A new report has said that the international airport under construction in western Sydney presents an opportunity to create an agtech business cluster that could attract investment and increase Australia’s exports.
The University of Sydney’s United States Studies Centre identified food, agribusiness and agtech – alongside aerospace and the manufacturing of medical devices – as potentially high-value export industries that could be based near Western Sydney International Airport.
In Bringing industry to airports: How the US experience can help western Sydney take off, author Justin Wastnage, a non-resident fellow in the centre’s Innovation and Entrepreneurship Programme, argues that precision agriculture would benefit from the airport’s ability to deliver just-in-time logistics to access export markets. He added that it was also a sector in which Australia has a potential competitive advantage.
Speaking at the report’s launch in Sydney this week, Wastnage said: “Freshness is prized. China is already a major export market for Australian agriculture, and it could be also for fruit and veg.
“The Netherlands is probably the world leader. It [accounts for] about 35 percent of global exports of fruit and vegetables and produces 10 times as much fruit and veg as the US [for example], despite being less than a tenth of the size.
“The [reason] is that ringed around Schiphol Airport in Amsterdam are these vertical, hydroponic plants, with produce exported to just-in-time markets in Europe.” He added that Australia could export goods to Asian markets in a similar way if the infrastructure were in place.
Wastnage said that the successful development of these business clusters would depend on the federal and New South Wales governments enacting policy levers and providing financial incentives to help attract and retain key players.
The report recommended that the federal Department of Agriculture and Water Resources should “work towards concluding pre-clearance protocols with key export markets for future sterile horticulture exports.” This would allow goods to be processed through the destination country’s customs before being loaded on to cargo planes.
The report also said that developing a precision agriculture cluster around the airport could help to increase Australia’s fruit and vegetable exports.
According to 2015 figures from the Department of Foreign Affairs and Trade cited in the report, meat and grain account for 25 percent and 11 percent, respectively, of Australian agricultural exports. Vegetables make up just 5.1 percent of the total, and fruit and nuts 3.9 percent.
The report acknowledges that soil quality around the site of the new airport is “relatively poor” but that indoor farming in aeroponic hothouses could help get around the problem.
It added that the long-haul service that is likely to link Western Sydney with the UAE would facilitate exports of premium red meat through the airport: “Given initial passenger figures will likely be low and increase over time, high-value and bulky air freight will be prized by the incoming airlines. Wet meat exports can play an important role in filling the belly holds of wide-body aircraft.”
In comparison with existing business clusters around airports, or so-called ‘aerotropolises’ in the US, the report emphasizes that facilities for processing time-sensitive goods like fresh produce and meat would be vital. These facilities would include road infrastructure linking the airport with agricultural land or facilities nearby.
The United States Studies Centre reported last year that Australia’s agtech sector was lagging far behind those of other countries, such as the US. However, it added that the outlook was “positive” and that there existed opportunities for growth.
Construction of Western Sydney International Airport is due to be completed in 2031. The project is being funded by the federal government, which committed A$5.3 billion ($3.7 billion; €3.3 billion) over four years in the 2017-18 budget.