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ABARES Report: Labour gaps still major pressure along supply chain

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According to the September quarter report from ABARES, labour is one of the key factors impacting the higher retail price of fruit and vegetables in Australia for 2021-2022.  

However, APAL CEO Phil Turnbull has cautioned assumptions that higher retail prices are translating into stronger returns to apple and pear producers. 

“ABARES’ latest report confirms the very challenging labour supply for our growers this season.”   

ABARES labour projections have used Pre-COVID figures of overseas and casual and contract labour across states and harvest seasons as a predictor of where and when there will be significant labour gaps in the year ahead.  

Use of overseas casual and contract labour on fruit and nuts farms, 2018–19 (Source: ABARES)

The report also illustrates a marked increase in recruitment activities throughout the supply chain for 2020-2021.  

From harvest labourers to forklift drivers, storepersons and shelf-fillers, the demand for labour throughout the supply chain has risen sharply during the pandemic. 

National recruitment activities for selected occupations, January 2019 to June 2021 (Source: ABARES)

Key points 

  • Labour costs and increased household demand for fresh fruit and vegetables will drive up farmgate prices, with the value of Australia’s horticultural production is forecast to reach a record $12.4 billion in 2021–22. 
  • Labour shortages will likely result in some crop losses. While the losses will form a small part of the whole-of-horticulture forecast, it is more likely to disproportionately impact fruit industries. 
  • As labour shortages extend the harvest season, the extended availability of products to consumers as a result will likely limit price growth. 
  • Favourable weather conditions and improved yield across Queensland and the southern states will contribute further to the high demand for harvest labour 
  • Competition for available labour throughout the supply chain will increase pressure on farms to become sought-after employers, potentially by offering higher pay and/or better conditions to attract and retain workers. 
  • Increasing efficiency and labour productivity – whether by restructuring the workforce or using on-farm innovations – could “buffer” the increasing production costs. 
  • A different workforce composition to make the most of available labour includes greater reliance on Pacific Labour Scheme and Seasonal Worker Program.  

Read the full report: Horticulture: September quarter 2021 

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