Agriculture hit $100 billion. Farmers kept 20 cents.
In 2018, the National Farmers' Federation set Australian agriculture a $100 billion farm-gate target by 2030. At the time the industry sat around $60 billion, and the NFF said business as usual would get it to about $84 billion.
The extra lift was meant to come from attracting people and capital, harnessing new technology, unlocking markets, and producing food and fibre more productively. That is why the number was set: to force an innovation agenda, not to wait for prices to do the work.
I was at the first AgriFutures evokeAG in February 2019 when that figure was widely discussed, and it became a key catalyst for the original innovation initiatives and funding that supported the first generation of AgriTech companies in Australia.
For a while that narrative held. Capital moved into AgriTech, research programs were justified against a national number, and the agricultural sector had a quantifiable finish line everyone could point to.
We have now crossed that line four years early. ABARES March 2026 put Australian farm production at a record $101.4 billion in 2025-26, but the story we are telling ourselves about how we got there is not the one the data supports.
It was not a productivity miracle. Inflation moved the finish line. Livestock prices did a large share of the remaining dollar work. Cropping volume is the part that earned honest credit.
The number that actually moved is inflation
ABARES put farm production at $59.9 billion in 2017-18 and a record $101.4 billion in 2025-26. The climb is $41.5 billion, or about 69 per cent in nominal terms, and that is the number being celebrated.
Agricultural CPI (inflation) tells a different story. Prices rose about 30 per cent from June 2018 to June 2026, which means the 2018 industry is worth about $78 billion in today's money. Around $18 billion of the increase, roughly 44 per cent, was needed just to keep pace with general inflation, so the real production increase is closer to 30 per cent, not 70.
If the original $100 billion target had been inflation-indexed, it would sit closer to $130 billion today. We did not beat a $100 billion challenge four years early. We beat a nominal target that got cheaper as the purchasing power of the dollar declined.
Three layers, not one story
I think there are three layers that have contributed to this $100 billion milestone.
Layer one is general inflation. A fixed-dollar target was always going to get easier after CPI hit 7.8 per cent in 2022. We are still dealing with the flow-on effects of those monetary policy decisions, with inflation hovering around 3.8 per cent.
Layer two is farm-gate prices running hotter than CPI. This is not the same thing as productivity. ABARES has livestock slaughter rising from $18.7 billion to $35.3 billion, with value growing about 8.3 per cent a year while production grew about 2.6 per cent. Cattle, lamb and sheep were worth more. Australia did not suddenly produce dramatically more of them.
Layer three is real output. This is where the honest credit belongs. Grains, oilseeds and pulses rose from about $12.5 billion to $27.8 billion, with volumes growing faster than prices. Horticulture added about $7.8 billion more steadily. Those three sectors, plus livestock slaughter, carried nearly all of the farm production increase, while wool, industrial crops and live exports went backwards.
Over the longer run ABARES has physical production growing about 1.3 per cent a year and agricultural prices about 2.9 per cent. Prices have been doing more work than production tonnes for a long time.
What agricultural productivity actually did
Productivity is not value. ABARES total factor productivity (TFP) measures how well farms turn labour, land, capital and inputs into output. That is a harder test than a dollar target, and it is the test the 2018 innovation story implied.
It has been slowing, not accelerating.
Broadacre TFP grew at 2.18 per cent a year through the 1980s and 1990s, then fell to 0.72 per cent from 2000 to 2023. Cropping is the exception, at 1.6 per cent over the long run. Sheep, beef and dairy are not.
If you need a test of whether $100 billion is a new floor, look at next year. ABARES June 2026 report expects farm-gate value to fall 5 per cent to $98.3 billion in 2026-27.
How much are farmers keeping?
$100 billion at the farm gate is a significant milestone. The more important question is how much of it farmers keep.
Gross value of production measures the size of the industry. It does not measure what is left after fertiliser, fuel, labour, interest and machinery have been paid. ABARES puts total farm costs near $79 billion in 2025-26. Against $101.4 billion of production, that leaves about $22 billion in the farm sector, or roughly 20 cents in every dollar.
That is not a healthy margin story. It is reflective of an industry under increasing cost and margin pressures
ABARES farm survey data makes the same point at the business level. Average broadacre farm cash income recovered to $266,000 in 2024-25, only just above the 10-year average of $264,800. Cropping has had the best run. Specialist cropping farms averaged $925,900 over the three years to 2024-25, well above their longer-term $545,300. Sheep did not. Their three-year average sat well below the already-depressed $130,000 longer-term mark.
Then look at next year. ABARES expects average broadacre farm business profit to fall from $216,000 in 2025-26 to $65,000 in 2026-27, a 70 per cent drop in real terms. Cropping profits are forecast to fall from $810,000 to $280,000. Beef from $95,000 to $11,000. Fertiliser prices are up 43 per cent this year, fuel 14 per cent, and mean broadacre costs stay elevated around $750,000 a farm.
A sector can print $100 billion and still leave farmers with a thinner share of the dollar. If the next target does not put retained margin at the centre, we will celebrate scale again while the people producing it go backwards.
What this means for AgriTech
The $100 billion target has been widely used as a driver for AgriTech innovation in Australia, and it was a catalyst for many accelerator programmes and the establishment of venture capital investment funds.
The risk now is treating a $100 Billion milestone as proof the innovation system worked. It is not proof.
Global AgriTech investment has fallen about 70 per cent since 2021. That is not the profile of an industry delivering the productivity gains this NFF milestone is being used to imply.
Australian agriculture and AgriTech now need to be clear and collaborative about what real productivity improvement looks like, especially in a more volatile macro-economic and climate environment.
If I had to nominate where meaningful focus should sit, it would be this:
Productivity has to show up in farm profitability. ABARES TFP, cost per tonne, and the share of the dollar that stays on farm are the tests. A $100 billion print that leaves average broadacre profit falling 70 per cent is not a productivity result.
Production has to hold through climate and macroeconomic volatility. Yield stability, season-to-season output, and whether farm-gate value gives the number back the moment prices or rainfall move are the tests. A finish line that slips to $98.3 billion the following year is not a resilient floor.
AgriTech has to translate research and investment capital into on-farm payback. Cost per hectare, labour hours saved, and time to recoup the purchase are the tests. Millions of dollars of R&D only count when a grower can measure the return in the paddock.
I still think the target was worth setting. However, I would rather have a smaller headline and a more productive industry than a $100 billion trophy that inflation helped hang on the wall.
