Free Essay

Agriculture Trend Between 1980 & 2000

In:

Submitted By Kahaia
Words 1671
Pages 7
Agriculture is the one of the most important industries in the Australian economy. While Gross Domestic Product (GDP) share of agriculture has fallen slightly from 1980 to 2000, the total productivity has increased constantly (Australian Bureau of Statistics, 2008).This inverse trend between GDP growth and the proportion of agriculture is common in developed countries. In 2000, agricultural industry reached 4 per cent ($25 billion) of GDP and this proportion remains one of the highest in the Organisation for Economic Cooperation and Development (OECD) countries (Australian Government Productivity Commission, 2005).There are several reasons for this upward trend during this period, which are specifically, advanced technology, change in farm structure, the change in demands, and trade. Even though there has been negative impact on agriculture, those four areas have led to the high performance of agricultural productivity during this period.
Over the last thirty years, the use of technology in the agricultural industry in Australia has changed and improved dramatically. Layton states that one of the key elements to increase in supply is new and more efficient technology (2012, p67). The adoption of new technology is essential for farmers to maintain the level of profitability and to shift production possibility frontier out (Australian Bureau of Statistics, 2008). For instance, satellite technology has been installed when making decisions on land use and some larger farms have invested in more sophisticated machinery and equipment to produce crops more efficiently. Technology has been developed to improve the quality of herbicides, fertilisers and other chemicals to enhance farm lands. In addition, genetic modification (GM) technique makes farm products more resilient to diseases and harsh climate conditions. (Kingwell, R 2011). However, serious natural disasters, such as drought, still severely affect agricultural crops and to total agricultural productions. In 1982-83 and 1994-95, two severe droughts occurred. During this period, despite the use of high technology, the productivity levels dropped. This brought the total Australian GDP down and many famers lost their jobs as well (Australian Bureau of Statistics, 2008). These natural disasters are unavoidable in Australia but technology contributes to lessen the adverse effect from natural disaster as the latter drought in 1994-95 recovered quicker than the former one.
The change in farms’ structures also assists high productivity. During 1980-2000, the Federal government intended to protect smaller farm businesses as it was believed that it was crucial to maintain the total number of farms, but farm economics resulted in the opposite. Whereas the total number of farms has decreased one quarter and the area of land in agricultural production has also decreased by around 9 per cent, the average size of existing farms has increased from 2270 hectares to 3340 hectares (Australian Bureau of Statistics, 2008). Ten per cent of larger farms produce over 50 per cent of total output and 50 per cent of smaller farms account for 10 per cent (Australian Government Productivity Commission, 2005) .Even though this number varies across the range of crop industries, fewer and large farms have dominated the industry. They generate the largest amount of production more efficiently so the total output increased significantly. This seems to be positive outcome for the industry.
However, there are some concerns in terms of sustainability. Relatively old workforce is one of the most urgent issues as business cannot sustain without a young workforce (Quiggin, J, 2007). In 2000, more than 30,000 farmers were 65 years and older (National Farmer's Federation, 2012).However, older farmers have experience with more conventional business, environment and economic factors. Young generation is not as willing to work in the agricultural industry because of negative perception toward the industry, although they have ability with technology, flexible in terms of change and physically very able. (Sappey et al 2012) .Over the 20 year period, the cost of farm inputs have risen 1200%, while the cost of farm outputs have only risen 230% (Gray et al 2014). The small-sized farms are struggling with lower income. In this situation, the younger generation prefer to look for other career opportunities (Kingwell, R 2011). Another issue is many farmers have a lack of skills other than farming and basic education. The proportion of the agriculture workforce without post-school qualifications is relatively high compared to the workforce generally and other countries (National Farmer's Federation, 2012).This issue has been looked at in terms of the Government assistance. When the government subsidises the agricultural industry, it has created incentives and opportunities for the younger generation to be able to work and stay connected in the agricultural industry. Currently, many young people work as casual employees such as fruit pickers and do not see it as regular full time work. As a result, Australia will maintain a strong position in the international agricultural community.
The change in size of farms has helped to increase the total value of output as has the changes in demands. On a global level, the increase in population has meant more food production is required. Similarly, since 1980, the Australian agricultural industry has recognised the necessity for high food productions because of demand. Profits have also increased because they are selling to supermarket chains and huge fruit markets (Australian Government Productivity Commission, 2005). Many farms have advanced contracts with major retailers so they can keep reliable and stable demands. This means that they can have more opportunities for marketing of their produce to different buyers and this helps to have sustainable business (Australian Government Productivity Commission, 2005). Change in demand influences the profitability of products as well. While pigs, eggs and wools are slow or have a declining growth, poultry, grapes, cotton, nurseries and dairy have seen a high growth (Gray et al 2014) .Farms use vast areas of lands for these high profitable products. It was difficult for smaller farms to adjust their production depending on demand, but large farms can shift their focus on different products in industry easily. This shift will stop when the market creates new equilibrium and every business is making zero profit (Layton et al 2012, p173). In this process, some small-sized farms have left the industry as their costs outweigh their profits.
Although domestic demand has expanded agriculture productions, the room for domestic consumption is limited. Therefore, agricultural industry is more oriented to international demand. International trade plays an important role in the increase of total productivity. While the proportion of agriculture of total export has decreased since 1980, the importance of export for Australia’s agricultural industries is still significant, and around two-thirds of total agricultural production is exported either directly or indirectly (Australian Bureau of Statistics, 2008). One of the main reasons for the increase in export is that Australia’s tariff was reduced in 1970 and it has fallen from over 30 per cent to under 5 per cent by 2000 (Garnaut, R. 2002). Until the beginning of 1980, Australia had the highest tariff among OECD countries, but it became the average level of industry protection by 2000 (ibid). Export products have diversified during this period because technological development allowed the exporting of not only fresh produce, but also canned and other processed products at low costs, such as power milk and canned of juice. The recent largest contributors are wine at 15 per cent, beef and veal at 12 per cent and wheat at 10 per cent (Australian Government Productivity Commission, 2005).During this period, export destinations have changed as well. Japan used to be the largest export market, but the share has decreased due to decline of the wool prices and volumes and slow growth in Japanese economy. On the other hand, the United States, China and New Zealand have increased their share. In particular, due to the rise of China’s economy and its vast population, the Chinese market share has improved significantly. Now, Australia has oriented agricultural exports to Association of Southeast Asian Nations (ASEAN) and away from European markets. ASEAN’s share of Australian agricultural exports increased from 7 to 13 per cent (Australian Government Productivity Commission, 2005). Recent rapid economic growth in Asian countries has provided great export opportunity for Australia using location as an advantage.
In conclusion, even though there have been some challenging issues, such as natural disasters and the aging workforce, there has been a long term upward agricultural productivity during the1980-2000. Advanced technology, the structural change in farms, the change in demand, and strong relationship with neighbour countries have aided this. In the future, it seems this trend will continue and agricultural business can make a sustainable profit as long as the government retain its economic interest and support to protect the agricultural industry.

