Investment

opportunities
in Australian
agribusiness
and food

Contents
WHY AUSTRALIA

02

AUSTRALIAS AGRIFOOD STORY 

04

STATE BY STATE

12

A GATEWAY TO ASIA

15

INNOVATION CAPABILITIES

19

TOP 25 AGRIBUSINESS AND FOOD

COMPANIES IN AUSTRALIA26
KEY AGENCIES

28

HOW AUSTRADE CAN HELP

29

Disclaimer
This report has been prepared as a general overview. It is not intended to provide exhaustive
coverage of the topic. The information is made available on the understanding that the Australian
Trade Commission (Austrade) and The Australian Government are not providing professional advice.
While all care has been taken in the preparation of this report, the parties do not accept any
responsibility for any losses suffered by persons relying on information contained in this report or
arising from any error or omission in the report. Any reference to companies or investment activities
is for illustrative purposes only and does not constitute an endorsement of those companies or any
investment activity.
Copyright The Australian Trade Commission (Austrade) May 2014.
This report is subject to copyright. All or part of it can be reproduced for bona fida research or
public policy with appropriate acknowledgement of the Australian Trade Commission. Requests and
inquiries concerning reproduction should be addressed to Austrade, GPO Box 5301, Sydney NSW
2001 or by email to info@austrade.gov.au

CONTENTS | Investment opportunities in Australian agribusiness and food

Australia.
Safe. Smart. Sustainable.
As an island continent with strong biosecurity regulations, Australias
agribusiness and food sector is renowned for clean, green and
safe production.
Leveraging established connections with Asia, Australia provides investors
with unparalleled opportunities to capitalise on the demand from fast-growing
consumer markets for healthy, premium and convenient food products.
As a major agricultural producer Australia offers potential investors access to
high quality raw inputs and the skills and capabilities needed to undertake
world-class research and development (R&D).

Why
Australia

Unparalleled opportunities
Australia is in its 23rd consecutive year of annual economic growth. Investors in
the agribusiness and food industries will find:
a large export-oriented agricultural
sector, with strong growth in food,
beverage and commodity exports
to Asia
a stable and reliable long-term
supplier of fresh produce offering
counter-seasonal availability to
the northern hemisphere
diverse climates and growing
conditions, ranging from
tropical to temperate and cool
environments, allowing varied
production systems from small
specialist farms for niche
products to large scale grazing
and cropping
an excellent reputation for safe,
sustainable and healthy foods,
supported by a transparent
food chain and highly
effective regulation

an ethnically and culturally diverse

population providing an ideal test
market for new food concepts
research institutions and
companies renowned for
excellence in agriculture
and food R&D, creating
opportunities for partnerships,
particularly for investors with
commercialisation expertise
a willingness to embrace new
technologies and manufacturing
processes to increase productivity
growing recognition of the need
for international partnerships,
industry consolidation and
reconfiguration of supply chains
to achieve globally competitive
economies of scale.

Investment opportunities in Australian agribusiness and food | WHY AUSTRALIA 03

Australias agrifood story

DELIVERING INNOVATIVE
AND PREMIUM PRODUCTS
FOR FAST-GROWING
GLOBAL MARKETS
Although Australia accounts for less
than three per cent of global food
trade, our advanced agricultural
sector produces a healthy surplus.
It is enough to feed a population
three times our own.
Australias produce is exported
world-wide: from traceable raw
commodities such as wheat and
beef, to sophisticated processed
goods such as infant nutritional
formula, wines, confectionery
and cheese.
Australia has a strong history of
agricultural and food R&D that
has fostered cutting-edge farming
techniques, technologies and a
sophisticated use of biotechnology.
This tradition is built on:
success in farming the worlds
driest inhabited continent,
through technology innovation
and our ability to adapt
production systems

THEY CHOSE AUSTRALIA:

SHANGHAI ZHONGFU

Through Australian subsidiary Kimberley Agricultural Investments (KAI),
Chinese firm Shanghai Zhongfu is investing up to A$700 million over six
years on a greenfield agricultural development near Kununurra, Western
Australia (WA).
KAI will lease and develop 13,400 hectares of irrigated farmland cleared
through the Ord-East Kimberly Expansion Project, which has already
expanded the area of agricultural land in the Ord River catchment to at least
28,000 hectares with a further 14,000 under consideration for expansion.
Shanghai Zhongfus investment will substantially expand the sugar
industry in WA and includes a proposal for a A$425 million sugar mill that
will process four million tonnes of cane and produce 500,000 tonnes of
export sugar crystal annually.
The companys investment in the Ord catchment opens up the potential
of the region for cultivation of other crops including sorghum, sandalwood
and horticultural products.

excellent agricultural R&D

Australias plant, animal and
agricultural scientists rank among
the best in the world
expertise and strength in human
health and nutrition research
robust regulatory protection
with consistent standards in
quarantine, food safety and
food labelling.

04 WHY AUSTRALIA | Investment opportunities in Australian agribusiness and food

To prepare the sector for a new

phase of growth, the Australian
Government is shaping a policy
environment that will open
opportunities for investors looking to
feed the future.
Among initiatives to improve
agricultural competitiveness,
sustainability and productivity
Australia-wide, the government
is exploring Northern Australias
potential as a food bowl, encouraging
private sector investment and
innovation to assist in developing
the regions infrastructure to facilitate
future agricultural production.

KEY DRIVERS FOR

SAFE, SMART AND
SUSTAINABLE
INVESTMENT
From lab to paddock to plate
Since 1960 Australian farmers
have been at the forefront of
developments in agricultural
productivity, tripling their production
and quadrupling the real gross value
of their produce.
Australian producers deliver
high quality and safe food to the
world, underpinned by a diverse
agricultural sector, supportive
government policies and innovative
R&D institutions.

