Food and grocery industry thrives in spite of challenge

The Australian Food and Grocery Council has released its annual State of Industry (SoI) report, which shows that the food and grocery manufacturing industry increased its value in 2020/21 despite being buffeted with problems from global supply chain issues and COVID-19.

The industry rose in value to be worth $133.6 billion in the 20/21 year, with a 0.9% increase in turnover for food and grocery manufacturing. This is despite a 17.1% decrease in the value of the industry’s exports due to major issues in markets in Asia and the United States.

AFGC CEO Tanya Barden said the industry had remained strong in the face of disruptions from the COVID-19 pandemic but that the war in Ukraine and related supply chain problems have had an impact in recent months.

“Food and grocery manufacturing plays a vital role keeping our supermarket shelves full and, as the nation’s largest manufacturing sector, it is central in ensuring we continue to make essential items here in Australia,” Barden said.

“These figures predate the unprecedented impacts of this year’s heavy flooding in eastern and central Australia, as well as the war in Ukraine. The pressures manufacturers were facing a year ago have intensified to the point where the viability of some businesses could be at risk.”

The SoI report shows that consumers panic buying and stocking up on foods were major drivers in domestic spending and increased the value of the sector by 9%, which helped counter the drop in exports.

It also shows that the food and grocery manufacturing industry makes up 32.1% of all manufacturing in the country and that it employs 272,800 people. Barden said that investment in the industry would serve to build up its resilience to future threats.

“The federal government has shown it understands the importance of supporting Australia’s competitive strengths, identifying food processing among the priority areas for its National Reconstruction Fund.

“Investment in Australia’s food and grocery manufacturing industry is an investment in the future and our sovereign manufacturing capacity.”

For information about AFGC’s State of the Industry report, visit www.afgc.org.au/industry-resources/state-of-the-industry.

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