Australia Agriculture Policy Review

Australia is a significant player in world trade for several commodities and agriculture is a vital part of the Australian economy. Around 60% of Australia is devoted to agriculture, with three broad zones in which agricultural activity occurs. These are referred to as the pastoral, wheat–sheep, and high rainfall zones. Australia had only about 130,000 commercial farms in 2005, so average farm size is high. Australia's agriculture is market driven and export-oriented. For some products, aggregations for values of production and for export values are not directly comparable because export values reflect the value of more highly processed products such as sugar and wine. Overall, about 65% of agricultural production is exported, representing about 25% of total merchandise exports. The processed agrifood products share of total merchandise exports has doubled since 1986-88. Between 1986-88 and 2002-04, the support to producers in Australia decreased from 8% to 4% of the total value of agricultural production. Australia has the second lowest level of producer support across OECD members. Productivity has grown at an average annual rate of 2.8% for the past 3 decades (Dolman et al, 2005).