Food ScoreCard 2016–17 · Table 1: South Australia’s Food ScoreCard summary, 2016–17, $ million. Industry Farm gate value Finished food value Overseas exports Interstate exports

Food ScoreCard 2016–17PRIMARY INDUSTRIES AND REGIONS SOUTH AUSTRALIA

FOOD SCORECARD 2016–172

Food ScoreCard 2016–17 © Government of South Australia 2017

DISCLAIMER

PIRSA and its employees do not warrant or make any representation regarding the use, or results of the use, of the information contained herein as regards to its correctness, accuracy, reliability and currency or otherwise. PIRSA and its employees expressly disclaim all liability or responsibility to any person using the information or advice.

ALL ENQUIRIES

Steve Welfare

Primary Industries and Regions SA (PIRSA) Level 15, 25 Grenfell StreetGPO Box 1671, Adelaide SA 5001T +61 8 8429 0450E [email protected]

FOOD SCORECARD 2016–17 3

Contents1. FOOD SCORECARD 2016–17 SUMMARY 4

1.1. Gross Food Revenue (GFR) grows 7% to a record $17.6 billion 5

1.2. South Australia’s farmgate production $5.28 billion 6

1.3. Finished food reaches level of $6.62 billion (wholesale values) 8

1.4. South Australian food exports (overseas) $4.17 billion (Free on Board) 9

1.5. Retail and hospitality sales reach $10.59 billion 12

2. SUMMARY AND OUTLOOK 13

3. GLOSSARY OF TERMS 14


To track the advances in the South Australian food and wine industries, Primary Industries and Regions South Australia (PIRSA) has developed a series of industry ScoreCards, which provide detailed value chain measures of annual performance. This report outlines the 2016–17 performance for South Australia’s food industry. The paper includes details of the Food ScoreCard and tracks performance against the Food Target articulated in South Australia’s Strategic Plan.

1.FOOD SCORECARD 2016–17 RESULTSThe South Australian Gross Food Revenue (GFR) has grown in 2016–17. An overview of the key attributes for the 2016–17 Food ScoreCard (more details are included later in this report) include:

• Gross Food Revenue grew, increasing by $1.09 billion (7%) to reach record levels of $17.6 billion.

• Total overseas food exports increased by $279 million (or 7%) over the year to reach $4.17 billion.

• Interstate commodity and processed food sales increased by $332 million (or 13%) to $2.85 billion.

• Growth in food retail and food service sales increased by 5% to reach a record of $10.59 billion.

• South Australian overseas food imports remained steady, decreasing by $1million (or 0%) to be $1.35 billion.

GFR reached $17.6 billion with growth of $1.09 billion (or 7 %) since 2015–16. Table 1 shows the contribution from each of the main sector groups and how results along the value chain contributed to the 2016–17 South Australian GFR growth. Retail and food service sales increased again to grow this year’s GFR value. Contributing to this year’s growth was the overseas exports which increased by 7%.

Table 1: South Australia’s Food ScoreCard summary, 2016–17, $ million.

IndustryFarm gate

value

Finished food value

Overseas exports

Interstate exports

Retail & service

sales

Gross food

revenue

Field crops 1 868 1 146 2 276 757 2 283 5 316

Livestock 1 827 3 003 1 252 1 215 2 336 4 802

Dairy 196 369 42 122 777 940

Horticulture 970 1 465 270 551 2 249 3 069

Seafood 428 501 244 148 516 908

Other - 136 87 60 2 436 2 583

Total food ($m) 5 288 6 620 4 170 2 852 10 597 17 619

$m Value change from 2015–16 908 -67 279 332 486 1 098

% Growth since 2015–16 21% -1% 7% 13% 5% 7%

Ave annual growth since 2006–07 (Ten years)

8% 5% 9% 6% 5% 6%

Note: Numbers have been rounded and discrepancies may occur between sums of the component number and totals.


1.1 Gross Food Revenue grows 7% to a record $17.6 billion In 2011, the Government of South Australia released an updated South Australia’s Strategic Plan (SASP), which included a target to grow the contribution made by the South Australian food industry to $20 billion by 2020 (baseline: 2001–02). This represents an average increase of around 4% per annum from the base year.

Figure 1 shows the annual trend in the headline GFR, from the 2001–02 baseline year along with the 2019–20 target. The chart shows how this year’s GFR growth to $17.6 billion brings GFR slightly above the SASP target goal trend line, on track to reach $20 billion by 2020.

