Australian Agricultural Industry - Literature review Example

AUSTRALIAN AGRICULTURE INDUSTRY By Student’s Name Code + Name of Course Professor/Tutor Institution City/State Date Literature Review: Australian Agricultural Industry Abstract The ability of Australia to exploit the opportunities brought by advances in global food demand in the future highly depends on its competitiveness through improvement on productivity. With this in mind, this literature review seeks to describe the overview of Australia’s agriculture, to determine the implications of reforming the industry for future productivity development and to determine the needed responses to the changing global environment to improve Australia’s Agriculture Industry. A thorough search has been conducted over the internet via the Google Scholar library and other available electronic databases to locate pertinent information to address this question. The research has identified a research gap, which is Precision Agriculture, an area that needs further inquiry. Introduction There is prevalent acknowledgement of the significance of improving the sustainability of the Australian agricultural industry. Worldwide, increase in agricultural productivity will improve the welfare and revenue of numerous farmers in rural areas in the long term and assist address issues of food security. Sheng, Zhao, Nossal & Zhang, (2015, pg. 16) posit that the ability of Australia to make the most of openings brought by advancement in global food demand in the future highly depends on upholding competitiveness through improving on productivity. Research demonstrates that domestic policy settings are significant elements of productivity in Australia’s agriculture industry because they shape the incentives and capacity of the farmers to innovate and enhance productivity (Gray, Oss-Emer, & Sheng, 2014, pg. 1.). The research objectives of this study were to describe the overview of Australia’s agriculture, to determine the implications of reforming the industry for future productivity development including how extension could bring positive information results in the agricultural sector and the to determine the needed responses to the changing global environment to improve Australia’s Agriculture Industry. In a bid to complete the task, this study conducted a search over the internet via the Google Scholar library and other available electronic databases to locate pertinent information. From the library searches, it was clear that the volume of information present to modern farmers and to other people interested in the Australian Agriculture industry is enormous, meaning that the available information may be used as a potential means of empowerment and in various critical decision-making processes within the sector. Based on the research questions of this study, the appropriate literature was searched grounded on their relevance to the under study. The articles selected are not further than 2010 to provide more updated information. The vast information available may culminate to fresh knowledge and better communication in the path to developing the sector (Mark, Philip, & Adrian, 2012, pg. 66). According to Sheng (et al., 2015, pg. 16), the farmer’s ability to make well-thought decisions is restricted by the limited provision of information. The opinion is supported by other researchers who assert that for the producers in the agricultural sector to apply the information available to them efficiently, the information needs to be availed in a format, which can be integrated into growers‘processes of decision-making. The 2004 proposal of the Food and Agriculture Organization declared that, in the agriculture industry and rural growth, new programs are often developed without bearing in mind the available information services. The perspective is shared by Gray, Oss-Emer, & Sheng (2014, pg. 6) who assert that the demand for valuable information services on the roles of different people and their responsibility in different areas is high. Consequently, from the library search, it was clear that the management of agricultural information by different authors and the numerous information services (including independent databases) has culminated in coverage of overlapping information. These information resources therefore, provide partial answers. Nonetheless, most critical research areas discussed are the inadequacy of whole-farm focus, methods of assessing crop quality, product tracking, and environmental auditing among others. An area, which has demonstrates a research gap is Precision Agriculture, a concept, which is quickly advancing. Therefore, future research should seek to fill these research gaps. Noteworthy, different authors collectively agree that future openings for government to stimulate growth in the agricultural industry may result from minimizing regulatory burdens, promoting the rural research efficacy, extension and development system, and growing human capital through enhancing the skills and availability of labour. An Overview of Australia’s Agriculture Industry According to Gray, Oss-Emer, and Sheng (2014, pg. 6.), the agriculture sector of Australia encompasses a diverse variety of industries. The comparative advantage of the country is in extensive broadacre agriculture (comprising sheep, cattle and non-irrigated crops) due to a relative richness of land. Much of this encompasses huge semi-arid and arid areas mostly suited to grazing livestock on native vegetation. The contribution of Broadacre farms is 54 % of the gross agricultural production value and comprise approximately 53 % of agriculture businesses. The horticultural industries also contribute to the gross agricultural production significantly accounting for 16 % in 2011–2012 (Gray, Oss-Emer, & Sheng, 2014, pg. 6.). Australian agriculture industry has a robust export focus. Approximately 60 % of the gross farm production value is exported, although this share was about to hit 75 % in 2011–2012. In recent years, Asia has been an important destination for Australia’s agricultural produce. Markets in Asian contributed for more than 60 % of the agricultural exports in 2011–2013. The major destinations were the Republic of Korea, Japan, China, and Indonesia. Simultaneously, exports to Europe have declined generally whereas those to the U.S. have improved. Each of these represents approximately 10 % of the Australian agricultural export value. Across the industry, industries differentiate in the level to which they rely on domestic or export markets. A few industries of high value supply the local market. For instance, in 2010–2011 the horticulture sector exported only fifteen per cent of the production vale. In dissimilarity, the broadacre sector is solidly export focused. For instance, wheat exports represented sixty-seven per cent of the 2010-2011 production value and nearly all of wool produce is exported. Agriculture makes a small but significant segment of Australia’s economy. The real agricultural production value was approximately $30 billion in 2011–2012, up from approximately $14 billion at the 1980s start and the industry contributes to export income approximately five times its GDP share (Gray, Oss-Emer, & Sheng, 2014, pg. 6.). Implications of Reforms for Australia’s Agricultural Industry Growth Different studies maintain that Australia’s agricultural industry has improved because of policy reforms undertaken in the sector from the 1980’s. According to Gray, Oss-Emer, and Sheng (2014, pg. 21.), the output payoff to the agricultural reform policies of the country has been critical and these have encouraged better efficiency in the use of resources across farms. The reforms, which lay focus on ensuring decision-making in agriculture is more responsive to forces in the market. Although declining productivity and slow growth on-farms generates the issue of whether some policy frameworks continue to interfere with spurs for innovation, the extent of reforms of Australia’s market suggests that most of the distorting elements have been addressed. The policy reforms of the previous thirty years suggest that Australian agriculture is intensely market-oriented (Gray, Oss-Emer, & Sheng, 2014, pg. 6.). Australia farmers face competition in both local and world markets, and governments have mostly eliminated trade and production-interfering support. The effects of agricultural policy reforms have been significant in that they have removed the obstacles that hampered the efforts of farmers’ adjustment to altering market environments by biased price signals brought by output price supports and statutory marketing arrangements. The elimination of output price support also minimized disparities in degrees of support across agriculture. This used to create inefficiencies given that the allocation of resources mirrored incomes attainable under support schemes, as opposed to real or new market opportunities (Gray, Oss-Emer, & Sheng, 2014, pg. 21). Treasury (2010, pg. 55) supports the assertions about economic reforms, which have been critical to productivity in Australia’s agricultural industry. According to the study, economic reform in the country during the 80s to the 90s resulted from an acknowledging that enduring government policies were main contributors to the prolonged drop in Australia’s relative standards of living in the 1960s, 70s and 80s. Such policies comprised highly regulated labour and product markets, high industry protection levels, centralized determination of wages and government ownership of huge economic infrastructure sections (Treasury, 2010, pg. 55). The study further posits that the economic reforms of Australia removed different government interventions and instead placed more focus on markets to allocate resources, give greater choice to customers, and sharpen motivations to be more fruitful. The reforms started with unilateral decreases in import protection that included the removal of import quotas as well financial markets liberalization, the floating 1983 exchange rate and lessening the capital market controls. The implementation of these reforms in Australia has also yielded progressive benefits. In specific, more microeconomic flexibility and market competition have permanently enhanced the industry’s operating environment, supporting the progressive search for and implementation of more productive procedures and better yields (Treasury, 2010, pg. 56). Another researcher further posits that one reform, which has and will improve the sector in the future, is agricultural extension, which has generated