Federal and State Government funding continues to play a critical role in the Australian food and beverage manufacturing sector for a variety of reasons, from research and development, to improved infrastructure and efficiency.
The Australian Government has laid out a commitment to help the nation’s primary industries reach $100 billion in total value by 2030. According to the Australian Bureau of Statistics, the manufacturing industry’s earnings grew by 2.2 per cent from 2022 to 2024.
Government funding plays an important role in the growth of the industry through the development of new technologies, products, and processes that enhance food and beverage manufacturing capabilities.
This continuous innovation has also become essential for keeping the Australian industry competitive and responsive to changing consumer demands, particularly around the manufacturing process.
The support provided by various forms of economic support from government can also be an invaluable asset for small and medium enterprises (SMEs).
Government funding helps provide these businesses with resources they need to grow, innovate, and compete with larger corporations, helping diversify the industry and drives local economies.
SMEs also have access to the Industry Growth Program.
The program supports innovative SMEs undertaking commercialisation or growth projects that will build Australian capabilities in priority areas for the National Reconstruction Fund (NRF).
It aligns with the NRF’s mission to promote investments in initiatives that enhance Australia’s industry and manufacturing capabilities.
Research and development
Research and development is another vital area for food and beverage manufacturers.
The sector always encounters challenges, from supply chain disruptions to the cost of production, which makes innovation critical for its sustained economic success.
With both local and international markets increasingly demanding new and innovative products, the relevance of the Federal Government’s R&D Tax Incentive for Australian businesses is set to rise.
If your company is dedicating resources to experimentally tackle technical issues or create new products or services, you may be participating in activities that qualify as research and development under the incentive.
With Australian manufacturers facing a range of challenges, including rising costs, supply chain disruptions, and global competition, the R&D Tax Incentive is increasingly seen as a vital tool for encouraging businesses to invest in innovative solutions.
The initiative also allows eligible companies to claim tax offsets on research and development expenditures, effectively reducing the financial burden of developing new products and processes.
The incentive is designed to mitigate costs and encourage Australian industries to engage in research and development activities. This offset reduces the financial risks associated with investing in R&D by addressing key concerns such as:
- Uncertainty of long-term gains – companies often face uncertainty about whether the potential long-term benefits of developing new or improved products or services will outweigh the costs of R&D efforts.
- Knowledge spill over – businesses may not fully reap the rewards of R&D investments because valuable knowledge can spill over to competitors and the wider economy, diminishing competitive advantage.
In addition to benefiting individual companies, the incentive is expected to have broader economic implications.
By stimulating investment in research and development, the government aims to enhance Australia’s position as a leader in advanced manufacturing, paving the way for sustainable economic growth.
The government has also worked to simplify the application process for the R&D Tax Incentive, addressing feedback from industry stakeholders about the complexities involved.
In recent years there have been some notable breakthroughs thanks to continued research and development, particularly through collaboration with universities.
Last year the University of Sydney received $2.2 million from the NSW Government in a round of Tech Central.
The university’s Alternative Protein Application Centre (APAC) was granted the funding to develop technology that supports a growing alternative protein manufacturing and processing industry.
The centre will conduct research and development on alternative protein production methods, including cellular engineering, precision fermentation, vertical farming, extraction, and texturisation.
It will also train researchers and practitioners in the food and beverage industry.
Sustainability initiatives
Meanwhile, sustainability is another area of importance for both the manufacturing industry and the government.
There are several funding opportunities for businesses looking to be more sustainable in production processes, such as the Sustainable Agriculture Research and Development (SARDA) fund.
SARDA funding in Australia is dedicated to advancing sustainable practices in agriculture.
The goal is to support research, development, and outreach efforts that improve the environmental, social, and economic sustainability of the agricultural sector.
Among the funding options are research grants, programs, initiatives, and supporting collaborations.
The funding, part of a broader initiative to promote eco-friendly practices, supports innovative projects that focus on improving crop yields, reducing waste, and increasing resource efficiency.
The program provides grants to universities, research institutions, and agricultural businesses working on cutting-edge technologies and sustainable practices. Early recipients include projects focused on precision agriculture and sustainable supply chain management, aimed at reducing carbon footprints and enhancing food security.
As Australia seeks to position itself as a leader in sustainable food production, this investment marks a crucial step toward a greener future.
Infrastructure funding
Then there’s the Federal Government’s Modern Manufacturing Initiative (MMI).
As of 2024, the initiative is a strategic program aimed at revitalising and strengthening the country’s manufacturing sector and was launched as part of the broader Modern Manufacturing Strategy.
The initiative seeks to enhance productivity, drive innovation, and promote sustainability in Australian manufacturing.
Among other things, the MMI encourages investment in cutting-edge technologies, such as automation, robotics, and digital manufacturing processes, as well as providing support to key industries, especially food and beverage.
An example of Australian food or beverage manufacturers reaping the benefits of the MMI includes Sabrini Foods, which received $1.47 million in funding, for a total government investment of $2.94.
The business was able to use the funds to develop a specialist dairy plant and a range of products.
Other recipients included Plenty Foods ($9 million), Regal Cream Products ($4.5 million), and Mulgowie Fresh ($5.1 million).
All these examples demonstrate how the MMI, and the broader MMS, is playing a role in empowering manufacturers to innovate and thrive in both domestic and international markets.
The Modern Manufacturing Strategy is aimed at revitalising Australian manufacturing, enhancing its competitiveness, innovation, and resilience in an increasingly competitive global environment.
This is only a sampling of the ongoing economic support from federal and state governments, which is aimed at reinforcing growth and sustainability in Australia’s food and beverage manufacturing sector.
As the industry evolves, these investments not only bolster the competitive edge of Australian food and beverage manufacturing, but also lay the groundwork for a resilient, innovative, and sustainable future.