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Program 2: Emerging New Industries

2.4 Essential Oils and Plant Extracts

Objective: To support the growth of a profitable and sustainable essential oils and natural plant extracts industry in Australia.

Expenditure in 2003–04: $328,107
Compared with 2002–03:$396,740

Background
Essential oils are largely used in the food flavouring, cosmetics and fragrance industries but their use in aromatherapy and other health care areas is growing. Changing consumer preferences in favour of natural over synthetic substances has had a strong impact on pharmaceutical and cosmetic industries, which has translated into growing demand for essential oils and plant extracts. There is increasing interest in essential oils in Australia and there are good opportunities for producing plant extracts from both native and exotic species. The current value of production of essential oils (excluding tea tree oil) is estimated to be approximately $10-11 million at the farm gate.The Australian essential oils industry is made up of around 150 commercial producers, with production dominated by a few larger firms. Most essential oil production takes place in Tasmania, Victoria and New South Wales. Medicinal herbs offer potential for Australian production of plant extracts. At present, about one-third of the 250 tonnes used each year is supplied from Australia. Australia has a comparative advantage as a reliable supplier of clean, good quality, unique oils and extracts based on the use of high technology in both production and extraction. However, they must meet well-defined quality parameters.

Key long term strategies

• improve understanding by potential researchers and producers of markets for essential oils and plant extracts
• improve existing products and encourage the development of new crops and products (including uses for existing products)
• support the development of sustainable and profitable production systems
• facilitate regulatory approvals for essential oils and plant extracts
• • promote cost effective post harvest and extraction technology to improve yield and quality.

Key outputs in 2003–04

• published a report on the production of high quality Australian valerian products. The re-port examines the levels of key active constituents of valerian in different genetic stock, during plant growth, postharvest handling, processing and in marketed products (03/081)
• published a report on commercial borage production for oil and gamma-linolenic acid, a human dietary supplement for which there is strengthening international demand (04/040)
• finalised a project outlining the techniques and management practices needed to es-tablish kesom oil as a viable essential oil for Australian producers
• finalised a project on the market situation for onion oil
• supported a successful International Ginseng Conference, held in Melbourne in November 2003.

Strategic planning
This Sub-program has its own five-year R&D plan, accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/essentoi.html
 

Research Manager: Mr Tony Byrne
Phone: 02 6272 5472
Fax:02 6272 5877
Email:tony.byrne@rirdc.gov.au

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2.5 Organic Produce

Objective:
To optimise the profitability of Australian organic production in both domestic and overseas markets and to promote the utilisation of organic farming systems as a means of enhancing the sustainability of Australian agricultural systems.

Expenditure in 2003–04: $229,223
Compared with 2002–03: $261,577

Background
Consumers are increasingly aware of the quality and safety of the food and fabrics they consume and wear. At the heart of this worldwide trend is a desire to consume products, especially foods, that are safe, produced from environmentally sustain-able farming systems, and ethically and socially acceptable. In growing numbers, export and domestic consumers are seeking certified organic products in response to these concerns.

The Australian organic (incorporating biodynamic) industry had over 2400 certified/registered members collectively marketing product estimated to be worth, at the retail level, approximately $250-300 million in 2003. Production growth was less than anticipated in 2003 because of the drought. Industry growth has been estimated at around 20% per annum. On current trends the industry is projected to grow to more than 3000 members and over $400 million over the period of the cur-rent five-year plan (by 2006). Members come from all sectors of the value chain—growers, processors and manufacturers, retailers and consumers—across all States. They operate in diverse rural industries, including grains and pulses, horticulture, viticulture, beef and pork, dairy, sugarcane and honey. Seven organisations are currently registered with the Australian Quarantine and Inspection Service (AQIS) to inspect and certify organic farming, processing and marketing systems for export markets.

