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Prospectsfor Queensland’s primary industries
2010–11
PR10–5697
Acknowledgements
DEEDI acknowledges the contributions to the report from:
• Science, Agriculture and Food, Tourism and Regional Services (SAFTRS) researchers and industry experts,
• Office of Economic and Statistical Research (OESR),
• Australian Bureau of Agricultural and Resource Economics (ABARE),
• Australian Bureau of Statistics (ABS),
• Meat and Livestock Australia (MLA),
• Avocados Australia,
• various industry representatives, and
• various market commentators and industry media.
© The State of Queensland, Department of Employment, Economic Development and Innovation, 2010.
Except as permitted by the Copyright Act 1968, no part of this work may in any form or by any electronic, mechanical, photocopying, recording, or any other means be reproduced, stored in a retrieval system or be broadcast or transmitted without the prior written permission of the Department of Employment, Economic Development and Innovation. The information contained herein is subject to change without notice. The copyright owner shall not be liable for technical or other errors or omissions contained herein. The reader/user accepts all risks and responsibility for losses, damages, costs and other consequences resulting directly or indirectly from using this information.
Enquiries about reproduction, including downloading or printing the web version, should be directed to [email protected] or telephone 13 25 23 (Queensland residents) or +61 7 3404 6999.
iii
Contents
This edition of Prospects 1
Key findings 3Total value of Queensland’s primary industries 3
Gross value of production (GVP) at ‘farm gate’ 3
Livestock industries 3
Crops 3
Fisheries 4
Forestry 4
First-stage processing 4
About Queensland’s primary industries 5
About the Department 6
About Prospects 7About Prospects update 7
Contact 7
Content and procedure 8
Climate outlook for October–December 2010 9
Drought situation 10
Global demand for Australian commodities 11
Primary industries—estimates and forecasts 13
Volume of production index 16
Livestock disposals 17Cattle and calves 17
Pigs 23
Poultry 23
Sheep and lambs 24
Kangaroos 24
Feature: Market placement delivers success in South Korea 25
Livestock products 26Milk 26
Wool 27
Eggs 28
Crops 29Horticulture crops 29
Fruit and nuts 29
Feature: Successful tropical fruit wine producers look to new markets 32
Vegetables 33
Other vegetables 34
Lifestyle horticulture 35
Other crops 36
Sugarcane 36
Cotton 38
Other major field crops 41
iv
Chickpeas 41
Peanuts 41
Soybeans 42
Sunflowers 44
Winter cereal grains 46
Wheat 46
Barley 47
Summer cereal grains 48
Grain sorghum 48
Maize 49
Feature: Prosperous partnerships for stable food quality 50
Fisheries 51Commercial fishing 51
Crustaceans 52
Finfish 53
Recreational fishing 54
Aquaculture 54
Feature: Strategy seeks balance between development and environment 55
Forestry 56
Special feature: Queensland’s food supply chain 59
Notes 61
Definitions 61
FiguresFigure 1 Probability of exceeding median rainfall for October–December 2010 9
Figure 2 Drought situation in Queensland as at 31 July 2010 10
Figure 3 Queensland cattle and calf slaughterings, 2000–01 to 2010–11(f) 17
Figure 4 Percentage share of total slaughter for cattle and calves and cows and heifers, Queensland, 2000–01 to 2009–10 (Source: ABS) 18
Figure 5 Eastern Young Cattle Indicator (EYCI) (Source: MLA) 18
Figure 6 Australian exports of beef and veal, 2009–10 (Source: DAFF) 19
Figure 7 Queensland exports of beef and veal, 2009–10 (Source: DAFF) 20
Figure 8 Queensland cattle on feed and feedlot capacity, March 2001 to March 2010 21
Figure 9 Queensland live cattle exports, 1999–2000 to 2009–10 22
Figure 10 International real and nominal raw sugar prices, 1960–2009 37
Figure 11 Capacity of major Queensland irrigation dams for cotton as at 16 September 2010 39
TablesTable 1 IMF forecast (year over year per cent change) 11
Table 2 GVP and first-stage processing 2008–09 to 2010–11 13
Table 3 Volume of production index for Queensland’s major agricultural commodities from 1996–97 to 2010–11 16
Table 4 Queensland milk production estimates and forecasts by region 2006–07 to 2010–11 27
Table 5 World production (000’s metric tonnes) 2009–10 40
Table 6 Food supply chain, 2008–09 60
1
This edition of Prospects
Prospects for Queensland’s primary industries is now in its tenth year, after being officially launched in June 2001. Since then, the Prospects publication has become a well established, comprehensive source of the statistics, analysis and forecasts for Queensland’s primary industries. Over time we have introduced changes to the methodology of estimating the value of the State’s primary production. The most recent changes are outlined below.
Total value of Queensland’s primary industriesPrior to September 2007, the measure used to value Queensland’s primary industry commodities in Prospects was gross value of production (GVP). From September 2007 onwards, the total value of Queensland’s primary industry commodities reported in Prospects comprises two components, which are reported separately. These components are: a GVP figure for unprocessed primary commodities, and a value of first-stage processing for the commodities in the following list.
Value of first-stage processingFirst-stage processing forecasts and estimates for previous years are provided for:
• meat processing
• sugar processing
• milk and cream processing
• fruit and vegetable processing
• flour mill product and feed processing
• seafood processing
• log sawmilling, timber dressing and plywood and veneer manufacturing
• lifestyle horticulture services
• cotton ginning
• kangaroo processing.
