Agricultural RandD Innovation Systems †Free Samples to Students

Question: Discuss about the Agricultural RandD Innovation Systems. Answer: Introduction Australian industry is one of the most agriculture intensive industries comparing with the global agriculture market. Victoria is dominant in dairy and herd production. The evolution of technology has served them well and their productivity has increased since last three decades (Klerkx and Nettle, 2013). The small farmers were able to generate the derivative products of milk and supported to the revenue that every individual state made in the following years. According to the dairy situation and outlook report on 2017 the farmers have produced 700 million fewer litters of milk due to a huge crisis that have hit the whole Australia in the last year (Sorensen, 2011). However, the consumption of the branded products has not lessened. Victoria being the centre of production has seen 9% growth in the full cream milk production (Klerkx and Nettle, 2013). Whereas Australia accounts for an approximate 2% of the worlds milk production, it is a noteworthy exporter of dairy merchandise (Regula tions, 2013). The Australian dairy industry was significantly challenged by deregulation, droughts and the financial crisis. However, the industry has also been seen to to adapt to difficult situations through sharing its view of the challenges and opportunities and with collective action. One crucial feature for their success now would be the policy control of the environmental factors, which is an important role in accordance with the industry to adapt in the future and further develop. The Australian Dairy industry is a fully established industry and some subtropical areas of Australia is also rich in giving supply to its customers. Even though most of the countrys milk production takes place in south?east seaboard parts states, all states have separate dairy farms that supply fresh drinking milk to close by cities and towns. Australian milk production has been steadily increasing with the demand and modified derivative product of milk. Fresh milk, butter, cheese, milk powders, whey products and casein (Sorensen, 2011). International market The New Zealand statistics shows that, they are one among the key industries in the dairy production (Klerkx and Nettle, 2013). The organization is able to satisfy the thirst of the country and whole worlds demand of milk and its side products. The small shelf life of milk means that Australias export percentage of fresh milk is partial mainly to UHT product. Around 80% of Australias fresh milk exports goes to Asia with a further 15% intended for the Pacific region (Regulations, 2013). The cheese industry itself exports to 50% of the domestic production. This industry itself is a predominantly developed in the national region. The Skimmed milk powder and the whole milk powder accounts to 80% of the National dairy herd 1.6 million Average herd size 220 cows National milk production 9 billion litres Dairy workforce 40,000*2.5 New Zealand - the major competitor of Australia is one of the most aggressive seller in the international market. Total number of herds 11,918 Average herd size 419 Number of cows 5 million Effective hectares in production New Zealand 1.8 million Milk processed by dairy companies 21.0 billion litres(2015-2016) International trade scenario The dairy research and development of organisations major contributor is federal government. The trade policy is in the industry is favourable for the industry. The three core business objectives in the dairy planning cycle is escalating farm productivity, maintain and develop value-added service, channels, products, high-margin and others. Promote and protect the unique profit of Australian dairy industry. ADF is formed by Australian farmers organisation and there is the help the small farmers get from non-profit organisations (Regulations, 2013). Southeast Asian market is Australias largest export oriented market. Stipulation from this market has led to a 33% enhanced in international dairy and its derivatives consumption in the last decade(Grace and Lennie, 2012). Even though there are hurdles to give services and sell in this market, the Ausis are confident enough that demand expansion is high. It is implied that economic prosperity and higher education enabled system will spread s all through the core region and there will be steady escalation in demand. The China, Africa, and Middle East are the one among the major exporters of the dairy products and consume the major percentage of the products (Grace and Lennie, 2012). The Australian market has strength in the domestic market and furthermore, they are milks multinational value increment (Sorensen, 2011). The derivatives of the main product are also capturing the completely international market competing with the value-addition and prospective consumption market percentage (Nettle, Paine and Penry, 2010). However, the trade regulations of the industry have to face some highly contingency factors. This includes the China and Middle Easts production and expansion in the regarding instruction (Nettle, Paine and Penry, 2010). The Neighbouring countries production and their strong economic condition can be highly competitive in the recent years inferred from the above table. Europeans balance and protectionist has long since given headache to the trade enablers in the international market. Their products are facing headed competition with the former dairy market leaders (Grace and Lennie, 2012). The prices of the products are also volatile because of dynamic supply-demand ration working in the industry. Export share of trade EU 32% New Zealand 35% Australia 10% USA 7% Argentina 4% Ukraine 2% Uruguay 1% Other 9% Milk and its derivative products life cycle The most consumption is in the fresh milk sector and the stage is by drinking (Nettle, Brightling and Hope, 2013). The drinking milk, butter, cheese, yogurt are the majorly consumed product among the country the statistics of per capita is given below. Commodity Consumption(per capita/annum) Milk 102 litres Cheese 13kg Butter 4 kg Yogurt 7 kg South East Asia 30% Japan 19% America 5% Africa 4% Middle east 10% Europe 2% Other Asia 24% Competition Internal value chain analysis Australian dairy industrys largest producer was Victoria accounting for supplying 60% of the national milk consumption (Backus, Eidman and Dijkhuizen, 2012). The Southern, Central, Coastal NSW Dairy industry produces diverse milk production as they have land grass and fodder growing areas (Edwards, 