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13 March 2018 Dr. Steve Jefferies Managing Director GRDC PO Box 5367 Kingston ACT 2604 By email: [email protected] Dear Dr. Jefferies GrainGrowers’ response to the Grower & Industry Consultation Discussion Paper on the GRDC 2018-23 Research, Development & Extension Plan. GrainGrowers welcomes the opportunity to provide a submission to the consultation paper for the 2018-23 Research, Development and Extension Plan (the Plan). As a joint Representative Organisation (RO) for the Australian grains industry under the Primary Industries Research Development Act 1989 (PIRD Act), Grain Growers believes it is imperative this plan underpins and drives sustainable profitability for the production sector and increases its significant contribution to the Australian economy (worth $17.8 billion in 2016/17 1 ). In preparing this submission, GrainGrowers conducted its own survey to obtain members’ input (with 123 respondents) and conducted a number of interviews with growers. The GrainGrowers National Policy Group considered this information and met with you to discuss a range of key issues and has approved this submission. GrainGrowers supports ‘enduring profitability’ as the key driver of the GRDC strategic plan, and the associated investment in the five identified priority areas - yield, price, on-farm and post farm-gate cost and risk. Given the significant challenges from other exporting countries (including increased supply and lower cost production/freight systems) and changing international market requirements, coupled with high farm inputs and post-farm gate costs in Australia, the industry requires robust and ambitious RD&E to navigate the challenges facing Australia’s production environment. In parallel, the Plan must also focus on building the capacity and skills of growers, and growing community and consumer trust to maintain and enhance social license for the grains industry. To this end, GrainGrowers recognises the importance of a 20 year outlook, and ensuring the GRDC’s next Strategic Plan sets the right trajectory for significant long-term growth in the grains industry. GrainGrowers believes the plan must target opportunities in premium markets, and at the same time focus on lowering production and supply chain costs for grain as a bulk commodity. GRDC must focus on creating real value in RDE and ensuring this value can be captured for the benefit of the Australian grains industry and grain levy payers. GRDC has a pivotal role to play given the size of its investment portfolio, the opportunity to develop key domestic and international research and development partnerships, and its ability to coordinate with other agricultural related R&D corporations on cross-sector initiatives. 1 ABARES Agricultural Commodities, March 2018
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Page 1: GrainGrowers response to the Grower & Industry Consultation … · 2018-04-11 · GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018 In

13 March 2018 Dr. Steve Jefferies Managing Director GRDC PO Box 5367 Kingston ACT 2604 By email: [email protected] Dear Dr. Jefferies GrainGrowers’ response to the Grower & Industry Consultation Discussion Paper on the GRDC 2018-23 Research, Development & Extension Plan. GrainGrowers welcomes the opportunity to provide a submission to the consultation paper for the 2018-23 Research, Development and Extension Plan (the Plan). As a joint Representative Organisation (RO) for the Australian grains industry under the Primary Industries Research Development Act 1989 (PIRD Act), Grain Growers believes it is imperative this plan underpins and drives sustainable profitability for the production sector and increases its significant contribution to the Australian economy (worth $17.8 billion in 2016/171). In preparing this submission, GrainGrowers conducted its own survey to obtain members’ input (with 123 respondents) and conducted a number of interviews with growers. The GrainGrowers National Policy Group considered this information and met with you to discuss a range of key issues and has approved this submission. GrainGrowers supports ‘enduring profitability’ as the key driver of the GRDC strategic plan, and the associated investment in the five identified priority areas - yield, price, on-farm and post farm-gate cost and risk. Given the significant challenges from other exporting countries (including increased supply and lower cost production/freight systems) and changing international market requirements, coupled with high farm inputs and post-farm gate costs in Australia, the industry requires robust and ambitious RD&E to navigate the challenges facing Australia’s production environment. In parallel, the Plan must also focus on building the capacity and skills of growers, and growing community and consumer trust to maintain and enhance social license for the grains industry. To this end, GrainGrowers recognises the importance of a 20 year outlook, and ensuring the GRDC’s next Strategic Plan sets the right trajectory for significant long-term growth in the grains industry. GrainGrowers believes the plan must target opportunities in premium markets, and at the same time focus on lowering production and supply chain costs for grain as a bulk commodity. GRDC must focus on creating real value in RDE and ensuring this value can be captured for the benefit of the Australian grains industry and grain levy payers. GRDC has a pivotal role to play given the size of its investment portfolio, the opportunity to develop key domestic and international research and development partnerships, and its ability to coordinate with other agricultural related R&D corporations on cross-sector initiatives.