In this edition of Prospects, estimates of major primary industry processing activity are based on a methodology derived from the 2006–07 Australian Bureau of Statistics (ABS) Manufacturing Survey/Census statistics released in April 2009.
The methodology assumes a constant ratio of farm output to processing output and a constant ratio of processing output to processing industry value-added. Previous editions used the methodology derived from the Queensland 2000–01 Manufacturing Survey. As such, the first-stage processing forecasts for 2010–11 should not be compared with the estimates for previous years.
Lifestyle horticultureIn September 2008, the Department commissioned Queensland Treasury’s Office of Economic and Statistical Research (OESR) to undertake a comprehensive, state-wide telephone survey to determine the economic value of the lifestyle horticulture industry. Lifestyle horticulture has changed significantly since a previous comprehensive survey in 2001, and the Department of Employment, Economic Development and Innovation (DEEDI) needed a new benchmark to improve our understanding of the scope and economic contribution of this important industry.
2
In Table 2 on page 14, the value of the industry is captured under ‘lifestyle horticulture production’ and includes the GVP of nurseries, cut flowers and turf.
ForestryIn Table 2 on page 15, the value of Queensland’s forest industry has two components:
• the gross value of the log timber produced from Queensland’s plantations and native forests before it reaches a sawmill or primary timber processing plant
• the value-added component that includes log sawmilling and timber dressing, and plywood and veneer manufacturing.
Maps showing main production regionsFor livestock, horticulture and crops, maps show the main production areas for individual commodities. The maps are based on ABS 2005–06 agricultural census data. The maps show statistical local areas (SLAs) in Queensland where the top 80 per cent of production of each commodity is concentrated.
Comparisons with previous yearsFrom 2005–06, the ABS used a new methodology for gathering agricultural data. ABS’s final GVP estimates for 2008–09, released in July 2010, are included in Table 2 (page 13). Due to this break in the series, ABS advises that figures from 2005–06 onwards should not be compared to previous years.
Special feature articleThis edition of Prospects includes a special feature article on the Queensland food supply chain.
3
Key findings
Total value of Queensland’s primary industriesIn 2010–11, the total value of Queensland’s primary industry commodities (combined GVP and first-stage processing) is forecast at $14.39 billion, which is three per cent higher than 2009–10 and seven per cent higher than the final ABS estimate for 2008–09.
Gross value of production (GVP) at ‘farm gate’In 2010–11, the GVP of Queensland’s primary industry commodities at the ‘farm gate’ is forecast at $11.23 billion, which is three per cent higher than 2009–10 and five per cent higher than the final ABS estimate for 2008–09.
Livestock industries
Livestock disposals• The GVP of Queensland’s cattle and calf industry in 2010–11 is forecast at $3.31 billion,
two per cent lower than 2009–10. The GVP of Queensland’s live cattle exports is forecast at $105 million, 12 per cent lower than 2009–10.
• The GVP of Queensland’s sheep and lamb industry in 2010–11 is forecast at $58 million, 29 per cent higher than 2009–10.
• The GVP of Queensland’s pig industry in 2010–11 is forecast at $232 million, one per cent lower than 2009–10.
• The GVP of Queensland’s poultry industry in 2010–11 is forecast at $370 million, four per cent higher than 2009–10.
• The GVP of Queensland’s kangaroo industry in 2010–11 is forecast at $20 million, 33 per cent higher than 2009–10.
Livestock products• The GVP of Queensland’s wool industry in 2010–11 is forecast at $90 million, 10 per cent lower
than 2009–10.
• The GVP of Queensland’s milk industry in 2010–11 is forecast at $272 million, eight per cent lower than 2009–10.
• The GVP of Queensland’s egg industry in 2010–11 is forecast at $112 million, two per cent higher than 2009–10.
Crops
Fruit and nuts and vegetables• The GVP of Queensland’s fruit and nut industry in 2010–11 is forecast at $1.06 billion,
eight per cent lower than 2009–10.
• The GVP of Queensland’s vegetable industry in 2010–11 is forecast at $1.08 billion, 10 per cent higher than 2009–10.
Lifestyle horticulture• The GVP of Queensland’s lifestyle horticulture industry (production sectors) in 2010–11
is forecast at $989 million, two per cent higher than 2009–10.
4
• The GVP of Queensland’s nursery industry in 2010–11 is forecast at $788 million, the same as 2009–10.
• The GVP of Queensland’s turf industry in 2010–11 is forecast at $116 million, 10 per cent higher than 2009–10.
• The GVP of Queensland’s cut flower and foliage industry in 2010–11 is forecast at $85 million, five per cent higher than 2009–10.
Other crops• The GVP of Queensland’s sugarcane industry in 2010–11 is forecast at $1.24 billion, 13 per cent
lower than 2009–10.
• The GVP of Queensland’s cotton industry in 2010–11 is forecast at $710 million, 100 per cent higher than 2009–10.
Cereal grains• The GVP of Queensland’s wheat industry in 2010–11 is forecast at $450 million, 70 per cent
higher than 2009–10.
• The GVP of Queensland’s barley industry in 2010–11 is forecast at $37 million, 19 per cent higher than 2009–10.
• The GVP of Queensland’s grain sorghum industry in 2010–11 is forecast at $239 million, 54 per cent higher than 2009–10.
