Every food, drink, personal care and household product made in Australia starts with an investment decision. A company chooses to replace a production line, automate a process or expand a plant. That choice is now made in a global market for capital, and Australia is struggling to compete. The question is simple. Will the next generation of manufacturing investment come here?
Ahead of World Food Day, we are making the case for boosting domestic production of food and groceries.
One of the best parts of my job is visiting the factories and facilities behind the products Australians know and trust.
I've met teams in regional towns and major cities who are deeply proud of what they make. You come away from those visits with a clear understanding of what is at stake.
These facilities are often major local employers, they create careers that span generations, and they anchor entire communities. They also need continued investment if they are to thrive into the future.
That’s why AFGC is calling for a government to treat investment in Australian factories as a priority. Manufacturers of every size, from large companies employing hundreds of people at one site to smaller operators in regional pockets, are deciding where to spend their next dollar. Australia should be the place they choose.
A sector that matters
Food and grocery is Australia's largest manufacturing industry. It turns over $182.6 billion and employs more than 301,000 people, many in regional towns where the factory is the biggest employer and keeps a web of suppliers in work.
Our manufacturers turn world-class Australian ingredients into the food, beverages and grocery products found in homes across the country and on shelves around the world.
Most of us don’t think about where our products come from until they’re missing from the shelf.
Think about your coffee, your shower or your breakfast this morning. Someone made the coffee, the soap and the cereal and in many cases, they made them in Australia.
Manufacturing is so woven into daily life that it becomes invisible and easy to take for granted.
The challenge
Manufacturers want to invest but the economics are against them. Everything from gas, ingredients, freight and packaging is more expensive since 2019, putting pressure on manufacturing. Meanwhile the capital supporting the sector has fallen by more than a quarter since 2013-14.
We need to join other nations in supporting this key sector on our shores. Britain lets all manufacturers deduct new machinery immediately. India rewards food processors that invest and grow. Thailand offers tax concessions to attract factories.
Why it matters
The returns reach well beyond the factory gate. More productive businesses, stronger regional communities, more essential products made locally and greater resilience when global supply chains break.
Smarter regulation, simpler compliance and faster approvals would help manufacturers invest with confidence. Federal compliance alone costs the economy around $160 billion a year, according to AICD and Mandala.
Australia has world-class agricultural inputs, skilled workers and a strong reputation for safe, high-quality products. What we need is a stronger signal that Australia wants the next production line, the next factory upgrade and the next wave of manufacturing investment to happen here.
The next generation of manufacturing investment is up for grabs. Australia should compete to win it.