Reference
Australian Bureau of Statistics, 2008, "A HUNDRED YEARS OF AGRICULTURE", Australian Bureau of Statistics, Viewed 15 September 2014,.
Australian Government Productivity Commission, 2005 "Trends in Australian Agriculture Productivity Commission Research Paper", Australian Government Productivity Commission, Canberra, Australia, viewed 12 September 2014,.
Cribb, J, 1992"Australian Agriculture" 3rd edition, National Farmers Federation, Victoria, Australia
Garnaut, R. 2002, ‘Australia: A Case Study of Unilateral Trade Liberalization’ Massachusetts Institute of Technology. .
Gray, E, Oss-Emer, M & Sheng, Y, 2014 "Australian agricultural productivity growth past reforms and future opportunities Research Report 14.2" the Australian Bureau of Agricultural and Resource Economics and Sciences, viewed 12 September 2014 .
Kingwell, R 2011, "Managing complexity in modern farming, Australian Journal Of Agricultural & Resource Economics", 55, 1, pp. 12-34, Australia/New Zealand Reference Centre, EBSCOhost, viewed 15 September 2014.
Layton, A, Robinson, T, Tucker, B, 2012,"Economics for Today", 4th edition, Cengage Learning, Victoria, Australia
National Farmers' Federation "Farm Fact 2012" National Farmers' Federation Ltd, viewed 12 September 2014,
Quiggin, J, 2007,"Drought, Climate Change and Food Prices in Australia" Australian Research Council Federation Fellow School of Economics and School of Political Science and International Studies University of Queensland, viewed 12 September 2014,.
Sappey, R, Hicks, J, Basu, P, Keogh, D, & Gupta, R 2012, "Succession Planning in Australian Farming, Australasian Accounting Business & Finance Journal", 6, 4, pp. 94-109, Business Source Complete, EBSCOhost, viewed 15 September 2014.

