Overall, Australian vegetable growers have been experiencing improved crop yields according to new Australian Bureau of Statistics (ABS) data, but it’s not all good news according to AUSVEG, with production costs becoming unmanageable for many growers.

“What we are witnessing is that Australian vegetable growers are striving for higher yields to help compensate for higher production costs,” said AUSVEG Economist, Mr Shaun Muscat.

“Higher yields for some vegetables do not necessarily translate into greater returns and profitability for vegetable growers. For example, many smaller to medium sized vegetable growers made losses in 2012-13,” said Mr Muscat. 

AUSVEG is the leading voice in Australian horticulture, representing 9,000 vegetable and potato growers.

According to the data released by the ABS, yields have increased in 2012/13 with tomatoes experiencing the largest yield improvements (45 per cent), followed by lettuce (30 per cent), capsicums (12 per cent), onions (6 per cent). Potatoes and carrots have improved at similar rates (1 per cent), in 2012-13 when compared to the previous year.

“Whilst yields seem to have improved, growers are using their land more intensively, which also increases production costs, for inputs such as fertiliser and energy, and therefore impacts overall profitability,” said Mr Muscat. 

In 2012-13, hired labour is estimated to have been the largest production cost, followed by contracts paid for fertiliser, seed and fuel. 

Electricity costs have almost doubled since 2005-06 for Australian vegetable growers, while hired labour and fertiliser costs have increased by 62 per cent and 68 per cent respectively.

“Australian vegetable growers are under continuous pressure to simultaneously improve yields and reduce costs of production in order to improve returns and remain viable. As a result, many growers are beginning to transition away from traditional methods of growing vegetables by introducing mechanised technologies to reduce labour costs,” said Mr Muscat. 

Australian vegetable growing businesses average cash income is estimated to have fallen to $103,000 per farm in 2012-13, according to the Australian Bureau of Agricultural and Resources Economics and Sciences (ABARES). This represents a 29 per cent decrease from 2005-06, and is 41 per cent lower than the five year average to 2012-13. 

“Estimates suggest that average vegetable business profits have fallen from $60,200 in 2011 12 to a deficit of $10,000 in 2012-13. This is an approximate reduction in business profit of 117 per cent from the previous year,” said Mr Muscat. 


MEDIA CONTACT: Shaun Muscat, AUSVEG Economist, AUSVEG; 
Phone: (03) 9882 0277 Mobile: 0490 082 740 E-mail: shaun.muscat@ausveg.com.au