• The GVP of Queensland’s maize industry in 2010–11 is forecast at $53 million, 43 per cent higher than 2009–10.
FisheriesThe GVP of Queensland’s fisheries in 2010–11 is forecast at $447 million.
In this edition, recreational fishing, which is an important part of Queensland fisheries, is included in the forecast for 2010–11 with an estimated value of $73 million. The values of commercial fishing and aquaculture are forecast at $269 million (a five per cent decrease from 2009–10) and $105 million (a three per cent increase from 2009–10) respectively.
ForestryThe GVP of the forest growing sector of Queensland’s forest industry in 2010–11 is forecast at $187 million, nine per cent higher than last year.
First-stage processing In 2010–11, the value of first-stage processing (or value-added production) is forecast at $3.16 billion. This should not be compared with the previous years as new ratios for value-added are applied for 2008–09 onwards (see Special feature: Queensland’s food supply chain, page 59).
• The value of meat processing in 2010–11 is forecast at $1.54 billion.
• The value of sugar processing in 2010–11 is forecast at $688 million.
• The value of milk and cream processing in 2010–11 is forecast at $144 million.
• The value of fruit and vegetable processing in 2010–11 is forecast at $184 million.
• The value of flour mill and feed processing in 2010–11 is forecast at $74 million.
• The value of seafood processing in 2010–11 is forecast at $67 million.
• The value of log sawmilling, timber dressing and plywood and veneer manufacturing in 2010–11 is forecast at $386 million.
• The value of cotton ginning in 2010–11 is forecast at $81 million.
5
About Queensland’s primary industries
In 2008–09, Queensland’s primary industries directly contributed an estimated $5.2 billion to the State’s economy, or 2.3 per cent of Gross State Product.1
Geographically, Queensland is Australia’s second largest state, covering more than 173 million hectares. Of this, almost 144 million hectares (or 83 per cent) of the land area is used for agriculture. Queensland has the largest area of agricultural land of any Australian state and the highest proportion of land area in Australia dedicated to agriculture.
In 2008–09, Queensland exported $5.4 billion worth of agriculture and food products. Exports of these primary products comprised 9.5 per cent of the State’s overseas commodity exports.2
In 2008–09, the combined employment associated with each of these steps equated to an estimated 267 000 employees who were either partially or entirely supported by the food sector.3
During the 2008–09 global economic downturn, Queensland’s agriculture, forestry and fishing sector performed strongly with annual growth of 10.4 per cent.
1 Source: ABS 5220.0 State Accounts
2 Source: ABS Exports from Queensland and Australia to all countries, by commodity, value, 2008–09, OESR, Standard International Trade Classification 2 digit, Food and Live Animals
3 Source: Prospects
6
About the Department
The Department of Employment, Economic Development and Innovation (DEEDI) has two main objectives: to create the conditions for business success, and to help individuals and businesses respond to the economic challenges they face.
DEEDI provides the opportunity for an integrated and holistic approach to driving competitiveness and productivity across the whole food value chain, by bringing together services in industry development, biosecurity, fisheries, science and innovation.
In 2010–11 DEEDI is committed to delivering the following initiatives for the food and agriculture sector:
• establishment of the Queensland Alliance for Agriculture and Food Innovation (QAAFI) with the University of Queensland
• establishment of the Health and Food Sciences Precinct at Coopers Plains and the Ecosciences Precinct at Boggo Road, representing an investment of more than $290 million by the Queensland Government
• continued implementation of Queensland’s commitments under the national research, development and extension framework
• development of the State’s first Food Policy
• development of the new single Biosecurity Bill and continued implementation of the Biosecurity Strategy
• reform of service delivery including a refresh of the Department’s web-based service delivery.
The Department is also collaborating across all levels of government to address major obstacles in areas such as land use competition, infrastructure delivery and complex legislation.
These initiatives will help DEEDI realise the vision of a $34 billion industry by 2020 as released by The Hon. Tim Mulherin, MP, Minister for Primary Industries, Fisheries and Rural and Regional Queensland in June 2008.
7
About Prospects
Prospects has a circulation of approximately 1700, with copies distributed to members of parliament, industry associations, agribusinesses, banks, law firms, local councils, government departments, educational institutions, primary producers and other businesses along the value chain.
The annual September edition of Prospects contains:
• initial gross value of production (GVP) forecasts for 2010–11
• initial first-stage processing forecasts for 2010–11
• GVP estimates for 2009–10 and 2008–09.
Prospects is available on the DEEDI website at www.deedi.qld.gov.au (click on ‘A-Z index’ > P > ‘Prospects’).
About Prospects updateThe September 2010 edition of Prospects contains initial GVP forecasts and first-stage processing forecasts for the current financial year. These forecasts are then updated in March. Updated forecasts will be made available electronically and can be downloaded from the DEEDI website, www.deedi.qld.gov.au. This is in line with our commitment to upgrade the DEEDI information technology platform to make services integrated, modern and more user-friendly.
ContactWe welcome your feedback. Please send your comments and suggestions to us at:
Prospects Economic Research and Analysis Economic Policy and Planning Department of Employment, Economic Development and Innovation 111 George Street Brisbane Qld 4001
or
Contact the Customer Service Centre on 13 25 23
or
Visit www.deedi.qld.gov.au for current and previous editions of Prospects and Prospects update.
