Where Does Agriculture Need to be in 2030/50?

15 February 2011

Global Agriculture“The Burning Platform”

• Population Growth• Arable Farmland• Competition for Arable Land (Biofuels, population)• Water Quality and Availability• Climate Change/Variability• Agricultural Productivity (?)• Farmer Profitability (?)

– Prices– Costs– productivity

World wheat consumption World wheat harvested area

660+ MMT

30 year down trend

+/- 900 MMTDemand in40 years

(+ 240 MMT)

229 MMT

239 MHA

World Population Growth: Projected to 2050

2050+/- 9.3 Billion

20106.8 Billion

World Production and UseNovember, 2010

68

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64

3

653666

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700

01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11

MM

T

Production Use

68

3

64

3

653666

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520

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01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11

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Production Use

Two days of unrest in Maputo, Mozambique, left seven people dead and 280 injured after the government decided to raise bread prices by 30%

Published: September 2, 2010 Fears grow over global food supply

Rainfall trend 1970-2008

Challenges for the Australian Grains Industry

Declining rates of Total Factor Productivity growth– Drought years– Decreased RD&E

expenditure ($, direction)– Lack of ‘near term’

technologies– GM (cereals) 10 years

away– Farm management

capability

High levels of farm debt amongst broadacre farms ...…$’000 2008/09 dollars

0

200

400

600

800

1978 1983 1988 1993 1998 2003 2008

Farm debt

Farm receipts

Farm cash income

Farmer Profitability

• Government Policy (National and International) Socio/economic Trade policies Industry restructuring Investments in RD&E Recognition of “Global Village” Climate variability/change

• Increased productivity Industry restructure Focussed and driven RD&E

• Increased profitability• terms of trade• productivity

SUSTAINABILITY

Global Agriculture“The Way Forward”

Increased urban

population

Increased free trade

Food safety traceability

Sustainable development

Resource Scarcity

Energy Environment

Food

Grains Industry – Global Trends

The grains industry next 20 years – Mega trends

Factors PrioritiesMain Game- Wheat; barley- Sorghum North- Broadleaf ↑ (hopefully!)

↑↑Yield )WUE ) ProductivityCost Efficiency ) &Abiotic/Biotic stress ) ProfitabilityQuality )

Niche/value added opportunities (Taiwan noodles, HAW, sponge & dough)

Identify and develop (<500k tons)

East Coast/West Coast Grain types/quality

Climate change- Geography shifts- ETS

HRZ wheats, irrigated wheatsCropsLivestockCostsLegumes

GM Technologies ↑Productivity (unlikely < 10years)

Quality/Traceability Market opportunities/requirements

Grain Farms NumbersSize & business

Second generation biofuels LocationSize

Grains Industry supply chain Continued consolidation and globalization

National Grains RD&E Strategy (International?)

↑ Productivity ↑Profitability and Sustainability

National Research Development & ExtensionStrategy

December 2010

Grains Industry

National RD&E Priorities & Delivery Plan

Vision A PROFITABLE. COMPETITIVE AND SUSTAINABLE GRAINS INDUSTRY

↑Yield ↑Value ↓Costs ↑Sustainability

I ndustry Outcome Total Factor Productivity Growth of Greater than 2.5% per annum over the Next Decade whilst Sustaining the Productive Capacity of the Resource base.

National RD&E Outcome Highly Efficient National Grains RD&E Sector

National Centres of Research Capability, National Research Programs, Regional Networks of RD&E

RD&E Strategies Partners DAFF State Departments CSI RO Universities GRDC GCA

BUILD ON EXI STING

NATIONAL

COLLABORATION

DEVELOP EFFECTI VE

RELATIONSHIP

MODELS FOR PRIVATE

- PUBLIC COEXISTENCE

NATIONAL RESEARCH

PROGRAMS, NATIONAL

CENTRES OF RESEARCH

CAPABILITY AND REGIONAL

NETWORKS OF APPLIED

RD&E UNDER THE “MAJ OR-SUPPORT-LINK”

FRAMEWORK

NATIONAL CAPABI LITY

PLANNING FOR HUMAN

AND PHYSI CAL

INFRASTRUCTURE

BETTER & ON-GOING

ALIGNMENT OF

STAKEHOLDER

PRIORITIES AND RD&E

RESOURCE ALLOCATION

I ndustry & Government Priorities

I mproved Varieties to Lift Productivity & Product Value

I mproved Practices to Enhance Productivity & Sustainability

Supply Chain Innovation & Market Competitiveness

Building Farm Business & I ndustry Capability

Productivity

Markets Biosecurity Climate Natural resource management Regional & industry capacity

Growers and industry have ongoing access to improved genetics and varieties with better on-farm performance, reduced cost of production and grain qualities that are competitive in global markets

Improved on-farm practices that increase productivity and profitability whilst maintaining or improving the natural resource base and product integrity

Advance industry knowledge throughout the supply chain to improve the competitiveness and profitability of the sector

Accelerate adoption of new technologies and practice change across all segments of the grains industry

Statement on Biotech Commercialization

1969 Rainfall

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Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Month

mm

Total rainfall 217mmGrowing Season

Rainfall April to October

152mm

Yield 400kg / ha

2002 Rainfall

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5

10

15

20

25

30

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Month

mm

Total rainfall 164mmGrowing Season

Rainfall April to October

110mm

Yield 990kg / ha

• Future Challenges but equally great opportunities will require:

Clearly defined strategies• Government• Private

Effective change management

Strong relationship management

Summary