Call to smarten up Northern Australia's agricultural supply chains

Northern Australia’s agricultural supply chains need an urgent shake up to fully capitalise on the region’s economic development opportunities – a new Cooperative Research Centre for Developing Northern Australia (CRCNA) report has found.

The Reframing smart supply chains in Northern Australia report found there is significant potential for economic growth in Northern Australia across different industries, if supply chains can be strengthened, trade volumes intensified, digitally smart technologies adopted and a more targeted market approach taken, particularly regarding exports to our ASEAN neighbours. The project also pointed to the need for stronger multi-sectoral supply chain collaboration across Northern Australia to spearhead a post-COVID19 economic recovery.

Project lead and report co-author James Cook University (JCU) Professor Hurriyet Babacan said despite the uncertainty caused by the COVID19 pandemic, Asian markets remained critical to Northern Australia.

“We identified synergies in supply chains between Northern Australia and our neighbouring countries which could be further strengthened by establishing sub-regional trading strategies or blocs for Northern Australian producers. This could include shared supply chain and value chain hubs with ASEAN nations to enable aggregation, processing and enhanced market access.”

As part of the information and data gathering activities, the project team held roundtable discussions and interviews with industry and government stakeholders. These sessions identified common challenges facing northern agricultural producers, businesses, logistics providers, importers, exporters and consumers.

Topping the list of concerns was a lack of a clear vision about where, when and how agricultural development should happen and the impact the lack of clarity has around planning and investing in supply chain infrastructure and systems. Professor Babacan said a clear pan-northern vision for agricultural development would support the prioritisation of supply chains.

“COVID19 has caused significant disruptions to domestic and international supply chains and shown the critical role they play in our lives.

“The challenges have highlighted the need to shift our supply chain thinking to look at ways more sectors and supply chain participants can work together – to create scale, resilience and persistence in the market.

 “A new demand-led approach is needed to drive critical mass and optimisation of the entire supply chain network.”

CRCNA CEO Jed Matz said the project highlighted a re-think of northern supply chains is needed to address the cost of freight and transport.

“These are big issues to overcome and can’t be resolved in isolation of other challenges identified in this report.  Taking steps to reframe Northern Australia’s supply chains requires a transformational approach.

“This is why the CRCNA strongly supports calls for the establishment of a Northern Australian supply chain fund which would support the identification, prioritisation and development of freight and non-freight business case options or models.

“The fund would focus on building stronger supply chain collaborations at the right scale and test the feasibility of these investments.”

Mr Matz said it makes sense the Federal Government consider investing in a Northern Australian supply chain fund as part of its COVID19 economic recovery plan. The reframing smart supply chains project has the broad support of industry, with the Australian Logistics Council (ACL) backing the report’s call for urgent action.

ACL CEO Kirk Coningham said the north’s vast potential is being choked by a lack of clarity and vision.

“The enormous global opportunity in the COVID-19 ‘new normal’ will only be realised if we get supply chains right. And the timing is perfect to leapfrog into a new future embracing a sophisticated, collaborative, connected approach powered by technology and a sense of urgency.

“If we get this right now, Northern Australia will earn a reputation as a reliable supplier of the quality produce the world craves. That will serve the North, and Australia, for decades to come as we trade our way out of the COVID-19 recession,” Mr Coningham said. 

The CRCNA is progressing with their next research investment to drive the key recommendations from the reframing study with work underway to build a cross sectoral supply chain collaboration with key stakeholders from the various regional supply chain projects.

Download FINAL report here

Download Literature Review here

For more information

Carla Keith, CRCNA Communications Manager 0499 330 051

Professor Hurriyet Babacan, JCU The Cairns Institute 0413 819 884

Kirk Coningham, Australian Logistics Council 02 6273 0755