Australias food processing industry

hosts a number of corporate global
centres of excellence setting the
standard by which other locations
are measured.
Australias agribusiness and food
industries are poised for growth as
they seize opportunities to supply
niche, premium food products to
these rapidly expanding markets.
A gateway to Asia

It is well known that

Australia has a clean
environment, and this
is important for us to
ensure our products
are fresh and of the
best quality.
Mr Jay Jeong,
Managing Director,
CJ NutraCon1

Australias connections through

geographic proximity and trade,
investment and cultural links to the
fast growing Asia-Pacific region, offer
cost-effective service compared
to competitors in Europe and
North America.

Asia-Pacifics agrifood
innovation hub
Key to our flourishing industries are
world-leading research institutions
and agricultural science companies.
Our agricultural industry is
characterised by cuttingedge farming techniques and
technologies, such as precision
farming using laser levelling
and satellite driven machinery,
sustainable production processes
and sophisticated plant and animal
genomic research.

BY 2050
world food consumption
is expected to be

75%

higher than it was in 2007

more than

40%

of this increased demand

will come from China and
13% from India2

Investment opportunities in Australian agribusiness and food | WHY AUSTRALIA 05

A REPUTATION FOR QUALITY FOOD

Australian food is regarded as being among the most safe, sustainable, healthy and highest quality in the world.

Attribute

Australia

Malaysia

US

China

France

Brazil

Canada

Safe

39

17

34

13

31

19

36

Sustainable

31

15

19

13

20

21

25

Healthy

30

13

21

12

22

18

26

High quality

37

14

41

12

42

18

34

Expensive

21

10

39

41

18

24

Good taste

27

18

28

20

30

27

24

Q5004: Which of the following attributes do you associate with food products from each of the following seven countries?
Source: Reputation Institute, 3 September 2013.

THEY CHOSE AUSTRALIA:

CAMPBELL SOUP COMPANY


Campbell Arnotts, a division of the Campbell Soup Company (USA),
has invested more than A$400 million in the past decade to upgrade
its existing Australian facilities with state-of-the-art manufacturing
technologies.
One third of this was spent on a new state-of-the-art biscuit production
line in Brisbane, Queensland, based on Australian design technology, with
additional funds invested in automating existing production.
The automation has led to improved efficiencies, enhanced product quality
and safer handling procedures. The Brisbane site produces more than 40
per cent of Arnotts biscuits found in Australian homes and this investment
ensures its ongoing competiveness.

06 WHY AUSTRALIA | Investment opportunities in Australian agribusiness and food

Australia.
Vibrant.
Competitive.

Sector
at a glance
Australias growing agribusiness and food sector offers unique opportunities for investors looking to expand food
and fibre production as well as add value to downstream processing industries.

$162.3m
$548.3m

300,600
222,100

TOTAL : $710.6m

TOTAL : 522,700
EMPLOYMENT

BUSINESS R&D EXPENDITURE

(persons: full time & part time)

(A$ million)

$21.8b
$17.2b

TOTAL : $38.5b

EXPORTS
(A$ billion)

$62.5b
unprocessed
processed

$92.0b

TOTAL : $154.5b
TURNOVER
(A$ billion)

3.93%

4.94%

in 12 months

in 12 months

GROWTH

GROWTH

Sources:
EMPLOYMENT - ABS Catalogue 6291.0.55.003 Labour Force, Australia, Dec 2013. TURNOVER - ABS Catalogue 8155 Australian Industry, May 2013.
R & D EXPENDITURE - ABS Catalogue 8104.0 Research and Experimental Development, Businesses, Australia 2011-12. EXPORTS - Based on DFAT,
Trade in Primary and Manufactured Products, Australia 2012-13

THEY CHOSE AUSTRALIA:

HAKUBAKU

Hakubaku, Japans largest dried noodle manufacturer, invested A$13 million to build a processing facility in Australia
after searching the world for the best wheat for making Japanese noodles.
Hakubaku Australia started producing noodles at its plant, the only one of its kind in Australia, in Ballarat, Victoria, in
1998. Producing noodles in Australia helps the company address strict Japanese import quotas on unprocessed grain
while still enjoying the advantage of the unique properties of the Australian wheat variety, Rosella.

08 WHY AUSTRALIA | Investment opportunities in Australian agribusiness and food

Composition of Australias
agrifood exports (A$ billion)
Investors can leverage Australian expertise and experience in finding pathways to market for a diverse range of agrifood
exports, helping to secure new customers in one of the worlds most dynamic regions.

Unprocessed
Wheat
Cotton
Wool and other animal hair
Oil seeds and oil fruits
Barley
Vegetables
Live animals
Fish and crustaceans
Fruit and nuts

Rice

Processed
Meat

Beverages (alcoholic and non-alcoholic)

Sugars and sugar confectionary
Animal feed
Milk cream, whey and yoghurt
Sauces, soups and seasonings
Cheese and curd
Cereal preparations
Butter and margarine
Chocolate and cocoa
0

Source: Based on DFAT publication Trade in Primary and Manufactured Products, Australia 2012-13

We researched the white wheat available in the major grain growing areas of the
world, visiting Canada, America and Australia. After many trials we found that certain
varieties of Australian wheat stood out as the most suitable for us, as the finest and
most consistent in quality.
Masaaki Nagasawa, Director, Hakubaku Australia 3

Investment opportunities in Australian agribusiness and food | WHY AUSTRALIA 09

Top export destinations

for Australian agrifood (A$ billion)
Australias strategic position and well-established trade relationships benefit investors seeking to access fast-growing
markets from a stable base.

1. CHINA
$7.3
11. UK
$0.6

4. KOREA
$2.4

$4.1

10. TAIWAN
$0.7
8. SINGAPORE
$1.0

5. US
$2.3

2. JAPAN

$0.9

9. HONG KONG

$2.6
3. INDONESIA

6. NEW ZEALAND
$1.4

$1.0

7. MALAYSIA

Source: Based on DFAT publication Trade in Primary and Manufactured Products, Australia 2012-13

10 WHY AUSTRALIA | Investment opportunities in Australian agribusiness and food

Australia.
Clean.
Green.