8
Content and procedure
In the Prospects publication, GVP refers to the output of primary industry operations. Most non-commercial activities, such as home vegetable and flower gardening and hobbyist beekeeping, are not included due to lack of data. This in no way diminishes the importance of these activities to Queensland’s economy and society.
Gross values of commodities produced are calculated by multiplying the output from each primary industry activity by the average wholesale market price paid to producers.
Estimates of major primary industry processing activity used in this edition of Prospects are based on a methodology derived from the 2006–07 ABS Manufacturing Survey/Census statistics released in April 2009. The methodology assumes a constant ratio of farm output to processing output and a constant ratio of processing output to processing industry value-added.
Previous editions used methodology derived from the Queensland 2000–01 Manufacturing Survey. As such, the first-stage processing forecasts for 2009–10 should not be compared with the estimates for previous years.
Value-added refers to the additional value created at a particular stage of production. Value-adding that occurs beyond the first stage was not included in this analysis until now. It should be noted that for some industries, there are a significant number of stages of processing and value-adding beyond the first stage. For instance, timber is processed in numerous downstream industries, including wooden structural component, pulp, paper and paperboard, and paper product processing.
Economists use the value-added method as a way to avoid double-counting (i.e. counting the same input twice). The sum of the value-added in each of the different stages of production equals the value of the final product. In a microeconomic context, value-added is simply measured as the value of the output produced minus the costs of the intermediate inputs.
For the first time, Prospects shows the values of the whole food supply chain.
The estimates and forecasts contained in this edition of Prospects were based on information available in August and September 2010, and follow consultation with industry experts and DEEDI staff.
The prices of all overseas-traded commodities are responsive to changes in the exchange rate of the Australian dollar relative to the currencies of our trading partners. Prices paid to primary producers, and therefore gross unit values, could change depending on whether exchange rates increase or decrease.
9
Climate outlook for October–December 20104
According to the Bureau of Meterology (BOM), a La Niña event is now well established in the Pacific Ocean. All computer models surveyed by BOM suggest that Pacific Ocean sea surface temperatures (SSTs) will continue to exceed La Niña thresholds through the Southern Hemisphere spring, with the majority of models indicating the event will persist into at least early 2011.
The BOM says that all key indicators of El Niño/La Niña-Southern Oscillation (ENSO) are at levels typical of a La Niña event. The indicators being that:
� the central Pacific has cooled significantly over the recent past
� the Southern Oscillation Index (SOI) remains well above La Niña thresholds
� cloudiness over the central Pacific remains suppressed
� trade winds continue to be stronger than the long-term average in the central and western Pacific.
The BOM reports that recent values of the Indian Ocean Dipole (IOD) index, combined with forecasts from the Bureau’s POAMA model, suggest that a negative IOD event may have commenced in the Indian Ocean. They believe that negative IOD events are often, but not always, associated with above-average rainfall over large areas of southern Australia during the Southern Hemisphere spring, and are known to coincide with La Niña events.
Therefore, in summary, for the October to December period, the BOM believes that the chance of exceeding the median rainfall is between 45 per cent to 55 per cent across most of Northern Australia. They explain that this means for every ten years with ocean patterns like the current, about five years would be expected to be wetter than average in these parts of north-eastern Australia during spring, with about five being drier.
Figure 1 Probability of exceeding median rainfall for October–December 2010
Source: www.longpaddock.qld.gov.au
4 Source: Bureau of Meteorology, October 2010
10
Drought situation
As at 30 September 2010, 1.4 per cent of the land area of Queensland was drought-declared under State processes. Notably, 24 individually droughted properties (IDPs) were indentified in a further four local government areas.
Joint State – Commonwealth Natural Disaster Relief and Recovery Arrangements (NDRRA) have been activated for 67 Queensland communities affected by heavy rainfall and associated flooding in January–March 2010, and for communities within Diamantina, Barcoo and Boulia shires affected by rain and associated flooding on 3–5 September 2010.
Figure 2 Drought situation in Queensland as at 31 July 2010
Source: www.longpaddock.qld.gov.au
11
Global demand for Australian commodities
Global prospects have improved and the world economy is recovering, albeit at varying speeds across regions, according to the International Monetary Fund’s (IMF) latest forecast. Economic growth is now projected to grow by 4.6 per cent in 2010 and 4.3 per cent in 2011. Relative to the April 2010 World Economic Outlook (WEO), this represents an upward revision of about ½ percentage point in 2010, reflecting stronger activity during the first half of the year.
