agribusiness insights - production season 2021-21

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• Tasmania experienced exceptional conditions for the 2020-21 production season, driven by the wettest and coolest summer days in a decade.

• While most commodities performed well under these conditions, localised weather events such as heavy rainfall impacted individual cherry producers and interrupted the harvesting of some field crops, including poppies.

• These growing conditions are likely to have resulted in above average harvest yields for a variety of vegetables, fruit and industrial hemp.

• The grape vintage was delayed by weather conditions in some regions, however predicted warm weather extending into autumn will improve the quality and yield of grapes.

• Grazing industries are enjoying exceptional seasonal conditions across the state, underpinning an increase in milk production and the highest cattle and sheep prices on record.

Agribusiness InsightsP RO D U C T I O N S E A S O N 2 0 2 0 - 2 1

Excellent seasonal conditions have led to exceptional volumes of production for some commodities

Access to seasonal labour has been difficult due to travel restrictions both domestic and international

Tasmania has so far been successful in containing locally acquired cases

of COVID-19 within the State

COVID-19 continues to have an impact on agri-tourism and

hospitality businesses

Weather during summer harvest 2020-21

Sep-Nov 2020

Dec 2020-Feb 2021

Sep-Nov 2020

Dec 2020-Feb 2021

Mean temperatureRainfall

Highest on

record

10Very much

aboveaverage

8-9Aboveaverage

4-7Average

2-3Belowaverage

1Very much

belowaverage

Lowest on

record

GROW

MAKE

PROTECT

EXPERIENCE

Agribusiness Insights PRODUCTION SEASON 2020-212

COVID-19

• As at June 2020, Tasmania has been successful in containing locally acquired cases of COVID-19 within the State, and many agricultural businesses have returned to a degree of normality.

• The easing of restrictions across most Australian jurisdictions is starting to see a pick-up in demand from restaurants and cafes for both fresh and processed food lines. However, disruptions remain likely.

• COVID-19 travel restrictions continue to have an impact on agri-food, agri-tourism and hospitality businesses that rely on domestic and international visitors.

• The monetary policies pursued by the Australian Government to help stimulate the economy have reduced the cost to business of borrowing funds to invest.

• The continuing impact of COVID-19 will result in challenges for many businesses adjusting to longer-term structural changes in the labour market, societal behaviour, travel patterns, spending habits, and the profitability of some industries.

• Impacts of COVID-19 have been challenging for businesses, however, they have also encouraged them to identify and implement opportunities such as alternative markets and technology solutions.

Itinerant and Seasonal Workers

• Itinerant and seasonal workers provide the largest proportion of experienced labour employed in the State’s agricultural sector and COVID-19 travel restrictions have severely reduced the availability of workers entering Tasmania from overseas and mainland Australia.

• With a reduced labour pool nationally, many producers have allocated additional resources to recruiting and training staff which has resulted in most producers ssuccessfully recruiting adequate staff.

• There are some reports of crops not harvested due to the shortage of labour.

• Challenges have also been experienced with access to specialist and technically skilled labour, such as pregnancy scanners, shearers, wool handlers and AI technicians. Opportunities have been created to train Tasmanian workers to fill some of these roles.

External impacts on Tasmanian agricultureExternal impacts during summer harvest 2020-21


• 2019-20 was another record-breaking year for Tasmanian exporters with land-based agri-food products accounting for approximately 21% of Tasmanian international merchandise exports.

• Ongoing global trade uncertainty due to trade sanctions on some Australian products and freight disruptions will have an impact on some Tasmanian agricultural industries.

• While costs are reported to have increased for both incoming and outgoing sea and air freight, most Tasmanian agricultural exporters have been able to supply products to market.

• The temporary direct flight service between Hobart and Hong Kong provided a critical avenue for fresh produce into South East Asia through the summer months.

• Additionally, targeted support measures such as the International Freight Assistance Mechanism (IFAM) administered by AusTrade have been put in place to keep global air links open in response to the ongoing effects of the COVID-19 pandemic.

