Australia taps agriculture with a productive difference

Updated: Nov 21 2005, 06:30am hrs
Australia and India have many things in common when it comes to agriculture. Like in India, agricultural landholdings in Australia are fragmented. Almost 63% of the farms are less than 500 hectares and 31% of the farms operations, valued at less than Australian $ 50,000. The share of Australias agriculture in its GDP has declined from 25-30% in the 1960s to just 3% todayIndia is witnessing a similar trend. Again, like in India, agriculture plays a very dominant role when it comes to politics or economic policies of the Australian government.

Unlike India, however, Australia has made agriculture a profitable business by closely integrating the sector to the agri-food chain and more efficient use of technology and farm management practices. Investment in cold storage chains, refrigerated vans and food processing industries, apart from dismantling of the statutory marketing arrangement (similar to Indias government procurement programme) have ensured that a greater proportion of the farm produce is sold by farmers directly to retailers or food processing industries, who thus realise greater value.


N Madhavan of fe spoke to Dr Susan Nelle, managing director, National Food Industry Strategy Ltd, an organisation promoted by Australias government and its food industry, on possible learnings for India.

Australia is a large country and agri-produce has to be moved over long distances. How have you handled the post-harvest infrastructure

It is an area in which we have built up expertise over the years. Ours is a large country with a widely scattered population. Besides, theres a locational skew in production of various commodities vis-a-vis their consumption. For example almost 60% of our total milk output is produced in the state of Victoria while 90% of our sugar is produced in Queensland, 80% of cotton is cultivated in New South Wales and 44% of grapes is grown in South Australia. We needed to develop expertise to ensure the farm produce reaches the market fresh. We invested heavily in cold chains, both in terms of physical infrastructure and research & development.

It is important to note that value addition to an agro commodity does not always come from processing. Higher value can be secured by ensuring that the product reaches the end customer in good condition. This requires proper handling at the time of harvest, packaging, and temperature management while transporting.

What has been the governments role in setting up cold chains and other related infrastructure

The Australian governments role has been more on the research and development front. Such investment helped us develop the required expertise. But the actual investment on the ground, when it came to cold chains etc, was from the private sector.

Australia, like in the case of India, has many small farmers. How have they managed to add value to their products

That was a challenge we faced as the country strived to become competitive. As you know, over two-thirds of our agricultural production is now either directly or indirectly exported. Increasing competition in global markets meant that even small farmers adopt farming practices normally used by large players. They have managed this by setting up cold storages or agri-processing facilities jointly, or by sharing such facilities together. This has enabled them to add value without having to make large investments individually. They also pool their produce and market them jointly.

In what areas can Australia offer its expertise to India

We can help in post-harvest handling, cold chain management, food safety and integrity issues and health foods. In fact, we have a centre for cold chain management. Australia has identified south India, to start with, as a major area of focus to further trade co-operation in the agri-sector. India, as a whole, is being increasingly seen by businesses in Australia as a land of opportunitya market that could be even better than China.