Table 1 IMF forecast (year over year per cent change)
Projections
Difference from April 2010 WEO
Projections
2008 2009 2010 2011 2010 2011
World Output1 3 –0.6 4.6 4.3 0.4 0
Advanced economies 0.5 –3.2 2.6 2.4 0.3 0
United States 0.4 –2.4 3.3 2.9 0.2 0.3
Euro Area 0.6 –4.1 1 1.3 0 –0.2
Germany 1.2 –4.9 1.4 1.6 0.2 –0.1
France 0.1 –2.5 1.4 1.6 –0.1 –0.2
Italy –1.3 –5.0 0.9 1.1 0.1 –0.1
Spain 0.9 –3.6 –0.4 0.6 0 –0.3
Japan –1.2 –5.2 2.4 1.8 0.5 –0.2
United Kingdom 0.5 –4.9 1.2 2.1 –0.1 –0.4
Canada 0.5 –2.5 3.6 2.8 0.5 –0.4
Other advanced economies 1.7 –1.2 4.6 3.7 0.9 –0.2
Newly industrialised asian economies 1.8 –0.9 6.7 4.7 1.5 –0.2
Emerging and developing economies2 6.1 2.5 6.8 6.4 0.5 –0.1
Central and Eastern Europe 3.1 –3.6 3.2 3.4 0.4 0
Commonwealth of Independent States 5.5 –6.6 4.3 4.3 0.3 0.7
Russia 5.6 –7.9 4.3 4.1 0.3 0.8
Excluding Russia 5.3 –3.4 4.4 4.7 0.5 0.2
Developing Asia 7.7 6.9 9.2 8.5 0.5 –0.2
China 9.6 9.1 10.5 9.6 0.5 –0.3
India 6.4 5.7 9.4 8.4 0.6 0
ASEAN-53 4.7 1.7 6.4 5.5 1 –0.1
Middle East and North Africa 5.3 2.4 4.5 4.9 0 0.1
Sub-Saharan Africa 5.6 2.2 5 5.9 0.3 0
Western Hemisphere 4.2 –1.8 4.8 4 0.8 0
Brazil 5.1 –0.2 7.1 4.2 1.6 0.1
Mexico 1.5 –6.5 4.5 4.4 0.3 –0.1
(Source: IMF, World Economic Outlook Revised Update, July 2010)
1 The quarterly estimates and projections account for 90 per cent of the world’s purchasing power-parity weights.
2 The quarterly estimates and projections account for approximately 77 per cent of the emerging and developing economies.
3 Indonesia, Malaysia, the Philippines, Thailand and Vietnam.
12
IMF Chief Economist, Mr Olivier Blanchard, indicates a cautiously optimistic view of the global recovery that is dependent on how Europe deals with financial problems:
While we remain cautiously optimistic about the pace of recovery, there are clear dangers and policy changes ahead. How Europe deals with fiscal and financial problems, how advanced countries proceed with fiscal consolidation, how emerging countries rebalance their economies, will very much determine the outcome for this year and next year.
As shown in Table 1, the United States economy is forecast to show a moderate recovery in economic output from the previous year, with GDP predicted to grow by 3.3 per cent in 2010 and 2.9 per cent in 2011.
Meanwhile, Europe is expected to face a more difficult recovery and is forecast to record sluggish growth of 1.0 per cent in 2010 and 1.3 per cent in 2011.
Growth is moderating in East Asia to more sustainable rates following the V-shaped recovery over 2009, most notably with economic growth in Japan predicted to moderate from 2.4 per cent in 2010 to around 1.8 per cent in 2011. China is showing signs of a more sustainable rate of growth with GDP estimated to moderate slightly from 10.5 per cent in 2010 to 9.6 per cent in 2011.
The Reserve Bank anticipates a rebalancing of domestic growth away from public investment. Private demand is expected to become a more important driver of growth:
Over the period ahead, a rebalancing of growth is expected, with public investment set to decline as fiscal stimulus projects are completed, while private demand is expected to become a more important driver of growth.
The outlook for investment in the resources sector remains favourable and the high level of the terms of trade is boosting incomes and demand.
The outlook for overall demand is driven less by consumption than has been the case over much of the past couple of decades. While consumer confidence is buoyant and the labour market is strong, growth in household consumption is expected to be a little weaker than that in income.
As a result, the saving rate is expected to rise modestly, with households being more cautious about their finances than in the past. Business investment is forecast to grow strongly over the forecast period, driving growth in domestic demand.
13
Primary industries—estimates and forecasts
Table 2 GVP and first-stage processing 2008–09 to 2010–11
2008–09 (b) 2009–10 (c) 2010–11 (d)
change 2009–10 to
2010–11Commodity GVP (a) $m $m $m %
Livestock disposalsCattle and calves 3366 3380 3310 –2
Sheep and lambs (m) 60 45 58 29
Pigs (m) 242 235 232 –1
Poultry (m) 351 355 370 4
Kangaroos – 15 20 33
Other livestock 16 16 16 –1
Total livestock disposals 4033 4046 4006 –1
Livestock productsWool 87 100 90 –10
Milk (all purpose) 293 295 272 –8
Eggs 109 110 112 2
Total livestock products (e) 489 505 474 –6
Total livestock 4522 4551 4480 –2HorticultureFruit and nuts – –
Bananas 390 460 360 –22
Pineapples 88 70 70 0
Mangoes 83 70 70 0
Mandarins 64 70 65 –7
Strawberries 87 145 145 0
Avocados 60 80 95 19
Macadamias 16 34 31 –9
Apples 33 40 40 0
Table grapes 24 50 50 0
Other fruit and nuts 126 135 138 3
Total fruit 971 1154 1064 –8
Vegetables – –
Potatoes 54 45 50 11
Beans 50 50 50 0
Carrots 22 25 25 0
Lettuce 71 65 68 5
Melons (rock and canteloupe) 31 30 32 6
Melons (watermelon) 42 44 44 –1
14
Table 2 GVP and first-stage processing 2008–09 to 2010–11 (cont.)Mushrooms 22 60 64 7
Pumpkin 30 30 30 1
Onions 28 25 25 0
Sweet corn 18 30 30 1
Tomatoes 188 180 236 31
Capsicums and chillies (f) 92 100 120 20
Zucchini and button squash 49 45 34 –24
Sweet potatoes 44 55 55 1
Other vegetables 212 200 216 8
Total vegetables 952 984 1079 10
Total fruit and vegetables 1923 2138 2143 0
Lifestyle horticulture productionNurseries (m) 788 788 788 0
Turf (m) 110 105 116 10
Cut flowers (m) 81 81 85 5
Total lifestyle horticulture production 979 974 989 2
2008–09 (b) 2009–10 (c) 2010–11 (d)
change 2009–10 to
