Acute grain transport costs chew up more than a quarter of the value of Australia's average cereal harvest.
In fact, freight is a big cost handbrake impeding much of agriculture's export competitiveness.
The fruit and vegetable sector's freight costs between farm and retailers total $618 million annually, or a big 21 per cent of its gross farm production value.
A Deloitte Access Economics investigation of farm transport costs from paddock to consumer describes logistics as the largest single cost factor in the production of many agricultural products.
Even in the relatively tight-knit rice industry, farmers pay 11.6pc of their gross harvest earnings on freight bills of $26m to shift grain from paddock and processor.
More alarming are the broader rice industry's total annual freight costs of $134m - almost $20m more than the entire rice crop's farm value in 2015-16.
The report shows Australia has comparatively higher freight costs for many of our key commodities compared to our international competitors, and it's hurting our bottom line
Farmer-paid freight expenses in the beef, sheep, goat meat sector range from 6.4pc and 5.8pc of farm production.
The dairy, pig, cotton and sugar industries enjoy comparatively more modest farmer contributions, from 4.3pc to just over 2pc of production values, although their total industry freight bills are significantly higher.
The freight report's sobering findings will not surprise most farmers, agricultural processors or marketers who face many geographic, weight and under-performing infrastructure challenges in their supply chains.
Within Australia alone, the agricultural freight task involves about 3.3m road vehicle movements annually, plus 400,000 by rail freight wagons.
Deloitte's report, compiled for AgriFutures Australia, highlighted how our future competitiveness on global markets depended significantly on cutting those freight bills.
With two thirds of the nation's food and fibre exported, reducing logistics costs would also help farming's chances of growing to its $100 billion value target within a decade.
Climate cost alert
The report warned freight issues would be further complicated in coming years by rising fuel and wage expenses and the impact of climate change on the variability and location of farm freight volumes.
"Strategic planning and regulatory frameworks are required to ensure infrastructure can be efficiently utilised," said AgriFutures managing director, John Harvey.
"The report shows Australia has comparatively higher freight costs for many of our key commodities compared to our international competitors, and it's hurting our bottom line."
- Inland rail to deliver freight savings
- Freight moves need to be matched with investment
- Port access hurdle for containerised freight
He said the findings highlighted how farmers might measure their true market competitiveness and identify pinch points and bottlenecks.
Even in New Zealand, where fuel is expensive and freight infrastructure less sophisticated, ag's costs were lower.
Remarkably, some Australian producers paid surprisingly low freight costs, despite the considerable logistics involved in getting products to market.
The poultry meat sector had the lowest relative farm freight costs of $28.2m - or just 1pc of gross farm income.
Total industry freight costs of $63.1m were also relatively constrained compared to its $2.7b farm production value in 2015-16.
AgriFutures senior business development manager, Jennifer Medway, said poultry's tight logistics expenses were achieved despite the industry relying on road freight to take newly hatched chicks to growing farms, then move birds to processing plants, and then distribute chicken meat to retailers.
"It's a very well refined and fast supply chain, with producers and processing plants strategically close to markets, which are primarily domestic," she said.
That compared with grain farming, which had a broad geographic spread involving a weighty commodity transported between paddocks and temporary farm storages, then to regional terminals, then by rail or road to port, domestic millers or other buyers.
In 2015-16 the $8.5b winter cereal harvest absorbed freight costs of $2.6b, of which a huge $2.4b, or 27.5pc of its gross value, were paid by farmers.
However, the report found Australia's export freight network for canola sold to Europe was cheaper than major competitor, Canada, partly because Canadian farmers mostly relied on just two rail freight operators to take grain longer distances to fewer seaboard terminals.
Total Australian grain freight costs to Western Europe in 2016 were $60 to $87 a tonne, compared with Canada's $107/t, while the market's third major supplier, Russia, paid just $56/t.
In dairy, Ms Medway noted a surprising disparity between Australian and NZ milk powder freight costs to Asia.
Labour, distance costs
Despite similar production arrangements and Australia having better maritime, rail and road services, and cheaper fuel, our total freight costs were higher, including on-farm milk collection rates of almost three cents/litre against 0.01c/l in NZ.
Australia's $4.3b farm milk value in 2015-16 encountered a total freight cost of almost $890m.
Key cost factors between the two exporters included higher Australian labor costs, distances travelled by milk collection tankers, and NZ's greater economies of scale thanks to dominant player, Fonterra, operating most of the supply chain.
If you're investing serious money in agricultural production systems, it may pay to think a lot more about private investment in freight needs
The $13b beef industry's biggest freight cost disadvantage against major competitor, USA, included higher domestic transport costs, reflecting cheaper US fuel prices and capacity to carry more cattle on better roads.
Ms Medway noted differing heavy vehicle weight limits between Australian states, and B-double access to local council roads, reduced freight cost efficiencies.
"A key observation of the report was just how much agriculture relies on publicly-owned rail and road infrastructure, including bridges which may restrict a route's capacity and efficiency," she said.
"If you're investing serious money in agricultural production systems, it may pay to think a lot more about private investment in freight needs.
"Roger Fletcher did exactly that - buying his own trains to move his grain and meat products to port."
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