The protein system
Australia's protein industry is built for export. In 2024 it produced about 2.6 million tonnes of beef and veal and exported 1.3 million tonnes, making it the second-largest beef exporter after Brazil.[4] Sheepmeat exports reached a record 614,389 tonnes the same year, and Australia remains the largest sheepmeat exporter.[5] The 2024-25 wheat harvest was 34.1 million tonnes, of which 23.7 million tonnes were exported.[6] Milk output was 8.47 million tonnes in 2023, with 22 per cent exported.[2] Chicken is the most eaten meat, at about 50 kilograms a head. Farms produce about 1.5 million tonnes of poultry a year at home, behind strict biosecurity rules.[7]
On FAO figures for 2023, Australia produces 314 per cent of the beef it uses, 318 per cent of its sheep and goat meat, 104 per cent of its poultry and 97 per cent of its eggs.[2] Seafood and pork are the exceptions. Imports supply 73 per cent of seafood and 38 per cent of pig meat. The United States supplied 41 per cent of fresh and chilled boneless pork imports in 2023 and 51 per cent in 2024.[2, 12] The real dependence is on farm inputs. Net imports met 83 per cent of nitrogen fertiliser use, 47 per cent of phosphate and all potash in 2023.[10] Paraquat, a weedkiller used with glyphosate in no-till cropping, is now made mainly in China.[14] Domestic refineries supply only about 20 per cent of the country's fuel.[15]
Durable domestic capacity:
Australia produces surpluses of beef, sheepmeat, wheat, pulses, dairy and poultry. Most cattle and sheep graze rain-fed pasture, and less than 5 per cent of available water is drawn off.[1, 2, 8]
Two limits remain. Domestic fisheries and fish farms supply only about a quarter of the seafood Australians eat, even with Tasmania harvesting more than 83,000 tonnes of salmon and trout in 2020–21.[2, 19] Drought can also shrink herds fast. The 2018–19 drought cut the sheep flock by 7 per cent to 66 million, its lowest since 1905, and forced farmers to sell off large numbers of cattle.[9]
Resource headroom:
On paper Australia has plenty of room to grow. Farms and towns drew 4.67 per cent of available freshwater in 2022, and the 30.4 million cattle mostly graze land that could not grow food crops.[4, 6, 8]
But the climate is making that land less reliable. Changes in the seasons between 2001 and 2023 cut average broadacre farm profits by an estimated 18 per cent, or about A$28,500 per farm.[24] Floods killed hundreds of thousands of cattle in 2019, and losses in 2025 and 2026 show the same risk.[22] More cattle are now fed grain, pig and poultry farms use imported soy meal, and salmon farms rely on feed made from wild fish.[4, 12, 31]
Import exposure:
Australia imports little protein. It produces large surpluses of every major meat, poultry imports are 0.4 per cent of supply, and no single market takes more than 29 per cent of its beef exports.[2, 4] The only real gaps are seafood and processed pork, and both could be replaced.[2, 12] Exports and imports alike travel long sea routes through Southeast Asian waters, where a disruption would affect them.
Upstream dependence:
Most of the farm inputs behind the surplus are imported. Australia makes no urea. It imported 3.2 million tonnes in 2023 and about 3.85 million tonnes in 2024.[11, 32] Its only urea plant closed in January 2023 because it could not secure affordable gas.[27]
In 2024, Gulf states supplied 68 per cent of Australia's urea imports, and plants inside the Strait of Hormuz about 55 per cent.[25, 32] During the 2026 Hormuz closure, farm urea prices rose from about A$830–840 a tonne to A$1,430–1,440 by 7 May, then fell after the June ceasefire.[33, 37] ABARES forecast a 21 per cent fall in winter crop output to 54.5 million tonnes, citing dry soils and higher input costs.[36]
Access and affordability:
In 2024, 3.2 per cent of Australians, about 0.9 million people, , which cost Int$3.23 per person per day.[41] stayed below 2.5 per cent through 2023–25.[42, 51]
Food prices have been fairly steady. Annual food inflation peaked at 9.5 per cent in the year to December 2022, was 7.9 per cent in the year to May 2023 and had settled at about 3 per cent by early 2025. Fruit, vegetables, meat and seafood moved most.[44] Remote areas are the main weakness hidden by the national average. A 2026 review of nine studies found food in outer regional and remote areas cost 30 to 160 per cent more than in cities, 48.8 per cent more on average, mainly because of freight and store costs.[46] The National Indigenous Australians Agency puts the remote premium on supermarket goods at about 39 per cent.[52] In 2022-23, 41 per cent of Aboriginal and Torres Strait Islander households went without food for lack of money, rising to 50.7 per cent in remote areas against 40.4 per cent elsewhere.[45]
As a grain and meat exporter, Australia felt only part of the 2021–22 world price spike. Its food prices rose 6.5 per cent, against 14.9 per cent for the FAO Food Price Index.[57, 59] Beef was different: retail beef and veal prices rose 10.0 per cent, exactly matching world meat prices, while eggs rose 7.0 per cent.[57, 60] The Australian dollar fell 8.3 per cent against the US dollar between 2021 and 2022 and a further 7.7 per cent by 2025, adding to costs already raised by drought, freight and wages.[58] Prices did not come back down when world prices did. Australia's food prices rose 19.0 per cent from March 2022 to March 2026, while the FAO index fell 19.7 per cent.[57, 59]
Within a year, prices move modestly. In 2025, eggs varied by 7.9 per cent between their high and low, beef and veal by 10.9 per cent and poultry by just 2.0 per cent.[60]
Shock endurance:
The export surplus is Australia's main buffer. Beef and sheepmeat output is more than three times what Australians eat, so exports could be kept at home without rationing.[2] Wheat stocks for are 5.61 million tonnes against domestic use of 9.60 million tonnes, though the MY2026/27 forecast brings stocks down to 3.19 million tonnes.[6] The country came through COVID, the 2018-19 drought and the Ukraine price shock without rationing any staple, and it has ample money to outbid other buyers.[1, 9]
The 2026 Hormuz closure was the first test of how fast the government could act on a shortage of farm inputs, and it moved faster than in 2021. Parliament passed a law on 1 April 2026, about five weeks after the conflict began, giving Export Finance Australia powers to secure strategic materials.[40] Backed by an A$7.5 billion Fuel and Fertiliser Security Facility, the government had arranged about 340,000 tonnes of extra urea in ten shipments by 26 June 2026.[34, 35] That is less than a tenth of a year's urea imports: enough to bridge a gap, but far short of a real reserve.
