Australian agriculture has been booming of late; we’ll discuss the drivers of that in another article. In this short article, I’ll look at each of the major industries contributing to determine which has had the strongest growth.
In this basic analysis, I compare industry growth between the early 2000s and the present. This examines the average value of each industry for the period 2000-2005 and the past five years.
I have also included a chart displaying the compound annual growth rate (CAGR) from 2000 to the present year. If you want an explanation of CAGR, then it is basically a way of measuring the annual growth rate of an investment/value.
The grains industry has seen significant growth in value since the turn of the century. Most grains have seen value increases in excess of 100%.
Canola and chickpeas have grown the highest, partly due to increased production due to these commodities’ increased attractiveness.
The big losers are triticale, with very few producing this grain anymore. The other loser, although not to the same extent, is rice.
The livestock industry has been mixed. The big winner in terms of the overall increase in value has been goats. It has to be noted from a small base, but still a huge increase in value.
All industries in livestock have experienced value growth, except live sheep/goats. These two industries have seen large decreases.
As we all know, the live export industry for sheep has been in a huge amount of turmoil over the past ten years, with export volumes coming under pressure. It has gone from >A$400m at the turn of the century to <A$70m. It must also be pointed out that sheep for domestic slaughter was the lowest-performing protein overall. Lambs though, provided a much stronger performance.
The wool industry has also been languishing in value. This might be attributed to the lower volumes being produced and sold. Still, since the turn of the century, the value has shown an average growth of 1%.
The majority of agriculture has been winning. We can probably also thank some pretty attractive seasonal conditions during the past half-decade.
Suppose we distil down to the overall industries showing the most growth. In that case, grains are carrying the weight, with horticulture in second place. The livestock industry is a close bronze.
The industry can’t rest on its laurels. Much of the increase in value has been through luck.