2003). The market influences are one among the major factor for fresh milk production. The processor authority prefers local and reliably produced milk, which helps them in cost reduction and logistics handling. This region produces among the 741 million litres of milk and 8% of Australias production milk (Nettle, Brightling and Hope, 2013). The level of risk for adaptation and investment may affect production of milk. Second, major reformation is likely to be made at milk production stage in some challenging regions, which will in turn will affect on the current system and structure (Buys et al.2014). Third, the Emission Trading Scheme of the country, paired with a limited growth of production and increased ethical standards, everything have the potential headed for raising costs above competitors, and this may affect the competitiveness and price of Australian products (Von et al., 2013). Industry structure and regional strength The Gippsland dairy industry 2 billion (22%) Western Victoria dairy industry 2 billion (23%) Murray dairy industry 1.84 billion (20.5%) Southern dairy industry 620 million (7%) Tasmanian dairy industry 650 million (7%) Western Australian Dairy Industry 338 million litres(20.5%) Different innovative products like fresh dairy products and stream included drinking milk and othere customised products and dairy desserts. Specialised ingredients and whey proteins, SMP, BMP and WMP are high valued manufactured products (Von et al., 2013). There are also schemes, centres that helps people in the industry to operate efficiently. The Australian Dairy Herd Impovemnet Scheme, Dairy Extension Centre, Dairy Futures Cooperative Research Centre(CRC), Dairy Innovation Australia Limited, Department of primary history Victoria (Backus, Eidman and Dijkhuizen, 2012). The national bodies which helps in this are National Heritage trust, National landscape program, NSW department and primary Industries, Tasmanian Institute and Heritage trust are one of the major investor in the innovation program and dynamic strategy faces challenges in the regarding Industry(Gourley et al., 2012). There are many challenges that the manufacturing industry faces in the production procedure. The volatility of the supply and demand market and customers preference in the different products. The global crisis on 2008-2009 has been the most difficult period for the Industry (Bethune et al. 2004). However, the prices of the products have come down due to the consumption pattern changes and outlook of retail stages have gone down due to the competitiveness of the food safety (Edwards, 2003). In addition there is a decline in inflationary pressure, that additionally benefits the selling of dairy products. Strengths and weakness Opportunities and threats of the industry As the historical data suggest that the dairy industry have grown in the last three decades they have incorporated efficient production methods The position of this industry is strong in the export market and have seen steady growth of 9% (Gourley et al., 2012). The Australian industry is one of the major exporters, as in third largest exporter on milk and its derivative products. The industry also have a backup of investors willing to contribute in the research and development in dairy manufacturing and value added products, as well as the packaging and customising the products (Bethune et al. 2004). The weakness is seen to be in the demand factor. The domestic market of the industry faces the volatility of climate. The agricultural sector has always been prone to volatility of climate change factors. The retail sell and wholesale industry of milk faces a major problem of having shelf life of the products. Policy uncertainty of the trade practises has been one of the major weaknesses of the industry. Management of production risk less Demand of all Australian milk products in Asia Greater efficiency scale of the industry The production cost Climate change in agricultural business Porters values chain analysis Barriers to entry the Australian diary industry has been strong since 1989 revolution in the industry (Soliman, 2000). However, the recent crisis in the milk production of the industry and shortage in the production has lead to crisis in the international market reputation. The domestic industry factors are strong to retaliate against (Gourley et al., 2012). Therefore, the risk to entry of global competitors is less. Threat of rival - the major threat in the industry is the water availability in the agro-cultivated land but the industry is facing certain policy related problem on the state of Victoria. The other industries are there to give competition to this industry in this matter. The deregulation of this industry has left some uncertainty in the boar (Buys et l.2014). The rationalisation of this industry has left the core efficient producers weak to international competitors vulnerable and heavily subsided. The main competitors of this industry are China and Africa. Threat of substitute the products itself does not have good substitute. However, the competitors pose a challenge in building the good substitute brand for the company. Threat of supplier The supplier market is dominative in this particular industry. The suppliers have different board of co-operation and back up of having investments from the government subsidiary bodies (Grace and Lennie, 2012). The total industry is private and deregulated in Australia. Threat of customers -the risk in threat of customers is less than any other industry. The customers are less prone to go to other products than the fresh produce of the domestic companies (Nettle, Brightling and Hope, 2013). However, the global competitors dairy products and their innovative products may inherit a threat to competitors. Conclusion The Australian dairy industry is certainly a self-sufficient and competitive enough in the global context. There is direct employment in the region of Australia for around 40,000 people and additional downstream processing. This industry is one of Australias major industries that contribute to the economic development. Australia ranks third in terms of global dairy trade with 10% share of world dairy export followed by New Zealand and the European Union. In response to these discussed challenges, a variety of strategies well as actions and plan have been redirected or executed by the industry in respect to the industrys production systems, response to environmental change and natural resource management, and market access. 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