Almost half Australia’s food industry is owned by foreign investors, report shows
A report on foreign investment in Australia from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) has found that foreign firms accounted for ownership of about half of the nation’s dairy, sugar and red meat sectors.
The report, commissioned by the Australian Government’s Rural Industries Research and Development Corporation (RIRDC), also says that current foreign ownership of agricultural land, business and water entitlements in Australia is comparable with the levels of 1983-84.
According to the report, major companies investing in Australian agribusiness include private companies such as Cargill and Finasucre, public companies such as Wilmar and Parmalat, at least one farmer cooperative, Fonterra, and a state-owned conglomerate, COFCO.
The report states, “Foreign investment in agribusiness has typically been made by companies involved in the same or similar business in other countries seeking to expand their activities at an opportunistic time. However, Kirin (a brewing company) and Wilmar (active in a number of commodities not including sugar) each branched out into new sectors when they invested in Australia’s dairy and sugar sectors, respectively.”
Foreign investment growth in Australian red meat processing
The level of foreign ownership in Australia’s red meat processing industry is now higher than ever, according to the report, with 42 per cent of the industry owned by foreign companies.
According to the report, foreign investment in Australian meat processing has been undertaken largely by companies established in the meat industries of other countries, and their interest has been focused on export rather than domestic operations.
The largest player in Australian meat processing is the Brazilian-owned company JBS Australia, a division of JBS, Brazil’s largest multinational in the food sector, and one of the world’s largest meat companies. The plants now owned by JBS accounted for around 24 per cent of Australian red meat production in 2006 and 2007.
Other major players include US company Cargill, which accounts for 8 per cent of red meat production in Australia, Japanese company Nippon (6 per cent of red meat production) and Harmony, a company based in the Cayman Islands.
Foreign investment in Australian dairy manufacturing
More than half the milk produced in Australia is now processed by foreign-owned companies, with 47 per cent of the nation’s milk processors were still Australian-owned.
Fonterra, a New Zealand farmer-owned cooperative, and the Japanese-owned Lion together handle around 45 per cent of Australia’s milk production. Parmalat, formerly Italian but now under French control, accounts for a little over 5 per cent.
The Australian-owned cooperative Murray Goulburn is still the largest individual dairy processor in Australia, taking around 35 per cent of milk produced. Fonterra, one of the world’s largest dairy manufacturing and exporting companies, is cooperatively owned by New Zealand dairy farmers.
According to the report, foreign ownership of milk processing capacity appears to have been beneficial for the industry. Major foreign investors have injected funds to improve efficiency and maintain profitability while at the same time engaging in some winding down of existing, out-of-date capacities.
Foreign investment in Australian sugar milling
Three foreign-owned milling groups, Sucrogen (controlled from Singapore–Malaysia), Bundaberg (from Belgium) and Tully (from China), now undertake around 60 per cent of Australia’s raw sugar production. Sucrogen mills account for around 43 per cent, Bundaberg for 11 per cent and Tully for 5 per cent.
According to the report, Sugar production in Australia has declined through the past decade as a result of low sugar prices, and a process of rationalisation has taken place, with a number of mills closing. The availability of additional capital from new foreign owners has facilitated this rationalisation and maintained efficiency in the industry.
A complaint against Spudshed, a chain of supermarkets in WA, has been dismissed.
Fast food chicken chain, Red Rooster, is expanding into more urban areas with a new-look brand and s...
Domino’s Pizza is the first company to pay penalties for alleged non-compliance under the Franchisin...
Woolworths’ decision to decrease the amount of Coca-Cola Amatil’s Mount Franklin water it stocks sig...
A new ‘no palm oil’ certification program has been launched by The Orangutan Alliance.
The Retail Food Group has said revenues from new and renewing franchise sales are now forecasted bel...
SPARKLING water infused with tetrahydrocannabinol (THC), the active ingredient that causes the marij...
How could a business possibly squeeze into the delivery service sector, carving out a market from th...