Benchmarking and comparing the production and regulatory conditions of Australian vegetable producers with our competitors (VG13105)

This is a final research report from Hort Innovation’s historical archives. Please note that as these reports may date back as far as the 1990s, the content and recommendations within them may be superseded by more recent research.

What was it all about?

The Australian vegetable industry was under increasing competitive pressure in both its domestic and international markets. Innovation, lower cost base and new access to market through trade agreements were some of the factors producing this pressure. To better position the Australian vegetable industry in this competitive landscape, Hort Innovation (then Horticulture Innovation Australia) had sought to benchmark Australian vegetable regulations against a set of selected competitors. The VG13105 project (the project), assessed regulatory conditions in Australia and those in seven of its competitors. The project aimed to provide clear insight on competition in the regulatory space so both Australian policy makers and industry players could make better informed plans for future regulatory development, industry practice and export strategy.

The scope of the benchmarking study was specifically concerned with the regulatory regime and the effectiveness of enforcement in the following areas:

• Primary production
• The use of chemicals
• Heavy-metal contamination
• Packaging
• Storage and transportation
• Food processing
• Labelling
• Infrastructure support
• Information access
• Buying-local initiatives
• Export subsidies and incentives.

And in the following countries:

• The United States
• Canada
• New Zealand
• China
• Thailand
• Peru
• Mexico.

The results of the project suggested that Australia’s regulatory support towards its vegetable industry was strong overall in the areas of food safety and agricultural marketing. However, regulation and enforcement in New Zealand, US and Canada were equally strong, which left Australia marginally competitively advantaged. Indeed, in certain areas, the regulatory regime in competitor countries was much stronger than that in Australia. For example, the US had more advanced regulatory support for local-grown products and safety standards for primary vegetable production.

China, Thailand, Peru and Mexico in general had weaker regulatory support in the areas of food safety and agricultural marketing, but there was a clear trend towards improvement. Thailand in particular, had more rigorous regulation of food packaging than Australia. The low cost of production and a growing safety and marketing support in these developing countries, was likely further to challenge the competitiveness of the Australian vegetable industry. However, lack of coordination and effective enforcement suggested that, in the realm of regulation at least, this challenge would likely only emerge over the medium term.