Australia pushing efforts to expand farm exports – eDairyNews
Countries Australia China South Korea |12 enero, 2015

Dairy industry | Australia pushing efforts to expand farm exports

Australia is intensifying its free trade activities with Japan, China and South Korea, aiming to increase its exports of such key items as beef and dairy products.

It reached an agreement in negotiations over a free trade agreement with China in November last year, and its FTA with South Korea took effect in December. Its economic partnership agreement with Japan is scheduled to go into effect on Thursday.

Overseas investment in Australia is also picking up.

Paul Roderick, 38, and his family operate a 220-hectare dairy farm in an inland area of the eastern Australian state of Queensland. Roderick plans to acquire more milk cows and invest in his farm’s facilities.

He said he was prompted by the current excellent climate brought about by the EPA and other forms of progress. Roderick also said he would of course welcome investment from overseas.

Oakey Beef Exports Pty Ltd., one of Australia’s largest beef processing plants and a member of the Nipponham Group, is considering expanding its facilities. General Manager Pat Gleeson expressed enthusiasm, saying the plant was also contemplating hiring more staff.

Trimming tariffs

Under its EPA with Australia, Japan will trim in stages the 38.5 percent tariff it currently levies on imports of Australian beef. The tariff on frozen meat meant for the food service industry will be reduced to 19.5 percent over 18 years, and the levy on refrigerated meat primarily for retail sales will be dropped to 23.5 percent over 15 years.

Duties on dairy products such as cheese will also be lowered for up to a certain volume of imports.

Australia holds the top share in Japan’s market for imported beef. Meat & Livestock Australia Limited ABN (MLA), an organization of beef producers, calculates that the value of exports to Japan will rise an aggregate 5.5 billion Australia dollars (about ¥530 billion) over the next 20 years.

Expectations are even higher regarding Australia’s FTA with China, with its population of more than 1.3 billion people. Australian products are highly regarded in China for their safety and quality.

MLA expects the value of exports of Australian beef and lamb to China will rise by an aggregate A$6 billion (about ¥580 billion) by 2030 once tariffs on those items are reduced to zero under the two nations’ FTA.

The industry group Dairy Australia has described this as a major turning point for Australia’s dairy sector.

From 12 to 91 cases

Investment from overseas, in anticipation of greater exports, is increasing rapidly. According to annual reports by the Australian government’s Foreign Investment Review Board, there were 12 cases of approved foreign investment in Australia’s agriculture, forestry and fishery sector in the 12 months through June 2009. In the 12 months to June 2013, however, that number jumped to 91, and the pace is believed to have continued increasing.

In September 2014, a Chinese company and a Chinese state-owned investment fund announced they would invest A$3 billion (about ¥290 billion) throughout Australia. According to sources including the Sydney office of the Japan External Trade Organization, a leading Chinese dairy company has invested heavily in a ranch it owns in southern Australia, while another Chinese company has purchased a ranch in the north.

There are rumblings of opposition when foreign parties buy land, but there appear to be more voices of support at the moment. John McVeigh, agriculture minister for the state of Queensland, for example, has said investment is indispensable for the growth of the agriculture industry.

Australia is also participating in negotiations over the Trans-Pacific Partnership free trade agreement. In November 2014, Australian Prime Minister Tony Abbott indicated that he wanted to conclude negotiations on an FTA with India within a year, demonstrating his intention to further promote free trade.

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