Environment Minister Sussan Ley said Australians throw out more than 7.3 million tonnes of food each year at a cost of more than $20 billion to the economy.

Meanwhile, the average Australian household discards up to $3800 worth of food each year.

Ms Ley said the newly-formed Stop Food Waste Australia would work with industry to create practical changes like adding clearer instructions on packaging for storage.

Another tweak could include creating consistent package design with use-by or packed-by dates that are easier to find.

"Australians have focused on recycling for years, but very few of us think about the amount of food that we waste every week," Ms Ley said in a statement on Saturday.

Food waste had a knock-on effect that could hurt Australian farmers, Waste Reduction and Environmental Management Assistant Minister Trevor Evans said.

"By reducing food waste, we can improve business bottom lines, put money back into household budgets and make better use of our natural resources," he said.

Australian Associated Press