Food system's billions of 'hidden costs' a sick outlook
The CSIRO report, released on Monday, found such "hidden costs" could be as much as $274 billion - the highest of any equivalent system worldwide.
The agency's research examined Australia's network of food production, processing, transport, distribution, marketing and consumption to strengthen it against sustainability challenges and boost the delivery of healthy food.
Among key issues in the $800 billion system - underpinned by 100,000 farmers - was a scarcity of fresh produce ending up on the tables of Australian consumers.
"Australia's food system does not produce enough vegetables to meet recommended daily intakes," the report by the nation's science agency said.
"The promotion of convenient, highly processed foods is costing the Australian economy billions (of dollars) in lost productivity from the impact of preventable, diet-related diseases."
There was a "significant opportunity for communities, governments and businesses to work together to create future food environments that are healthier, more sustainable and more equitable".
Australia's "industrialised food system" included many high-quality and safe items, but was also associated with obesity and diet-related diseases at epidemic levels.
This was linked to the poor diet of the average Australian, who ate too few fruit and vegetables and too many nutrient-poor "discretionary foods".
"Displacement of healthy foods with discretionary foods means that many Australians suffer from micronutrient deficiencies despite the relative abundance of food," the report said.
There was also uneven access to grocery stores for healthy diet choices, room for improvement on food safety, and widespread food insecurity across the country, according to the report.
About 3.4 million households experienced moderate or severe food insecurity in the past 12 months, while 31 per cent of remote Indigenous people experienced food insecurity, it said.
In addition to impacts on human health, hidden costs include animal welfare, loss of biodiversity, greenhouse gas emissions, pollution and air, soil and water degradation, and food waste.
"This national stocktake provides an evidence base to guide our actions as social, cultural, environmental, and economic priorities shift," CSIRO agriculture and food director Michael Robertson said.
"We have an intergenerational responsibility to pursue these goals vigorously."
Foodbank chief operating officer Sarah Pennell said the findings confirmed the charity's observations from operations around the country.
"Too many Australians are struggling to afford and access nutritious food," Ms Pennell said in a statement.
"It's especially concerning that fresh fruit and vegetables, essential for good health, are among the first things to be cut from household budgets when money is tight.
"Good nutrition is a basic right, not a luxury, and this report reinforces the urgency of addressing Australia's growing food insecurity crisis."
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