1 ABARES Agricultural Commodities, March 2018

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

In the following pages, GrainGrowers has responded to each of the questions in the GRDC discussion paper and has identified a number of additional areas for consideration. Also attached in Appendix 1 are the full results from GrainGrowers survey. GrainGrowers, as a representative organisation, welcomes the opportunity to discuss this submission with you and we look forward to working with GRDC to finalise the strategic plan. Should you wish to discuss our submission or results of the GrainGrowers survey further, please contact GrainGrowers National Policy Manager, Fiona McCredie on (02) 9286 2000 or email ([email protected]) Yours Sincerely

David McKeon CEO Grain Growers Limited

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan

Summary of GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan

1. GrainGrowers supports ‘enduring profitability’ as the key driver of the GRDC strategic plan, and the associated investment in the five identified priority areas being (in order of RD&E importance to our members) yield, price, on-farm costs and post farm-gate cost and risk. The most important investment opportunities for each priority were identified as:

o Improving water use efficiency o Meeting market specifications o Weed, disease and pest management o Maintaining grain quality in storage and handling o Improving weather forecasting accuracy.

2. With $1 billion to be invested in grains RD&E through the GRDC over the next five years, growers require the plan to include clear measures to benchmark, track and publicly report on progress to all levy payers. An appropriate return on investment must be defined as part of the plan and agreed with industry and Government.

3. Growers’ current confidence in the GRDC provides a strong platform for the new strategic plan to more boldly address the challenges and opportunities facing the industry. There are opportunities to improve extension activities in particular to ensure quick dissemination and adoption, and to prevent duplication in research effort within regional and/or nationally. The ability for growers and advisors to be able to readily and easily access a library of past research is essential.

4. Growers will benefit most from a plan focused on value creation and capture rather than just volume growth. This requires a detailed understanding of customer expectations and translating these into research projects which will drive agronomic, farming systems and supply chain improvements.

5. An equal mix of incremental and transformational research initiatives is needed to respond to global supply and demand pressures and remain competitive on the global stage. Using one example, unconstrained digital agriculture could unlock production gains of $5.93 billion for grains specifically representing a 51% improvement in gross value of production. These benefits stem from automation and labour savings; genetic gains through objective data; tailoring inputs to need; and market access and biosecurity.

6. The plan must build the capacity and skills of growers, and at the same time assist in growing community and consumer trust to maintain and enhance social license for the grains industry.

7. GRDC should work closely with existing bodies, such as farming systems groups and state departments of agriculture, to get the maximum benefit from research investment and also to ensure a strong skill base exists for grains related research now and in the future.

8. Opportunities should be explored to develop both domestic and international partnerships to ensure Australian growers have access to cutting edge innovations, science and technology in the production of all grains and oilseed. This is also fundamental to strengthen the research skills, infrastructure and capabilities available to Australian growers now and in the future.

9. GRDC should, where appropriate, take the opportunity to co-invest and partner with other Research Development Corporations to undertake agriculture-wide/mixed enterprise research which will directly impact on grain growers. This includes in energy, connectivity, workforce, business risk management and environmental stewardship.