Rising domestic and overseas demand for Australian organic products is prompting a greater number of conventional farmers and processors to consider and adopt organic systems. Typically the attraction is either improved market access and/or higher prices from niche markets, together with recognition by the marketplace of better and more sustainable farming practices. Concern by both consumers and producers in the need for more sustainable farming practices is growing strongly and there is the potential for organic farming systems to play a role in this across agriculture as a whole

Key Performance Indicators:

• Increase in both new and total certified growers
• broader range of product
• increased industry adoption of new/modified organic systems
• demonstrated evidence of improved soil health and structure
• increased product quality
• increased yields
• satisfying customer demand

Key long term strategies

• address strategies and targets published in the Organic Produce R&D Plan 2001–2006
• document, develop and facilitate adoption of new organic system designs ap-propriate to Australia
• increase awareness and uptake of new and existing successful plant and ani-mal nutrition methodologies for organic systems
• develop new integrated soil management techniques leading to improved soil management practices in organic and conventional farming
• identify and overcome structural, technological, economic and social impedi-ments to conversion
• promote policy and standards-setting processes that deliver market access based on verifiable objective equivalence of certified products while recognising the uniqueness of Australian production systems
• establish successful organic product supply chain models
• foster industry development.Key long term strategies
• address strategies and targets published in the Organic Produce R&D Plan 2001–2006
• document, develop and facilitate adoption of new organic system designs ap-propriate to Australia
• increase awareness and uptake of new and existing successful plant and animal nutrition methodologies for organic systems
• develop new integrated soil management techniques leading to improved soil management practices in organic and conventional farming
• identify and overcome structural, technological, economic and social impediments to conversion
• promote policy and standards-setting processes that deliver market access based on verifiable objective equivalence of certified products while recognising the uniqueness of Australian production systems
• establish successful organic product supply chain models
• foster industry development.

Key outputs in 2003–04

• a successful series of meet-ings for the RIRDC Organic Produce R&D Advisory Committee in Tasmania, sup-porting industry development in partnership with the Tasmanian Primary Industries Ministerial Organic Advisory Group
• 2nd OFA National Conference held in Adelaide in October 2003. The conference theme was Organic Futures for Australia. The success of the conference was assisted by RIRDC support for the conference itself and for the Awards for Excellence
• the Organic Systems R&D Advisory Committee has reviewed the role, format and frequency of the RIRDC Organic Newsletter. Future editions will focus on RIRDC research news and will link to advisory committee meetings
• completion of a commissioned project ad-dressing issues related to the organic industry requirement for certified seeds and seedlings for organic vegetable production systems
• completion of a project developing integrated intensive organic vegetable production sys-tems in a commercial context
• completion of a project addressing the man-agement of high input tree crop systems to commercially viable organic systems
• completion of a literature review of an inventory of alternatives to copper for disease con-trol in the Australian organic industry.

Strategic planning
This Sub-program has its own five-year R&D plan, accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/organic.html
 

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2.6 Rare Natural Animal Fibres

Objective: To facilitate the development of new and established industries based on rare natural fibres.

Expenditure in 2003–04: $238,194
Compared with 2002–03:$214,893

Background
The program can incorporate cashmere, mohair, alpaca fibre, camel hair and other rare fibre projects. The R&D projects currently cover the first three of these fibres.In 2003 world prices for mohair increased. Cashmere and alpaca fibres prices were buoyant. Reducing fibre diameter is still a high priority for all these industries. Raising the effciency of production and by growing what is required by the proc-essors/markets will increase productivity and net returns. A concern in the mohair and cashmere industries is limited investment on production while more alpaca enterprises are being established although many of them have numbers of less than ten.

Key Performance Indicators:

• Improved reproduction techniques in alpaca
• improved genetics for cashmere and mohair goats
• adoption and utilisation of R&D results

Key long term strategies

• address, within budgetary limitations, published strategies and targets in the 2003–2008 R&D plan
• identify and research appropriately with industry fibre properties required for commercialisation by processors to produce yarn, fabric and garments de-manded further along the value-added chain
• increase productivity on-farm by investment in reproduction and breeding research
• communicate more effectively to interested parties progress and conclusions of projects
• identify ways of increasing investment in mohair and cashmere production and adoption of results
• maintain and advance international producer and research linkages.

Key outputs in 2003–04

• published ways of collecting, pre-serving, storing of alpaca semen (03/104)
• reported on many fibre characteristics and relationships in and between guard hair and down fibre in cashmere (04/027)
• published further information related to drought feeding of goats including the chemical composition and effects of available water during drought
• reported on alpaca fibre softness compared to wool, impediments in scouring and at-tributes in blending with other animal and plant fibres (03/128)
• proposed ways which could assist in-creased production of cashmere and mohair (04/096).

Strategic planning
This Sub-program has its own five-year R&D plan, accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/rna/index.htm
 

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2.7 Tea Tree Oil

Objective:
To support the continued development of an environmentally sustainable and profitable Australian tea tree oil industry that hasd established internatinal leadership in marketing, in value-adding, and in product reliability and production.

