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report identifies Australian market challenges AFGC State of the Industry report finds industry is 'resilient' but still facing challenges Food and grocery suppliers' industry representative body the Australian Food and Grocery Council (AFGC) has released the sixth edition of its annual State of the Industry Report.
AFGC Chairman Terry O'Brien said in the Report's foreword that the AFGC had found that the food and grocery industry had continued to show real louis vuitton bags vs fake "resilience" in the face of the "ongoing challenge of staying competitive in a country with high costs and low margins." The Report found that the high Australian dollar was still having an impact on the industry, as were high input costs, retail concentration and "highly restrictive, complex and overlapping regulatory structures". Export growth for processed food and beverages has been 'solid' and there has been a rising trade surplus in food, according to the AFGC's Report. Mr O'Brien said turnover in the industry had increased slightly, but job numbers had decreased. "This is a microcosm of the broader economy growth is still below trend and unemployment is creeping higher," Mr O'Brien said. The food and grocery sector currently employs just under 300,000 people. Almost half of those are in rural and regional areas. "Of concern is the flatlining of capital investment, at a time when we need an infusion of capital," Mr O'Brien said. "Food and grocery processing relies heavily on patient capital investment and when there is a reluctance to re invest regularly to keep up pace with technology and its associated improvements, a vicious cycle occurs where re investment lags and returns inch lower over time, and so, capital is even less likely to be attracted," he said. Mr O'Brien said the industry needed consideration of "carefully focussed investment allowances or incentives" within the tax system for a period, to provide an ongoing boost to the industry. The food and grocery sector had a total turnover of $114 billion in 2012 13. Food and louis vuitton alma figue beverage processing contributed $91.8 billion, grocery manufacturing $16.2 billion and fresh produce $6.2 billion. In 2012 13 the combined industry value add (IVA) for the food and beverage, grocery manufacturing and fresh sectors was approximately $31.3 billion. Food and beverage manufacturing contributed $24 billion of this total. In 2013 14, total industry exports increased by 8.6 per cent and total imports grew by 6.1 per cent. This reduced the industry's trade deficit to $1.8 billion, which continued to contract for a second year in a row. The AFGC said it was also important to note that Australia's net surplus in food and beverages increased by 12.8 per cent to $8.6 billion in 2013 14. Turnover recorded a 0.9 per cent growth in 2012 13 and capital expenditure recorded only a marginal 0.3 per cent increase. Moreover, the AFGC found that the industry's trade performance for 2013 14 showed a strong improvement due to growth in exports for key industries such as meat and dairy manufacturing. The AFGC said these trends showed signs of strength and indicated a recovery in the food and grocery sector. Notwithstanding this, the AFGC said rising commodity and energy costs remained "significant challenges" for the sustainable growth of the industry. The AFGC said effective government policies and programs were "essential" to reduce the cost of doing business and streamline regulations, which would improve the competitiveness of the industry. In 2013 14, there were an estimated 27,469 businesses in the industry: 7,507 businesses in food and beverage manufacturing (7,469 businesses in 2012 13); 1,353 businesses in grocery manufacturing (1,348 businesses in 2012 13); 18,609 businesses in the fresh produce industry (18,835 businesses in 2012 13). The AFGC said these results showed that there were 183 fewer businesses in 2013 14, compared with 2012 13. The AFGC said the food and beverage sector grew by 1.2 per cent in 2012 louis vuitton alma fr 13. Of the 12 sub categories, six sub categories contracted by an average of 3.4 per cent, which the AFGC was primarily driven by declines in bakery product manufacturing and wine and other alcoholic beverage manufacturing during this period. This was in contrast to the 8.1 per cent average growth across the remaining six sub categories, including dairy product manufacturing, which had the largest absolute growth, increasing 9.1 per cent. The AFGC found that the dairy sector showed signs of recovery with a lower Australian dollar and more favourable weather conditions further supported by improved demand conditions and rising domestic consumption. Meat and meat product manufacturing continued to comprise the largest share (24.6 per cent) of the total sector, contracting slightly by 0.7 per cent in 2012 13. Dairy product manufacturing was the second largest at 14.7 per cent, increasing 9.1 per cent. Seafood processing comprised the smallest share (1.2 per cent) with a decline of 4.2 per cent in 2012 13. The fresh produce sector recorded a turnover of approximately $6.2 billion in 2012 13. The AFGC said this represented an increase of 12.3 per cent over the previous year. The vegetables category and tropical and other fruit category (including nuts, bananas, and berries) contributed the most to the growth, increasing by 10.6 per cent and 22.5 per cent respectively. The AFGC said this growth was due to recovery from adverse weather conditions. Vegetables comprised the largest product group for the fresh produce sector, accounting for 45.3 per cent of total turnover. The largest growth was recorded in the tomatoes category, along with significant growth in melons, lettuce and potatoes.
In contrast, the onions category declined. In 2012 louis vuitton alma mm size 13, Queensland and Victoria's respective shares of the fresh produce sector turnover remained largely unchanged at 32 per cent and 26 per cent respectively. New South Wales' share increased from 16 per cent to 17 per cent.
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