National

Australian farmers thrive without handouts

By AAP Newswire

Australia's farmers are among the least subsidised in the world, with government support at just two per cent of revenue.

The federal government's agriculture forecaster on Friday released new analysis comparing major and developing economies.

ABARES found Australia was second only to New Zealand and well below many European and Asian countries' agriculture subsidies.

Norway (61 per cent of revenue), Iceland (59 per cent), Switzerland (55 per cent), Korea (52 per cent) and Japan (46 per cent) had the highest levels of support.

The research comes after China slapped a prohibitive 80 per cent tariff on Australian barley, citing subsidies as a key reason.

China claimed parts of the Murray-Darling Basin Plan amounted to subsidies despite vast amounts of grains being grown outside the river system.

Report author Jared Greenville said there were no targeted subsidies provided to Australian grain producers, along with other top exports beef and veal.

"In contrast, global levels of support for beef and veal were around 13 per cent of farm revenues, on average," he said.

"Grains markets other than rice are relatively free from market distortions - on average three per cent and six per cent for wheat and barley, respectively."

The report also warned of "creeping protectionism" in a post-coronavirus trading environment.

"Since late March, several countries have moved to impose export restrictions to shore up domestic food supplies," it said.

"The focus of restrictions has been on staple commodities, like rice, wheat and some other grains."

Dr Greenville said keeping subsidies low was important for both Australian producers and international markets.

He said deregulating agriculture and removing distorting support had spurred the sector's growth and boosted participation in global markets.

Countries with lower subsidies had better performing agriculture industries, with faster growing incomes, Dr Greenville said.

"The costs of increasing distortions to trade and subsidies are also felt more in countries that implement these policies than elsewhere."

Agriculture Minister David Littleproud said the research showed Australian farmers don't need handouts to thrive.

"They work mighty hard off their own bat to produce the safe and fresh food trusted by all Australians and sought after by the world," he said.