The Federal Government is being urged to set up a National Food Security Agency to help reverse declining agricultural productivity.

The Government has been told agricultural productivity has fallen in the past decade, largely because of cuts to research and development funding.

A report prepared by the Prime Minister's Science, Engineering and Innovation Council says Australia could become a net importer of food if the country's population continues to grow and climate change cuts agricultural production.

The report also warns that international food shortages are likely to become more severe.

The council's chairman, Professor Peter Langridge, says Australia needs to return to the levels of investment in agriculture that were occurring in the 1970s and 1980s.

He says international food shortages could have national security implications.

"This is going to have a big impact upon stability in our region - political stability on the issue of refugees and so on," he said.

"The Government's been told more money needs to be invested in agricultural research and a national agency should be set up to coordinate Government and industry efforts."