Post on 22-May-2020
AGRIBUSINESS GIPPSLAND ANDKPMG FORUM
16 February 2016
kpmg.com.au
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With us today
10:00am Welcome
Paul Ford, Chair Agribusiness Gippsland
10:20am Thinking Regional & RuralJames Flintoft, CEO, Regional Development Victoria
10:45am A Collective Voice for GippslandIan Proudfoot, KPMG Global Agribusiness Leader
Ben van Delden, KPMG Australia Head of Markets
11:45am Coffee break
12:00pm Food for thought panelFacilitator: Tim Ada, Executive Director – Sector Development, Department of Economic Development,
Jobs, Transport and Resources
Panellists:Ian Proudfoot, KPMG Global Agribusiness Leader
Dr Chris Downs, Research Director, Food Innovation CSIRO
Dr Christine Pitt, General Manager Value Chain Innovation, Meat and Livestock Australia
Peter Liddell, KPMG ASPAC Supply Chain & Operations Leader
Piers Hogarth-Scott, KPMG Director Digital Consulting
1:00pm Lunch
2:00pm Forum closed
Agenda
Welcome
Paul Ford, Chair Agribusiness Gippsland
“Agribusiness”……
Interdependence of all parts of the value chain that work towards the production, manufacturing, distribution and retailing of food and fibre products and services
Australia:• $155bn value chain • Provides Australians with 1.6 million jobs• Earns $36bn in export revenue
Gippsland:• 6500 farm families living in and contributing to small rural communities • 3000 post farm gate “agribusinesses”• Globally competitive large and small food and fibre manufacturers • 52% of Gippsland commerce is agribusiness dependent
Why is “agribusiness” important
• Victoria’s largest region by gross regional product
• $14.3bn : Agribusiness is $6.5 to $7bn
• Dairy $3bn
• Forestry $1.5bn
• Meat $1bn
• Intensive horticulture $750m
• Fishing $300m
Gippsland Region
“Greater Gippsland” agribusiness value chains……
Image - Ian Rolfe Photography Melbourne
Nicoll family farm @ Fish Creek
Andrew Willis, Gail Beer and Phillip McIlwaine – Murray Goulburn Leongatha
Mate Batarilo – Noojee Trout Farm
Federation University & Training – attracting retain and developing talented people
Elizabeth Ross @ Ellinbank Innovation Centre
Vibrant small rural communities…….
Ken Lay - Korumburra
Build strong rural communities
Fast track economic development
Provenance of Gippsland food & fibre products
Generate new investment
Attract, retain & developtalented people
Building size &
diversity of networks
Data to give insight &
agility on emerging issues
Driving projects w
ith real world outcom
es
Smarter, uniquely A
ussie innovation processes
Collaboration on precom
petitive projects
Driv
ers
Enablers
“What Can We Do Matrix”…..Drivers and Enablers
Where are we at in early 2016?..........................
In the latter half of 2015 the Andrews’ Government has set up the policy framework that shapes agribusiness…………….
1. Food & Fibre Discussion Paper establishes “agribusiness” as a priority industry
2. The Regional Statement establishes Gippsland as the biggest region at $14.3bn GVP pa. Agribusiness represents half that value.
3. The Regional Partnerships establishes a process whereby Regions identify emerging issues and Government develops a whole of government response.
“VISION WITHOUT ACTION IS JUST A DREAM.”
“ACTION WITHOUT VISION JUST PASSES TIME.”