10. Deployment of the plan requires a flexible approach which accommodates regional differences. These differences reflect agronomic conditions, market opportunities and the effectiveness and availability of current research and extension channels.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018 The importance of GRDC GrainGrowers’ ongoing discussions and consultation with members and the recent survey show strong support for GRDC. In the survey 45% consider GRDC’s performance better than other research and development corporations, and a further 39% believe it is about the same as other RDCs. In each region, GRDC’s research and development efforts were well regarded. The survey did identify, however, that there are opportunities to strengthen the extension activities in particular. This has already been acknowledged by GRDC in its recent restructure and annual operating plan and is essential to translate research outcomes into benefits in the paddock. GrainGrowers therefore believes the Plan needs to further strengthen GRDC extension capabilities and timeliness to ensure quick access to information and assist in reducing duplication of the research effort. The overall confidence in the GRDC provides a strong platform for the new strategic plan to more boldly address the challenges and opportunities facing the industry. GrainGrowers’ members support a balance of incremental and transformational research initiatives - . This will enable lower risk RD&E activities to continue to deliver 1-2% incremental changes each year, which on a cumulative basis delivers significant benefits for growers. It is also recognized that industry must evolve and transform if it is to remain competitive on the global stage. This requires “blue sky” thinking and ambitious (and higher risk) research which when successful, will deliver transformational outcomes of +10% improvements in the first year. Given this more proactive and ambitious agenda, it is incumbent on industry to ensure that the GRDC model has the operational flexibility, accountability and governance to deliver results on behalf of all levy payers.

Q1. Are there any additional trends the GRDC should be aware of when developing the Plan?

Q2. Are there any implications for grains RD&E arising from the global trends for supply and demand for grains? The Australian grains industry is well-positioned to continue to capitalize on growth in export markets, particularly in Asia and the subcontinent, for food and feed grains. Indeed, as seen in the graphic, Australia has experienced growth in wheat exports over the last decade. Our geographic proximity to major export markets and the industry’s broad production base are strengths that can be leveraged to achieve continued growth in the value of exports. However, we cannot let proximity lead to complacency and there is a key role for the strategic plan to tackle a range of global supply and demand issues, including:

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Demand signals: o The strong demand growth for grains and protein meal in livestock feed rations, arising from ongoing

rapid growth in global meat consumption. This incorporates the expansion of global aquaculture industry, and associated demand for specialist aquaculture feed rations.

o The rapid growth in Asian bread-wheat and soft-wheat consumption, and the associated slower consumption growth in traditional noodle demand.

o The need to meet increasingly stringent consumer demands for market, social and environmental sustainability (e.g. Europe).

o The ongoing strong demand growth for food-based pulse crops, driven by the subcontinent consumer.

o The uncertain future evolution in biofuel industry, and the impact of changing feedstock requirements.

o The recognition that global procurement occurs based on multi-origin and blends. o The increased demand for niche, health-conscience grains (such as oats) as Asian consumers become

more affluent and have increasingly westernized diets.

Supply signals o The rapid growth in supply from low-cost production regions (i.e. Black Sea), including improvements

in the consistency and quality of supply from these regions. o The relative high cost of production in Australia (including labour and transport costs). o The demanding Australian production environment (i.e. climate, rainfall and similar factors that can

impede production). o The need to differentiate Australian grains to attract price premiums.

The activities of AEGIC have provided direction on opportunities for the Australian grains industry, including2:

The potential for soft wheat to be used in the growing Asian cake and biscuit market, expanding demand and increasing the value of low protein wheat classes;

Confirmation that Australian canola meets new feedstock requirements for EU biodiesel, securing a $1 billion export market;

Emergence of new oat products in the China market such as oat noodles, oat milk. China has increased oat imports from 2013/14 to 2016/17; and

Identifying improvements that could reduce the average cost of Australian export grain supply chains, such as improved grain yields, more cropping in higher rainfall areas, more investment in infrastructure.

The Plan must focus on creating and capturing value for growers in this changing competitive global environment, rather than being driven solely by volume growth. The graph below shows the performance of the industry over the last 10 years and highlights the importance of value over volume. To do this investment in research is required to:

mitigate the threats of other origin grain into key export markets through supply chain efficiencies,

develop stronger traceability systems and strengthening product quality assurance programs to underpin Australian grain’s safe, ‘clean and green’ reputation,

refine farming systems to achieve alignment with consumer and market expectations (such as crop protection and weed management which have less reliance on chemical products)

Ensure the functionality of Australian grain is aligned to market requirements,

2 AEGIC website, www.aegic.org.au

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Meet evolving market requirements including regulations on biosecurity, gene technology and chemical use. Examine the potential to produce high-value crops, particularly pulses, across different regions in Australia (i.e. expand chickpea production in WA).