Similar Documents

Premium Essay

Thailand: a Story of Unequal Growth

...Thailand A Story of Unequal Growth Hailed as the “Southeast Asian Miracle,” Thailand’s economy was among the fastest growing in the world in the latter 20th century. Gross domestic product (GDP) averaged 7.6% during the 1960s and 1970s, dropping to 5.5% during the early 1980s, and then rose to 9% during 1985-1995 (Doner 26). Having undergone dramatic transformation from an agrarian economy into a Newly Industrializing Economy (NIE) in just three decades, the IMF and the World Bank were touting Thailand as a successful example of market-based development (K.S. et. al 56-57). However, critical examination of Thailand’s progress beyond GDP growth finds the extent of its economic achievements was similarly matched by its widening inequality and lagging development indicators, begging the question of whether standard measures of economic progress, such as GDP, are sufficient in assessing national development. Thailand’s Government and the Development of a Modern Economy Following the end of absolute monarchical rule in 1932, Thailand became a constitutional monarchy with a parliamentary democratic political system. The head of state is King Bhumibol Adulyadej, who has reigned since 1946. Its partially elected national legislature selects a prime minister, who appoints a cabinet of ministry heads (Economist Intelligence Unit). While the kingdom is divided into four geographical regions – North, Northeast, Central, and South, Thailand is a centralized unitary state whose powers...

Words: 1808 - Pages: 8

Premium Essay

A Macroeconomic Review of the Dr

...perhaps due to its influence on the rest of islands. The following settlers were cruel to the natives and within fifty years reduced the population of about one million to approximately five hundred habitants. During the 1600s French setters took over the western part of the island but it was later ceded by Spain in 1697 becoming the Republic of Haiti. The Haitians conquered the whole island in 1822 and held it until 1844, when forces led by Juan Pablo Duarte, the hero of Dominican independence, drove them out and established the Dominican Republic as an independent state. Today the island is divided between the Dominican Republic and Haiti. The trend analysis of the gross domestic product indicates that the economy of the Dominican Republic is growing steadily and expanding. The trend of the Dominican GDP also shows a dramatic increase from $6.6 billion dollars in 1980 to a whopping $17.3 billion dollars in the key year of...

Words: 885 - Pages: 4

Premium Essay

Globalization and Food System-Impact on Food Security and Nutrition.

...TABLE OF CONTENTS 1. INTRODUCTION...................................................................................................... 02 2. CONCEPTUAL FRAMEWORK............................................................................ 02 3. GLOBALIZATION OF FOOD SYSTEMS IN CONTEXT................................ 03 a. Urbanization.................................................................................................. 03 b. Economics, health and education................................................................. 04 c. Employment................................................................................................... 05 d. Technology and facilitating mechanisms..................................................... 06 4. CHANGES IN DIETARY PATTERNS ............................................................... 07 a. Dietary convergence ..................................................................................... 07 b. Dietary adaptation ....................................................................................... 08 i. Lifestyle changes and adaptation of meal patterns........................... 08 ii. Street foods......................................................................................... 09 iii. Supermarkets .............................................................................

Words: 6445 - Pages: 26

Premium Essay

Economic Growth

...Agriculture, services and manufacturing industries play a vital role in the development of the Indian economy. The IT outsourcing, software and call center/ BPO industries, in particular, have helped skyrocket India’s economic development in recent years.   Economic development in India still depends on the various sectors that constitute the Indian economy – agriculture, services and manufacturing industries.   India is rated as one of the top economies in the world in terms of purchasing power parity (PPP) of the gross domestic product (GDP) by leading financial entities of the world, such as the International Monetary Fund, the World Bank, and the CIA (as referenced in the CIA World Factbook).   As far as agriculture is concerned, India is the second largest in volume of output. Certain related sectors of agriculture have played a major role in the development of the Indian economy by providing employment to a number of people in the forestry, fishing and logging industries.   In 2009, the agricultural sector contributed 17.5% to the entire GDP, and more than 50% of the total labor force working in India is employed in the agricultural sector.   Production volume has gone up in Indian agriculture at a consistent rate since the 1950s. Much of this improvement can be attributed to the five-year plans that were established for the development of Indian agriculture. Developments in irrigation processes, as well as various modern technologies used have contributed to the...

