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AGRICULTURE INDUSTRY
At 30 June 2005 there were about 129,900 businesses with an annual value of agricultural operations of $5,000 or more. For the vast majority of these (128,515) their primary activity was agriculture, as defined in the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition (1292.0). While the remainder were undertaking some form of agricultural activity, their main activity was not in agriculture. The majority of agricultural businesses were mainly engaged in either beef cattle farming (35,979), mixed grain/sheep/beef farming (17,195), sheep farming (12,956), grain growing (12,719), or dairy cattle farming (9,881) (table 14.4).
14.4 BUSINESSES UNDERTAKING AGRICULTURAL ACTIVITY(a) - 30 June 2005
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 | | | NSW | Vic. | Qld | SA | WA | Tas. | NT | ACT | Aust. |
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| Agriculture industries | | | | | | | | | |
| Horticulture and fruit growing | | | | | | | | | |
| | Plant nurseries | 674 | 337 | 535 | 117 | ^162 | ^38 | 18 | 5 | 1,884 |
| | Cut flower and flower seed growing | ^210 | ^184 | 156 | ^58 | ^134 | ^31 | 5 | - | 778 |
| | Vegetable growing | 730 | 793 | 1,282 | 359 | 395 | 521 | 9 | - | 4,090 |
| | Grape growing | 1,199 | 2,027 | ^141 | 2,300 | ^611 | ^100 | 4 | 2 | 6,385 |
| | Apple and pear growing | ^152 | ^322 | ^29 | *116 | ^176 | ^116 | - | 1 | 912 |
| | Stone fruit growing | ^401 | ^291 | *112 | ^209 | ^165 | ^47 | - | - | 1,224 |
| | Kiwi fruit growing | *32 | **11 | **2 | - | *4 | - | - | - | *50 |
| | Fruit growing n.e.c. | 1,593 | ^520 | 1,793 | 456 | 264 | ^26 | 112 | 1 | 4,763 |
| Grain, sheep and beef cattle farming | | | | | | | | | |
| | Grain growing | 3,164 | 2,690 | 1,417 | 3,143 | 2,289 | ^13 | 2 | - | 12,719 |
| | Grain-sheep/beef cattle farming | 7,078 | 3,169 | 1,259 | 2,561 | 3,075 | *53 | - | 1 | 17,195 |
| | Sheep-beef cattle farming | 3,585 | 2,255 | ^739 | 926 | ^458 | 322 | - | 23 | 8,309 |
| | Sheep farming | 5,446 | 3,790 | ^351 | 1,448 | 1,289 | 605 | - | 26 | 12,956 |
| | Beef cattle farming | 11,228 | 7,924 | 12,136 | 1,339 | 1,991 | 1,136 | 203 | 22 | 35,979 |
| Dairy cattle farming | 1,468 | 6,199 | 956 | 409 | 296 | 553 | - | - | 9,881 |
| Poultry farming | | | | | | | | | |
| | Poultry farming (meat) | 262 | 173 | 114 | 48 | 58 | ^11 | 1 | - | 666 |
| | Poultry farming (eggs) | ^139 | *117 | ^55 | ^38 | ^51 | ^19 | 3 | 1 | ^423 |
| Other livestock farming | | | | | | | | | |
| | Pig farming | 217 | ^172 | ^273 | ^138 | ^59 | ^21 | 2 | - | 882 |
| | Horse farming | ^627 | ^366 | ^583 | ^77 | ^97 | *66 | 1 | 3 | 1,819 |
| | Deer farming | **24 | *35 | **17 | **15 | **2 | *9 | - | - | ^101 |
| | Livestock farming n.e.c. | *295 | **112 | *90 | *29 | *58 | *8 | 2 | - | ^593 |
| Other crop growing | | | | | | | | | |
| | Sugar cane growing | ^504 | - | 4,054 | - | 5 | - | - | - | 4,563 |
| | Cotton growing | ^260 | - | 360 | - | - | - | - | - | 620 |
| | Crop and plant growing n.e.c. | ^299 | ^561 | ^502 | ^148 | *106 | ^96 | 9 | - | 1,721 |
| Total | 39,586 | 32,049 | 26,955 | 13,933 | 11,745 | 3,791 | 371 | 85 | 128,515 |
| Other industries | ^491 | ^307 | ^177 | *178 | ^170 | *86 | 9 | 1 | 1,418 |
| Total | 40,076 | 32,357 | 27,132 | 14,111 | 11,915 | 3,877 | 380 | 86 | 129,934 |
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| (a) In this chapter 'Agricultural establishments', as defined in Explanatory Notes, 'Agricultural Commodities, Australia, 2004-05' (7121.0) are described as 'Businesses undertaking agricultural activity' and classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition. |
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| Source: Agricultural Commodities, Australia, 2004-05 (7121.0). |
GROSS VALUE OF AGRICULTURAL COMMODITIES PRODUCED
The contribution of agriculture to the Australian economy can be measured in a number of ways. The most direct measurement available is the gross value of agricultural production. For the year ending 30 June 2005, the estimate of gross value of agricultural production in current prices was $35.6 billion (b).