Q3. Comments on the SWOT analysis. The SWOT analysis presented in the paper broadly identifies the pertinent issues facing Australian grains industry. A concerted approach is required to ensure that research and development focuses on grain products which will continue to meet evolving market requirements and in turn strengthen access to key markets. GrainGrowers encourages GRDC’s plan to emphasize the importance of building social license for the grains industry, including improving traceability systems, and demonstrating environmental sustainability. GRDC should consider investing more directly in projects which build closer connections between our grain production systems and the community and consumers – building confidence and trust in our industry and products. Ensuring our grain meets market and community expectations is the key to holding and developing our markets, growing the value of our industry and therefore delivering enduring profitability to growers.

Q4. What do you believe is the right balance between research with transformational and incremental outcomes? In light of the challenges and opportunities for the industry, GrainGrowers recognises the need to invest in transformational research which delivers significant outcomes and step change in the industry. At the same time incremental research remains fundamental given the value that a 1-2% improvement can generate across the whole industry. The GrainGrowers’ survey demonstrated support for a balanced investment mix in research opportunities that deliver incremental (1-2% a year change) and transformational outcomes (+10% change in the first year). Interestingly, as shown in the graph below, the results for all states and GRDC regions were very similar, generally supporting close to half of the research effort being transformational in nature.

GRDC already undertakes transformational research initiatives including “transformational projects on water use efficiency, identifying genetic variances for heat tolerance in wheat and partnering with Bayer CropScience to develop new chemistries to combat difficult-to-manage weeds in Australian cropping

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

systems. New initiatives are also being pursued in automation, robotics and industrial products such as bio-plastics made from grain”3. The ability to identify and/or create transformational opportunities and find appropriate partners and investment vehicles will also present a challenge for GRDC. GrainGrowers recognises that GRDC must be flexible in how it approaches these partnerships if it is to capitalize on the opportunities. GrainGrowers is supportive of GRDC exploring a range of partnerships with domestic and international organisations to best leverage grower levies to achieve significant positive change for the industry. As one example, there may be opportunities to explore an arrangement with International Crops Research Institute for the Semi-Arid and Tropics (ICRISAT) particularly in chickpea breeding. Similarly, GrainGrowers recognises the importance of incremental changes to underpin the industry’s growth and believes GRDC must work closely with existing bodies, such as farming systems groups and state departments of agriculture, to get the maximum benefit from research investment and also to ensure a strong skill base exists for grains related research now and in the future. GrainGrowers supports:

An equal mix of transformational and incremental research projects

GRDC identifying appropriate partners for both incremental and transformational research initiatives,

and encourages GRDC to explore closer partnerships with Farming Systems groups (particularly for

incremental research) and domestic and international partnerships for larger, more risky

transformational projects.

GRDC maintaining its focus on predominantly grains-specific RD&E , however it needs to also invest in

broader agriculture-wide/mixed enterprise research as it relates to grain growers. This includes working

collaboratively with other RDCs and research partners to address issues impacting mixed farming

businesses.

Q5. What areas of research do you believe will have transformational outcomes for Australian grain growers? Future investments need to address industry challenges and global megatrends 4 , and provide the breakthrough research that is going to keep Australian grain competitive on a global scale. Technology, data, automation, new products and varieties, and breakthrough plant breeding (such as nitrogen fixing wheat) are just some of the areas which will deliver transformational change to farming systems, the grains supply chain and the production environment. More broadly, capitalizing on opportunities in energy, regional infrastructure, and telecommunications and connectivity, to name but a few, are fundamental to transform the agricultural sector and regional economies overall. And considering how industry responds to or utilizes disruptive technologies (such as Blockchain, CRISPR, drones) will be essential to ensure growers are informed and position to respond to harness the benefits. With nearly $1 billion to be invested in the next five years, the Australian grain grower should expect GRDC research, development and extension to deliver major improvements to their bottom line.

3 GRDC website GroundCover™ Issue: 132 January–February 2018 Research highlights for 2016-17 4 Rural Industry Futures, Megatrends impacting Australian agriculture over the coming twenty years. S Hajkowicz and S. Eady, RIRDC and CSIRO July 2015

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

To take the example of digital agriculture, the Precision to Decision Agriculture Project (supported by all 15 RDCs) identified unconstrained digital agriculture could unlock production gains of $20.3 billion5 overall, and $5.93 billion for grains specifically representing a 51% improvement in gross value of production. Such benefits stem from:

Automation and labour savings;

Genetic gains through objective data;

Tailoring inputs to need; and

Market access and biosecurity.

