Australia faces a 'potential food shock' from Asia: AAco

04/06/2012 - Australia needs to open up its northern regions to agricultural expansion or face a potential food shock from Asia, says the chief executive of Australia's biggest beef producer, Australian Agricultural Company (AAco).

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But he does not think the federal government has the political will to do it.

AACo's David Farley told a stockbrokers' conference in Melbourne on Friday that by 2049 the world population was expected to increase by 40 per cent and demand for food by 77 per cent.

Demand for food in Asia is expected to double in that time, accounting for 70 per cent of the global increase.

He said the Middle East in 2007/08 had already suffered civil unrest when there had been an insufficient supply of affordable food caused by a run down in world food inventories.

He said Australia had been responsible for a food shock in Indonesia when the federal government temporarily banned the export of live cattle to that country because of animal welfare issues.

If Australia did not start focusing on becoming a global food supplier, particularly to Asia, and increase its capacity to produce food, global supply could be disrupted and the price of food would rise, he said.

"That disrupts society. The 'Arab Spring' (arising from events) in 2007/08 proved that food stability is important for any government," Farley told reporters.

"We need to educate the populace of Australia on why agriculture is important, not only to feed ourselves but to feed the world.

"The consequences of being naive to it will be instability in the region."

It was revealed this week that the federal government was looking to open up land for farming in northern Australia.

It also was suggested the government was looking to attract Chinese investment in those sites.

But Farley said Australian politicians lacked the political will to open the northern part of Australia to more agriculture.

"I don't think there's the breadth of intellect needed," he said.

He said the current federal government was more focused on political survival, rather than thinking of food.

Farley said opening up the north to more agriculture would mean dealing with difficult issues such as land title, native title, infrastructure, logistics and environmental and animal welfare matters.

"It really takes a big commitment from government," he said.

"We've got 38 years to get to 2050, and we need to be performing in that period of time."

Meanwhile, Nationals senator Barnaby Joyce urged the federal government to allow a local company to purchase farming land in northern Australia ahead of Chinese interests.

Chinese investors have shown an interest in the vast Ord Two development zone in the Kimberley.

"We should have policies in place that encourage Australian capital first," Senator Joyce told reporters in Canberra on Friday.

Trade Minister Craig Emerson said he was surprised by the senator's objection to the idea of supplying more food to global markets.

Farley said foreign capital had always played a role in the development of agriculture in Australia.

"And I think foreign capital should always play a role in developing Australian agriculture, but foreign capital should not control Australian agriculture."

Source: AAP

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