Words: 3844 - Pages: 16

Premium Essay

Infrastructure

...distribution, and sustainable economic development. Late developing countries can benefit from previous development experience provided they choose the right model1. However, the relationship between infrastructure and economic growth is still frequently debated. This paper will examine the experience of Korea and Japan in infrastructure development for economic growth to acquire some valuable lessons that infrastructure development contributes to economic development in developing countries. 1. Introduction The lack of infrastructure is hindering the economic growth in many developing countries2. Infrastructure investment has the effects of contributing to increase the productivity and it is expected to contribute to future economic growth in developing countries where infrastructure is still insufficient. Therefore, infrastructure development is one of the most integral parts of the public policies in developing countries. Supporting infrastructure development in developing countries by advanced countries is extremely important field. This can be inferred from the fact that many international organizations such as World Bank and OECD are actively promoting the improvement of infrastructure by providing various support programs to developing countries. However, the precise relationship between infrastructure and...

Words: 11379 - Pages: 46

Premium Essay

Globalisation

...threatens the very basis of survival for the vast majority of small and marginal farmers as also for agricultural labourers. On the other hand, there is an agricultural developmental crisis that lies in the neglect of agriculture arising out of poor design of programmes and allocation of resources and having resulted in declining productivity and profitability (Government of India 2007, Reddy and Mishra 2009). This twin dimensions could also be equated with the developmental discourse where the former is about displacement of people and the latter is about displacement of ideology (Bhaduri 2008). The outcome is that planning is not people-centric. Features of the Current Crisis: During the 1990s (1993-94 to 2004-05) when the compound annual growth rate for the Gross Domestic Product (GDP) was 5.9 per cent whereas agricultural GDP was significantly lower at 2.2 per cent. Compared to 1980s (1983-84 to 1993-94), agricultural Gross State Domestic Product was lower in most states in the 1990s and this deceleration was significant for the states of Arunachal Pradesh, Assam, undivided Bihar, Haryana, Kerala, Maharashtra, Meghalaya, Nagaland, Punjab, Sikkim and Tamil Nadu. There has been a decline in the trend growth rate in the production and productivity for almost all crops; between the two periods the compound annual growth rate of decreased for foodgrains from 2.5 per cent to 0.7 per cent, for oilseeds from 6.6 per cent to -0.5 per cent, for sugarcane from 4.0 per cent to 0.1 per cent, for...

Words: 1765 - Pages: 8

Premium Essay

Jobless Growth

...Discussion Paper 99 JOBLESS GROWTH IN INDIAN MANUFACTURING: A KALDORIAN APPROACH Michele Alessandrini* November 2009 Abstract Despite the remarkable economic performance in the last twenty-five years, India maintains a high discrepancy between the rate of growth of the economy and the rate of growth of employment. Labour elasticity to output has decreased over time and the capability of the Indian economy to generate employment seems to be limited. As a result, more than 60 percent of Indian workers are still employed in agriculture and 94 percent of total labour force can be found in the unregistered segment of the economy. This paper analyzes the jobless growth problem in India in terms of a Kaldorian framework where the linkages between agriculture and industry enter the labour demand through the changes in the terms of trade between the two sectors. Moreover, we investigate the role of the unorganized sector in influencing the growth of the registered employment. Using a dynamic panel dataset on registered manufacturing from the 15 major Indian states over the period 1980-2004, our System-GMM estimates show that states with a higher growth of demand for industrial goods originating from agriculture also exhibit a higher growth of employment. In addition, in those states where the weight of the unregistered manufacturing has risen over time, the jobless growth problem has worsened. Keywords: India, jobless growth, manufacturing, intersectoral terms...