State by state
From grains to dairy and meat to
seafood, Australias varied growing
environments provide investment
opportunities for a broad range of
produce and products.
Unique industries exist in each
Australian state and territory,
providing a broad range of
investment opportunities across the
agribusiness and food value chain.
New South Wales is the base for
highly diverse agrifood companies,
with capability in cereals, pulses,
oilseeds, food processing and fruit
and vegetables. The state is at the
forefront of research and application
in functional foods, nanotechnology,
new processing technologies
(irradiation, high pressure
processing, low-energy electron
beam processing, pulsed electric
field processing), smart logistics
control and e-commerce.
Victoria accounts for more than
two thirds of Australias total dairy
production and hosts companies
undertaking 40 per cent of the
countrys food processing R&D. Its
strong manufacturing base underpins
opportunities in areas such as
specialist dairy food as well as high
value-add food processing for meat,
cereals and horticulture produce.

12 STATE BY STATE | Investment opportunities in Australian agribusiness and food

Queenslands climatic diversity

helps it produce a range of
agricultural products. Crops include
bananas, mangoes, strawberries,
avocados, sugar cane and grains,
including wheat and sorghum.
The state is Australias largest
beef producer and a major meat
processor. Queensland has a
strong biotechnology sector that
supports manufacturing of foods with
enhanced nutritional health benefits.
South Australia is renowned for
premium food and wine, wheat,
barley, beef, lamb, poultry and
seafood. South Australian businesses
enhance and add value to a broad
range of horticultural and grain
products and the state is the home
of the Waite Institute, which has
the largest cluster of agricultural
researchers in Australia.
Western Australia has a varied and
efficient agricultural sector reflecting
the states diverse geography, able
to accommodate the production
of premium seafood, cattle, grains,
oilseeds, sheep meat and wool. The
state provides the raw materials for a
rapidly growing range of processed
exports, including wine, ice cream,
barley malt, noodles and fine leather.
It is also a major world supplier of
lobsters, prawns and pearls.

8
SINGAPORE
$1.01b

$0.95b

HONG KONG

$2.62b
INDONESIA

6
NEW ZEALAND
$1.45b

$1.04b

MALAYSIA
7

Tasmanias
affordable
TOP EXPORT
DESTINATIONSland and
2012-13water
A$000 are some of the
abundant
features that underpin its reputation
11
for world class agriculture. Key UK
sectors for the state include wine,$0.59b
dairy, red meat, fruit, vegetables,
poppies, aquaculture and wild
fisheries. Tasmania is also acclaimed
for its superfine wool. The state
is attracting international interest
in its Sense-T project, which
integrates various data sources to
enable businesses, governments
and communities to make better
management decisions.
The Northern Territory is
geographically close to growing
Asian markets and has large pastoral
operations. It has a long history of
supplying live cattle for export and
domestic markets. Large mango
farms are situated in the north along
with other tropical horticulture crops
such as melons, Asian vegetables
and bananas. Table grapes and
dates are grown in central Australia.
Opportunities exist for investment in
aquaculture for prawns, barramundi
and sea cucumbers along the
northern coastline, as well as
in premium meat and skins for
international export markets.

Food exports by state

of origin (A$ million)
1
CHINA
$7.30b

4
KOREA
$2.36b

JAPAN
$4.18b

10
TAIWAN

Unprocessed
TOTAL

$0.70b

8
SINGAPORE
$1.01b

5
US
$2.62b

Processed

VICTORIA

SOUTH AUSTRALIA

$0.95b

2 972

HONG KONG

2 123

4 958

2 191

$2.62b
INDONESIA
3

QUEENSLAND NEW ZEALAND

TASMANIA

$1.45b

$1.04b

1 657

MALAYSIA
7

4 456

192

NEW SOUTH WALES

2 193

369

NORTHERN TERRITORY

2 897

187

WESTERN AUSTRALIA
4 371

683

Unprocessed
TOTAL
VICTORIA

Processed
SOUTH AUSTRALIA

Based on ABS Merchandise Trade data, DFAT STARS

or
2 972 database. Totals
2 123
4 958do not include fibre exports
confidential items of trade.

QUEENSLAND
1 657

GM FOODS

4 456

NEW SOUTH WALES

2 191
TASMANIA

192

369

NORTHERN TERRITORY

Australian states adopt different positions

on the2 897
cultivation of
2 193
187
genetically modified organisms (GMOs). While a number of states allow
GM crops to be grown under carefully regulated conditions, TasmaniaTOTAL
WESTERN AUSTRALIA
has an indefinite moratorium on the commercial release of GMOs,
except for non-commercial scientific
683Australia has extended
4 371trials. South
its moratorium until 2019.

TOTAL

Investment opportunities in Australian agribusiness and food | STATE BY STATE 13

THEY CHOSE AUSTRALIA:

MONSANTO
The Monsanto Company, headquartered in the
United States, began operations in Australia in
1928 with a focus on commodity chemicals before
expanding into agricultural products.

THEY CHOSE AUSTRALIA:

FERRERO
Ferrero established its manufacturing plant in
Lithgow, NSW in 1974 and today the company
is Australias fourth-largest confectionary
manufacturer. We came here when globalisation
was not even in the dictionary, on pure
entrepreneurial instinct, says Rocco Perna,
Ferrero Australia Managing Director.
Ferrero chose Lithgow as its manufacturing centre
because of the bracing climate at 1,000 metres
above sea level and the company tradition of
basing such facilities in smaller communities.
In 2013, the Ferrero Group announced an
investment of A$70 million to set up a hazelnut
plantation of one million trees on 2,000 hectares
in the Riverina region in New South Wales. This
long-term investment will enable the company to
source a supply of fresh, high-quality nuts locally.

