National Australia Bank’s (NAB) team of leading economists has broken down the 2021-2022 Federal Budget, looking at what it means for Australian agribusinesses.
NAB’s Federal Budget report provides insights into some of the key elements impacting the agricultural sector, including:
While the National Farmers Federation’s (NFF) ambition of a $100b agricultural sector by 2030 has been around for some time, the 2021-22 budget explicitly addresses this commitment, providing additional funding for biosecurity, soils, biodiversity, export and production. The budget provides $850m over the forward estimates.
Just under half of the funding under Agriculture 2030 (some $411.4m) is directed to biosecurity and pest management.
There is also $147.9m for soil programs, $102.1m for production and trade, $67m for organic waste, $36.8m for biodiversity and $50.3m for forestry and fisheries, with the balance of funds in the package to support agricultural employment and innovative agricultural practices.
Instant asset write-off extension
The instant asset write-off scheme was expanded substantially in last year’s budget to $150,000, largely as a COVID-19 stimulus measure. The scheme has been extended for one year to 30 June 2023, providing a longer window of opportunity for agribusinesses to make on-farm investments.
Drought and water infrastructure projects, other sundry measures
The budget provides funding for drought support, although some of this is existing funding, as well as redirected $1.5b from the Water Efficiency Program to improvement works in the Murray-Darling Basin. The budget also provides $29.3m for timely environmental assessments.
Visa changes and border reopening timing
A key challenge for agricultural businesses, particularly in horticulture, has been lack of labour availability with closed borders.
While the budget includes a measure (announced in January 2021), to allow temporary visa holders to work more hours in the agricultural sector, the major challenge remains closed borders. The budget does not forecast the border reopening until well into 2022.