2010–11Commodity GVP (a) $m $m $m %Total horticulture 2902 3112 3132 1Other field crops – –
Sugarcane (g) 968 1425 1240 –13
Cotton (raw) (h) 325 355 710 100
Other crops (c) 355 255 128 –50
Total other crops 1648 2035 2078 2
Cereal grains – –
Wheat 536 265 450 70
Barley 43 31 37 19
Grain sorghum 356 155 239 54
Maize 60 37 53 43
Other cereal grains 81 89 127 43
Total cereal grains 1075 577 906 57
Total crops 5625 5724 6116 7Total agriculture 10 148 10 274 10 595 3Fisheries (c) (i)Commercial fishing
Crustaceans 161 166 145 –13
Mollusc 9 10 11 10
Finfish 103 108 113 5
Total commercial fishing 273 284 269 –5
15
Table 2 GVP and first-stage processing 2008–09 to 2010–11 (cont.)Recreational fishing 73 73 0
Aquaculture 85 102 105 3
Total fisheries 358 459 447 –3
Forestry and logging (c) (j) 162 171 187 9Total primary industries (farm gate) 10 668 10 904 11 229 3First-stage processing value-added (k)
Meat processing (d) (l) 1547 1552 1536 –1
Sugar processing (d) 406 722 688 –5
Milk and cream processing (d) 155 156 144 –8
Fruit and vegetables processing (d) 166 184 184 0
Flour mill and feed processing (d) 87 47 74 57
Seafood processing (d) 54 69 67 –3
Log sawmilling and timber dressing and plywood and veneer manufacturing (d) 334 353 386 9
Cotton ginning (d) 37 40 81 100
Total primary industries (first-stage processing) 2786 3123 3160 1
Total primary industries 13 454 14 027 14 389 3
(a) GVP is defined as the gross value of commodities produced. It is a measure of economic output. In this publication, GVP relates to the output of primary industry commercial operations only. The GVP is the value of recorded production at wholesale prices realised in the market place (e.g. cattle sold at saleyards, sugarcane at the mill door, fruit and vegetables at the wholesale market). It is derived by multiplying the output from each primary industry by the average wholesale price paid to producers.
(b) ABS final estimates for 2008–09 unless otherwise indicated.
(c) QPIF estimates
(d) DEEDI forecasts
(e) Excludes minor commodities such as honey, beeswax, mohair.
(f ) DEEDI estimate does not include chillies.
(g) Gross value of sugarcane at mill door.
(h) Includes value of cotton seed and lint.
(i) I ncludes catches from both Commonwealth-managed (including Torres Strait, Gulf of Carpentaria and east coast tuna fisheries) and state-managed fisheries.
(j) Australian Bureau of Agricultural and Resource Economics (ABARE) estimates.
(k) See special feature section explaining the new approach for calculating first round processing values.
(l) Includes value of kangaroo meat processed.
(m) Revised DEEDI estimate
16
Volume of production index
A volume of production index describes the movement in production over a period of time relative to a base period. The volume of production index for Queensland’s major agricultural commodities from 1996–97 to 2010–10 is detailed in Table 3 below.
In 2010–11, the production index for agriculture is forecast to be 112. This indicates that Queensland’s agricultural production in 2010–11 is forecast to be 12 per cent higher (on average) than in the base year of 1996–97.
On average, the volume of agricultural production in 2010–11 is forecast to be seven per cent higher than in 2009–10.
Table 3 Volume of production index for Queensland’s major agricultural commodities from 1996–97 to 2010–11
Volume Index (a) 1996–97
1997–98
1998– 99
1999–00
2000–01
2001–02
2002–03
2003– 04
2004– 05
2005– 06
2006–07
2007–08
2008–09
2009–10(e)
2010– 11(f)
Wheat 100 70 98 96 58 46 30 56 59 62 39 48 102 68 78
Grain sorghum 100 69 106 130 115 124 93 129 116 103 89 251 176 101 105
Barley 100 48 75 59 27 40 35 61 42 39 18 33 40 32 33
Major cereal grains 100 67 98 103 72 69 50 80 74 77 51 102 117 76 83
Sugarcane 100 102 98 97 71 78 94 93 97 95 91 86 82 83 83
Cotton lint 100 116 146 173 129 120 50 88 151 130 42 26 93 86 179
Major other field crops 100 104 110 116 86 88 83 92 110 103 78 71 84 83 106
Major fruit 100 112 108 128 159 151 139 137 149 131 167 148 161 192 195
Major vegetables 100 96 96 100 104 108 98 122 104 112 122 110 113 118 130
Major fruit and vegetables 100 105 102 114 132 130 119 130 134 127 145 129 138 156 163
Crops 100 95 105 114 92 92 82 97 105 99 85 90 103 96 112
Cattle calves + live exports 100 115 125 130 140 133 136 131 135 132 140 131 134 130 126
Pigs 100 108 113 111 108 113 123 132 128 135 127 128 115 115 113
Poultry 100 110 108 113 111 116 123 127 138 143 147 156 158 169 170
Sheep and lambs 100 116 119 133 143 111 84 66 68 64 75 69 61 43 41
Major livestock disposals 100 114 122 126 134 129 132 129 132 131 137 131 116 130 126
Milk (all purposes) 100 103 104 106 95 93 90 85 78 73 67 61 64 66 64
Wool 100 103 109 95 95 67 55 50 60 54 54 46 23 41 35
Eggs 100 138 133 162 173 151 135 187 191 260 260 445 266 495 495
Major livestock products 100 105 107 106 100 87 80 78 78 77 77 78 61 82 79
Livestock 100 111 118 121 125 118 119 116 120 116 119 116 100 116 112
Total agriculture (b) 100 102 111 116 107 111 98 105 109 86 100 102 102 105 112
(a) Base of each index is 1996–97 = 100 (e) Estimate
(b) Excludes lifestyle horticulture due to insufficient data (f ) Forecast
(Source: Compiled by DEEDI from ABS and DEEDI data)
The indices of different commodities and groups of commodities were calculated using a simple Laspeyres index with 1996–97 as the base year. The year 1996–97 was chosen as the base year because it is considered to be a year when average production levels were recorded for most of Queensland’s major agricultural commodities.