“TOGETHER VISION WITH ACTION CAN CHANGE THE WORLD”
Joel A Barker
Thinking Regional & Rural
James Flintoft, CEO, Regional Development Victoria
Supporting Agribusiness jobs and industry development in Gippsland
James FlintoftChief Executive
Regional Development Victoria
Agribusiness Insights BriefingAgribusiness Gippsland & KPMG
16 February 2016
UNCLASSIFIED
Regions and food and fibre are important
• 1.5 million Victorians (25% of state population)
• Agriculture: $11.6 billion exports, employs 190,000 people (2 in 6 regional jobs)
• Regional tourism: $10.9 billion Gross Regional Product and employs more than 107,000 (1 in 6 regional jobs)
– Of the 2.6 million visits to the Twelve Apostles, the average “snap and go” tourist spends 40 minutes and leaves only 18 cents in the regional economy
• Key to sustainability: food security, biodiversity, preservation of indigenous cultures, water solutions, climate change solutions
• A vital contributor to the quintessential nature of what defines Australia
– the bush, iconic landscapes, indigenous heritage etc.
UNCLASSIFIED
Regional Victoria: Opportunities and Challenges
FORCES AT WORK OPPORTUNITIES CHALLENGES
Globalisation: rise of Asia
• Food and fibre• Tourism (international)• International education
• Globalisation of supply chains (e.g. automotive)• Energy prices• Biosecurity
Demographics• Tourism (domestic)• Commuters• Tree/Sea changers
• Non-urban land use conflicts (e.g. agriculture)
• Education attainment levels• Poorer health outcomes• Entrenched disadvantage in some areas
Technology• Accessing markets (e.g. ecommerce)• Modern agriculture• Remote health and education service delivery
• Coverage (mobile black spots, broadband)
Climate• High rainfall zones in western Victoria• Gippsland weather patterns • Renewables
• Variable climatic conditions for regional producers
• Severe weather events
UNCLASSIFIED
Economic levers of Government
Transport, infrastructure and land use planning
• Six sector strategies: $200 million Future Industries Fund• $60 million Start Up Victoria initiative• Visit Victoria (tourism and major events under one agency)
• ‘Back to Work’ Scheme• TAFE Rescue Fund - $320 million• Investment in new Tech Schools (Gippsland, Bendigo, Ballarat and Geelong)
• $500 million Premier’s Jobs and Investment Fund• Trade mission programs• $200 million Regional Jobs Fund
• Murray Basin Rail Project• Regional Transport Network Development
Plan (e.g. passenger rail)
Industry and innovation policy
Taxation, efficient regulation and public
sector reforms
Trade and investment attraction
Skills and employment
• Victorian Small Business Commission• Biosecurity services and regulation
• $250 million Regional Infrastructure Fund• Advisory Council on Intensive Agriculture• $200 million Agriculture Infrastructure Fund
• Invest Victoria• Invest Assist• Victorian Government Business Offices
UNCLASSIFIED
Government Policy Frameworks
Regional Partnerships:
The centrepiece of government’s regional agenda
UNCLASSIFIED
Food and Fibre Discussion Paper
Themes from consultation
Access to innovation capabilities and accelerator services
Locally-relevant education and training close to the place of production
Reduce business compliance costs
Support businesses to be more investment ready
Market access, including addressing barriers to entry
Support a strong ‘Brand Australia’
Better and more reliable access to water (water security)
Simplify planning frameworks to support growth
Upgrade transport infrastructure, especially freight corridors to ports
Improve access to digital services in regional Victoria
UNCLASSIFIED
‘Regional Statement
Regional Economic Development & Services Review• Distinguished independent Advisory Board.• Extensive consultation across business, community
and government (early 2015). • 61 recommendations to government – delivered in
July 2015.
Victoria’s Regional Statement• Government’s response to the Regional Review
(November 2015)• Announced a new way of working with regional
communities: Regional Partnerships.
“Government needs to do more to listen to – and act on – the voice of regional Victoria.”
UNCLASSIFIED
Regional Partnerships
REGIONAL PARTNERSHIPS x 9
- Drive local action around priorities.- Mutually reinforcing activities towards a common agenda.- Find new ways of working within existing resources.- Could be time limited or ongoing.- Outcomes focussed. Progress is measured and reported.
- Receives priorities requiring policy/budget response from State Government.
- Advocates regional priorities to Ministers and decision-making committees.
