Media Release

Continued strength forecast for Australian agriculture sector

17 June 2014

Earnings from farm exports are estimated to reach a high of $41 billion in 2013-14, with livestock and livestock product export earnings expected to rise by 23.3 per cent to $18.4 billion, according to figures released today by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).

Agriculture Minister, Barnaby Joyce, said the figures demonstrated the strong and enduring value of Australian agriculture to the national economy.

"While a number of regions are still doing it tough, $41 billion is a powerful contribution to the national economy," Minister Joyce said.

Minister Joyce said the estimated increase in farm export earnings in 2013-14 is supported by higher farm production and favourable export prices.

"Less favourable conditions forecast for 2014-15 mean that farm export earnings are likely to decline from this year's high, to be around $38.5 billion. At this forecast level, export earnings in 2014–15 would still be around 9 per cent above the average of $35.5 billion over the 10 years to 2012–13 in real terms," Minister Joyce said.

"There is a reason the Coalition has recognised agriculture as a pillar of the Australian economy as our farmers – with one of the lowest levels of agricultural subsidies in the OECD – continue to pay dividends to the nation every year.

"The policies we are putting in place will only grow those dividends in the future and there's no better example than the Korea-Australia Free Trade Agreement."

Following conclusion of negotiations in late 2013, and official signing of the agreement in Seoul in April this year, Australia and Korea aim to complete ratification in the latter half of 2014 so that KAFTA can enter into force.

Minister Joyce said that Australian exporters and producers of beef, sheepmeat, cheese, wine,  malting barley and unroasted malt, and a number of horticulture products are expected to benefit most from the agreement, as these commodities are currently subject to relatively high import tariffs.

"Under KAFTA, the volume of Australian beef exports to the Republic of Korea in 2029 – the year the agreed removal of tariffs on Australian beef imports will be completed – is projected to be 58 per cent higher than without KAFTA," Minister Joyce said.

"Meanwhile, the increase in the import value of Australian cheese to the Republic of Korea under KAFTA is projected to be around 350 per cent higher in 2034 compared with a scenario without KAFTA.

"The tariffs on Australian cheese imports to the Republic of Korea will be completely phased out by 2034."

ABARES analysed the potential effects on Australian exports of beef and cheese to the Republic of Korea as part of the Agricultural Commodities 2014 June Quarter release.

The full report can be found on the ABARES website: daff.gov.au/abares/publications