Agriculture Minister Barnaby Joyce has conceded Australian food prices will rise as a result of the nation's freshly inked free trade agreement with China.

Mr Joyce told Fairfax radio on Tuesday that the agreement would mean farmers would be able to demand higher prices for their produce, because they would have more potential buyers for their products.

Chinese President Xi Jinping and Prime Minister Tony Abbott.

"Another market means competition, and competition means that you're going to get a better price. And we've got to do that – we've been asking the supermarkets for so long... well now they've got somewhere else to go," he said.

But Mr Joyce said consumers would not notice much difference in food prices in stores, because only between 10 and 15 per cent of the retail price of food went to the farmer.