- Commissions work on regional policy priorities.
RURAL AND REGIONAL MINISTERIAL COMMITTEE
- Develops priorities across economic, social and environmental issues based on:
• existing strategic plans,• community engagement, and• good data and analysis.
- Identifies outcomes / indicators for priorities and measures them.
Working Groups (examples only)
REGIONAL SKILLS-TAFEs-DET-Strategic Industry Sector Leads (DEDJTR)-Industry reps (e.g. food + fibre or tourism)-Office of Victorian Skills Commissioner
REGIONAL TOURISM-Regional Tourism Board-Local Government-Visit Victoria-DELWP-Regional Directors (RDV)
Y12 ATTAINMENT-Children and Youth Partnerships-Local Learning and Employment Networks-DET-DHHS
Agribusiness-Regional agribusiness groups-VFF/grower groups-Catchment management authorities-Local government (inc. relevant metro councils)
UNCLASSIFIED
Gippsland Plans
Gippsland Workforce Plan
UNCLASSIFIED
Questions?
UNCLASSIFIED
APPENDIX - Fast facts: Regional Victoria
Population (2014p)
Unemployment Rate (December
2015)
Labour Force Participation (Dec 2015)
% who completed year
12 (2011)
% who are obeseBMI ≥30(2011/12)
Gippsland 265,150 7.1% 58.6% 36.2% 19.3%
Regional Victoria 1,467,496 5.4% 60.9% 39.2% 20.7%
VICTORIA 5,841,667 5.9% 64.6% 54.2% 17.3%
Source: Regional Development Victoria Information Portal; DTF Victoria Economic Fact Sheet; Estimates based on ABS Census Place of Work; NIEIR 2015; ABS 3218.0; DHHS.Unemployment Rate and Labour Force Participation Rate derived using a three month average
A Collective Voice for Gippsland
Ian Proudfoot, KPMG Global Agribusiness Leader
Ben van Delden, KPMG Australia Head of Markets
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32
VOICES FROM THE NEW ZEALAND PRIMARY SECTOR2008
“We are all operating in Silos, nobody understands what real collaboration looks
like”
“Young people are walking past the industry, we can’t attract the talent we need, despite
the competitive pay”
“It’s all about movies for the government, we are yesterday’s
game”
“We know we should focus on growing value but it is far easier to focus on
growing more volume”
“Everybody is head down bum up on the day to day stuff and lack the time to focus on the
future”
“Nobody is investing in building the infrastructure to support strong connected rural communities”
“I compete with the company down the road, why would we work together in the
market?”
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33
FORUMS WERE NEEDED FOR THE “WHAT IF” CONVERSATIONS
THE AGRIBUSINESS AGENDA BECAME A CATALYST FOR US TO BE ABLE TO ENABLE THESE FORUMS
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34
WHY HAS THE AGENDA SUCCEEDED?
- EXTENSIVE STAKEHOLDER CONTRIBUTIONS
- COMPREHENSIVE RESEARCH
- OPINIONATED, INDEPENDENT ANALYSIS
- LEVERAGING KPMG GLOBAL NETWORK
- CONSTANT INNOVATION IN APPROACH
- MARQUEE LAUNCH EVENTS
- COMMITMENT TO LEVERAGE THE CONTENT
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35
WHAT HAVE WE COVERED?
- NOTHING IS OFF LIMITS (IF IT IS RELEVANT)
- ILLUSTRATIVE CASE STUDIES
- STATE OF THE NATION INSIGHTS
- DEEP DIVES (MARKETS, LABOUR, SUSTAINABILITY,INNOVATION, INDUSTRY GOOD, VALUE ADD)
- ANNUAL PRIORITIES SURVEY
- ANALYSIS OF FOOD IMPACTS OF MEGAFORCES
- EMERGING LEADER PERSPECTIVES
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36
EMERGING LEADERS SUMMIT: SEPT 2015
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37
ENABLING THE ‘WHAT IF’ FORUMS
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38
WHY IS THIS RELEVANT?