Given the quantum, GrainGrowers strongly supports the GRDC investing in specific initiatives which address each of these areas. Furthermore GrainGrowers encourages GRDC to continue to partner with all RDCs to ensure the benefits of digital agriculture are realized. At a higher level, there are significant opportunities in agribusiness which was “nominated by Deloitte in Building the Lucky Country: Positioning for Prosperity (BTLC#3) as one of the ‘fantastic five’ industry sectors which has the potential to take over from mining as key drivers of growth opportunities for the Australian economy over time. Of all the sectors in the Australian economy, agribusiness was the sector with the strongest combination of playing most to Australia’s competitive advantages and being a sector producing what the world increasingly wants.”6

Specifically for GRDC, the Deloitte report identified oilseeds as one of the five major next opportunities in agribusiness which should be reflected in GRDC’s strategic investments.

5 Accelerating Precision Agriculture to Decision Agriculture” - Australian Farm Institute 24 November 2017 6 Building the Lucky Country #3. Positioning for prosperity? Catching the next wave. Deloitte, 2014:

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

GrainGrowers also sought the views of members about the appropriate mix of grains specific research compared to research which has a broader agriculture-wide/mixed enterprise focus. Overall the survey showed that a mix is important, with support for slightly more resource being targeted to grains-only research. However there was still strong support for research with a broader agriculture focus, including research relative to mixed enterprises. This is reflective of the 50:50 mix of grain specialist vs mixed farmers, with 22% or 4,900 of the 22,156 classified as grain farmers operate “grain only” farms 7 . Interesting Queensland was strongest in its support of the GRDC focusing on grains only research, with NSW and SA supporting closer to a balanced mix. GrainGrowers recommends GRDC explores this further to understand if this result is reflective of widespread views in each region, and if so to identify the contributing factors for these regional differences.

Q6. Rank the different profit drivers from most to least important based on the ability of RD&E outcomes for each to create enduring profitability for Australian grain growers; and Q7. Please provide comment on the Key Investment Opportunities. GrainGrowers supports the five profit drivers as key elements of enduring profitability and, as a representative Organisation, will work with GRDC to refine these drivers and associated opportunities as the

7. ABARES Agsurf database 4 December 2017

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Plan progresses. The scope of each driver is broad and it will be important to identify the pertinent opportunities in terms of their scale and reach. As shown in the graph below, the results of GrainGrowers survey found that in terms of impact on farm business, price ranked the highest, followed by yield, costs (production and post-farm gate) and managing risks. However respondent’s considered that GRDC’s funding priorities should target yield as its top priority, then price followed by reducing costs, and then managing risks (see Appendix 1 for details response data).

The following tables shows how respondents ranked each of the investment opportunities for these five priority areas, ranging from most to least important – one table each for the national results, and then for each of the three GRDC regions. Nationally under the priority ’improvements in yield’, improving water use efficiency was considered the most important with plant physiology and biochemistry of lower importance. Within the ‘maintaining and improving price’ priority, investment in growers meeting market specifications was of most importance, with developing novel products of least importance. There are some variations by region which reflect the different agronomic, production and marketing challenges in each state. National results

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

GRDC Northern Region

Improvements in yield Maintaining and improving price

Optimise input costs Lower post-farm gate

cost Manage risk

Most important Water use efficiency

(59.26%)

Meeting market specifications

(60.71%)

Weed, disease and pest management

(85.71%)

Maintain grain quality when handling and

storing (57.14%)

Improve weather forecasting accuracy

(55.56%)

Addressing the gap between actual and

potential yield Value adding

Improving N & P availability

Research to address technical barriers

Optimise risk management integration

Minimising impact of extreme temperature

Determining expansion opportunities

Fertiliser manufacturing & application costs

Quantification of grower tariffs

Research new technology adoption

Soil research Developing novel

products (10.71%)

