The shift from commodity to value

The shift from commodity to value


Farm Online News
ANZ head of agribusiness, Mark Bennett, says farmers continue to strive for productivity gain but as costs continue to rise, some of the value must come from careful consideration and efficient processes post farm gate.

ANZ head of agribusiness, Mark Bennett, says farmers continue to strive for productivity gain but as costs continue to rise, some of the value must come from careful consideration and efficient processes post farm gate.

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Australian agriculture has proven its ability to adapt overtime, something it will need in the future, writes ANZ agribusiness head, Mark Bennett.

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WITH the inaugural National Agriculture Day fast approaching, it’s an opportune time to celebrate the contributions of Australian agriculture while examining how it can continue to grow in an increasingly competitive, global and ever-changing marketplace.

Today the industry has stable debt, rising output and improved water efficiency.

It is also extending its market reach and preparing to meet much of the expected rise in global food demand. 

This is a demonstration of Australian farming yet again evolving to secure global competitiveness and profitability.

The industry has proven its ability to adapt overtime, but to grow it must not only focus on improving productivity but also on how to more effectively extract value in balance with commodities.

This is especially true as Australian agriculture’s cost base continues to rise.

Being able to generate value, consumer trust and command a premium, starts with building brand equity.

An example of a company that has done this well, is Tasmanian seafood business Petuna, founded by Peter and Una Rockliff in 1949.

A long-term focus on quality and sustainability led to the establishment of a solid distribution network for its Petuna Ocean Trout and Atlantic Salmon through leading seafood wholesalers.

Its products also feature on the menus of many high-end restaurants throughout Australia.

The company developed a long-term relationship with Sydney Chef Tetsuya Wakuda whose signature dish featured its ocean trout and remained on his menu for more than 15 years.

This created many opportunities for brand exposure in a premium setting.  

At a farm level we continue to strive for productivity gain, which is the right thing to do, but as costs continue to rise, some of the value must come from careful consideration and efficient processes post farm gate.

This is not a natural progression for all farmers or farming, but it can produce opportunities for farming businesses to develop roles and talent beyond the paddock.

Marketing, finance and trade are all critical areas that can provide new pathways for children of farming families or for the new and curious youth of our labour market.

You’d be hard-pressed to find an Australian that would debate the contributions our farmers make to our national economy and regional Australia. - Mark Bennett, ANZ

Education is equally important as creating brand equity and is largely dependent on understanding consumer needs and wants.

That includes our 24 million-odd domestic consumers as well as those in many largely untapped markets across the globe.

Australian consumers are increasingly discerning and concerned with the quality and provenance of foods as well as the people and stories behind them.

Riverina-based Mimosa Valley Lambs, a sixth-generation farming business, uses the regular interactions it has at Sydney’s marketplaces as a valuable feedback channel to better appreciate what matters to its customers, influencing the decisions it makes across the supply chain.

International markets can at times represent complex and bespoke challenges in understanding consumers. Redbelly Citrus has cited Asia as its next international target following export success in Italy and the US.

However, it recognises its biggest challenge will be determining how to market a product to consumers that have little knowledge of the fruit’s health benefits and how to incorporate it into everyday cooking.

Spending time in a target market, talking with consumers and to those working in the local agri supply-chain, is a must for any business looking to create a highly valued product.

This work takes time and money, highlighting the importance of foreign and corporate investment which can open up new market opportunities, stimulate discussion, and bring with it added intellectual property, technology, jobs, infrastructure and learnings. 

You’d be hard-pressed to find an Australian that would debate the contributions our farmers make to our national economy and regional Australia.

We’re the world’s leaders in many ways and the industry has reason to feel optimistic when considering the growing demand from our nearest neighbours and the enviable reputation we have built.

To continue this success and evolution, the industry must focus on technology, innovation and productivity, which involves looking beyond the farm gate and working collaboratively to create the ultimate consumer experience.

- Mark Bennett is the head of agribusiness for ANZ.

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