The NSW government today announced it would subsidise half the quarantine costs for overseas agricultural workers as labour shortages in the sector remained at critical levels.

Overseas agricultural workers entering the country under the Pacific Labour Scheme (PLS) and or Seasonal Worker Program (SWP) will be eligible for a 50 per cent subsidy of the cost of mandatory quarantine.

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It will reduce the cost to industry from $3000 per person to $1500 for 2020-21.

With costs halved, it is expected the industry could start bringing in workers to offset the shortage of 5000 workers in horticulture and 10,000 in the meat sector.

Currently Tasmania is fully subsidising the cost of quarantine in a dedicated hotel with shared rooms.

Victoria is quarantining through Tasmania's quarantine facility. Tasmania is charging Victoria $7200 per worker, in which the government will absorb $4200 of this, with industry having to cover the additional $2000 for each worker.

Queensland is providing on-farm quarantine but it's considering moving to a cost recovery model.

South Australia has set up a regional quarantine facility at Paringa, where it can accommodate 216 workers, at a cost of $2500.

In Western Australia, industry must cover the cost with shared accommodation available at $3360 while in the Northern Territory costs are being subsidised to $2000.

Agriculture Minister Adam Marshall said he expected to see an increase in applications through the PLS and or SWP as the proposition for farmers becomes a lot more viable.

"We know that our primary producers rely on seasonal and foreign workers, but we have heard loud and clear that the cost of mandatory quarantine is a significant barrier for farming businesses wanting to employ overseas workers," Mr Marshall said.

As well as working to cut costs for producers, the government also spearheaded the Ag Workers' Code, which approved almost 1200 overseas seasonal workers and successfully launched the 'Help harvest NSW' website to connect ag employers with out of work Australians.

The Northern Tablelands MP said he was hopeful producers would take up the scheme to attract skilled and unskilled workers alike.

"Now, by subsidising half the quarantine costs for overseas agricultural workers, we have made it more commercially viable for the farmers to get the workforce they need," he said.

"Horticulture and meat processing are the two most impacted industries by the international travel restrictions, but there are other industries as well.

"If we are looking at restricted international arrivals over the next 12 months, then we are going to have shortages across the whole agricultural sector.

"We're hoping this might give confidence to a number of farming businesses to make that investment now in bringing over those skilled people because it will be so much more affordable now."

NSW Treasurer Dominic Perrottet said this subsidy would be available "for at least the next 12 months" and would "help our vital agricultural sector" which was worth more than $10 billion to the NSW economy each year.

"Assisting Australians who want to return home will continue to be our number one priority, but we can't ignore the importance of our agricultural sector and their critical need for workers," Mr Perrottet said.

"We've done the heavy lifting here in this state when it comes to hotel quarantine and we will continue to do that because it is money well spent.

"We will continue this $12.5 million program because we want to make sure the industry can have the support it needs to bring in workers from overseas to get agricultural work done."

Mandatory hotel quarantine remains a critical part of the state's COVID-19 defence and any international arrivals are required to enter hotel quarantine in accordance with the Public Health Orders.

All seasonal workers approved to quarantine in NSW during the 2020-21 financial year will be eligible for the subsidy, provided the majority of their work is undertaken in NSW.