Figure 1: Performance and target for Gross Food Revenue (GFR), South Australia 2001–02 to 2019–20 ($ million nominal)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

- 11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

2017

-18

2018

-19

2019

-20

$ m

illio

n

It should be noted that the performance of the South Australian food industry is a key driver for the South Australian Government’s economic priority Premium Food and Wine Produced in our Clean Environment and Exported to the World. In 2016–17 South Australia’s finished food exports contributed $1.9 billion to the $3.4 billion combined differential and finished food and wine export result.


1.2 South Australia’s farmgate production value Farmgate values for the production of food increased in 2016–17 by $ 908 million (or 21%). Field crops (58%), livestock (12%) and horticulture (5%) industries’ farmgate production value grew in 2016–17. Declines occurred in the seafood industry (-1%) and the dairy industry (-8%).

By way of summary, Table 2 on page 7 shows the value changes due to the combined influence of price and volume variations.

• Field crops: Field crop yields and volumes increased after a record harvest but farmgate prices across almost all grains were similar to the previous year. Malting barley had a good season after the declines in the previous year and the farmgate value was 435% higher than in 2015–16. The total farmgate value of lentils improved significantly and their value increased by $129 million or 98%, canola also had an increase in total farmgate value of $46 million or 38%.

• Livestock: The overall livestock (or meat) industry experienced a positive year with the production value increasing by $196 million or 12%. Sheep production has led the way with a $128 million (or 26%) increase and beef also grew by $34 million (or 6%) due to the increase in farmgate price. Goat meat also attained higher prices, while the volume of both chicken and egg production continued to increase with strong domestic demand. The number of pigs processed in South Australia reached over 1.3 million for the first time.

• Dairy: The $ 18 million (or 8%) decline in the farm gate value received by the state’s dairy farmers reflects a decline in production volumes.

• Horticulture: Almonds were the best performing horticulture commodity with volumes growing along with an increase in the farmgate price. Citrus was a strong performer with exports of fresh fruit and juice being valued at over $103 million.

• Seafood: There was a small increase in the production value of Southern Bluefin Tuna and prawns, however, these increases were offset by declines in volumes and price of lobster and abalone, resulting in an overall decrease in the value of the seafood industry of $6 million (or 1%).


Table 2: South Australia’s food production (farmgate value) by sector and product, year to 2016–17

IndustryValue $ million

2015–16

Value

2016–17 % change

Field crops total 1 182 1 868 58%

Wheat 805 1 176 46%

Malting barley 25 135 435%

Other grain 351 557 59%

Livestock total 1 632 1 827 12%

Beef 572 606 6%

Pig meat 222 211 -5%

Sheep and lamb meat 490 617 26%

Chicken meat 291 322 11%

Other livestock 58 72 24%

Dairy total 214 196 -8%

Horticulture total 920 970 5%

Potatoes 121 145 20%

Citrus 82 103 26%

Almonds 122 128 5%

Other horticulture 596 593 0%

Seafood total 433 428 -1%

Blue fin tuna 119 122 2%

Lobster 133 117 -12%

Other seafood 181 189 5%

Total primary production 4 381 5 288 21%



1.3 Finished food reaches $6.62 billion (wholesale values) South Australia’s finished food includes post-harvest value-adding, such as packing, cleaning, cold-chain management and food manufacturing.

Figure 2 shows how finished food value experienced a small decline, down $67 million (or 1%), to reach $6.62 billion in 2016–17. The declines occurred in the livestock and seafood industries, while growth was in field crops, dairy and horticulture.

Figure 2: Value of finished foods, South Australia, 2001–02 to 2016–17, $ million

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

$ m

illio

n


1.4 South Australian food exports (overseas) increase 7% to $4.17 billion FOBDuring 2016–17, overseas food exports increased by $279 million or 7% to reach $4.17 billion. Commodity exports increased by $396 million or 22% on the back of increased grains exports. The increase in commodity grains exports was a result of larger volumes of grain available after the 2016–17 harvest. The value of finished food exports declined in all industries with the exception of dairy which grew by 7%.

Figure 3 shows trends in food exports for both commodity and finished foods over the past 15 years. The value and importance of finished food exports have grown over the past 15 years, with the proportion of finished food exports against total food exports increasing from 42% in 2001–02 to 47% in 2016–17.

