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Last Updated:[06-10-2009 08:31:49 EDT] Zoom in Zoom out Back to Tradenews

Aus Vegetable Farmers bogged down by Imports and Input Costs

tradenews According to AUSVEG, the peak industry body that represents the Australian vegetable growers, the vegetable industry is troubled by imports and rising input costs. AUSVEG CEO Richard Mulcahy referred a report from the Australian Bureau of Agricultural and Resource Economics (ABARE) to establish AUSVEG’s finding.

Mulcahy said that findings from an ABARE survey showed a 3 percent fall in vegetable farm incomes on average in 2007-08 were an indication that rising farm input costs and competition from China were affecting the bottom line of Australian vegetable farmers. He pointed out China’s input costs such as labour was significantly lower, and apart from Chinese imports, New Zealand imports too posed serious threat to processed vegetable growers.

ABARE, a professionally independent government economic research agency highlighted in its survey that besides high input costs, marketing costs, low vegetable prices and availability of irrigation water as other impediments to future viability. However, compared with the previous survey, access to and cost of labour was no longer regarded by the majority of vegetable growers as an impediment facing future viability.

The report which was commissioned by Horticulture Australia Limited (HAL) informed that despite adverse seasonal conditions the vegetable growers were able to maintain farm incomes. Although adverse seasonal conditions in many vegetable growing regions in 2007-08 led to a fall in average yields and lower vegetable production, average farm cash incomes of vegetable farms declined by only 3 percent.

ABARE Deputy Executive Director, Dr Terry Sheales while releasing its report stated despite a rise in average prices received for vegetables in 2007-08, overall receipts from the sale of vegetables had fallen by 6 percent on average as seasonal conditions had resulted in lower yields and production. Though input costs have sunk the confidence of 86 percent of vegetable growers, the mood seemed to be upbeat with 72 percent expecting to be still engaged in vegetable growing in five years’ time and 31 percent planning to expand vegetable production in the next three to five years.

The gross value of production of the vegetable industry is estimated about $3.5bn in 2008-09, contributing around 8 percent to Australia’s gross value of agricultural production. Mulcahy felt that to compete with China the country must ensure that input costs were kept down wherever possible, and the benefits of local production for the consumer, such as safer, fresher produce, and a strong local economy that supports Australian jobs, were better understood.

By Jose Roy

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