“WITH GREAT COURAGE, INTEGRITY AND LOVE, WE EMBRACE OUR RESPONSIBILITY TO CO-CREATE A WORLD WHERE EACH OF US, OUR COMMUNITIES, AND OUR PLANET CAN FLOURISH – ALL THE WHILE, CELEBRATING THE SHEER LOVE AND JOY OF FOOD.”
PURPOSE STATEMENTWHOLE FOODS MARKET INC
IT IS TIME FOR A PARADIGM SHIFT
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39
RECOGNITION IS GROWING THAT THE FUTURE IS COMING AND LOOKS VERY DIFFERENT
TANGIBLE CAPITAL ASSETS
PEOPLE BRAND EXPERIENCE INNOVATION CONSUMER
CONNECTION
CRITICAL INTANGIBLE INVESTMENTS
Often lack governance focus on intangiblesMore difficult to articulate expectationsHarder to do and lack the capability to collaborate
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40
FRAMEWORK FOR CAPTURING GIPPSLAND’S AGRIBUSINESS POTENTIAL
February 31 March Mid May Late July August/ September
IDENTIFY & ENGAGE• Business• Research• Government
CONDUCT ROUNDTABLES• In market / pan industry
•Qualitative •Compliments Regional Partnerships pathway
SHARE• Inform Regional Partnership representative
•Independent•Free access
ONLINE SURVEY•Sector specific•Opportunities•Challenges•Scalable
WRITE AGENDA•Local & independent author
•Sector agnostic• Ian Proudfoot peer review
Indicative timeline
DESKTOP RESEARCH•Consolidate existing research•Build in agility
Coffee Break
Facilitator: Tim Ada, Executive Director – Sector Development, Department of Economic Development, Jobs, Transport and Resources
Panellists:Ian Proudfoot, KPMG Global Agribusiness Leader
Dr Chris Downs, Research Director, Food Innovation CSIRO
Dr Christine Pitt, General Manager Value Chain Innovation, Meat and Livestock Australia
Peter Liddell, KPMG ASPAC Supply Chain & Operations Leader
Piers Hogarth-Scott, KPMG Director Digital Consulting
Food for thought panel
Accelerating into a disruptive future
Ian Proudfoot, KPMG Global Agribusiness Leader
44
ACCESSIBILITYENVIRONMENT
BOUNDARIES
COMMUNITIES
DISRUPTION
THE FORCES DRIVING OUR CHANGING, MULTIPOLAR WORLD
BIODIVERSITY
RELIGION
FOOD ON DEMAND
COUNTERFEITINGFOOD PRINTING
45
EMERGING ISSUES THROUGH A MACRO LENS
CLIMATE CHANGE FORCES SYSTEM CHANGE
ACTIVIST ENGAGEMENT(WELFARE VS RIGHTS)
RESPONDING TO EVOLUTION OF GM
ACTIVELY MINIMISING FOOD WASTE
CONSUMER RESOURCE CONSTRAINTS
CONNECTING DIRECTLY WITH CONSUMERS
46
EMERGING ISSUES THROUGH A MACRO LENS
ALTERNATIVE PROTEIN EVOLUTION
CORPORATE RESPONSE TO AMR
THE ROLE OF ARTISAN ENTERPRISES
COMPLIMENTARY NUTRITIONAL
MARKETS
CLONING IS DELIVERED AT SCALE
DEVOLVED AGRICULTURE
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THANK YOUIan ProudfootGlobal Head of AgribusinessKPMG Auckland, New Zealand
+64 (0) 9 367 5882+64 (0) 21 656 815iproudfoot@kpmg.co.nzwww.fieldnotes.co.nz
Megatrends and Agri-food innovation
Dr Chris Downs, Research Director – Food, CSIRO
7 Global Megatrends
Opportunities for agri-food innovation?