Expenditure in 2003–04: $326,459
Compared with 2002–03: $349,751

Background
Tea tree (Melaleuca alternifolia) is native to the north coast of New South Wales. Its oil has gained widespread therapeutic use for fungal and microbial infections, but is not yet registered for use by the medical profession.

The industry comprises some 250–280 growers and is located principally in north-ern New South Wales and on the Atherton Tableland in Queensland. More than 90 per cent of Australian tea tree oil is exported, principally to North America and Europe. The major end uses of the oil are in antimicrobials and cosmetics, with much of the oil being sold as a pure oil.

As plantings increase, there is currently an imbalance between supply and demand. However, the industry remains optimistic about its future. The challenge is to build on recent R&D achievements, particularly relating to safety and efficacy and to explore options for new applications of tea tree oil. On the production side, contin-ued work on breeding superior genetic material also remains a priority.

Key Performance Indicators:

• New value-added products
• level of new information available in peer-reviewed journals on safety, efficacy and mode of action that originates from research funded by the program
• level of uptake of improved genetic material

Key long term strategies

• improve the understanding of markets for tea tree oil
• improve existing products and develop new ones
• enhance the ability of the industry to meet appropriate safety and efficacy standards
• provide production systems that are both ecologically sustainable and profitable
• enhance the human capital and level of commercial adoption by the industry.

Key outputs in 2003–04

• produced a database and review of all tea tree oil publications relating to efficacy and toxicol-ogy
• produced a material safety data sheet for use by industry
• published a report showing successful use of tea tree oil on as anti-inflammatory for human skin (04/037)
• field trial results of 91% yield gain against industry standard

Strategic planning
This Sub-program has its own five-year R&D plan, accessible in hardcopy and on the Internet at: www.rirdc.gov.au/pub/tto5yr.htm
 

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2.8 Wildflowers and Native Plants

Objective:
To improve the profitability, productivity and sustainability of the Australian wildflower and native plant industry.

Expenditure in 2003–04: $351,309
Compared with 2002–03: $355,967

Background
Wildflowers (native to Australia) and Proteas constitute a substantial small agricultural industry with recent estimates putting the value of production at about $65 million pa. Several hundred small growers and a few larger growers are involved. Some even larger scale producers are probably required if Australia is to compete with the major producers of Australian wildflowers in other countries. We have the germplasm and now we need the entrepreunerial strength to grow the industry.

The key commercial wildflowers are Geraldton wax, kangaroo paw, Thryptomene, Stirlingia and species of Banksia, Leucadendron and Protea, with species other than waxflower increasing in relative importance. The major markets are Japan, the United States, the Netherlands, Canada, and Germany. Eucalyptus buds and foliage are also important. Opportunities exist for both the cut flower and foliage sectors plus the nursery industries in native plants. Fashion changes will demand continu-ing new cultivars and species.

Key Performance Indicators

• Availability and utilisation of market information
• proportion of production accounted for by cultivated flowers.
• return per kilogram of product
• industry involvement in product development
• availability of user-friendly production information, including return on investment data
• support for industry-driven training, workshops and networking

Key long term strategies

• implement the R&D Plan as comprehensively as possible to address industry priorities
• assess, strengthen and develop markets to achieve commercial outcomes
• improve existing products and develop new ones
• provide profitable and sustainable production and management systems
• enhance the human capital of the industry and consequent research knowl-edge and adoption.

Key outputs in 2003–04

• initiated actions to attract increased funding from the wildflower industry
• future funding partnerships to be pursued at the forthcoming Australian Wildflower Conference
• commissioned research in both Western Australia and the Northern Territory to produce a plan to develop a red coloured feature flower for the Christmas and New Year period
• identified commercial gaps in the wildflower market requiring follow up research to bring such crops into production
• conducted long term research on new varieties of Leucadendron at the University of Western Australia
• conducted commercial negotiations to release some cultivars of Leptospermum developed with DPI Victoria into the commercial flower and amenity markets.

Strategic planing
This Sub-program has its own five-year R&D plan, accessible in hardcopy and on the Internet at www.rirdc.gov.au/pub/wildflow.html
 

Research Manager:  Mr Max Bourke AM Phone: 02 6247 4630 Fax:02 6247 4051 Email:mbourke@ruralfunds.com.au