Australian farmers can produce enough food for 80 million

AUSTRALIAN farmers, some 140,000 of them at last count, produce enough food to feed 80 million people.

In addition to satisfying more than 90% of local demand, we export two thirds of our product to world markets with the value expected to pip $60 million in this financial year.

The Australian Bureau of Agricultural and Resource Economics and Sciences reports our major exports are grains (30%) and meat (24%) with cotton sugar and wine making up 13%. Wool, dairy and horticulture also feature but in single figures.

Unsurprisingly, the Asian market is our most important, a rising middle class increasing demand to 60%. China is the largest of those consumers taking 40% of Australia's beef exports, much of our grain and half of our dairy. Sales to Korea (11%), Japan (9.4%) and Indonesia (7.3%) continue to grow. 

The United States and Canada are also key markets for Australia exports with the European Union taking a large percentage of our meat, grain, sugar and wine too.

A number of Free Trade Agreements brokered with Japan, China and South Korea, as well as the Trans-Pacific Partnership are also likely to benefit primary producers of meat, dairy, grain, fruit and pulses. Tariff reductions and better access to the Asian market will add to the coffers of Australian farmers provided they are in a position to take advantage of increased demand for high-quality produce.

"Milk and cream processors, cheese manufacturers and milk powder manufacturers are all expected to see export-related revenue grow by more than 10%," IBISWorld analyst Brooke Tonkin said.

"Fresh Australian milk can be sold for up to $10 per litre in China, which indicates that there are high-income earners seeking out Australian dairy produce due to its reputation for product safety and high quality."

Chinese tariffs on dairy will be phased out over the next decade while Australian cheese producers are already reaping the benefits of tariff-free exports to South Korea.

Wine, another growing export market for Australia, can now compete on a level playing field with American and European producers in South Korea while in Japan and China the tariffs will be eased out by 2022.

Beneficial free trade agreements are not all rainbows and sunshine for Australia, with the government forced to make a fair few concessions. There are no reductions for sugar, wool, wheat, rice, maize or canola while China can impose additional custom duties if beef and milk powders exceed certain limits.

China also has some rights to sue the Australian government for policy decisions that adversely affect their interests and Chinese investors in projects worth more than $150m can bring in their own workers without local labour market testing.