Monsanto Australia recently opened a purpose-built

research facility in Toowoomba to ensure cotton
growers continue to benefit from its successful
insect-tolerant and herbicide-resistant cotton.
Australias significant cotton production, its
reputation in agricultural research and the
countrys pool of talented agricultural scientists
made Australia the ideal choice for this type
of investment.

Developments in biotechnology
have underpinned the (Australian)
cotton industrys well documented
productivity and sustainability
gains. This impressive performance
was driven by the industrys
commitment to innovation, rapid
adoption of new technology and
crop management practices.
Daniel Kruithoff, Managing Director, Monsanto Australia 4

Sales of Ferrero products in Australia and New

Zealand are worth A$150 million a year, with
additional sales of Australian manufactured
products in Asia worth up to A$20 million a year.

14 STATE BY STATE | Investment opportunities in Australian agribusiness and food

A gateway to Asia
Connected to strong
growth markets
Australias food exports reached a
10-year high in 2012-13. While the
figure is an endorsement of the
strength of Australias food industry,
it is just a small taste of trade to
come if Australia can achieve its
goal of increasing its share of the
premium food and beverage market.
By 2030, Asia will be home to 66
per cent of the global middle class,
compared with 28 per cent today.

The Australia and New Zealand

Banking Group in 2012 predicted
Australias food producers could
achieve up to A$1.7 trillion in
additional revenues from agricultural
exports by 2050.
Asias increasing appetite for safe,
healthy and high-quality foods and
retail-ready ingredients complements
Australias strengths as a clean and
green food producer and its record
as a regional supplier.

AGRIFOOD TO CHINA
China is Australias most valuable export destination for agrifood, with
the value of exports to China totalling more than A$7.3 billion in 2012-13.
Major products were wool, cotton, grain (mostly wheat), meat, wine
and dairy.
Australia and China are currently negotiating a Free Trade
Agreement. As an interim measure, Memoranda of Understanding
(MoUs) are becoming an increasingly popular vehicle for opening
commercial opportunities.

In future we will see

more and more food
businesses creating
goods and farmers
planting crops that are
intended solely for Asia
from the outset.
This will require
innovation that starts
behind the farm gate
and continues across
every process in the
supply chain, to new
packaging, marketing,
and business processes.
Peter Schutz, Chairman
Food Innovation Australia Limited 5

Examples include:
an MoU between South Australia and Fujian province in south-east
China signed in 2012 focused on trade and investment in premium
food and wine
a new agriculture agreement between Australia and China signed in
2013 to expand cooperation in science, investment and trade on a
range of agricultural products.

Investment opportunities in Australian agribusiness and food | A GATEWAY TO ASIA 15

FREE TRADE
AGREEMENTS
Australia has seven Free Trade
Agreements (FTAs) currently in force,
with countries covered by these
FTAs accounting for 28 per cent of
Australias total trade. This coverage
will increase significantly as recently
concluded FTAs with South Korea
and Japan are brought into force.
A further eight FTA negotiations are
being undertaken - four bilateral
FTAs and four plurilateral FTAs.
These FTAs will continue to help
exporters from Australia access
new markets and expand trade
in existing markets. The countries
covered by these negotiations
account for a further 45 per cent of
Australias trade.

FTAs in force

FTAs under negotiation

ASEAN-Australia-New
Zealand FTA

Australia-China FTA

Australia-Chile FTA
Australia-New Zealand Closer
Economic Relations
Australia-United States FTA
Malaysia-Australia FTA
Singapore-Australia FTA
Thailand-Australia FTA
FTAs signed
(but not yet in force)
Korea-Australia FTA
FTAs concluded
(but not yet in force)
Japan-Australia Economic
Partnership Agreement

Australia-Gulf Cooperation
Council (GCC) FTA
Australia-India
Comprehensive Economic
Cooperation Agreement
Indonesia-Australia
Comprehensive Economic
Partnership Agreement
Pacific Agreement on Closer
Economic Relations (PACER) Plus
Regional Comprehensive
Economic Partnership (RCEP)
Trade in Services Agreement
(TiSA)
Trans-Pacific Partnership
Agreement (TPP)

THEY CHOSE AUSTRALIA:

KAGOME
Kagome Australia, a subsidiary of Japans Kagome Group, is investing
A$21 million to expand its tomato processing plant in Echuca, Victoria.
The investment will help the company to increase supply capability and
target export markets in Asia.

TEN of Australias
top 12 export markets
are in ASIA

Kagome is Australias largest tomato processing company. Following the

upgrade, the company estimates it will replace 7,000 tonnes of imported
tomato paste with local product, worth about A$6.5 million.

We are excited with the prospect of being

Paddock to Plate capable. The Kagome Group
chose Victoria because of its capabilities and
reputation of being one of the best safe food
suppliers in the world.
John Brady, CEO of Kagome Australia 6

16 A GATEWAY TO ASIA | Investment opportunities in Australian agribusiness and food

PACER Plus: Australia, Cook Islands, Kiribati,

Marshall Islands, Micronesia, Nauru, New
Zealand, Niue, Palau, Papua New Guinea,
Samoa, Solomon Islands, Tonga, Tuvalu
and Vanuatu. RCEP: ASEAN members and
Australia, China, India, Japan, Republic of
Korea and New Zealand. TiSA: Australia, US
and EU, with a subset of WTO members. TPP:
Brunei Darussalam, Canada, Chile, Japan,
Malaysia, Mexico, New Zealand, Singapore, the
United States and Vietnam

A sophisticated logistics network

Australias agrifood sea and land freight network

ASIA

Darwin

Ports: total value

(A$)

Townsville

> 100 million

> 500 million

Mackay

> 1 billion

Gladstone

> 5 billion

Brisbane
Geraldton

> 10 billion

Major freight

Perth
Fremantle
Albany

Esperance

Wallaroo
Port Lincoln

Port Adelaide

Newcastle
Adelaide
Portland

Sydney

Port Kembla

Port Giles

Geelong

Sea freight

Melbourne

Land freight

Australia has a sophisticated

logistics network that offers
extensive, frequent and timely air
and sea services to Asia.
A strong outbound shipping capacity
services Asian markets, with more
than 10 companies offering weekly
shipping services to China.
Reduced transport times are
particularly important for fresh
produce. For example, table grapes
can be picked, packed and air
freighted to markets in Asia within
48-60 hours or sent by sea within
16 days.