Engineering to improve product accuracy,

efficiency, reduced running costs

Policy development and advice

Support grower business management skills

(18.52%)

Plant physiology and

biochemistry (30.77%)

Modelling support, more accurate input decision

making

Research and extension to improve transaction

efficiencies

Least important

Engineering to reduce labour cost including

automation and robotics (10.71%)

Automation of handling and storage

(14.81%)

GRDC Southern Region

Improvements in yield Maintaining and improving price

Optimise input costs Lower post-farm gate

cost Manage risk

Most important Water use efficiency

(41.46%)

Meeting market specifications

(52.5%)

Weed, disease and pest management

(70.73%)

Maintain grain quality when handling and

storing (51.22%)

Improve weather forecasting accuracy

(73.17%)

Minimising impact of extreme temperature

Value adding Improving N & P

availability Quantification of grower

tariffs

Support grower business

management skills

Addressing the gap between actual and

potential yield

Determining expansion opportunities

Fertiliser manufacturing & application costs

Policy development and advice

Research new technology adoption

Plant physiology and biochemistry

Developing novel products (15.0%)

Modelling support, more accurate input decision

making

Automation of handling and storage

Optimise risk management integration

(19.51%)

Soil research (19.51%)

Engineering to improve product accuracy,

efficiency, reduced running costs

Research to address technical barriers

Least important

Engineering to reduce labour cost including

automation and robotics (17.07%)

Research and extension to improve transaction

efficiencies (12.5%)

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Respondents in the survey also identified other investment opportunities as:

crop/legume pasture rotations

a focus on pulses and oilseeds

diversification to manage risk,

optimise nutrient inputs and

explore new markets for growers and the industry as a whole.

Additional areas for consideration The GrainGrowers’ survey and National Policy Group identified a number of other issues which mainly relate to the framework, approach and measurement of the strategic plan. While these are beyond the scope of the discussion paper, they are important to address in the final strategic plan to ensure levies are efficiently and effectively used. Minimise duplication of research There is a view that more needs to be done to improve access and cataloguing of past and current research. This will help to improve extension activities but as importantly will reduce [perceived] duplication and repetition of research projects and therefore allow better use of levies. Strengthen research skills and capabilities The success of the RD&E strategic plan is contingent on access to world-class research people and facilities. With the changing investments from the private sector and state governments through their Departments of Agriculture, there is a concern about the stability and longevity of key grains research teams to undertake both incremental and transformational research. This aligns to issues identified in the consultation paper about the international reputation of its researchers and R&D system to ensure Australian grain maintains dominance in quality and innovative practices on a global scale. GrainGrowers is willing to assist the GRDC to progress policies which will support long term access to high-quality R&D and capacity of its staff.

GRDC Western Region

Improvements in yield Maintaining and improving price

Optimise input costs Lower post-farm gate

cost Manage risk

Most important Water use efficiency

(64.71%)

Meeting market specifications

(70.59%)

Weed, disease and pest management

(76.47%)

Maintain grain quality when handling and

storing (35.29%)

Improve weather forecasting accuracy

(64.71%)

Soil research Determining expansion

opportunities Improving N & P

availability Automation of handling

and storage

Research new

technology adoption

Minimising impact of extreme temperature

Value adding Fertiliser manufacturing

& application costs Quantification of grower

tariffs Optimise risk

management integration

Addressing the gap between actual and

potential yield

Developing novel products (17.65%)

Engineering to improve product accuracy,

efficiency, reduced running costs

Research and extension to improve transaction

efficiencies

Support grower business management

skills (23.53%)

Plant physiology and

biochemistry (23.53%)

Engineering to reduce labour cost including

automation and robotics

Policy development and advice

Least important

Modelling support, more accurate input decision

making (18.75%)

Research to address technical barriers

(6.25%)

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Flexible approach to accommodate regional differences While the strategic plan must articulate overarching national objectives, actions and targets, it is important that regional differences are acknowledged and that solutions are tailored to suit each region and will (most efficiently) deliver the results on the ground. As previously outlined, the survey showed some regional difference in rating the performance of GRDC currently in research, development and extension (show in the table below). For example, in the northern region research was highly rated (91% said it was good/excellent) while extension was rated the lowest (with 63% said it was good/excellent). GrainGrowers recommends that GRDC explore these differences and ground truth these survey findings.