• Freight services, supply chain integrity, labour supply and storage capacity remain key considerations for stakeholders.

• The strengthening Australian dollar is unfavourable for some exporters.

1 Red meat’ refers to beef, mutton and lamb, and pork. 2 ‘Other food’ includes food not easily placed into other categories, such as pre-prepared foods, unidentified flours and products containing a combination of ingredients.

Sources • Trade data (international food exports) – purchased from ABS.

A summary of these export statistics is available from Department of State Growth website.

• Bureau of Meteorology, Climate Outlooks

Trade

0 20 40 60 80 100 120 140 160

Rest of World

Malaysia

Vietnam

New Zealand

Indonesia

Taiwan

Hong Kong

Singapore

South Korea

Thailand

China

USA

Japan

Tasmania overseas food exports 2019-20 (excludes seafood)

$ million

Red meat1

Dairy

Fruit

Vegetables

Field Crops

Wine

Other food2


TA SMANIAN AGR ICULTURE TOWARDS $10 B I LL ION BY 2050

Initiative Description Status

Tasmanian Rural Water Use Strategy

Work with farmers, irrigators, rural communities and other stakeholders to develop a Rural Water Use Strategy. The strategy will set the direction for legislative and policy reform in the rural water sector for the next few decades.

Upgrade of Tasmania’s Research Farm Assets

The Government’s Plan for Tasmania’s Research Farm Capacity is guiding the investment of $7 million to modernise our Crown and TIA research farm assets to make our research farms centres of excellence for practical research and demonstration:• Contribution of $5 million to a $7.4 million joint investment with the University of

Tasmania to upgrade Elliott and Forthside Research Farms;• $750,000 to upgrade core infrastructure at Cressy;• Feasibility studies into horticultural industry-led RD&E options for the Grove

Station (Farm).

Underway

Agricultural Workforce Resilience Package

$1.9 million package including:• Tassie Harvest Jobs, Take Your Pick jobs campaign to encourage Tasmanians to consider

local agricultural career options;• Support for industry resilience, promotion and targeted development of skills;• Increasing service delivery capability of FarmPoint and Safe Farming Tasmania;• Forming the Agricultural Workforce Roundtable to bring industry and their

communities together with government to build workforce resilience.

Water resources and irrigation

The Government plans to invest $30.2 million into water resources and irrigation including: • $23.7 million to supersize tranche three of the Pipeline to Prosperity;• $5 million for Tasmanian Irrigation to develop a business case for the South East

Extension Scheme; • $1.5 million to implement initiatives in the Rural Water Use Strategy.

Underway

Agricultural Development Fund

• $3 million in a new Agricultural Development Fund supporting agricultural research, development and extension in Tasmanian agriculture.

Underway

Ag-Protection Package The Government Ag-Protection package will invest $10.2 million to future-proof Tasmanian agriculture and manage risks to primary industries including: • Addressing biosecurity, including on-farm biosecurity awareness and practices, and the

threats posed through import risks, pests and disease, and cat management;• Support farmers to adapt to a changing climate, including capitalising on opportunities

for carbon farming.

Underway

Community Farming Partnership Program

Invest $5.6 million to support farming communities, local farming issues, and improvements to farm safety.

Underway

Tasmanian Agricultural Precinct

• Partner with UTAS to create a new Tasmanian Agricultural Precinct in Launceston and invest $15 million for state-of-the-art research facilities;

• $2 million to expand the Strategic Industry Partnership Program to support key sectors such as beef, dairy, fruit and vegetables.

Underway

The Tasmanian Government initiatives delivering on the Competitiveness in Tasmanian Agriculture White Paper and Tasmania’s Sustainable Agri-Food Plan include:

ISSN 2653-1488 (Online)

CONTACT:AgriGrowth Tasmania Department of Primary Industries, Parks, Water and Environment GPO Box 44 Hobart TAS 7001

P: 1300 292 292 E: [email protected]: www.dpipwe.tas.gov.au

https://dpipwe.tas.gov.au/agriculture/competitiveness-of-tasmanian-agriculture-for-2050

https://dpipwe.tas.gov.au/agriculture/competitiveness-of-tasmanian-agriculture-for-2050

https://dpipwe.tas.gov.au/agriculture/tasmanias-agri-food-plan


Challenges this season

• Over the last year, herd rebuilding on the mainland following drought has reduced the supply of cattle into Tasmania and is placing upward pressure on prices.