Words: 13030 - Pages: 53

Free Essay

Proposals to Eliminate the Mismatch of Demand and Supply Cultivated Agricultural Products

...The boundary of the island covers 65610 of Square Kilometres. Per Capita GDP was US $ 2836 by year 2011 and was composed with agriculture 11.2%, industry 29.3%, and services 59.5%. Sri Lanka had an agriculture based economy when we liberated from the British rule by 1948. There were two main categories as export and subsistence agriculture. Yet there was a very week relationship in between these categories. 85% of the total population lived in rural areas and they made their living by agriculture related activities. Agriculture was under the private sector by the time we gained freedom. Sustainable agriculture mainly depended on field crops such as rice, millet, sweet potato and maize and export agriculture depended on major plantation crops such as tea, coconut and rubber and on minor export crops such as cinnamon, pepper, cocoa and coffee. These export crops had a contribution of approximately 33% to the gross domestic production of the country. Even though livestock management was a main aspect of Sri Lankan agriculture it was neglected through the last few decades. Fishery was also such neglected field. But according to the national policy of the country it is a positive trend to see that agriculture has given a priority. All the governments established in the country after the liberation implement number of activities for the development of agriculture such as infrastructure, irrigation, agricultural loans, establishment of institutional structure for inputs and extension services...

Words: 893 - Pages: 4

Free Essay

Labor in China

...Coombs Building 9 Fellows Road, Canberra ACT0200, Australia dandan.zhang@anu.edu.au • Contact author Economic Reform and Changing Patterns of Labor Force Participation in Urban and Rural China By Margaret Maurer-Fazio, James W. Hughes, and Dandan Zhang Abstract In this project, we employ data from the Chinese population censuses of 1982, 1990, and 2000 to examine reform-era changes in the patterns of male and female labor force participation and in the distribution of men’s and women’s occupational attainment. Very marked patterns of change in labor force participation emerge when we disaggregate the data by age cohort, marital status, sex, and rural/urban location. Women have decreased their labor force participation more than men, and urban women much more than rural women. Single young people in urban areas have decreased their labor force participation to stay in school to a much greater extent than single young people in rural areas. The urban elderly have decreased their rates of labor force participation while the rural elderly have increased theirs. We also find evidence of the feminization of agriculture. Key words: China, labor force participation,...

Words: 12223 - Pages: 49

Free Essay

Carbon and Remote Sensing

...Abstract We investigated normalized difference vegetation index data from the NOAA series of Advanced Very High Resolution Radiometers and found several regions in United States that experienced anomalies over the course of the past 25 years. Our tasks consist of investigating and understanding the drivers of the anomalies in the Midwest forests of Minnesota and Wisconsin. 1. Introduction Forests are known to absorb and sequester carbon dioxide of the atmosphere through the photosynthesis process. Globally forests contain 90% of the total vegetative carbon and 80% of the soil carbon and they assimilate 67% of the total terrestrial carbon dioxide (CO2) sequestered from the atmosphere (Landsberg and Gower, 1997). Hence this process is very essential in mitigating the global climate change. However this carbon is release into the air once the trees die from disease or cut down. The Advanced Very High Resolution Radiometer (AVHRR) Normalized Difference Vegetation Index (NDVI) is indicating a continuous disturbance in the forested area of Wisconsin and Minnesota (Neigh et al., 2008). Although a number of recent studies have found marked variations in NDVI throughout the Northern Hemisphere, they have not attributed these changes to regional factors that may include natural disturbances and/or human alterations to ecosystem functioning ([Gong and Shi, 2003], [Slayback et al., 2003], [Tucker et al., 2001] and [Zhou et al., 2001]). It is important to identify and quantify...

Words: 2220 - Pages: 9

Premium Essay

Economic Structural Changes and Growth

...but also in terms of development in general. Human endures intellect toward productive growth in developed countries which mainly relies on technological innovation. However, as for developing countries, growth and development follows developed countries by forcing the technology mechanism and changing the structure of production towards activities with higher levels of productivity. The evidence show that during 1970s and 1980s there were of structural changes in economic activities where developing countries enters the global markets. In his preface, Giplin (2001; xi) point out that “…important step toward the creation of a truly global economy, since the mid-1980s the world has also witnessed the extraordinary growth of economic regionalism as a countermovement to economic globalization.” Similarly, Magdoff (1992; 50) state that “In fact, capital exports have helped shape the evolving global economy ever since the end of the Second World War”. Moreover, Glyn and Sutcliffe (1992; 79) point out that “…left the world economy leaderless in the 1970s and 1980s with increasingly open economies disciplined by market forces, but without a unique center of gravity.” This implies that global economies forces t To provide a well-structured discussion, this essay will begin by briefly introducing into how neo-liberalism in the mainstream of development thinking greatly achieve its victory of defence mechanism for a new wave of market orientation intervention, before discussing the structural...

