This paper examines the competitiveness of the Australian processed food industry using trade pattern measures and constant market share (CMS) model. The trade orientation criterion adopted in the study revealed that the industry has evolved over the years with an export focus and capable of competing with foreign suppliers in the domestic market. But an important empirical finding is that the industry’s competitive position in foreign markets as a whole has deteriorated over the period between 1980 and 1996 although different sub groups within the industry have shown mixed performance.