 |
|
|
|
|
R&D PLAN FOR
THE AUSTRALIAN FODDER INDUSTRY
2004-2009
Also
available as a downloadable PDF document - 465k
Foreword
The fodder industry, we believe, is playing an important role in these trends. As intensive livestock production expands the demand for high quality and reliable feed supplies will increase if final product quality and safety requirements are to be guaranteed. This requires specialist producers who can support quality assured feed products. Fodder is becoming an important component of this process for increasing exports but especially the domestic market. These developments will enhance the traditional importance of fodder in times of drought.
Despite these trends the industry has not had a high R&D profile and consequently has not achieved its production potential or maximised its market scope. This plan we believe is an important step in supporting the further development of this expanding industry.
The plan has been developed in consultation with industry and most particularly the Australian Fodder Industry Association (AFIA). The plan details the agreed strategic R&D needs of the industry, which will be pursued by RIRDC in concert with industry as sufficient funds become available.
Much work has gone into the
preparation of the plan, this has included a range of industry oriented
meetings, discussions with research groups and presentations at AFIA conferences.
We would like to thank all for the contributions they have made.
| Simon Hearn
Managing Director Rural Industries Research & Development Corporation |
Don Law
Chair, Fodder R&D Advisory Committee Rural Industries Research & Development Corporation |
August 2004
1.
The Purpose of the Plan
Research and development
will enable the fodder industry to achieve and maintain competitive advantage
by solving problems that represent either inherent weaknesses or arise
as the result of changing market requirements. History has shown that industries
that continue to invest in R&D are more proactive in rapidly changing
market conditions and are able to differentiate their products so that
they are less susceptible to the volatility of commodity markets.
Research and development is, by its very nature, a step into the unknown and a risky business. The world is also full of market opportunities. The real test is to be able to prioritise those opportunities to achieve a pre-determined level of investment return that will cover the costs of successful project and program outcomes as well as those projects that do not deliver to expectations.
Successful industries and companies plan for their success by having strategic plans and business plans that convert strategies to real life outcomes with improved competitive advantage. In the same way research and development is not a hit and miss affair but rather a planned approach to address industry and company priorities identified in an examination of weaknesses, opportunities and threats in other planning activity.
R&D should either build on existing successful R&D outcomes or address new strategic priorities to enable scarce financial resources to be invested in a prioritised way that increases the chances of further success.
The Fodder industry through the Australian Fodder Industry Association (AFIA) has been working for five years to develop a case to Government for a compulsory R&D Levy like most other significant agricultural industries. While several submissions have been made to Government a compulsory levy has still not been approved. AFIA is still working to this end and will continue this process in the coming years. In the mean time the industry has introduced a voluntary levy arrangement to highlight its commitment to R&D. Initially this was agreed to for export cereal hay as the collection points were relatively straightforward. Subsequent to this, domestic traded hay has been included. Voluntary levies are difficult as the usual ‘free-rider’ issue always arises.
This plan is the document that enables a transparent examination of priorities, the programs and projects that will be developed to address those industry priorities and the mechanism to evaluate progress against pre-determined quantitative objectives over the five year R&D planning period.
The following research and development strategy for the RIRDC Australian fodder program builds on the outcomes of a series of industry and research group meetings and consideration by the Australian Fodder Industry Association (AFIA).
While this plan relates to
research and development, inherent in the strategy is the industry recognition
that there is a great need to address the substantial education and extension
needs of the industry.
“A sustainable and profitable Australian fodder industry producing quality product”.
The MISSION STATEMENT supporting the fodder industry based R&D effort will be:-
“To stimulate and promote
those R&D efforts that will produce quality products and secure sustainability
and profitability for all sectors of the Australian fodder industry value
chain in domestic and export markets”.
Fodder production is concentrated in Victoria and New South Wales. Although Western Australia and South Australia are the major exporting states. The largest domestic market users are the dairy industry (40%), horse industry (25%) and feedlot industry (20%) and others (15%). In recent times there has been a growing trend for the dairy industry to rely more on off-farm purchases with recent estimates suggesting that more than 55% of fodder is purchased off-farm.
The animal feeds industry in East Asia is estimated to be valued at US$10 billion, and it is perceived that a large untapped demand will enable the industry to develop many new opportunities. The fodder industry has been taking advantage of this market with exports increasing significantly in recent years to over 500,000 tonnes. The largest market is currently cereal hay into Japan but other markets such as Korea, and Tiawan and the Middle East are growing.
Several years ago the Australian
Fodder Industry Association (AFIA) developed a case for the introduction
of a statutory R&D levy to support a longer-term basis for an R&D
program for fodder. This case was submitted to the Government but was not
supported at that time. More recent approaches to Government have also
not met with further developments. AFIA will continue to investigate options
and discuss these with Government. In 2000/2001 the cereal hay exporters
introduced a voluntary R&D levy on export cereal hay to demonstrate
that the industry is strongly committed to an R&D program. In the first
full year of collection of the levy (2001/2002) $173,000 was contributed.
In 2002/2003 additional producers have agreed to contribute this voluntary
levy and at the AFIA Annual conference domestic hay producers also agreed
to progress a similar voluntary levy contribution despite the difficulty
they face of many collection points and groups.
5. Fodder
Industry R&D Priorities
The original five year plan
workshops (1998-2002) identified priority areas for R&D. A range of
recent fodder industry meetings have reviewed these and added or subtracted
issues based on them being emerging problems or having been satisfactorily
resolved in the last five years. These can be grouped into the following
areas:-
The issues within each
of these crop areas are summarised in the following tables.
6.
The R&D Strategy for 2004-2009
The overall objective of
the strategy is “A sustainable and profitable Australian fodder industry
producing quality product”.
This will be achieved by
focusing on seven key R&D goals. These have been developed during discussions
in more recent workshops and industry meetings. The key goals (not necessarily
in priority order) are:
R&D program monitoring
and funding base development has not been included as a specific R&D
goal. However, the Committee and Program will support these activities
on an ongoing basis. It is not felt that it is appropriate to support projects
in these areas.
ATTACHMENT 1:
ALIGNMENT OF PROGRAM STRATEGIES
WITH RIRDC’S CORPORATE GOALS AND STRATEGIES
ATTACHMENT 2:
ALLIGNMENT OF FODDER CROPS
PROGRAM STRATEGIES WITH NATIONAL PRIORITIES AND RURAL RESEARCH PRIORITIES
|