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Livestock disposals
Cattle and calvesForecastIn 2010–11, the GVP of Queensland’s cattle and calf industry (including cattle and calves sold for slaughter plus live exports) is forecast at $3.31 billion. This is nearly two per cent lower than DEEDI’s final estimate for 2009–10 and the final ABS estimate for 2008–09.
Analysis and discussion
Cattle and calves sold for slaughterThe marginal decrease in GVP can be attributed to a forecast decline in slaughtering over 2010–11. Counterbalancing this to some extent is an expected rise in cattle prices over the same period, as well as heavier expected slaughter weights due to better growing conditions across cattle producing regions as less than 1.5 per cent of Queensland is drought declared.
In 2009–10, around 3.58 million head of cattle and calves were slaughtered in Queensland, two per cent more than 2008–09. This is depicted in figure 3 below.
Figure 3 Queensland cattle and calf slaughterings, 2000–01 to 2010–11 (forecast)
3,200
3,300
3,400
3,500
3,600
3,700
3,800
3,900
4,000
2000–01 2001–02 2002–03 2003–04 2004–05 2005–06 2006–07 2007–08 2008–09 2009–10 2010 –11(forecast)
('000
hea
d)
Throughout 2010–11, slaughter numbers in Queensland are expected to be lower than in the previous year, at approximately 3.406 million head. The anticipated decrease in slaughter numbers in Queensland is attributable to producers retaining cattle for herd rebuilding following prolonged drought and the Gulf Region floods in early 2009.
The average to above-average seasonal conditions across much of Queensland during 2010 has allowed producers to capitalise on ample supplies of feed to undertake restocking.
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The percentage of the female slaughter has since stabilised and is trending normally compared to previous years, returning to 2006–07 levels (as shown in Figure 4 below). The maintenance of cow and heifer slaughter shares in 2009–10 from the previous year suggests more producers have begun herd rebuilding in response to improved seasonal conditions.
Figure 4 Percentage share of total slaughter for cattle and calves and cows and heifers, Queensland, 2000–01 to 2009–10 (Source: ABS)
63 6258 58
64 64 62 61 62
37 3842 42
36 36 38 39 38
62
38
2000–01 2001–02 2002–03 2003–04 2004–05 2005–06 2006–07 2007–08 2008–09 2009–10
% share cattle and calves % share cows and heifers
As shown in Figure 5, beef prices at the beginning of 2010–11 are tracking higher than in the previous year, although nominal prices have not reached the high levels of 2005–06.
Figure 5 Eastern Young Cattle Indicator (EYCI) (Source: MLA)
2 0 0
2 5 0
3 0 0
3 5 0
4 0 0
4 5 0
J u l A u g S e p O c t N o v D e c J a n F e b M a r A p r M a y J u n
c /kg
2010–112009–102008–092007–082005–062002–03
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AustraliaThe total number of cattle and calves slaughtered in Australia in 2009–10 was estimated at 8.53 million head, three per cent lower than 2008–09.
According to Meat and Livestock Australia (MLA), total cattle turn-off is forecast to decline over the next year. This is due to the significant improvement in seasonal conditions across key beef-producing regions, with producers responding by withholding cattle to facilitate herd rebuilding.
According to MLA and the Australian Lot Feeders Association (ALFA) quarterly lot feeding survey, just over 790 000 cattle were on feed at the end of the June quarter, which was the highest quarterly result for the past three years. Numbers for the quarter were up 11 per cent on the previous quarter and six per cent on the corresponding period in 2009.
ExportsFigure 6 Australian exports of beef and veal, 2009–10 (Source: DAFF)
South Korea14%
USA23%
Japan38%
Other7%Other Asia
11%
Taiwan4%
Eastern Europe3%
Exports of Australian beef and veal decreased by three per cent from 2008–09 to 2009–10, when 898 959 tonnes were exported, compared to 922 703 tonnes in 2008–09.
Japan was Australia’s largest export market with shipments of 349 888 tonnes in 2009–10, approximately 13 000 tonnes less than in 2008–09. Japan accounted for 38 per cent of Australia’s beef and veal exports, followed by the United States (23 per cent of Australia’s exports) and South Korea (14 per cent of Australia’s exports). Together, these three countries accounted for three-quarters of Australia’s beef and veal exports.