Highest rating GRDC region Lowest rating GRDC region

Research Northern Region Southern Region

Development Western Region Northern Region

Extension Southern Region Northern Region

In addition to the regional production differences, there were also issues raised about differences in local research extension capabilities and structures which may contribute to this result. The focus must be on ensure grower engagement and quick and timely adoption of research findings, and where existing groups and channels for extension are effective then it is important they continue to be used rather than adopting a ‘one size fits all’ approach.

Measuring the strategic plan

Milestone tracking and reporting It is noted that the consultation paper did not provide insight into how the Plan will be benchmarked, tracked and reported, nor how incremental and transformational outcomes will be measured. As a Representative Organisation GrainGrowers expects GRDC to closely monitor levy expenditure and track return on investment at a project and corporate level.

Return on Investment With close to $1 billion to be invested in RD&E over the next five years, GRDC in its strategic plan needs to clear about the likely return on investment to levy payers – both growers and government. The ROI should continue to be benchmarked against other RDCs to guide investment decisions and to encourage partnership and collaboration opportunities to leverage the multiple levies a single farmers often incurs.

Measuring success in delivering enduring profitability There are significant challenges in measuring “enduring profitability”, including how to separate the impact of the GRDC’s investments versus external factors like the impact of global supply changes on price. GrainGrowers supports the concept of a benchmarking tool that allows every grower to compare their performance against regional and industry norms, and will work with GRDC to develop such a measurement tool. GrainGrowers also recognises that the profitability of the production sector has direct link to the profitability and viability of regional communities and regional growth and expansion. GrainGrowers recommends that GRDC incorporate some measure of this multiplier effect into its measurement to understand the full impact of its levy investment on both regional and the national economy. Where possible GRDC should also align its measurement with other RDCs under the auspice of the National Primary Industries Research Development and Extension Framework website (www.npirdef.org/strategies) as this provides a mechanism to track and compare performance across all RDCs.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Appendix A: GrainGrowers’ survey results and discussion

Q1: Which state do you live in? and Q2: Which GRDC region do you farm in? In the online GrainGrowers survey, respondents were provided maps (obtained from the GRDC website) that outline the GRDC growing regions.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

When the results were analysed by state, 27.78% of New South Wales residents responded they farm in the GRDC Southern Region and 72.22% farm in the GRDC Northern Region. This is interesting to note, given the GRDC Northern Region is defined as New South Wales and Queensland, and the Southern Region does not incorporate New South Wales. A possible explanation for this is that then ten (10) growers who responded they reside in New South Wales and farm in the GRDC Southern Region live in areas on the border between New South Wales and Victoria, or are referring to GRDC regions that existed prior to realignment by state borders.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q3: Thinking about GRDC’s current operations, how do you rate their performance in delivering each of the following? To determine how respondents rated GRDC’s performance in research, development and extension, each of the three categories were given an overall score based upon ratings assigned by respondents. This score was assigned by SurveyMonkey. Research received the highest rating for performance and extension received the lowest rating. The results were further analysed by GRDC region, with research performance rated highest by respondents in the Northern Region, development highest by respondents in the Western Region, and extension highest by those in the Southern Region. Research performance was rated lowest by Southern Region respondents, development was rated lowest by Northern Region respondents, and extension received the lowest performance rating from respondents in the Northern region.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q4. In general terms, how do you rate GRDC’s overall performance compared to other research and development corporations (RDCs)? Overall, results show the majority of respondents (41.51%) rate GRDCs performance better than that of other RDCs. This result extends that GRDC is highly respected by growers and this is backed by a significant percentage (38.68%) of growers rating GRDC’s performance the same as other RDCs. 14.51% of respondents were unsure of how they rate GRDC’s overall performance, which could be attributed to a lack of involvement or interaction with other RDCs, meaning they may never have had dealings with other RDCs which would be an ample explanation if respondents included single commodity farmers.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q5. As a grower, what impact would each of these have on your business? And Q6. Which order of priority should GRDC allocate funding for the following investment areas? This question was asked to provide insight into the five profit drivers as defined in the GRDC paper. To arrive at an overall ranking of each profit driver, a score was applied based on cumulative response rating for each profit driver from the categories available for growers to rank the impact of the profit driver on their business (scale = 1. Most impact to 5. Least impact) and the ranked priority in which GRDC should allocate funding to the investment areas (score = 1. Most important to 5. Least important). Comparison of the results shows that respondents rated Improvement in price as having the most impact on their business while Improvement in yield the most important for GRDC to allocate funding to. These results switch for the ranking of second most important, as displayed in the graphs accompanying the results above.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

