NFF should increase its farmgate output goal to $125 billion by 2030: Episode 3

The National Farmers’ Federation is being urged to think big and look beyond its $100 billion by 2030 farm gate output target for Australian agriculture after the industry reached $90 billion last year. Episode3 cofounder Andrew Whitelaw said the NFF should readjust the target to $125b-plus, on the back of good rains and strong cropping results, the Russia-Ukraine war and sheer “luck” during the past few years. “When the target was initially announced, the industry had a gross value of farm output of $61b, giving the industry nearly $40b to improve output,” Mr Whitelaw said. “In the past few years, we have seen farm output increase massively. “In 2022, the farm output reached $90b, a fair increase from when the target was announced, and only $10b short of the 2030 target.” Mr Whitelaw said the grain industry had pulled a lot of additional weight during the past two years, with “cropping output (having) gone absolutely through the roof”. “It has done the heavy lifting of bringing agricultural output to a mind boggling $90b in a short period of time,” he said. “The important thing to consider now is how we continue this trend. “What has caused the large increase in cropping value, and how can we repeat it?” Mr Whitelaw said weather was one of the biggest drivers, but industry had also experienced “superb prices” for grain crops. Rising canola prices were attributed to a severe drought in Canada, the world’s biggest supplier to the export market. “The wheat industry rose through much of last year, in part due to the Russian invasion of Ukraine,” Mr Whitelaw said. “Combined these nations provide about 30 per cent of the worlds tradeable wheat. “As exports started back through the grain export corridor agreement, prices started to slide. “It’s to be determined whether this trade corridor will continue.” He said the war and the weather were the two things driving the prices, as well as assisting the industry to reach its target — both things were out of the control or influence of the Australian agricultural industry. Mr Whitelaw also threw inflationary figures into the mix to understand how it would impact agriculture’s worth going forward. He said inflation was now nowhere near two per cent — “we are sitting at around seven per cent”. “We don’t know what inflation will do over the coming years, but it is unlikely to stay at seven per cent, as the RBA have targets for inflation at 2-3 per cent,” Mr Whitelaw said. “If inflation averages four per cent over the coming years, then the industry will reach $97.5b. “In effect, this would just be keeping up with inflation.” He said the current ambitious target of $100b was a nominal value, not a real value. NFF chief executive Tony Mahar said six years was a long time in farming and there’s a possibility that the seasons will turn at some point, “which could send us a fair way backwards”. He said while industry had experienced a “tremendous run” since 2018, the $100b target was not a done deal. “At this point we’re not considering changing the target,” Mr Mahar said. “If we’re lucky enough to get there early we’ll just have to work with industry and agree on a new north star.”