THEY CHOSE AUSTRALIA:

LONGLEY FARM
British dairy company, Longley Farm, has invested more than A$100
million in a high-tech milk processing facility in the town of Casino,
New South Wales, developing an unique export business based on a
patented fast-freeze technology.
Under local subsidiary Fast Freeze International, the company is
exporting 10kg blocks of high-quality frozen cream for use by premium
ice cream manufacturers, patisseries and bakeries in the Middle East,
south-west Asia and Japan. The plant also produces yoghurt concentrate
and skim milk powder.
The plant is located in the NSW north coast dairying region and is
supplied with premium milk high in fat and cream from Jersey cows.

Investment opportunities in Australian agribusiness and food | A GATEWAY TO ASIA 17

Australia.
Innovation.
Quality.

Innovation
capabilities
Australias strong agricultural R&D networks link universities, government and
specialist research centres in fields as diverse as plant and animal health,
sustainable agriculture and genetic resources. This opens up many collaboration
and technology investment opportunities for potential offshore partners.

Research excellence
The Commonwealth Scientific and
Industrial Research Organisation
(CSIRO), Australias national science
agency, is among the worlds most
esteemed scientific institutions.
CSIRO:
is in the top one per cent of global
research institutions in 15 of 22
research fields
is in the top 0.1 per cent in four
research fields agricultural
sciences, plant and animal
science, environment and
ecology, and geosciences
is actively involved in over 100
collaborative agreements each
year with over 80 countries
outperforms similar organisations
in Europe and is a regional
and national leader in terms of
research impact, as measured by
research paper citations7.

CSIRO aims to deliver sustainable

productivity growth and value to
food and fibre production through
excellence in the biological and
food sciences, creating profound
impact across Australias agricultural
value chain.
It draws on world class expertise
from across CSIRO, in partnership
with a wide variety of R&D partners
and collaborators including large
corporations, technology-focused
SMEs, government departments,
universities, other research
organisations, Cooperative
Research Centres and Rural
Development Corporations.
CSIRO also manages important
national research facilities such as
the world-class Australian National
Animal Health Laboratory (AAHL) in
Geelong, Victoria.

Australias
CSIRO ranks in

TOP 1%

of world scientific
institutions in 15
of 22 fields*

5 Australian

universities
are in the worlds

TOP 100.

Ranked 4th
globally
#

* Source: CSIRO Science Health and Excellence Report 2012-13. #Source: Times Higher Education ranking for 2013-14, Top 400

Investment opportunities in Australian agribusiness and food | INNOVATION CAPABILITIES 19

AUSTRALIAS TOP SCIENTIFIC RESEARCH FIELDS

Global Average

Multidisciplinary

1.44

Materials Science

1.42

Plant & Animal Science

1.42

Physics

1.39

Microbiology

1.35

Agricultural Sciences

1.34

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

The relative impact of Australian research publications by research field, as measured by citation rate
in the Thomson ISI Essential Science Indicators database, 2013.

THEY CHOSE AUSTRALIA:

BAYER
Bayer CropScience, a division of Germanys The Bayer Group, has been
operating in Australia for over 90 years.
Regular investment in Australian production and research infrastructure
underpins Bayers agricultural business operations, with the company
operating two factories near Brisbane and Perth that ensure year-round
supply of products exported around the Asia-Pacific.
Bayers research partnerships with CSIRO, the Grains Research &
Development Corporation and Horticulture Australia Limited form an
integrated part of the companys global research efforts.
Bayer recently opened a A$14 million state-of-the-art Wheat and
Oilseeds Breeding Centre at Longerenong College, near Horsham,
Victoria the first of its kind in Australia.
The centre will develop new wheat and oilseeds varieties with higher
yields and productivity improvements tailored for the Australian
environment.

20 INNOVATION CAPABILITIES | Investment opportunities in Australian agribusiness and food

SELECTED RESEARCH LOCATIONS

CSIRO agriculture and food research

Australian Export Grains Innovation Centre, Western Australia

An independent source of Australian grain quality information, analysis and
technical support to agribusiness and customers. The centre supports the
trade and use of Australian grains around the world and carries out grain
quality, economic and export market research.

Queensland Alliance for

Agriculture and Food Innovation,
Queensland
Established to significantly improve
the productivity, competitiveness
and sustainability of tropical and
subtropical food, fibre and agribusiness industries. It comprises
three centres which undertake
research into plant science, animal
science and nutrition and food
sciences.
Australian Institute of Food
Science and Technology, New
South Wales
A national not-for-profit industry
body which represents all sectors
of the food science and technology
industry. Its annual national
convention is Australias major
national food technology conference,
attracting industry, research and
government organisations from
Australia and overseas.

South Australian Research and

Development Institute

Centre of Food Innovation,

Tasmania

AgriBio, Centre for

AgriBioscience, Victoria

The Institute, known as SARDI, is

the South Australian Governments
principal research institute,
where scientists work to position
Australias agricultural, food,
aquatic and bioscience industries
as internationally competitive and
ecologically sustainable. SARDI
addresses these priorities, as well as
barriers to growth, through programs
assessing challenges such as food
security, resource and climate
adaptation, biosecurity and enabling
technologies.

The Centre is a partnership

between the Defence Science and
Technology Organisation (part of the
Australian Department of Defence),
University of Tasmania and CSIRO.
Planned new testing facilities and a
technology demonstration site aim to
help diversify Tasmanias economic
base through increased exports of
high-quality, nutritious, value-added
food products.