Table 14.5 shows the gross value of agricultural commodities produced for the years 2000-01 to 2004-05. The values shown are the values of recorded production at the wholesale prices realised in the principal marketplace. Also shown are volume indexes of the value of production, which provide an indication of the change in value after the direct effects of price changes are removed. Volume measures are discussed in Volume or 'real' GDP in the National accounts chapter.
14.5 AGRICULTURAL COMMODITIES PRODUCED
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| | 2000-01 | 2001-02 | 2002-03 | 2003-04 | 2004-05 |
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GROSS VALUE OF COMMODITIES PRODUCED (Current prices) ($m) |
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| Crops | | | | | |
| Barley for grain | 1,343.5 | 1,724.8 | 984.2 | 1,750.1 | 1,233.3 |
| Oats for grain | 138.4 | 251.3 | 209.7 | 278.7 | 171.8 |
| Wheat for grain | 5,130.4 | 6,356.3 | 2,691.9 | 5,635.8 | 4,316.5 |
| Other cereal grains | 881.2 | 989.0 | 723.6 | 823.1 | 672.8 |
| Legumes for grain | 582.8 | 805.5 | 395.0 | 572.8 | 394.2 |
| Oilseeds | 594.7 | 725.3 | 413.9 | 745.9 | 548.9 |
| Sugar cane cut for crushing | 656.7 | 989.1 | 1,018.9 | 854.1 | 979.5 |
| Cotton | 1,304.6 | 1,326.8 | ^853.0 | 750.8 | 945.1 |
| Nursery production | 794.7 | 772.6 | 787.8 | 800.8 | 768.2 |
| Fruit and nuts | 2,041.5 | 2,129.7 | 2,216.1 | 2,183.8 | 2,546.9 |
| Grapes | 1,517.5 | 1,577.7 | 1,370.8 | 1,688.8 | 1,508.2 |
| Vegetables | 2,182.6 | 2,268.5 | 2,125.6 | 2,355.5 | 2,133.5 |
| All other crops(a) | 1,365.5 | 1,486.1 | 1,684.3 | 2,050.4 | 1,588.5 |
| Total | 18,534.2 | 21,402.7 | 15,474.9 | 20,490.7 | 17,807.3 |
| Livestock slaughterings and other disposals | | | | | |
| Cattle and calves | 6,430.6 | 7,142.4 | 6,411.1 | 6,658.8 | 7,828.8 |
| Sheep and lambs | 1,401.8 | 2,117.6 | 2,036.9 | 2,038.8 | 1,949.0 |
| Pigs | 822.3 | 967.7 | 911.3 | 878.9 | 906.0 |
| Poultry | 1,060.2 | 1,174.9 | 1,280.5 | 1,280.8 | 1,303.7 |
| Total(b) | 9,737.8 | 11,434.5 | 10,676.0 | 10,896.0 | 12,030.2 |
| Livestock products | | | | | |
| Wool | 2,541.2 | 2,713.2 | 3,317.8 | 2,396.5 | 2,195.5 |
| Milk(c) | 3,053.3 | 3,717.1 | 2,795.2 | 2,808.7 | 3,193.8 |
| Eggs(c) | 332.7 | 320.4 | 294.0 | 335.5 | 327.9 |
| Total(d) | 5,964.7 | 6,750.7 | 6,412.1 | 5,540.7 | 5,717.2 |
| Total(d) | 34,236.7 | 39,587.9 | 32,563.0 | 36,927.4 | 35,554.7 |
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VOLUME INDEX OF GROSS VALUE OF COMMODITIES PRODUCED(e) (Index number) |
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| Crops | | | | | |
| Barley for grain | 87.1 | 107.0 | 49.9 | 134.1 | 100.0 |
| Oats for grain | 81.8 | 111.8 | 74.6 | 157.3 | 100.0 |
| Wheat for grain | 100.9 | 110.9 | 46.3 | 119.3 | 100.0 |
| Other cereal grain | 148.1 | 135.4 | 71.1 | 117.7 | 100.0 |
| Legumes for grain | 81.6 | 86.2 | 73.0 | 138.0 | 100.0 |
| Oilseeds | 114.6 | 113.5 | 54.5 | 110.3 | 100.0 |
| Sugar cane cut for crushing | 81.7 | 82.7 | 97.2 | 97.2 | 100.0 |
| Cotton | 114.1 | 115.7 | 62.4 | 56.3 | 100.0 |
| Nursery production | 101.4 | 102.8 | 91.1 | 89.1 | 100.0 |