positive information results through enhanced networking and flow of information in the agricultural industry and farming communities. Extension represents a critical activity across the Australia public and private sector. The delivery service foundation of extension has transformed over the previous twenty years in significant ways. The private industry has started to play a meaningful role in producing and transferring information similarly to the use of ICT technologies. Linked with this new model, is the augmented use of farmers’ groups for agricultural extension. Extension personnel are presently considered not as just as technology experts or scientists but instead as agricultural information implementers. The development of influential farmer controlled groups has culminated in farmer contribution in research and extension, resulting in new approaches in which information flows and more emphasis is placed on contribution of agricultural stakeholders in adult principals of learning (Al Musawi, 2014, pg. 7.). Responding to Changing Global Environment to Improve Australia’s Agriculture Industry Numerous studies demonstrate that the changing global environment will prove a main disruptive element for Australian agriculture industry. Such researches recommend that existing strategies for the managing Australia’s climatic variability may be hugely needed to enable farmers adapt to low levels of climate change over the subsequent decade. According to Lockie (2015, pg. 34), these include changing the location or the timing of cropping events, shifting to species or varieties with increased drought tolerance, water collection and conservation, enterprise diversification, incorporated pest management and climate foretelling. The author further posits that beyond this, important changes in land use will be needed such as developing of more intensive agricultural systems in which conditions enable greater conservation goals. These sentiments are expressed in a different research by Anwar, Li Liu, Macadam and Kelly, (2013, pg. 225) who state that the discrete climate change expected by the end of the century need transformational and planned changes. With this in mind, focus should be targeted at the farm-level and that farmers will need to respond to climate change over time. In this regard, the extent, nature, and sources of climate change will need to be analyzed and assessed to provide insights for adapting agricultural productivity to climate change. The main priority areas identified to moderate these challenges where new creativities would be required are information production and dissemination to improve awareness at the farm-level, research, and development in agriculture, formulation of policies, which promote suitable adaptation at the farm level, and improving cooperation among the appropriate stakeholders. Establishing partnerships among policy makers, farmers, R&D providers, and extension agencies would be at the core of transforming adaptation to changing climate at the farm level (Anwar, et al., 2013, pg. 225). Conclusion and Reccomendation This study has addressed the research objectives and questions of this research, which were describe the overview of Australia’s agriculture, to determine the implications of reforming the industry for future productivity development including extension in the agricultural sector and the needed responses to the changing global environment to improve Australia’s Agriculture Industry. The research has identified a research gap, which is Precision Agriculture, a quickly advancing concept in the industry. Therefore, future research should seek to fill these research gaps. Consequently, this study has established that apart from addressing the key research objectives, it will be significant to conduct transformational adaptation and substantive R&D support in as preparation for the constraints of global environmental change. The studies by Lockie (2015) and Anwar (et al., 2013, pg. 225) recommend that the Australian government needs to put more investment in R&D to encourage transformational adaptation and to put in place policies, which address the status of agriculture as a source of greenhouse gas discharge. Reference List Al Musawi, H 2014. Information provision and retrieval in the farming industry in Western Australia (Doctoral dissertation). Anwar, M R, Li Liu, D, Macadam, I, & Kelly, G 2013, ‘Adapting agriculture to climate change: a review, Theoretical and applied climatology,’ Vol. 113, no. 1-2, pp. 225-245. Gray, EM, Oss-Emer, M & Sheng, Y 2014, ‘Australian agricultural productivity growth.’ Past reforms and future opportunities, Canberra: ABARES, Vol. 14, no. 1, pp. 1-56. Lockie, S 2015, ‘Australia’s agricultural future: the social and political context,’ Australian Council of Learned Academies, 1-71. Mark, S, Philip, L, & Adrian, T 2012. Research methods for business students. Harlow: Prentice Hall. Sheng, Y, Zhao, S, Nossal, K, & Zhang, D 2015, ‘Productivity and farm size in Australian agriculture: reinvestigating the returns to scale,’ Australian Journal of Agricultural and Resource Economics, Vol. 59, no. 1, pp. 16-38. Treasury, A 2010, ‘Raising the level of productivity growth in the Australian economy,’ Economic Roundup, Vol. 3, pp. 47-66. Read More