AgriBio employs scientists

specialising in plant and animal
biosciences, biosecurity, bioprotection and soil sciences. It aims
to improve productivity, fight disease
and reduce negative environmental
impacts.

Investment opportunities in Australian agribusiness and food | INNOVATION CAPABILITIES 21

COOPERATIVE
RESEARCH CENTRES

RURAL RESEARCH AND

DEVELOPMENT CORPORATIONS

The Cooperative Research Centre

(CRC) program supports the
adoption and commercialisation
of research through financial
support for end-user-driven
research collaborations. Since 1991,
the Australian Government has
awarded over A$1billion to 53 CRCs
undertaking food industry research.

Rural Research and Development Corporations (Rural RDCs) are partnerships

between the Australian Government and industry. They aim to provide industry
with the innovation and productivity tools to compete in global markets.

Relevant CRCs include:

Advanced Manufacturing,
Victoria - established in 2008, has
received funding of A$35 million
Australian Seafood, South
Australia - established in 2007,
allocated A$35.5 million over
seven years
High Integrity Australian Pork,
South Australia - established in
2011, has received A$19.9 million
over eight years
Sheep Industry Innovation, New
South Wales - established in
2007, A$35.5 million in funding
over seven years
Dairy Futures, Victoria established in 2010, funding of
A$27.7 million over six years

Rural RDC

Headquarters

Australian Egg Corporation Ltd

New South Wales

Australian Meat Processor Corporation

Horticulture Australia Ltd
Australian Wool Innovation
Cotton R&D Corporation
Meat & Livestock Australia
Australian Livestock Exports Corporation
Australian Pork Ltd
Fisheries R&D Corporation

Australian Capital
Territory

Grains R&D Corporation

Rural Industries R&D Corporation
Sugar Research Australia

Queensland

Forest and Wood Products Australia

Victoria

Dairy Australia Ltd

Grape and Wine R&D Corporation

Future Farm Industry, Western

Australia - established in 2007,
A$34.1 million in funding over
seven years
Invasive Animals - Pests,
Australian Capital Territory established in 2012, A$19.7 million
over five years
Plant Biosecurity, Australian
Capital Territory - established in
2012, A$29.7 million over six years
Poultry, New South Wales established in 2010, A$27 million
over seven years.

22 INNOVATION CAPABILITIES | Investment opportunities in Australian agribusiness and food

South Australia

AUSTRALIAN RESEARCH
COUNCIL
The Australian Research Councils
Industrial Transformation research
program funds research hubs and
training centres focusing on food
and manufacturing in the 2013-14
funding round.
The Industrial Transformation
Priorities focus on future food
storage; food processing;
manufacturing capabilities;
product opportunities and other
food- related research.

The Centre of Excellence in Plant

Cell Walls (2011-2017) is a A$32
million collaboration between
the Universities of Adelaide,
Melbourne and Queensland
in partnership with the South
Australian State Government and
seven international institutions.
The Centre of Excellence in Plant
Energy Biology is a cutting edge
research centre focused on better
understanding the way in which
plants produce and use their
energy systems in response to
environmental change.

The Centre of Excellence for

Integrative Legume Research
is an internationally-renowned
research network of plant
scientists conducting research
into legumes and other plant
species. Research into plant
physiology, molecular and cell
biology is providing fundamental
insights into developing enhanced
food production, agricultural
sustainability, environmental
quality and products for
human health.

Corporate R&D excellence

AGRIBIO, CENTRE
FOR AGRIBIOSCIENCE
ALLIANCE WITH DOW
AGROSCIENCES
AgriBio is a A$288 million worldclass facility for agricultural
biosciences research
and development.

In addition to other commercial

partnerships, AgriBio is undertaking
a large-scale R&D collaboration
in agricultural biotechnology with
Dow AgroSciences. Through this
and other research partnerships,
Australian grain producers
gain access to world-leading
technology and innovations, with
global applications.

A joint initiative of the Victorian

Government and La Trobe University,
AgriBio brings together world-leading
scientists in the fields of plant and
animal biosciences, biosecurity,
bioprotection and soil sciences.

VICTORIAN ALLIANCE
WITH FONTERRAS DAIRY
FOR LIFE INNOVATION
CENTRE

AgriBio supports Australias

agricultural sector through
research to:
improving productivity
fighting disease
reducing environmental impact.

Fonterra operates innovation

centres around the world and in
2009 opened a dedicated R&D
facility in Melbourne, Victoria. The
centre focuses on innovations
to meet consumer demands for
healthy, nutritional, convenient
and tasty products as well as new
processing technologies.

PLANTIC TECHNOLOGIES
Plantic Technologies innovative
bioplastic technology is an outcome
of research undertaken by the CRC
for International Food Manufacture
and Packaging Science. The
company was incorporated in
Victoria in 2001 for the purposes
of acquiring, developing and
commercialising intellectual property
developed by the CRC.
Plantic produces corn-based
biodegradable and renewable
alternatives to conventional plastics,
winning support from leading food
producers like Cadbury, Mars
and Nestl to supply sustainable
packaging solutions.

Investment opportunities in Australian agribusiness and food | INNOVATION CAPABILITIES 23

Australias R&D tax incentive

Australia offers a generous R&D
tax offset that benefits eligible
businesses and eligible R&D and
innovation-based activities.

WHO IS ELIGIBLE
The types of entities eligible for the
R&D Tax Incentive are:
Companies incorporated in
Australia (and are not tax-exempt
entities)

Agriculture R&D
Examples include:
New or adapted production
processes for crops and livestock
in alternative regions and climates
Novel fertiliser and agricultural
chemical developments
Alternative techniques in animal
and plant breeding to achieve
improved yields and efficiencies.

Foreign companies that are

Australian residents for tax
purposes

Food processing R&D

Foreign companies carrying on

business in Australia through
a Permanent Establishment
where Australia has a double
tax agreement with the foreign
companys country of residence.