| Fruit and nuts | 87.8 | 84.4 | 84.9 | 84.5 | 100.0 |
| Grapes | 76.9 | 84.7 | 74.3 | 99.7 | 100.0 |
| Vegetables | 97.3 | 95.8 | 86.3 | 98.0 | 100.0 |
| All other crops(a) | 93.0 | 92.8 | 80.0 | 117.9 | 100.0 |
| Total | 93.7 | 98.2 | 67.0 | 104.6 | 100.0 |
| Livestock slaughterings and other disposals | | | | | |
| Cattle and calves | 105.4 | 101.1 | 104.6 | 101.2 | 100.0 |
| Sheep and lambs | 123.1 | 116.7 | 108.3 | 98.3 | 100.0 |
| Pigs | 94.1 | 102.0 | 108.4 | 104.8 | 100.0 |
| Poultry | 86.4 | 93.1 | 96.2 | 96.8 | 100.0 |
| Total(b) | 104.7 | 102.7 | 104.5 | 100.4 | 100.0 |
| Livestock products | | | | | |
| Wool | 124.7 | 113.3 | 106.2 | 98.8 | 100.0 |
| Milk(c) | 104.2 | 111.3 | 102.0 | 99.5 | 100.0 |
| Eggs(c) | 97.4 | 92.1 | 94.0 | 95.1 | 100.0 |
| Total(d) | 112.0 | 111.4 | 103.6 | 98.9 | 100.0 |
| Total(d) | 98.3 | 100.2 | 82.3 | 102.4 | 100.0 |
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(a) Includes pastures and grasses. Excludes crops for green feed and silage.
(b) Includes other livestock.
(c) Excludes NT for 2002-03, (included in total).
(d) Includes honey and beeswax prior to 2001-02. Collection of bee product data ceased in 2002.
(e) Volume indexes reflect the change in volume of production between two periods, enabling a comparison of the value of production between the periods without it being affected by any change in price between the periods. To obtain a measure of the value of production at 2004-05 prices for a commodity in this table for an earlier period, multiply the reference year (2004-05) value of the commodity by the volume index value of that commodity for the earlier period, and divide by 100. |
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| Source: Agricultural Commodities, Australia (7121.0); Value of Agricultural Commodities Produced, Australia (7503.0). |
EMPLOYMENT
The agriculture sector is an important source of employment in regional and rural Australia. The number of people employed in the Agriculture and Services to agriculture industries declined in 2006 to 330,900 persons, the fourth consecutive fall (table 14.6). The significant reduction in the work force in 2003 was largely the result of the drought experienced over most of Australia during that period, which severely affected the agriculture sector. The majority of people employed in agriculture in 2006 were men (68%).
14.6 AGRICULTURE AND SERVICES TO AGRICULTURE INDUSTRIES, Employment(a)(b)
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| Males | Females | Persons |
| '000 | '000 | '000 |
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| 2002 | 278.6 | 133.6 | 412.2 |
| 2003 | 239.8 | 110.0 | 349.8 |
| 2004 | 236.5 | 109.2 | 345.7 |
| 2005 | 227.0 | 109.8 | 336.8 |
| 2006 | 224.1 | 106.8 | 330.9 |
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(a) Employed persons include persons who worked without pay for at least one hour per week in a family business or on a farm (i.e. unpaid family helpers). Persons who worked in another industry and in agriculture are classified to the industry of predominant activity, according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition.
