobs
- Increasing annual agricultural contribution to GDP
It is a challenging time for many economies around the world to solve the hunger problem going forward, but Australia is well primed and positioned to support that challenge. Now it is time to get moving to realise the benefits for Australia and the world.
Australia has a big part to play!
If you have questions, comments or feedback. Please feel free to contact us. Love to hear everyone’s thoughts in this area.