The AFGC, which speaks on behalf of the $70 billion sector, is urging the Federal Government to either impose a new tariff on food imports or adopt a carbon price of no more than $10 a tonne - half the level recommended by the Government's top climate advisor, Professor Ross Garnaut.

The sector has annual sales and service income in excess of $70 billion and employs more than 200,000 people – almost one in five of the nation’s manufacturing workforce.

Of all Australians working in the industry, half are based in rural and regional Australia, while the processed food sector sources more than 90pc of its ingredients from Australian agriculture.

It is also warning that consumers will face "significantly higher" prices for food, drinks and groceries.

"The potential for the cost impact of [the ETS] to erode the industry's comparative advantage based around cheap energy, high quality inputs and available land should not be under-estimated," the AFGC's submission states.