Development of new or improved

product formulations. Specific
attributes to be improved could
include stability, quality, flavour,
texture and form

Examples include:

WHAT QUALIFIES
Two types of R&D activities are
eligible under the R&D Tax Incentive:
core and supporting R&D activities.

Development of new and

improved food processing
technology. For example, this
could include new packaging
technology, new robotic
technology, and new retorting
technology.

How the tax incentive works (as of 1 July 2014)

Refundable
Tax Incentive
Aggregated Turnover
<$20m
if in tax loss
= 43.5% cash

or

if tax payable
= 15% tax benefit

Non - Refundable
Tax Incentive
Aggregated Turnover
>$20m
Any tax position
= 10% tax benefit

For example, if a company incurs A$1m R&D expenditure

A$435,000
cash

A$150,000
credit to tax

24 INNOVATION CAPABILITIES | Investment opportunities in Australian agribusiness and food

A$100,000
credit to tax

International R&D collaborations

Sense-T - a partnership program
between the University of
Tasmania, CSIRO, the Tasmanian
Government and IBM. Sense-T
is a world-first economy-wide
intelligent sensor network
that integrates different data
sources. Through user-friendly
applications drawing on realtime data, Sense-T assists
producers to improve yield quality
and productivity, reduce input
costs, improve environmental
sustainability and demonstrate
food provenance and safety.

Limagrain - French multinational

Limagrain Crales Ingrdients,
CSIRO and the Grains Research
and Development Corporation
have formed a A$12.5 million
research partnership, Arista Cereal
Technologies.
Using technology developed
by Limagrain and CSIRO, Arista
undertakes research into wheat
that is high in starch-resistant
dietary fibre, containing high levels
of amylose.

Novozymes Biologicals
Australia
is a joint venture between
Novozymes Biologicals and
the GRDC. The company has
commercialised phosphate
solubilising technology in the
form of TagTeam inoculant for
legume crops and JumpStart for
use in wheat and canola crops.
These inoculant technologies
were developed with research
partners overseas and in Australia.
They include the Australian
National University, CSIRO,
Flinders University and the
South Australian Research and
Development Institute.

THEY CHOSE AUSTRALIA:

NESTL HEALTH SCIENCE

Nestl Health Science invested A$17 million to expand its capabilities
in Australia, upgrading its Tongala, Victoria factory with a liquid
manufacturing unit to produce ready-to-drink medical supplements.
The state of the art factory is part of the companys plans to develop a
new industry spanning traditional nutrition and pharmaceutical industries.
The aim is to produce science-based personalised nutrition solutions
to help prevent disease and manage conditions such as diabetes, renal
disorders and malnutrition.

This significant investment by Nestl Australia

to extend its Tongala factory into a bigger
production hub is a huge vote of confidence by
the company in the region.
Paul Bruhn, Regional Business Head
Nestl Health Science in Asia, Oceania and Africa 8

Investment opportunities in Australian agribusiness and food | INNOVATION CAPABILITIES 25

Top 25

agribusiness and food

companies in Australia

Company
Name

Revenue
(A$b)

Ownership

Detail

Coca-Coca
Amatil

5.2

Australia

Lion

5.1

Japan

GrainCorp

4.5

Australia

Olam
Investments
Australia

4.1

Singapore

Cargill

3.7

United
States

Incitec Pivot

3.5

Australia

Incitec Pivot manufactures, distributes and sells fertilisers explosives and

chemicals throughout Australia, Asia and North and South America.

JBS Australia

3.2

Brazil

JBS Australia is a division of JBS, Brazils largest food multinational, and

the worlds largest meat company. In Australia it has 10 meat processing
plants and five feedlots.

CBH Group

2.9

Australia

CBH Group is a co-operative deriving revenue from grain storage,

handling and marketing for its members. The company has also invested
in flour processing facilities and bulk shipping operations.

Murray
Goulburn
Co-Operative
Co. Limited

2.4

Australia

Murray Goulburn Co-operative owns and operates six processing sites

in Victoria and Tasmania. It plans to invest A$200 million over three
years to almost double its dairy processing capacity.

Glencore Grain

2.4

Switzerland

Nufarm

2.3

Australia

Nestl Australia

2.2

Switzerland

Coca-Cola Amatil is one of the largest bottlers of soft drinks in the

Asia-Pacific and one of the worlds top five Coca-Cola bottlers.
Kirin-owned Lion employs almost 7 500 people in Australia and New
Zealand and operates in the beer, spirits, wine, milk, fresh dairy, juice
and soy beverages segments.
GrainCorp provides services to the grain industry including bulk
commodity storage and handling, marketing, merchandising and
logistics, across operations in Australia, New Zealand, Asia, Europe and
North America. The company is part-owned by US food processing and
commodities trader Archer Daniels Midland.
Olam is the local subsidiary of Singapore-based trader Olam
International. The company operates integrated supply chains for five
key products in Australia (cotton, almonds, pulses, grains and wool) to
deliver these worldwide.
Cargill Australia is the local subsidiary of the US-based food and
agricultural product supplier, operating in oilseed and meat processing,
grain and oilseed storage and flour milling.

Glencore Grain is a subsidiary of Swiss-based Glencore AG, wholesaling

cereal grain in Australia. In 2012 Glencore expanded its local operations
by acquiring Viterra Australia to facilitate a move into storage and
handling services.
Nufarm is the largest manufacturer of crop protection products in
Australia and supplies domestic and international markets.
Nestl Australia is a wholly-owned subsidiary of the Swiss-based
giant Nestl S.A. It employs more than 5,000 people in 70 offices, with
factories and distribution centres located across the region.

26 TOP 25 | Investment opportunities in Australian agribusiness and food

Company
Name

Revenue
(A$b)

Ownership

Detail

Teys Australia

2.2

Australia

Teys Australia is Australias second largest meat processor and exporter,

operating six beef processing plants in Queensland, New South Wales
and South Australia which produce 270,000 tonnes of beef each year.

