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Australia Agribusiness Report Q2 2016

Australia Agribusiness Report Q2 2016

BMI View: Australia's agribusiness sector will see its exports grow in the coming years, driven by the rise in production, its reputation as a reliable exporter of safe and quality products and strong external demand. However, the sector's future success will be somewhat held back by rising production costs and profitability issues that are weighing on the production outlook. Moreover, the country's vulnerability to extreme weather events will grow in the coming years with climate change, making agricultural production even more volatile. Australia has to face rising competition coming from lower-cost producers that aim at supplying the attractive markets in Asia and the Middle East. Australia has signed a number of trade deals with key importing countries, including the Trans Pacific Partnership, which will help its competitiveness remain satisfactory. Australia will also need to step up investment in some parts of its supply chain in order to improve its competitiveness and reach a new level of innovation, efficiencies and exports.

Key Forecasts

Beef production growth to 2019/20: -9.9% to 2.3mn tonnes. The negative growth over our forecast period is mainly due to high base effects (production reached a record in 2013/14) and because output will decrease over 2015-2017 as farmers rebuild their herds. Beef production will reaccelerate beyond 2018.

Milk production growth to 2019/20: 7.4% to 10.4mn tonnes. Milk production will grow only modestly in the coming years as the sector struggles to expand the herd, while yields are already elevated and will see limited further growth. Meanwhile, the processing sector is very dynamic and will grow strongly in the coming years, requiring more domestic supply.

Poultry consumption growth to 2020: 19.3% to 1.27mn tonnes. Poultry consumption will prove to be the strongest over the coming years, as consumers continue to choose the meat as a healthier alternative to beef. As such, we forecast consumption per capita to rise to 50kg in 2020, compared with 39kg back in 2010.

2016 BMI universe agribusiness market value: USD40.92bn, up from USD41.31bn in 2015; growth expected to average 2.2% annually between 2016 and 2020.

2016 real GDP growth: 2.1%, down from 2.5% in 2015. Forecast to average 2.2% from 2016 to 2020.

2016 consumer price inflation: 1.0% y-o-y ave, down from 1.5% in 2015. Forecast to average 2.0% from 2016 to 2020.

2016 central bank policy rate: 1.50% eop, down from 2.00% in 2015. Forecast to average 2.30% from 2016 to 2020.


BMI Industry View
SWOT
Agribusiness
Industry Forecast
Grains Outlook
Table: Australia - Grains Production And Consumption Outlook
Table: Risks To Outlook
Table: Grains Production & Consumpton (Australia 2013-2020)
Sugar Outlook
Table: Australia - Sugar Production And Consumption Outlook
Table: Risks To Outlook
Table: Australia - Main FTAs Signed Or Under Negotiations
Table: Sugar Production & Consumption (Australia 2013-2020)
Dairy Outlook
Table: Australia - Dairy Production And Consumption Outlook
Table: Risks To Outlook
Table: Australia Dairy - Recent Company Developments
Table: Dairy Production & Consumption (Australia 2013-2020)
Livestock Outlook
Table: Australia - Livestock Production And Consumption Outlook
Table: Australia - Risks To Livestock Outlook
Table: Livestock Production & Consumption (Australia, 2013-2020)
Commodities Price Analysis
Global - Global Commodities Strategy
Table: Select Commodities - Performance And BMI Forecasts
Featured Analysis
Cotton Production To Recover Despite Weak Chinese Demand
Table: Cotton Production & Growth (Australia, 2012-2020)
TPP - Agribusiness Winners And Losers
Table: TPP - Main Winners And Losers For Agriculture
Bright Export Outlook For Australia But Growing Challenges
Table: Production Balance (Australia 2010-2019)
Upstream Analysis
Asia GM Outlook
Table: Selected Countries - GM Crops Use (mn hectares)
Asia Fertiliser Outlook
Downstream Analysis
Food
Latest Updates
Structural Trends
Table: Food Sales (Australia 2013-2020)
Regional Overview
Table: Impact Of El Niño On Crops
Competitive Landscape
Table: Australia - Major Agribusiness Companies
Demographic Forecast
Table: Population Headline Indicators (Australia 1990-2025)
Table: Key Population Ratios (Australia 1990-2025)
Table: Urban/Rural Population & Life Expectancy (Australia 1990-2025)
Table: Population By Age Group (Australia 1990-2025)
Table: Population By Age Group % (Australia 1990-2025)
Methodology
Industry Forecast Methodology
Sector-Specific Methodology

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