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Figure 7 Queensland exports of beef and veal, 2009–10 (Source: DAFF)
South Korea15%
USA21%
Japan45%
Other5%
Other Asia7%
Taiwan4%
Eastern Europe3%
In 2009–10, Queensland exported 518 154 tonnes of beef and veal, accounting for 58 per cent of Australia’s beef and veal exports. This was a decrease of approximately 27 000 tonnes from the previous year.
JapanJapan was Queensland’s largest export market, accounting for 45 per cent of Queensland’s beef and veal exports in 2009–10. This was followed by the United States (21 per cent) and South Korea (15 per cent).
According to MLA, the demand and price outlook for Australian beef in Japan is still somewhat clouded by the continued uncertainty surrounding the ability of the Japanese economy to sustain its recovery. MLA believes that initial signals would tend to indicate the recovery is on track following the global financial crisis, and that Japanese consumers’ ability to absorb higher beef prices throughout the remainder of 2010 and 2011 will be the main factor behind any sustained rise in export returns for Australian producers.
South KoreaMLA forecasts that Australia will continue to face increased competition from both US and domestic Hanwoo beef production in the Korean market over the medium term, which they believe will limit the potential to share in the expected growth in Korean beef demand. However, MLA has confidence that Australia’s market share is expected to remain well above the 21 per cent share in 2003, before the BSE-related bans on imports of US beef.
United StatesMLA believes that limited manufacturing of beef supplies, a high Australian dollar and stronger competition for Australian beef from other markets has hamstrung Australian shipments to the US market. They therefore predict that beef exports will be revised back by five per cent below 2009 levels to around 240 000 tonnes, which is 14 per cent below the average for the past five years.
FeedlotsThe number of cattle on feed in Queensland fell consistently between June 2006 and March 2008. However, since June 2008, numbers have gradually increased to reach just over 455 000 head in the June 2010 quarter. This was an improvement from the previous quarter and also from the same time last year.
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In the June 2010 quarter, Queensland’s feedlots were operating at 70 per cent capacity— an improvement on the March 2009 quarter but the same as the June 2009 quarter.
According to MLA, the results for the first half of 2010 have been a mixed period for Australian lot feeders, with the benefits of sustained cheaper feed grains prices being largely offset by higher young cattle prices, the high and rising Australian dollar and continued tough trading conditions for grain-fed beef to Japan.
MLA also believes that the significant improvement in seasonal conditions across a large swathe of eastern Australia has also seen competition for young cattle from re-stockers surge throughout the first six months of 2010.
Queensland’s grain-fed cattle turn-off in the June quarter of 2010 was three per cent greater than at the same time last year. It was also three per cent greater than in the two previous quarters.
Turn-off from feedlots generally accounts for approximately 40 per cent of Queensland’s total slaughter. Changes in the number of cattle on feed therefore have a significant impact on total slaughter numbers and beef production in Queensland.
Figure 8 Queensland cattle on feed and feedlot capacity, March 2001 to March 2010
Cattle on feed in Q ueensland Queensland capacity
Mar
-01
Sep-
01
Mar
-02
Sep-
02
Mar
-03
Sep-
03
Mar
-04
Sep-
04
Mar
-05
Sep-
05
Mar
-06
Sep-
06
Mar
-07
Sep-
07
Mar
-08
Sep-
08
Mar
-09
Sep-
09
Mar
-10
Num
ber o
f hea
d
700 000
600 000
500 000
400 000
300 000
200 000
100 000
0
(Source: Australian Lot Feeders’ Association (ALFA)/MLA, June 2010 national accredited feedlot survey)
Live cattle exportsIn 2010–11, the gross value of live cattle exports is forecast at $105 million. Live cattle export data from the ABS estimated the value of Queensland’s live cattle exports at $109 million in 2009–10.
In 2002–03, live cattle exports from Queensland accounted for almost 25 per cent of Australia’s live cattle exports, reaching a peak of 253 835 head. Since then, the number of live cattle exported has decreased dramatically due to the appreciation of the Australian dollar, competition from South America and increasing freight costs. However, live cattle exports rebounded in 2008–09, reaching 178 307 head, which accounted for approximately 20 per cent of Australia’s live cattle exports.
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According to MLA, after a very good year in 2009, the first half of 2010 has seen Australia’s live cattle export industry enter a period of uncertainty, framed by import permit and weight restriction issues to the Indonesian market. MLA believes that these restrictions and uncertainty have caused a reduction in the number of shipments, which in turn will force further revisions to their outlook with reductions of 16 per cent year-on-year, to 800 000 head.
The Indonesian Government has advised that permits will only be issued for 480 000 head of Australian cattle in 2010, according to MLA. They also point out that there will be an enforcement of a 350 kg live weight limit for cattle into the Indonesian market. Given the distance and associated costs required to get heavy stock to slaughter markets, MLA predicts that the returns to producers will be severely impacted.
Figure 9 Queensland live cattle exports, 1999–2000 to 2010–11
0
50
1 00
1 50
200
250
300
1 999–00
2000–01
2001 –02
2002–03
2003–04
2004–05
2005–06
2006–07
2007–08
2008–09
2009–1 0
201 0–1 1
'000
hea
d
Note: Data for 2010–11 is a forecast
