The Australian Food and Grocery Council has welcomed measures in the Federal Budget aimed at supporting productivity, business investment and workforce capability, while warning that escalating instability in the Middle East could still place upward pressure on costs across manufacturing supply chains and for consumers.
In a statement released following the Federal Budget, AFGC chief executive officer Colm Maguire said initiatives designed to encourage investment and strengthen skills development were positive steps for Australia’s manufacturing sector.
“This Budget recognises lifting productivity is essential to securing Australia’s long-term economic resilience,” Maguire said.
“Commitments to support investment, encourage innovation and build workforce capability are positive signals for manufacturers operating in an increasingly challenging global environment.”
Maguire said the food and grocery manufacturing sector remained a significant contributor to the Australian economy, employing almost 300,000 people and supplying essential goods nationwide.
“The food and grocery manufacturing industry is Australia’s largest manufacturing sector, employing almost 300,000 people and producing essential goods for every household in the country,” he said.
“Policies that help businesses invest in new technology, improve efficiency and address workforce shortages are critical.”
The AFGC said ongoing investment in skills and training would be important as manufacturers continue to face labour shortages and increasing operational complexity.
“Building a pipeline of skilled workers will help improve productivity, strengthen sovereign manufacturing capability and support more sustainable growth across the sector,” Mr Maguire said.
At the same time, the organisation cautioned that global geopolitical instability could continue to affect supply chains and operating costs, despite domestic policy measures aimed at supporting economic growth.
“Over recent days, the AFGC has highlighted the growing risks associated with disruption to global shipping and energy markets stemming from instability in the Middle East,” Mr Maguire said.
“These developments have the potential to increase freight, fuel and input costs right across the supply chain.”
Maguire said while the Budget included “constructive measures” to support business investment and economic growth, global volatility remained a significant risk factor for manufacturers and consumers.
The AFGC said maintaining a stable and competitive operating environment would be important in helping manufacturers respond to future disruptions while continuing to supply affordable food and grocery products.
“Industry and government must continue working together to improve productivity, strengthen supply chain resilience and ensure Australia remains an attractive destination for manufacturing investment,” Mr Maguire said.
