Lockdowns lift but supply chain pain remains

Lockdowns lift but supply chain pain remains

COMMENT
Agribusiness
Aa

Long lockdowns have lessened demand from southern states for Queensland's fresh produce.

Aa

Growers in the north of Australia, by and large, have weathered a pretty average winter.

It's the season Queensland comes into its own, supplying southern markets with all the fresh produce from sunny climates they can't grow themselves.

But this winter has been tough due to the long lockdowns that have lessened demand from the food service sector in Australia's two largest markets, Sydney and Melbourne.

And food service is a big piece of the fresh produce pie.

The Horticulture Statistics Handbook reports that to the year ending June 2020, about 17 per cent or $1.75 billion of national fresh produce supply went into the food service, including cafés, pubs and catering.

With a number of growers making the link between southern food service disruption, dampened demand and the poor prices they're receiving, the end of the southern lockdowns couldn't come soon enough.

Prices, however, are only one part of the equation, with growers also absorbing skyrocketing costs of production.

The costs of recruiting and retaining labour is through the roof. Where once workers would come knocking, now additional workers need to be flown from the Pacific and put through quarantine.

Growers are paying above award rates to attract workers where many other sectors of the economy are also short of staff.

Less widely reported have been sharp rises in input costs, much of which is sourced overseas, including fertiliser, chemicals and packaging.

So while talk of an agriculture visa, vaccine passports and a return to international travel offers some hope of a return to the normal movement of people across borders and an eventual easing of the labour shortage, growers also need the costs of importing of farm inputs to come down and quickly.

Federal Trade Minister Dan Tehan has reportedly asked stakeholders to explore what adjustments could be made to policy and regulatory settings to address shipping costs. This is just one answer to the problem.

Another answer is greater self-sufficiency in our agricultural inputs, and thus a reduced dependence on imported products. It would be a great waste of this pandemic if it ended with no improvement in the resilience of our supply chains compared to when it started.

Growcom believes a great opportunity remains for locally sourced solutions to fill the gaps where weaknesses have been found in our supply chains.

Aa

From the front page

Sponsored by