Figure 3: South Australia’s food exports (overseas): commodity and finished foods, 2001–02 to 2016–17, $million (FOB)

1240 1195 1103 1064 1083 1143 1207 1324 1213 1289 1308 1307 1630 2033 2058 1941

1743 1128 1078 622 708 554

809 1055 916

2177 2365 1880 2041 1971 1833 2229

0 300 600 900

1,200 1,500 1,800 2,100 2,400 2,700 3,000 3,300 3,600 3,900

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

Finished Food Commodity

$ m

illio

n

Finished Food Exports

$ milli

on

0

500

1,000

1,500

2,000

2,500

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

Commodity Exports

$ milli

on

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2015

-16

0

500

1,000

1,500

2,000

2,500


Total field crop exports increased by $402 million or 21% due mainly to the $222 million or 129% increase in the value of lentil exports (supported by both volume and price increases) and the $65 million or 36% increase in the value of barley exports. The largest decline of $109 million or 8% was in total livestock exports with a decline of $102 million or 18% in beef exports.

Factors that influenced the performance of food exports include:

• Livestock exports were impacted by increases in export value of sheep meat and pig meat as well as a decline in beef exports after supply tightened during the year.

• Dairy exports had a $3 million (or 7%) increase in the value of 2016–17 dairy exports.

• Horticulture exports have experienced steady growth in the past few years, however, declined by $27 million (or 9%) to $270 million in 2016–17. There were declines in the value of almond and heavy vegetable exports, due to lower almond prices and declines in carrot and onion export volumes, and small increases in the value of apple and pear and citrus exports.

Overseas food exports contribute to the South Australia’s Strategic Plan Target 37 to increase the value of South Australia’s export income to $25 billion by 2020. Currently South Australian food exports comprise 37% of South Australia’s merchandise trade, up from 33% last year.

Table 3 shows the value and change in finished food and commodity (overseas) exports by key products. Overseas food exports for South Australia saw a $396 million or 22% increase in the value of commodity exports and a decrease in the value of finished food exports by $117 million or 6%.

Table 3: Overseas exports of South Australia’s food, growth in selected commodities and finished foods

Value ($m) Value change ($m) Value change (%)

2016–172015–16 to

2016–17 2015–16 to

2016–17

Grains 2 188 408 23%

Livestock 41 -12 -23%

Total commodity exports 2 229 396 22%

Grain products 87 -6 -7%

Fruit and vegetables 270 -27 -9%

Seafood 244 -7 -3%

Meat 1 211 -97 -7%

Dairy products 42 3 7%

Other 87 18 27%

Total finished food exports 1 941 -117 -6%

Total food exports 4 170 279 7%



Figure 4 shows the leading markets for South Australian food during 2016–17. South Australia exported food to 95 countries in 2016–17. The United States of America (USA) is South Australia’s largest food export market with $508 million or a 12% share of all food exports from South Australia. Meat is the main export to the USA which accounts for 87% of all South Australian food exports to that destination. Other key export markets for South Australian food in 2016–17 include China and Hong Kong, with exports worth $400 million or 10% of total food exports, India at $389 million or 9% of total food exports, and Indonesia $362 million or 9% of total food exports. These four key export markets accounted for 40% of the total value of South Australian food exports in 2016–17.

The value of South Australian food exports to China and Hong Kong continue to grow in importance, increasing by $33 million or 9% since 2015–16. The value of South Australian food exports to India has also grown in importance, becoming the third largest food export market in 2016–17 after purchasing significant volumes of wheat, peas and lentils.

Figure 4: Leading markets for South Australia’s food exports, 2016–17

-

100

200

300

400

500

600

USA

Chin

a &

Hong

Kon

g

Indi

a

Indo

nesi

a

Japa

n

Mal

aysi

a

Viet

nam

Bang

lade

sh

UAE

Germ

any

$ m

illion


1.5 Retail and hospitality sales reach $10.59 billionFigure 5 below shows the ongoing growth in 2016–17 of the food retail and hospitality sectors. Sales increased by 5% or $486 million to reach a total of $10.59 billion.

Figure 5: South Australia’s food retail and food service sales 2001–02 to 2016–17, $ million

4,086 4,375 4,552 4,879 5,199 5,359 6,033

6,589 6,527 6,689 6,896 7,307 7,520 7,858 7,995 8,263 1,172

1,318 1,395 1,410

1,453 1,365

1,606

1,758 1,724 1,763 1,857

2,025 1,985 1,949 2,115

2,334

-

2,000

4,000

6,000

8,000

10,000

12,000

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

$ m

illio

n

Retail Sales Hospitality Sales


2. SUMMARY AND OUTLOOKIn 2016–17, South Australian Gross Food Revenue grew by $1.09 billion due to increases in the value of the field crop, livestock and dairy industries.

