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Agriculture has the technology, but will consumers swallow it?

Mick Keogh - Tuesday, September 15, 2015

The growth opportunities for Australian agriculture lie in expanding resource use via the development of northern Australia, and increasing output from existing resource use through productivity growth. While these two options are perhaps equally important, agricultural productivity growth is essential in order to maintain international competitiveness irrespective of what happens in northern Australia, but also faces a major stumbling block due to the purported attitudes of consumers.

Over the last four decades, Australian agricultural output has continued to increase in both volume and value terms, despite the removal of approximately 100 million hectares of land from agricultural use (approximately 20%) over that period, and despite the more recent removal of up to 2,750 gigalitres of water from irrigation use in the Murray Darling Basin. This increased output was achieved through agricultural productivity growth, which for periods exceeded 2% per annum, especially in the cropping sectors. The rate of agricultural productivity growth in Australia has slowed significantly since around the year 2000, and regaining that previous momentum is proving to be a challenge.

A key factor in previous waves of accelerated agricultural productivity growth was the introduction of new technologies, in the form of more powerful and technologically advanced machinery, artificial fertilisers, modern agrichemicals and animal health products, and more intensive livestock production systems. The need for, and the use of these technologies to improve food security was largely accepted by consumers - perhaps with the previous generations' experiences of food shortages and mass starvation firmly etched into the collective consciousness.

There are agricultural technologies currently available that could be deployed and which would assist the sector to regain productivity momentum, but the apparent growing resistance of Australian consumers to the use of many of these technologies is proving to be a major stumbling block. This is despite these technologies - such as genetically modified crops and livestock growth promotants - having been proved to be absolutely safe for use in food production for many decades, and being in widespread use internationally.

The impact of the purported growing resistance of consumers to new agricultural technologies lies not just in the immediate loss of productive potential, but also in a loss of longer-term productivity opportunities due to the uncertain research and development investment environment that has been created. Major agrichemical companies are concentrating on extending the life-cycle of existing products, rather than investing in the development of new compounds, because bringing a new product to market means not only having to meet the scientific requirements of chemical regulators, but also running the gauntlet of consumer acceptance. This latter risk is exacerbated in Australia due to the dominant position of Coles and Woolworths in food retailing, both of which have implemented outright bans on specific agricultural technologies and practices, despite the safety, and well-proven productivity benefits of those practices.

The growing challenge that the agriculture sector faces in getting access to productivity enhancing technologies is the subject of a series of papers published in the recently released edition of the Farm Policy Journal, published by the Australian Farm Institute. The papers make a number of interesting observations in relation to this issue. 

The first is that the more educated consumers become, the less trustful they apparently become of the science underpinning new agricultural technologies. This is despite those same consumers readily accepting the use of advanced technologies in a wide range of other areas of their lives - ranging from travel to communications and medicine. The second is that consumers are apparently more reassured about new technological developments that have been endorsed by someone they identify as their peer, rather than by a scientist. 

It is apparent that it is no longer sufficient to simply invest in agricultural research and development, and to assume that if successful, the resulting innovation will be able to be deployed to improve agricultural productivity. A new product development pipeline now needs to include a substantial consumer communications program, ideally engaging relevant peers (bloggers, community groups, commentators) who can assist in explaining and communicating the new technology more widely to consumers. This type of activity is now being undertaken by some rural research and development corporations in Australia, but there is obviously a great deal of learning ahead of the sector in order to become as effective and adept at this activity as some of the opponents of new agricultural technologies have become. 

 
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