In 2016/17, Australia produced 45 million tonnes of grains from 22.9 million hectares, generating $13.5 billion in revenue. The Australian grain industry exports approximately 60% of this production (by value and 70% by volume), with the other 40% being consumed domestically. Grain production is predominantly focused in New South Wales, Victoria, South Australia and Western Australia.Australian farmland investment
Why Invest in the Australian Industry?
The majority of world grain crops are consumed in developing countries. Population growth and continuing economic development are key drivers of increasing global grain consumption. As global population grows, the demand for grains will increase more rapidly. Grain is required not only for human consumption, but also as feed for animals.
Demand, especially within emerging economies, is forecast to outstrip supply, which will continue to support a strong export market. The Australian grain industry is well positioned to meet this increasing demand.
Free Trade Agreements
While Australia is well positioned geographically and has a low cost of production, the ability to penetrate emerging markets has been constrained by government intervention in large grainconsuming countries. This government intervention has historically distorted market signals in the
international market and encouraged additional production at a price less than the real cost of production. However, the World Trade Organisation (WTO) has implemented an agreement to end global agricultural export subsidies4. Under this agreement, tariffs on Australian wheat exported under the ASEAN FTA were eliminated in 2016 (to all countries except Laos and Cambodia). All tariffs on other grains exported under this FTA will be eliminated by 2020. The removal of these subsidies is likely to increase Australia’s competitiveness in the global grain market.
Asian countries account for 63% of Australian grain export , 30% of which goes to S.E AsiaGrain exports