Global Megatrends | Dr Stefan Hajkowicz, CSIRO Futures
More From Less
Planetary Pushback
The Silk Highway
Forever Young
Digital Immersion
Porous Boundaries
Great Expectations
Global megatrends: Opportunities for agri-food innovation
More from Less
• Population growth >9b by 2050• Economic growth• Protein demand growth• Limited global resources• Innovations in water, energy and agri-
food production
CSIRO Agriculture / Data 61CSIRO Land and WaterCSIRO Energy
More From Less
Planetary Pushback
• Climate change – increased risks • More invasive and resistant pest species• Antibiotic resistance • Increased food safety risks• Innovations in product safety and
stability
CSIRO AgricultureCSIRO Food and NutritionCSIRO Health
Planetary Pushback
The Silk Highway
• Population growth in Asia• Rapid economic and income growth• Growth in urbanisation• Proximity to Australia, export growth• Innovations supporting value addition -
healthy, safe, stable products
CSIRO AgricultureCSIRO Food and NutritionCSIRO Health
The Silk Highway
Forever Young
• Ageing population – Australia and Asia• Rising health care costs• Increased chronic disease and inactivity• Innovations in designed food, diet and
lifestyle products and services
CSIRO Food and NutritionCSIRO HealthCSIRO Data 61
Forever Young
Digital Immersion
Digital Immersion
• Incredible growth in the digital economy• Digital disruptions in agri-food• New business models - productivity and
competitiveness • Innovations in digital agriculture / food
CSIRO Data 61CSIRO Food and NutritionCSIRO Agriculture
Porous Boundaries
• Digital technology and globalisation• Porous boundaries – countries, governments,
companies, professions, research disciplines• Innovations in networks and business models• Innovations in global food and ingredient
supplies. Risk around ethics, image, brand
CSIRO Data 61CSIRO AgricultureCSIRO Food and Nutrition
Porous Boundaries
Great Expectations
• Increased desire for personal experiences• Income growth• Personalised products and services• Personalisation and mass customisation• Innovations agri-food products and services:
Genomics-ICT-3D printed foods
CSIRO Data 61CSIRO HealthCSIRO Food and Nutrition
Great Expectations
Global Megatrends
More From Less
Planetary Pushback
The Silk Highway
Forever Young
Digital Immersion
Porous Boundaries
Great Expectations
Opportunities for agri-food
innovation
CSIRO Food and NutritionDr Chris DownsResearch Director - Foodt +61 7 3214 2001e chris.downs@csiro.auw www.csiro.au
Thank you
CSIRO FOOD AND NUTRITION
Food innovation
Dr Christine Pitt, Meat and Livestock Australia
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Insights2Innovation Initiative
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Innovation Insights & ServicesMarket Intelligence
Consumer & Customer InsightsCompetitor Analysis
Technology ScanningOpportunity/Business Analytics
Product DevelopmentInnovation Toolkits
Young Food InnovatorsValue Chain Design & New
Business Models
R&D/Prod Development
Facilities
Global R&D Providers
TechnologyProviders
Finance
Education & Training
Government
Food EntrepreneursMarket &
Consumer Knowledge
Open Innovation Partners
Producers Value Chain Partners Global Customers
Create Connected Food Innovation Eco-system
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THANK YOU
Dr Christine Pitt
General Manager, Value Chain Innovation
Meat and Livestock Australia
Tel: 0411680520
Email: cpitt@mla.com.au
Operating in Asia Pacific – a focus on ChinaPeter Liddell, KPMG Partner
ASPAC Supply Chain & Operations Leader
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China’s economy is largerthan the combined value of Russia, Brazil, and India.