• High prices and tight supply within the red meat sector are reducing processing volumes within the State, with potential impacts on trade markets being closely monitored.

Positive impacts this season• Excellent seasonal conditions and strong market

demand are benefitting red meat primary producers within the State.

• Decreased volumes of overseas exports resulting from restrictions in trade imposed by China and lack of freight options to the Middle East creates potential to explore alternative markets.

• Exceptional seasonal conditions have resulted in abundant pasture growth, noting that if there are insufficient grazing animals in coming months some pasture management issues may arise.

Agribusiness InsightsR E D M E AT

Year-on-year growth in farm gate value over the last 7 years

Value of exports (2019-20)

High prices and herd rebuilding placing upward pressure on prices

Note: Where data is not included above it is unavailable or not yet determined.

Sources • Australian Bureau of Statistics Cat: 7215.0 Livestock Products,

Australia;• DPIPWE Agri-Food ScoreCards

0

100

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100,000

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21

(Mar YTD)

$ m

illio

n

tonn

es

Red meatVolume Farm Gate value (RHS)

Red meat volume and value of production 2011-12 to 2020-21



• At present, global supply of dairy products is rising in all major dairy regions around the world which may eventually lead to some softening of global dairy prices if supply growth outstrips demand.

Positive impacts this season

• Seasonal conditions across all major dairy regions have been exceptional.

• Milk production is tracking above the record breaking 2019-20 level, up 1.7% on last year to the end of March, which is expected to be welcomed by processors who have heavily invested in processing capacity within the State.

• The recently announced opening prices are welcomed and continue a trend of global price resurgence following a period of depressed prices during the COVID-19 pandemic.

• 2020-21 has been the first year of the mandatory Dairy Industry Code of Conduct, providing a level of certainty to both producers and processors with respect to milk pricing.

Agribusiness InsightsDA I RY

Milk production in 2020-21 is tracking ahead of the record production of 2019-20

Value of exports (2019-20)

Increasing global production may place downward pressure on prices


Sources• Dairy Australia, Milk Production Statistics • DPIPWE Agri-Food ScoreCards

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900,000

1,000,000

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21(Mar YTD)

$ m

illio

n

‘000

litr

es

Milk producedVolume Farm Gate value (RHS)

Milk volume and value of production 2011-12 to 2020-21

8%



• The greatest challenge for fruit growers has been sourcing appropriate labour during the harvest season with access to experienced seasonal workers (domestic and international) limited.

• The weather conditions have been unfavourable for some commodities, with cool and overcast conditions delaying the start of the berry harvest in most areas, and causing localised losses in cherry crops in the North of the State from heavy rainfall prior to and during harvest.


• Spring and summer rainfall and temperatures have been ideal for the development and early ripening of lunch-box staples apples and pears, with growers looking to recover from the reduced national demand last year due to lack of physical school attendance during COVID-19 lockdowns.

• Weather conditions, in part, changed crop harvest requirements and timing which helped to mitigate peak labour demand.

Agribusiness InsightsF R U I T


Exceptional season for quality of apples

Access to appropriate labour for harvest was challenging

p: preliminary Note: Where data is not included above it is unavailable or not yet determined.

Sources • Horticulture Innovation Australia (Hort Innovation),

Australian Horticulture Statistics Handbook

• DPIPWE Agri-Food ScoreCards

0

50

100

150

200

250

300

0

10,000

20,000

30,000

40,000

50,000

60,000

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20p 2020-21(YTD)

$ m

illio

n

tonn

es

Fruit and nutsVolume Farm Gate value (RHS)

Fruit volume and value of production 2011-12 to 2020-21

17%



• The continuing impact of COVID-19 on food service and hospitality industries is resulting in suppressed domestic demand for fresh and processed products, with some concern regarding oversupply in the local market.

