Dynamic Business

While biofuels have not been as big an issue in Australia as in other countries, the international expansion of this industry is impacting on the world’s food supplies as grains like corn are being diverted to fuel production. Stoeckel says this is a particular issue in the United States where the US government has prevented the importation of ethanol from Brazil—the most efficient producer of ethanol in the world—and are using their own crops of corn and other grains for fuel, adding to food scarcity in the global market.

It seems likely that this will become a bigger issue as the demand for alternative fuels ramps up. But there are opportunities for Australians to take advantage of the food crisis and Sheales says our efficiency and innovation is a leading factor. Our food producers are among the most efficient in the world and much research has been invested in developing agriculture in arid and challenging environments. “Some of that expertise could be exported to other countries,” he says.

There is also optimism in the seeds industry. “People here can see opportunities for both developing and exporting seed varieties that may be better suited to a changing climate.”

There is also an enormous amount of waste in food production from fruit left unpicked because it is not a high enough quality, to food rotting in fridges and portions left on restaurant plates. Many countries suffer from storage difficulties. “In Africa, 15 percent of food is eaten by pests in storage,” Robertson says. “There are certainly lots of opportunities to be more efficient in what we do.”

While Stoeckel’s model would see less demand for luxury and more expensive items as people respond to higher prices, Anni Brownjohn, founder and managing director of Ozganics, which manufactures organic processed foods in northern New South Wales, is confident being a niche food producer will help her business thrive. “We are certified organic so we’re very specialised,” she says.

Demand for organic products has skyrocketed in recent years and Brownjohn is noticing strong growth in Asia where she says people are more conscious that what they eat affects them. However, she acknowledges food security is going to be an issue in coming years and exporters will have to “keep their finger on the pulse”. “The challenge is going to be to better understand the threat of food security in your market,” she notes.

The ‘crisis’ is a mixed bag for Australia’s agribusiness and value-added food exporters. In the short term, there are opportunities to take advantage of increased commodity prices and the growing demand for luxury and niche produce.

But in the long term, climate change, water supply, land availability and land quality are likely to pose many challenges to increased production. And with the Murray Darling river system in dire straits, the nation is faced with the possibility of not being able to meet normal production levels in years to come.

But Australia is a nation of innovation and the incentives are now there to increase research and make agriculture and food production more efficient than it has ever been.