Goodman
Fielder

2.2

Australia

Goodman Fielder produces packaged goods, breads and sauces sold

in 30,000 retail and food service outlets across Australasia. It operates
48 processing plants throughout the region.

Inghams
Enterprises

2.1

US

Inghams Enterprises is the largest poultry processor in Australia. Its

operations extend across fully integrated farming, primary and further
processing operations.

Food
Investments

2.1

UK

Food Investments is part of the UK-based Associated British Foods

and generates the majority of its Australian revenue through subsidiary
George Weston Foods. Its products include bread, baking products,
small goods, cakes and ingredients.

Mondelez
Australia

2.0

US

Mondelez Australia, formerly Kraft Australia, is a subsidiary of the

worlds second largest food company, Mondelez International. In 2013,
Mondelez opened the first stage of Australias largest food R&D facility.

Agrium SP

2.0

Canada

Sucrogen

1.8

Singapore

Sucrogen, owned by Singaporean agribusiness Wilmar International, is

the largest raw sugar producer and refiner in Australia and eighth largest
producer globally.

Fosters Group

1.7

UK

Fosters is Australias second largest brewer and is owned by SABMiller,

the worlds largest brewer.

Treasury Wine
Estates

1.7

Australia

Treasury Wine Estates has over 12,000 hectares of vineyards, sales

totalling over 35 million cases of wine annually and 4,000 employees.

Elders

1.7

Australia

Elders is one of Australias oldest continually running agribusinesses,

providing a diverse range of agricultural and financial services to rural
Australia including farm supplies, real estate assistance and banking.

Unilever

1.6

UK

Unilever Australias portfolio includes Flora, Bertolli, Lipton and Bushells,

as well as a number of personal care and household brands. It recently
acquired T2, an Australian tea retailer.

Asahi

1.6

Japan

Asahi, the Australian subsidiary of Japans largest brewer, encompasses

Schweppes Australia and water bottler Mountain H2O.

Emerald Grain

1.5

Australia

Agrium SP is the local subsidiary of Canadas Agrium, providing rural

services and commodity management.

Emerald Grain is a grain handler, trader and supplier to international

markets, working with growers across Australia. Japanese trading
company Sumitomo Corporation acquired a 50 per cent interest in
Emerald Grain in 2010.

Source: IBISWorld 2013. Table is based on the most recent available data at the end of the 2013 financial year.

Investment opportunities in Australian agribusiness and food | TOP 25 27

Key agencies

for industry and government

Department of Agriculture

Lead Australian Government agency with responsibility

for the agricultural sector, including the management of
Australias biosecurity system through quarantine and
export certification.

www.daff.gov.au
www.daff.gov.au/biosecurity

Australian Bureau of
Agricultural and Resource
Economics and Sciences
(ABARES)

The Department of Agricultures research bureau

providing professionally independent research, analysis
and advice for government and the private sector.

www.daff.gov.au/abares

Department of Industry

Lead Australian Government agency with responsibility

for helping industry become more efficient, competitive
and innovative. The Department provides support to the
food processing industry through a number of programs.

www.industry.gov.au/industry

AusBiotech

Australias largest biotech industry organisation: a

network of companies involved in the life sciences,
medical technology (devices and diagnostics), food
technology and agricultural, environmental and
industrial sectors.

www.ausbiotech.org

National Farmers Federation

The peak sector body representing farmers and

agriculture across Australia.

www.nff.org.au

Australian Food and Grocery

Council

A national organisation representing Australias

packaged food, drink and grocery product
manufacturers.

www.afgc.org.au

REFERENCES
1. https://www.austrade.gov.au/Invest/Doing-business-in-Australia/Success-Stories/Australian-food-safety-record-attracts-Korean-food-giant
2. http://www.daff.gov.au/ABARES/Pages/outlook/conference-program/transcripts/jammie-penm.aspx
3. http://www.austrade.gov.au/Invest/Doing-business-in-Australia/Success-Stories/Hakubaku-goes-with-the-grain-in-Australia
4. http://www.monsanto.com/global/au/newsviews/pages/aussie-cotton-set-for-an-rd-boost.aspx
5. www.australiaunlimited.com/food/australian-flavours-asian-food-boom
6. http://www.premier.vic.gov.au/media-centre/media-releases/8847-coalition-assists-kagome-australia-to-replace-imports-with-local-produce.html
7. CSIRO 2012-13 Science Health Report, http://www.csiro.au/Portals/About-CSIRO/How-we-work/Budget--Performance/Performance-reviews/
ScienceHealthAndExcellenceReport-Summary-2012-13.aspx
8. http://www.nestlehealthscience.com.au/newsroom/press-releases/tongala

28 KEY AGENCIES | Investment opportunities in Australian agribusiness and food

How Austrade
can help
The Australian Trade Commission
Austrade contributes to
Australias economic prosperity
by helping Australian businesses,
education institutions, tourism
operators, governments and
citizens as they:
develop international markets
w
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direct investment
promote international education

What we provide
Working in partnership with
Australian state and territory
governments, Austrade provides
international investors with the
information needed to establish
or expand a business in Australia.
Services for international
investors include:
initial coordination of investment
enquiries and assistance

s trengthen Australias
tourism industry

information on the
Australian business and
regulatory environment

seek consular and

passport services.

market intelligence and

investment opportunities
identification of suitable
investment locations and
partners in Australia
advice on Australian
government programs and
approval processes.

Accessing Austrades
investment services
Austrades investment
services are free of charge
and are focused on productive
foreign direct investment
(FDI) outcomes of strategic
importance to the Australian
economy, to build capability and
enhance productivity.
Austrade does not assist with real
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straight acquisitions, hostile
takeovers or investments
by individuals.
W: www.austrade.gov.au/invest
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austrade.gov.au/invest