The Food ScoreCard result reflects the record grain harvest in 2016–17, however, this may not continue through 2017–18, with the current grain harvest forecast predicting a harvest closer to the ten-year average.

The pig and poultry processing industries are expected to continue building on the growth they have achieved in recent years, although an oversupply in pigs may lead to decreased profitability. The development of a beef industry blueprint over the coming year will assist the cattle industry to plan for sustainable growth and profitability.

The recently signed Free Trade Agreements with key Asian markets will continue to support growth in the value of exports from South Australia. The opportunities for increasing exports to Asian markets is also supported by ongoing trade missions to these countries. Recognition by the Chinese Government of the Riverland Pest Free Area will support growth in horticultural exports to China, and provide Riverland producers with a competitive advantage.


3.GLOSSARY OF TERMSFarmgate

This measures the value of a commodity at the local level of production, which is known as farmgate. Farmgate value is calculated by multiplying the volume of production by the price received. This represents the value of production to the farmer or fisher person.

Differentiated and finished food value

This measures finished food – the value of foods and beverages that are processed at their highest level of processing in South Australia. Finished foods may be minimally or highly processed and the value is represented by their wholesale price into the retail or export markets.

Food retail sales

Food retail sales measures the value of food sales made through all retail stores including supermarkets and grocery stores, takeaway food, meat, fish, poultry, fruit and vegetable retailing, liquor retailing, bread and cake, and specialist food retailing.

Food service sales

Food service sales measures the value of sales of food and beverages through restaurants, hotels, and tourism operations within South Australia. The calculation estimates the percentage of total sales that occur through these outlets. Prices used in this calculation are usually higher than those used at the retail level.

Free on Board (FOB)

Free on Board (FOB) is the price of a commodity or product received by a supplier, including all costs incurred in getting the commodity or product to the port of departure, at which point the buyer takes responsibility of the costs.

Gross revenue

An aggregate measure of revenue that includes international and interstate food and beverage exports and the value of food and beverage retail and service sales contributing to the South Australian economy. It is calculated by taking the sum of overseas export value (commodity and processed), interstate trade value (commodity and processed), food retail sales and food service sales. Gross revenue can be used in reference to food, wine or food and wine combined.


Interstate sales – commodity and finished food

This represents the difference in the value of goods exported interstate from those imported from interstate. A positive value represents net interstate exports – for example exports exceed imports. A negative value represents net interstate imports – for instance, imports exceed exports.

Overseas commodity exports

This measures the value of overseas exports of agricultural commodities sold overseas by South Australian firms, calculated by using free on board prices. Commodity exports are products that have a minimal change from their natural form – for example, live animals or bulk grain.

Overseas imports – commodity or finished food

This measures the value of either agriculture commodities or finished food products that are purchased from overseas. Import volumes and values are quantified at their South Australian landed value (at the port of shipment).

Overseas finished food and wine exports

This measures the value of overseas exports of food and wine products sold overseas by South Australian firms, calculated by using free on board prices. Finished food and wine exports are commodities that have had further value added from the point of production. For example, meat, wine, packed fruit and vegetable or fish.

Primary activity

Primary activity refers to primary production activity, which refers to the various activities within the agriculture, food manufacturing sectors i.e. poultry farming or dairy cattle farming.

South Australia’s Strategic Plan (SASP)

South Australian’s Strategic Plan (SASP) guides individuals, community organisations, governments and businesses to secure the wellbeing of all South Australians. South Australia’s Strategic Plan contains the state’s visions and goals and its 100 measurable targets reflect our priorities. SASP identifies priorities for South Australia.

Value chain measures

Value chain measures include all measures or indicators that are used along the value chain from the farmgate through the chain to the final point of sale.


Food ScoreCard 2016–17 © Government of South Australia 2017

Primary Industries and Regions South Australia Level 14, Grenfell Centre 25 Grenfell Street Adelaide 5000 South Australia T: +61 8 8226 0900 www.pir.sa.gov.au

Documents

Food ScoreCard 2016–17 · Table 1: South Australia’s Food ScoreCard summary, 2016–17, $ million. Industry Farm gate value Finished food value Overseas exports Interstate exports