(b) Annual average of quarterly data. |
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| Source: Labour Force, Australia, Detailed - Electronic Delivery (6291.0.55.001). |
SELECTED FINANCIAL PERFORMANCE MEASURES
Statistics of the financial performance of farm businesses provided in this section are based on information collected in the annual Australian Agricultural and Grazing Industries Survey, conducted by ABARE. This collection covers farm businesses engaged in the 'broadacre' Grain , sheep and beef cattle farming industry, as defined in ANZSIC.
14.7 BROADACRE FARM BUSINESSES(a), Selected financial performance measures
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| Annual average per farm | Units | 2000-01 | 2001-02 | 2002-03 | 2003-04 | 2004-05 |
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| Total cash receipts | $'000 | 254.5 | 314.3 | 257.6 | 295.0 | 289.8 |
| less Total cash costs | $'000 | 182.7 | 213.5 | 205.8 | 230.0 | 234.7 |
| Farm cash income | $'000 | 71.9 | 100.8 | 51.8 | 65.0 | 55.0 |
| Farm business profit | $'000 | 9.4 | 42.4 | -27.4 | 4.5 | -9.5 |
| Profit at full equity(b) | $'000 | 27.9 | 63.0 | -6.6 | 30.4 | 14.7 |
| plus Capital appreciation | $'000 | 90.6 | 77.6 | 150.4 | 213.0 | 167.3 |
| Profit at full equity (incl. capital appreciation) | $'000 | 118.5 | 140.6 | 143.8 | 243.4 | 182.1 |
| Farm capital at 30 June | $'000 | 1,432.3 | 1,699.6 | 1,917.7 | 2,521.1 | 2,736.3 |
| Rate of return (excl. capital appreciation)(c) | % | 1.9 | 3.7 | -0.3 | 1.3 | 0.6 |
| Rate of return (incl. capital appreciation)(c) | % | 8.3 | 8.3 | 7.5 | 10.8 | 7.2 |
| Off-farm income(d) | $'000 | 23.6 | 25.3 | 29.0 | 27.0 | 30.6 |
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(a) Businesses classified to Group 012 in the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition.
(b) Farm business profit, plus rent, interest and finance lease payments less depreciation on leased items.
(c) Computed by expressing profit at full equity as a percentage of total opening capital.
(d) Collected for owner manager and spouse only. Includes income from wages, other businesses, investment and social welfare payments. Average for those responding farms for which details of off-farm income are available for both owner-manager and spouse. |
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| Source: Australian Bureau of Agricultural and Resource Economics, 'Australian Farm Surveys Results - March 2006'. |
Selected financial performance measures - expressed as annual averages per farm - for all broadacre farm businesses for the years 2000-2001 to 2004-05 are shown in table 14.7 and for the years 1998-99 to 2004-05 in graphs 14.8, 14.9 and 14.10.
The financial performance of Australian farms improved as the impact of the widespread drought of 2002-03 receded. However, while 2003-04 saw record harvests and high cattle and lamb prices, conditions deteriorated in 2004-05 with lower cash receipts and higher cash costs.
Following a fall in 2002-03, average total cash receipts for broadacre farms in 2003-04 were estimated to have increased by 15% but have since fallen 2% to $290,000 in 2004-05. Average total cash costs for broadacre farms rose 12% in 2003-04 and 2% in 2004-05.
Farm cash income is a measure of the cash funds available for farm investment and consumption after paying all costs incurred in production, including interest payments, but excluding capital payments and payments to family workers. It is a short-term measure of farm income because it takes no account of depreciation on assets. Average cash income for the broadacre farms as a group fell 15% in 2004-05 to $55,000, substantially short of the high cash income year of 2001-02 with $100,800 (graph 14.8).
Average farm business profit declined in 2004-05 to negative $9,500 from $4,500 the previous year (graph 14.9). Farm business profit is a longer-term measure of the profitability of farms because it takes account of depreciation and inventory changes.
For the broadacre industries as a group, rate of return (excluding capital appreciation) averaged 0.6% in 2004-05 (graph 14.10), down from 1.3% in 2003-04.
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