Words: 3839 - Pages: 16

Premium Essay

Agriculture

...Agriculture, growth and poverty reduction This paper was produced by the Agriculture and Natural Resources Team of the UK Department for International Development (DFID) in collaboration with Anne Thomson of Oxford Policy Management, Oxford. The authors are grateful to the UK Food Group for their additional contributions and comments. The paper reflects work in progress towards the development of new thinking on agricultural policy in DFID. It does not necessarily reflect the views and policy of DFID. This (working/supporting) paper is intended to stimulate public discussion. It is not necessarily DFID or UK Government policy. October 2004 Contents Executive Summary...................................................................................................... 3 1. What is the issue? .................................................................................................... 4 2. Agriculture, growth and poverty – what we know of the relationship ............................ 5 2.1 The context – the state of world poverty............................................................... 5 2.2 Agriculture’s recent performance – a picture of mixed progress............................... 7 2.3 Agricultural growth and poverty reduction – the evidence....................................... 9 2.4 Understanding how increased agricultural productivity reduces poverty ................. 10 3. Emerging issues and questions................................................

Words: 10970 - Pages: 44

Free Essay

Mortgage Rice Price Policy in Thailand and Its Hiding Aim

...Mortgage rice price policy in Thailand and its hiding aim 08 Fall 08 Fall Abstract Thailand has had a great influence on the global rice market for decades due to its huge stock and export. Hence, the Thai government has intervened in the paddy rice market by introducing the mortgage rice price policy. The policy was first implemented in 1980 in order to resolve the low-price problem in the paddy rice market. However, in the 21st century the government attempted to re-issue the policy, even though the paddy rice market price was already high at that time, resulted in a marketing failure to both domestic and international markets. Furthermore, the cost of the policy was excessively high raising concerns that the main reasons for presenting the policy could not be purely economical. Therefore, I argue that there were political reasons behind the aim of amending the policy in 2001. This essay will examine this argument by providing the process of the policy, the effects and problems of the policy, the cost of the policy and the hidden aim of the policy. CONTENT * Introduction * The process of the mortgage rice price policy * The rice distribution system * The effects of the policy * The problems and errors of the policy * The cost of the policy * The hidden aim of the policy * Conclusion * References What was the main reason for presenting the mortgage rice price policy in...

Words: 2702 - Pages: 11

Premium Essay

Social

... Background Paper for the UNESCO Education for All Monitoring Report 2003: Gender and Education for All Introduction The 1980s and 1990s are frequently referred to as the era of globalization. While there is no consensus on what the term “globalization” means, for the purposes of this paper we use the term to refer to the greater openness of economies to international trade and finance, or external liberalization. The question that this paper will be tackling is how globalization has impacted on the growth of real economies in diverse regional contexts (Section One), their capacity to create employment (Section Two), and specifically how the new policy agenda has impacted on women’s labour force participation in diverse regional contexts and their enjoyment of social rights (Sections Three and Four). In addition to the available global data sets, the paper will be drawing on in-depth case studies from around the world in order to support the arguments that are being put forward. 1. International Economic Integration and Economic Growth The purpose of this section is to look at the growth implications of globalization. However, to begin the discussion we need to clarify how the term globalization is understood in this paper. As Gerald Helleiner (2000) usefully points out, the term globalization as frequently used, confuses two different phenomena. The first is the shrinkage in space and in time that the world has experienced...

Words: 9695 - Pages: 39

Premium Essay

Economics

...Issues • Sustainable Development and Environmental Accounting • Population, Resources, and the Environment • Poverty and Environment • Growth versus the Environment • Rural Development and the Environment • Urban Development and the Environment • The Global Environment — Consequences of Environmental Damage — The Indian Case • Consequences of Environmental Plunder — Public Policy SECTION - II Indian Economy at Independence 3. India's Economy at Independence. 57 — Introduction — The Relative Importance of Various Industrial Activities • Composition of National Income — The Working Force — The Agrarian Scene • Stagnating Agriculture • Causes — India's Industrial...

Words: 57754 - Pages: 232