Organic farming poised for 5-year growth

Organic farmers could have their work cut out over the next five years, as a recent report from IBISWorld suggests this will be a standout performer in the agricultural sector.

The group said when combined with other sectors, organic farming is currently generating revenue of $67.3 billion. However, it expects 5.7 per cent growth by 2019 to reach $71.1 billion.

IBISWorld Australia General Manager Dan Ruthven revealed there are various factors working in organic farming's favour at the moment.

"Australia is very well placed to take advantage of our highly productive soils, efficient farming practices and geographic position on the doorstep of Asia," he commented.

The sector has already performed well over recent years, especially as demand for organic produce has risen across the globe as people become more health-conscious.

There is also growing concern for the environment and an ever-expanding availability of organic produce that makes it more easily accessible than ever before.

Mr Ruthven revealed how Australia has the largest amount of organic farmland in the world. It's estimated that 12 million hectares are dedicated to organic farming, with the majority used for cattle production.

However, he explained how much of the industry is made up of small operators, many of whom will no doubt have taken out farm insurance to protect their businesses.

IBISWorld warned that these small operators make it difficult for consistency to be achieved with the quality and quantity of produce, leading the industry to become "highly fragmented".

Organic farming techniques also have some way to go before they will become as efficient as traditional farming strategies, which will be one of the challenges the sector faces in years to come.

The industry is expected to achieve growth of 11.2 per cent this year to reach $655.3 million, followed by an additional 49.6 per cent rise over the coming five years.