You don’t need a crystal ball to know Australia’s rural industries will face significant change at global, national and local levels over the coming decades. This will create opportunities and challenges for small and large farms, and will affect rural lifestyles, agricultural landscapes and Australia’s society and economy.

In a new report, we describe this future through a series of interlinked “megatrends” set to hit Australia over the coming 20 years. As we describe below, each prompts some serious questions (or “conversation-starters”, as we have termed them) for Australian farmers. We don’t yet know the answers, but we do know they will be crucial for how the industry fares in the future.

The world will get hungrier

We know that the world is going to require more food as populations grow – about 70% more by 2050, according to the United Nations.

This will come primarily from increasing yields, along with some expansion of agricultural land.

The target is achievable but should not be taken for granted. There are competing uses of land for biofuels and urbanisation; in some places land is degrading; and we don’t have good predictions yet of the effect of climate change on agriculture. As a significant exporter of food, Australia has a vital role to play in supplying world food markets and buffering supply shocks.

We are well positioned — both in terms of geography and comparative advantage — to supply overseas markets. And while Australia can’t hope to feed Asia or the world, with astute R&D investment it can increase production and exports. How well we step up to that challenge depends largely on our ability to maintain a price competitive position and continue to improve yields. So the key questions are:

Will farms be able to scale up production and performance to meet this challenge?

What is a sensible investment in innovation, and how should it be funded?

The world will get wealthier

Some 1.02 billion people will move out of poverty and into the middle classes in the developing Asia region alone by 2040. Along with wealth comes the ability to diversify food choices – wealthier households will consume more meat, dairy and vegetable oils.

This presents an opportunity for Australian rural industries to identify new food types and connect to new markets. A diversified rural export base is likely to be more resilient to supply-and-demand shocks in markets.

Is Australia better off focusing on commodity markets that have provided solid export earnings, or should it be working hard to respond to the demand for a more diverse range of boutique, luxury and niche food and fibre goods?

Does Australia have the infrastructure and the persistence to get a wider range of desirable agricultural products into Asian markets competitively?

Customers will get pickier

The consumer of the future will be increasingly able and motivated to choose food and fibre products with certain characteristics. This has impacts both within and beyond the farm gate. Information technology will increasingly enable the consumer to access, share and validate information about products along the whole supply chain from farm to fork.

Health is likely to become a particularly prominent driver of food choice and consumption patterns – be that from a desire for food safety or to help prevent chronic disease. Many people’s lives are being cut short by poor diets, and at current trajectories government budgets could become crippled by unsustainable growth in healthcare expenditure.

The issues of environment, provenance and ethics will also play a vital role. The consumer of the future will have greater expectations for these qualities in the food and fibre products they choose to buy. Consumers will be “information-empowered” and rural industries stand to gain or lose market share based on this increase in consumers’ knowledge.

In the face of soaring diet-related health costs, will governments increase control of the components of food and diets?

How does agriculture in Australia build and safeguard its clean, green reputation?

Technologies will transform farm life

Advances in digital technology, genetics and materials science will change the way food and fibre products are created and transported.

Many plant productivity breakthroughs will be from gene technology. Big data systems and digital technologies will bring better risk-management approaches to Australian agriculture; weather and yields will be much more predictable and farmers will have sophisticated tools to assist with decision making.

Knowledge about land use and framing practices will increasingly move into the public domain as remote monitoring, be it from drones or satellites, makes available new data in a highly interconnected world. Business and capital models will change with the introduction of “disruptive” technologies such as peer-to-peer lending.

Will market perceptions hold back Australian agriculture by restricting access to advanced technologies being used by our major competitors?

How will farmers manage a higher level of scrutiny of their operations?

The rollercoaster of risks will get bumpier

Risk is an ever-present characteristic of Australian agriculture. However, the coming decades will see changes in the global climate, environmental systems and the world economy which will create new and potentially deeper risks for farmers.

Australian agriculture has shown a strong capacity to adapt and respond to risks in the past. But as trade globalises and we rely more on imported inputs such as fertiliser and fuel, the risk of supply chain shocks increases.

More international trade and passenger travel brings greater biosecurity risks. Climate change impacts are not well understood, and the need to cut greenhouse gas emissions will set up competing land uses for both biofuels and carbon storage.

Do we understand the likely implications of a global price on carbon of US$50-100 per tonne?

Is the agriculture sector at risk of complacency and underinvestment when it comes to risk management?

Overall, there is a bright future for Australian agriculture, laden with deep and diverse opportunity. The future outlined above will be a challenge for some producers and industries but an opportunity for others. The effectiveness with which Australian agriculture captures these opportunities and avoids the risks will largely come down to innovation.

Through centuries past, repeated innovation has allowed Australian farmers to expand into new land areas, develop water resources and increase crop and pasture yields. As we look to the decades ahead, innovation becomes ever more important. In a world of exponential growth in both technology and global trade, it’s about working smarter, not just harder.

Sandra Eady is Principal Research Scientist, CSIRO Agriculture at CSIRO and Stefan Hajkowicz is Leader – CSIRO Futures at CSIRO

This article was originally published on The Conversation. Read the original article.