BRAZIL$2.3 BN
RUSSIA$2.0 BN
INDIA$1.9 BN
CHINA $8.4 BN
The opportunities in China remain vast compared to other emerging markets, even the other BRICS
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A deeper look at China’s Consumer Market Rise of the middle class
Major shift in urban household income between 2010 and 2020
The future China domestic market will be driven by the emerging urban middle class
Source: “Winning the $30 trillion Decathlon: Going for Gold in Emerging Markets,” McKinsey Global Institute
82%
6%2%
7%
36%
51%
6%Affluent
(>34K per year)
Lower class(6K-16K per year)
Poor(<6K per year)10%
2010 2020
Middle class(16-34K per
year)
Non traditional players (disruptors) are emerging
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Shifting landscape…
Source: China Statistical Yearbook, KPMG Analysis
Construction growth continues in inland cities
Jiangxi
24%
21%
19%
18%
14%
12% 11%
10%
1%1%
2%
8%
Shanghai
Beijing
Dalian
Xiamen
Harbin
Shenzhen
ShijiazhuangUrumqi
Xi’an
Haikou
Zhengzhou
Chongqing
Chengdu
8%
5-year CAGR change in finished construction by floor space
1 Slowing coastal markets
2 Development “goes west”
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A complex logistics environment
1. Supply chains are still developing
• Becoming more complex• Require more control over
lead-time, service levels, cost and working capital
• Competitive advantage
2. Different regions / market segments require customizedlogistics network structures and more targeted services
3. A responsive supply chain is essential – move away from a single point of source and distribution
4. Using local distributors can support relatively quick expansion with less investment and lower risk level
5. Focussing on Logistics at the outset - is critical to success
Internet of things
Piers Hogarth-Scott, KPMG Director Digital Consulting
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“The Internet of Things (IoT) is the network of physical objects or "things" embedded with electronics, software, sensors, and network connectivity, which enables these objects to collect and exchange data.
The Internet of Things allows objects to be sensed and controlled remotely across existing network infrastructure, creating opportunities for more direct integration between the physical world and computer-based systems, and resulting in improved efficiency, accuracy and economic benefit.
Each thing is uniquely identifiable through its embedded computing system but is able to interoperate within the existing Internet infrastructure. Experts estimate that the IoTwill consist of almost 50 billion objects by 2020.”
Source: Wikipedia
Making ‘dumb’ things ‘smart’ by connecting them to the Internet
A Definition
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Why IoT Matters
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1. Wine Quality EnhancingMonitoring soil moisture and trunk diameter in vineyards to control the amount of sugar in grapes and grapevine health.
2. Green HousesControl micro-climate conditions to maximize the production of fruits and vegetables and its quality.
3. Meteorological Station NetworkStudy of weather conditions in fields to forecast ice formation, rain, drought, snow or wind changes.
4. CompostControl of humidity and temperature levels in alfalfa, hay, straw, etc. to prevent fungus and other microbial contaminants.
5. HydroponicsControl the exact conditions of plants grown in water to get the highest efficiency crop
6. Animal TrackingLocation and identification of animals grazing in open pastures or location in big stables.
Source: Libelium
Use Case – Smart Agriculture
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“IoT technology is driving the concept of ‘precision agriculture’. Precision agriculture is the use of technology aimed at improving growers’ decision-making through data analytics. It includes software, such as big data solutions and farm management tools, and hardware, such as drones and satellites. Development of IoTtechnologies is likely to drive this segment in the long-term.
Currently, growers make uniform decisions across large plots of land, which can lead to high variability of crop yield across the farm. Integration of sensors into fields will improve the availability of localised information to growers regarding temperature, soil moisture, and soil nutrients. Drones and satellites will provide real-time snapshots of farm situation.
The aim of ‘precision agriculture’ is to reduce uncertainty for growers, minimise variability of crop production and ultimately increase crop yields.”
Ros Harvey, CEO, The Yield
Image source: www.theyield.com
IoT Precision Agriculture
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Piers Hogarth-Scott Director, Digital Consulting KPMG Australia 0405 151 971 piershs@kpmg.com.aukpmg.com/app
THANK YOU
Food for thought
IN CLOSING