The report, Australian grains industry: factors influencing productivity growth, was released today by Mr Phillip Glyde, Executive Director of ABARE.

"Moisture availability is the main factor influencing productivity, however, it is largely beyond the control of the farmer. Land use intensity also has a substantial impact on productivity, with its impact largely dependent on natural soil fertility and management practices," Mr Glyde explained.

After the effects of moisture availability are removed, the Australian grains industry has realised an underlying productivity improvement of around 2.6 per cent a year on average over the sixteen years from 1988-89 to 2003-04 — considerably less than the rate of 3.8 per cent over the seventeen year period to 1993-94.

The report uses ABARE's unique farm surveys data to investigate the drivers influencing productivity differences between individual grain producing farms, as well as over time.

The analysis reveals that the factors likely to influence individual farm productivity are diverse and include variables representing human, physical, financial and natural capital.

Other factors that have a significant impact on farm level productivity in some or all regions include finance, land area, education, crop specialisation, investment income and corporate ownership.