• COVID continues to impact exports of Tasmanian vegetables to significant markets in Europe and South-East Asia, with extended lockdowns and fewer international travellers reducing demand in these regions.

• The labour shortages experienced by fruit growers have also been felt by vegetable producers.


• Tasmanian vegetables such as onions, have an excellent global reputation for having a long shelf life outside of cool storage which should mean that Tasmanian products will be well placed to fill demand post COVID-19 down-turns.

• The 2021 potato harvest is expected to benefit from favourable seasonal conditions and improve upon 2020, which was impacted by adverse weather conditions.

Agribusiness InsightsV E G E TA B L E S

Excellent potato season predicted

Tasmanian vegetables have excellent overseas reputation

Access to appropriate labour for harvest was challenging

Sources• Horticulture Innovation Australia (Hort Innovation),

Australian Horticulture Statistics Handbook

• DPIPWE Agri-Food ScoreCards

p: preliminary Note: Where data is not included above it is unavailable or not yet determined.

0

50

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350

0

100,000

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300,000

400,000

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2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20p 2020-21(YTD)

$ m

illio

n

tonn

es

VegetablesVolume Farm Gate value (RHS)

Vegetable volume and value of production 2011-12 to 2020-21



• Relatively cool and damp conditions over the summer delayed harvest for poppies and cereal crops.

• Grain storage capacity may face pressure due to the level of pasture and fodder growth available to be used for livestock grazing.

Positive impacts this season• Growing conditions have been excellent for

industrial hemp, pasture and fodder with average to above-average yield expected from this season’s harvest.

• Confidence remains strong in the industrial hemp industry, with private investment and RD&E increasing.

• Demand for feed grains is expected to remain high as dairy production continues at record levels with milk prices increasing.

Agribusiness InsightsF I E L D C RO P S

Cool and damp conditions delayed harvest for some crops

Growth in hectares hemp cultivation since 2014-15

Good pasture growth may put additional pressure on feed grain storage capacity

3 excludes volume for pasture and vegetable seed, poppy, pyrethrum, hops, and spirits as data is unavailable or not published across overall time period. Note: Where data is not included above it is unavailable or not yet determined.

Sources• DPIPWE Agri-Food ScoreCards

0

25

50

75

100

125

150

175

200

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

225450,000

250500,000

400,000

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21(YTD)

$ m

illio

n

tonn

es

Field cropsVolume3 Farm Gate value (RHS)

Field crops volume and value of production 2011-12 to 2020-21

1200%



• Recent trade restrictions are likely to result in Australian wine exports being redirected to the domestic market, potentially resulting in increased competition and lower prices.

• Fewer sunlight hours due to overcast conditions delayed the vintage in some growing regions, which posed a challenge in sourcing pickers at appropriate times for some producers.

• The risk of disease in key growing regions may be increased due to regular summer rain events and cooler, moist nights which have occurred over the last few months.

Positive impacts this season• Tasmanian wines are primarily sold in the

domestic market where they attract a price premium. As a result, fewer Tasmanian producers have been directly affected by the recent trade restrictions on Australian wines than in some other states.

• COVID-19 and trade restrictions have encouraged some Tasmanian vineyards, wineries and their parent companies to explore alternative markets for products.

Agribusiness InsightsW I N E

Price of Tasmanian wine grapes relative to the national average over the past 5 years


Unfavourable seasonal conditions delayed vintage in some growing areas


Sources• Wine Tasmania, Tasmanian wine grape vintage results • DPIPWE Agri-Food ScoreCards

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18,000

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21(YTD)

$ m

illio

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tonn

es

WineVintage Farm Gate value (RHS)

Wine vintage and value 2011-12 to 2020-21

16% 4.5x

agribusiness insights - production season 2021-21

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