Agroforestry in Australia: A guide to sustainable farming systems

Agroforestry is the deliberate integration of trees and shrubs within farming systems to improve productivity, resilience, and environmental outcomes.

In Australia, it is being explored as a way to help farmers improve farm-level profitability - diversifying income through timber production and, in some cases, environmental markets including carbon and biodiversity.

This guide to agroforestry in Australia explores what it is, how it is applied, and the research and innovation supporting its adoption.

Agroforestry research & innovation in Australia

Agroforestry research in Australia is focused on improving how trees can be integrated into working farms to lift productivity, resilience, and long-term profitability.

A key focus is matching the right species to the right environment, particularly given Australia’s variable climate, nutrient-limited soils, and exposure to drought and heat extremes. This includes selecting drought-tolerant species and systems suited to marginal or degraded farm landscapes.

Research also examines agroforestry as a whole-of-farm system rather than isolated plantings, including how trees interact with soil function, water use, and enterprise performance.

Examples of innovation include:

digital platforms for farm and natural capital planning.
precision mapping for tree placement.
integration of remote sensing for biomass and canopy assessment.
carbon measurement and monitoring technologies.
improved genetics and selection for drought-tolerant and high-value timber species.

What is agroforestry?

Agroforestry is a sustainable land management system that integrates trees and shrubs with crops and/or livestock on the same land. It is designed to deliver multiple outputs, including timber, food, fibre, and increasingly, environmental services.

In Australia, agroforestry is used both for conservation outcomes and as a farm productivity practice. It can help improve land condition and support production in variable climates, and may also enable additional income through timber and environmental markets such as carbon and biodiversity.

Farmers may manage agroforestry systems for a range of outcomes. These can include a single primary focus such as timber production or carbon, or a combination of benefits within the same planting. Priorities may also differ across the farm or change over time, with plantings shifting between functions such as shelter, production, habitat, or future harvest.

Agroforestry systems may increase agricultural output in some areas or reduce it in others, making smart design critical.

Understanding agroforestry practices

Agroforestry is applied in different ways depending on landscape, enterprise mix, and farm objectives.

Silvopasture

The integration of trees with livestock grazing systems. In Australia, this often includes shelterbelts or scattered plantings that provide shade, shelter, and improved animal welfare outcomes.

Silvoarable

The integration of trees with cropping systems, such as alley cropping where rows of trees are combined with annual crops.

Windbreaks/ shelterbelts

Linear plantings designed to reduce wind speed, protect soils, provide shade, and improve livestock and crop performance.

Riparian buffers

Tree plantings along waterways that reduce erosion and chemical runoff, improve water quality, and support biodiversity.

The advantages of agroforestry

Agroforestry delivers a combination of productivity, environmental, and income diversification benefits for Australian farming systems.

Productivity

Creates microclimates that reduce wind speed and evapotranspiration, helping retain soil moisture and protect crops, pastures, and livestock.
Improves livestock welfare through shelter from heat, cold, and wind stress.
Supports natural pest control and pollination by increasing habitat for beneficial insects, birds, and pollinators.
Can provide supplementary fodder in drought or during feed gaps periods.

Soil health

Reduces erosion through deep root systems and permanent groundcover.
Improves soil structure and organic matter through leaf litter and root turnover.
Enhances nutrient cycling, particularly in multispecies plantings.
Can assist in managing salinity and stabilising degraded soils.

Biodiversity

Increases habitat and connectivity for native species in agricultural landscapes.
Supports beneficial fauna that contribute to pest regulation and ecosystem balance.
Enhances ecological function in cleared or simplified farm landscapes.

Carbon sequestration and environmental markets

Stores carbon in biomass and soils – a process known as carbon sequestration.
May enable participation in carbon markets, such as Australia’s regulated Australian Carbon Credit Unit (or ACCU) Scheme, subject to method requirements, measurement and reporting rules, permanence obligations and policy settings.
Can provide one potential pathway to diversify income while contributing to emissions reduction efforts.

Strategic considerations for adopting agroforestry

While agroforestry offers multiple benefits, successful adoption depends on careful planning and integration into the broader farm system.

Key considerations include:

Site selection: matching tree species and systems to soil type, rainfall, and landscape position.
Financial planning: establishment costs, time to returns, and long-term revenue pathways.
System design: balancing trees with existing production systems to minimise impact on crops or livestock (and avoid displacement of existing land use.)
Infrastructure requirements: considering fencing, machinery access, water points, and layout changes required to manage the farm with integrated agroforestry.
Time horizon: aligning timber, carbon and nature repair returns with broader business goals, both short- and long-term.

Agroforestry works best when it is designed as part of the farm business, not tacked onto it.

Opportunities on grow^AG.

Agroforestry in Australia is supported by a range of research programs and market pathways. These initiatives can help connect landholders, researchers, and service providers working in farm productivity, natural capital, and climate-related activities.

For farmers, researchers, and investors looking to explore what’s emerging in this space, grow^AG. provides access to current opportunities across funding, research translation, and investment pathways.

Explore Australian and global agrifood innovation at grow^AG^.