Fuel stocks were thin throughout. Diesel cover averaged 32 days in the March quarter of 2026 and stood at 39 days on 28 July, with petrol at 43 days and jet fuel at 34.[15] Australia has not met the International Energy Agency's 90-day stockholding rule since 2012, although it committed to comply by 2026.[16] Required diesel stocks are 20 days for refiners and 32 for importers, with a temporary 20 per cent cut extended to 30 September 2026.[17] There is still no strategic grain reserve and no stockpile of crop chemicals. In December 2021 a shortage of AdBlue, the diesel-engine fluid made from urea, brought the country close to running out, with no comparable government response at the time.[18]
The 2026 shock lasted about four months, from late February to a June ceasefire that reopened the strait. In the following weeks about 200,000 tonnes of urea passed through, more than 380,000 tonnes were on the way, and prices had fallen back close to pre-conflict levels by early July.[37] Fuel supply held up: stocks stayed above pre-conflict levels and only 65 of 8,118 fuel stations were out of diesel on 31 July, even though diesel traded 80 per cent above its pre-conflict price in late July.[15] ABARES's June 2026 crop report showed the cost. Winter crop output was forecast to fall 21 per cent to 54.5 million tonnes, still 4 per cent above the ten-year average. Growers had enough fertiliser to plant but used less of it, and switched some land from wheat to canola and barley.[36]
That was a better outcome than the 2021 AdBlue scare or the 2024 bird flu outbreak. In 2024 about 1.8 million birds were destroyed,[29] more than 600,000 laying hens were culled by 17 June out of a national flock of over 21 million,[28] and every state except Western Australia limited egg purchases to two cartons.[21] Both episodes caused visible shortages within days. The 2026 fertiliser shock raised prices and the next season's costs instead.
Australia can borrow through a shock, though its reserves are thin. Foreign exchange reserves cover only about 1.5 months of imports.[47] That matters less than it would elsewhere, because the Australian dollar floats freely and all three major agencies rate the government AAA, with S&P confirming its rating on 22 October 2025.[48] Government debt is about 51 per cent of GDP, and the A$7.5 billion fuel and fertiliser facility was paying out within weeks of the shock.[49, 34, 35] Household support can scale up fast. The JobKeeper wage subsidy paid A$88.82 billion to 1,068,856 businesses, supporting an average of 3.6 million people a month from April to September 2020.[50]
Protein supply is 125.0 grams per person per day, more than double what people need.[1]
Trajectory
Policy is moving. The Feeding Australia food security strategy, funded with A$3.5 million in the 2025-26 Budget,[23] and a National Food Council of eleven members appointed in November 2025,[30] made food security a national policy aim for the first time. Neither created food stocks. The Hormuz closure forced faster action: the strategic reserve law passed within five weeks, and the fuel and fertiliser facility had delivered about 340,000 tonnes of urea by late June.[34, 35, 40] That is still small next to the roughly 3.85 million tonnes Australia imports in most years.[32] The Ceres project aims to start producing urea at home in March 2027.[18, 38] The government has secured the first of three pilot ships for a strategic fleet, against a pledge of twelve, and the Transport Minister cited the Hormuz closure as the reason for new urgency.[20] Required diesel stocks were lowered during 2026, not raised.[15, 17]
The main risks are climate and dependence on imported inputs, and 2026 showed both recur. The 18 per cent fall in broadacre farm profits is a trend, and each drought now starts from a warmer baseline.[24] If the Phosphate Hill mine closed, phosphate imports would rise from 47 per cent of use towards 100 per cent, as for potash.[10] The next steps are to finish Ceres, build stocks of diesel, AdBlue and crop chemicals sized to what Australia actually imports, and make more crop chemicals at home. Farm output remains high, but 2026 showed how imported inputs and thin reserves can hold it back when shipping routes close.