From respondents’ comments provided in the GrainGrowers survey, it is evident that Managing risk may have received a lower score given grower views on prior performance of GRDC in the investment opportunities outlined under Managing risk to maximize profit and minimize losses. Further clarification around the investment opportunities in this outcome may have produced a different result in terms of the importance of GRDC funding allocation to this area.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q7-Q11: Importance of investment opportunities for each investment priority The GrainGrowers survey asked respondents to rank the importance of summarized investment opportunities under each investment priority. The results are summarized in the table above and rank the investment opportunities from most to least important based on an overall score obtained through analysis of the responses under each investment priority by SurveyMonkey.

Q12: Are there other areas you feel should be included in the strategic plan? Outlined above are the summarised responses obtained from an open comment box provided for respondents to detail other areas they feel should be incorporated into the plan.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q13: Overall, do you agree with the alignment of the GRDC’s Strategic R&D Plan to its purpose through aligning RD&E opportunities to the drivers of farm profitability? From the results, it is demonstrated that wholistically growers are agreeable with the strategic plan meeting its objective of enduring profitability through the outlined investment priorities and their opportunities. Only three (3) respondents replied they disagree with the alignment. The opportunity to provide comment saw the responses outlined in the graphic above returned by respondents in relation to the plan.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

Q14: What do you believe is the right balance in the GRDC’s portfolio between research with transformational and incremental outcomes? Results show that respondents want close to a 50:50 balance between incremental and transformational outcomes. The question allowed respondents to provide their answer using a sliding scale with 0 being incremental outcomes and 100 transformational outcomes. The position of the slider on the scale gave a single numeric score and this score was used to provide an average response. The average of responses was a score of 51.02 which lands on the side of transformational outcomes. The minimum score received was a 0 and the maximum score received being 92. The box and whisker analysis shows most responses fell between 41 and 69.

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

The results were analysed to provide insight into responses by state and GRDC region. This data is provided on the green scale. Interestingly, South Australian respondents were most in favour of transformational research outcomes giving a combined score of 57, whilst Western GRDC Region provided a cumulative response of 49, which is slightly below the overall average response of 51.02.

Q15: What do you believe is the right balance in the GRDC’s portfolio between grains-specific research and research that impacts on broader, mixed-farming operations or agriculture-wise issues? Results show that respondents want close to a 50:50 balance between grains-only and broader, mixed farming/ag-wide research. The question allowed respondents to provide their answer using a sliding scale with 0 being grains-only research and 100 being broader, mixed farming/ag-wide research. The position of the slider on the scale gave a single numeric score and this score was used to provide an average response. The average of responses was a score of 46.27 which lands on the side of grains-only research. The minimum

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GrainGrowers’ response to the discussion paper on GRDC’s 2018-23 Strategic Plan, March 2018

score received was a 0 and the maximum score received being 98. The box and whisker analysis shows most responses fell between 25 and 60.25. The results were analysed to provide insight into responses by state and GRDC region. This data is provided on the green scale. Interestingly, Queensland respondents were most in favour of grains-only research giving a combined score of 18, whilst South Australian respondents gave a cumulative score of 51. In terms of regional responses, the Northern GRDC Region provided a response of 43 whilst Southern GRDC Region respondents returned a cumulative score of 50.

Q16: Do you have any comments about RD&E in general or any issues facing the industry over the next five years? The GrainGrowers survey concluded with an option for respondents to provide final comments on RD&E or issues they believe will face the grains industry over the next five years. The comments have been summarized in the graphic above, with asterisks denoting issues which were raised more than once. This insight establishes areas the GRDC may want to provide consideration to in the strategic plan.

*** denotes recurring themes in responses


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