Read the full ScoreCard report 2002/03 (pdf file, 213 kb)
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South Australia's food ScoreCard report indicates the state's food industry has performed well compared to the national average, despite being severely hit by drought, the SARS epidemic, global unrest and the impact of a strong Australian dollar.
Food commodity production fell dramatically in most sectors as a result of the drought, however strong consumer demand and the sustained performance of processed exports have helped cushion the fall in gross food revenue from $9.4 billion to $8.9 billion, a five percent decrease.
Processed exports, fell just 4 percent compared with the national average of 12 percent, substantiating the need for a continued focus on value adding rather than being dependent on the volatile commodities sector. This suggests that South Australia's growing competitiveness has helped compensate for the ongoing challenges of trading in a continually changing global market.
The measuring of processed exports is a particularly important part of the ScoreCard analysis, as the State Food Plan has focussed industry effort toward higher value adding as a way of insuring against seasonal volatility associated with commodity focussed production.
The gross food revenue 2002/2003 has dipped slightly below the $9.4 billion mark required to achieve the target of $15 billion by 2010. Despite the disappointing year, South Australia is still $600 million in front of where we would have been without the direction set by Industry and Government in the State Food Plan.
Despite this year's negative trends, the results show positive signs of "structural" changes taking place in the food industry. A 30 percent increase in new capital expenditure in food processing and retail is an example of confidence that investors have in the future of the food industry.
Significantly, trends in value-added processing since the start of the Food Plan show an average annual growth close to 5%, while total food exports have grown by an average 9.2% every year. Processed exports have outpaced the average over the past 6 years, doubling in value at an average growth of 12.2% per annum.
With the influence of seasonal conditions, it is important to compare annual changes against the longer-term underlying trend movement. The graphic shows the extent of Food South Australia's challenge as the difference between the underlying or historical trend growth in gross food revenue and the target growth line. Even with the coincidence of negative influences over 2002/03, Figure 1 demonstrates that since the development of the Food Plan and target in 1996/97, the State's food revenue growth has lifted to an average of 5.6% per annum. This latest growth remains above the growth of the food industry in the decade prior to the development of the food target of 4.9% per annum.
In previous ScoreCard assessments where exceptional positive seasonal influences have pushed the food industry beyond the target growth required to reach the 2010 target, we have cautioned against any 'over' interpretation of food industry progress. In 2002/03 we have seen a clear case of the cascading influence of poor seasonal production along the food industry value chains.
In addition to reporting on economic outcomes of the food industry, the ScoreCard team have recently taken on the task of developing a system of measuring environmental and social issues relating to the South Australian food industry. This report includes additional papers on the importance of developing sets of environmental and social indicators.
The environment indicator paper focuses on selected environment indicators and gives a summary of these indicators at a Global, National and State level. The main categories that have been identified as being important environmental issues to report on include water, land, energy, air and waste.
Social indicators that the ScoreCard team have identified as important, include level of employment, skills, education, cultural change, product integrety and community involvement. The third paper in this report highlights the importance of both understanding and then measuring these social and community issues.
The papers in the report all highlight the importance of the establishment of a Triple Bottom Line (TBL) reporting system for the food industry. Without such a system it would be difficult to measure and therefore monitor the true sustainable growth of the industry into the future.