WA economy can transition from mining boom to dining boom

We believe the Western Australia economy can transition from the mining boom to the dining boom ANZ Bank, Regional Business Banking WA, State General Manager, Stuart Hancock has told a CEDA audience in Perth.

Mr Hancock said that while the “rising incomes and changing diets in places like China and India isn’t new news, the statistics were worth remembering.”

“Australian goods exported to China were $81 billion in 2015, which was up 35 per cent on the year 2010 and the value of Australian agricultural exports to China was $7.7 billion in 2014, which is up 75 per cent on the year 2010,” he said.

“These figures all speak widely to the view agriculture is the next sector to benefit from the Asian Century, especially given our land, our water, our skills and our proximity to the growing region. 

“In WA the agricultural sector is strong, we’ve seen the value of agricultural production increase.

“Overall WA’s contribution to total agriculture production has increased and more than half of WA’s agricultural production is exported overseas.”

Mr Hancock said in Australia we need to rethink the future agricultural opportunity.

“At an industry level it’s about accessing the right markets, getting the right skills and people in place, having better technology and improving the way we tackle research and development,” he said.

“At a farm level it’s about focusing on the three key elements –  innovation, capital and education – the three key elements to having a best-practice agribusiness model. 

“Capital...needs to come from multiple sources. We should consider more innovative ways with how we receive capital investment.

“Innovation is also about marketing and finding new markets. Through having the right connections, investors and plenty of time and patience, farmers can take advantage of the Asia opportunity.

“The last key element to best practice farming is about education. We’re already seeing the outcomes and benefits coming from the next generation of farmers in the last few years.

“They’ve come back to the farm with an education, a new mindset and a fresh perspective on productivity and innovation. They’ve studied business, economics, agronomy and they’ve got increased knowledge on the fundamentals of business.

“They’re interested in sourcing new capital and setting up different ownership structures and they’re also driving on farm innovation with seed varieties, genetics, chemicals.

“The younger generation understands and views farming as a business. They’re keen to apply best practice, using their education to embrace the growth possibilities in the industry and not just doing what their parents did because they’ve been taught that way.

“Overall, farmers who recognise the benefits from doing things differently are ones to take the lead from.

“This is very much in our national interest.”

WA Department of State Development, Special Advisor - Agribusiness Expansion, Rob Delane discussed the need to move from discussion to action.

“Money generally flows where there’s value, not where there’s hubris or rhetoric,” he said.

“It’s got a bit of currency in Australia but I can assure you hubris and rhetoric is not good evidence for business decisions and good evidence of buying a product.

“But there are many opportunities for WA agriculture. We do have the natural resources to underpin the doubling of agriculture production in WA."

Advisian Manager, Kerryl Bradshaw discussed the need to learn from the success and failures in other sectors in trying to grow the agriculture industry. 

“We actually need to leverage off the other sectors that have been able to grab hold of these booms and really invest into them,” she said.

“It doesn’t make sense for us to think we are so isolated.”

CBH Group General Manager, Operations, David Capper said while there were opportunities Australia’s competitive advantage in Asia was starting to “erode.”

“The lowest shipping freight rates that we’ve had in decades has made our world smaller and bought our competitors closer,” he said.