Riverina is in a strong position to capitalize on Australia’s Free Trade Agreements with Asia because of a determined focus on value-added farming, says Farrer MP Sussan Ley.
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Business representatives at a North Asia Free Trade Agreements seminar in Albury on Wednesday heard of dramatic market growth of agricultural products such as wine, beef and grapes.
“Farming contributes massively to our export income but irrigated farming has the value-add capacity that can really make a difference when you’re talking about the payload, flying out the value-add is vital,” Ms Ley told The Border Mail during the seminar.
“We’ve also got so much else going on. We have a good emerging nutraceuticals market in the Riverina which is growing plants for supplements, which is massive in China at the moment.
“I think the problem is how to scale up for a lot of our exporters here today: how to identify the market and transact effectively and be able to be a reliable supplier because you could be going from someone who’s got a small domestic market to literally a huge overseas market.”
Department of Foreign Affairs and Trade representative Litonya Shallcross said two thirds of Australia’s trade was covered by FTAs, which reduced or eliminated certain international trade barriers.
“It means your products and services are more competitively priced in key markets which opens up more opportunities,” she said.
She said Australian wine sales to China had increased almost 38 per cent since the China-Australia FTA was enacted, which cut a 14 per cent tariff to 5.6 per cent and will reduce it to 2.8 per cent at the beginning of 2018.
It was a similar story for Australian beef sales to Korea.
“There was a 40 per cent tariff on beef exports into Korea and that’s been reduced now to 29.3 per cent and will be cut again to 26.6 per cent,” she said.
“Prior to the FTA in 2014, exports of beef to Korea were at $942 million and in 2016 it has risen to $1.395 billion, which is an increase of around 44 per cent.”
Austrade Victoria and Tasmania director Tim Carroll supported Ms Ley’s view, and said Australia’s positive reputation was a strong selling tool.
“The gold spot for us is our clean, green brand,” he said.
“The game plan for a country like ours, in the food and agriculture spaces, is premium foods.
“Our products are highly valued and sold to a select part of the market that attract a higher price.”
Assistant Minister for Trade, Tourism and Investment Keith Pitt said regional economies relied heavily on international trade.
“ABARES estimates for the next 12 months that agriculture could hit and be over $60 billion in farmgate value, a new record, and that means jobs in the regions and that’s what we’re about,” the Queensland Nationals Member for Hinkler said.
”Agriculture is absolutely a mainstay, particularly of regional Australia … There has been massive increases in exports for wines, for table grapes, cherries, almonds – there are real opportunities in agriculture, almost every commodity is going incredibly well and that’s down to two things.
“Firstly, we’re very good at producing a wonderful product and secondly we have markets to send them to which are high value and certainly high margin and that means stronger bottom lines.”
Beechworth Honey’s chief executive Sara Quon spoke about Beechworth Honey’s expansion into Asian markets at the FTA seminar.
“Many of the partners we were talking to overseas ... were interested in premium foods, interested in very natural foods, organic, those sorts of things,” Ms Quon said.
“I think there is a broad potential for a number for Border businesses. The customers that we were talking to were very savvy. They know what they want.”
The session outlined Australia’s free trade agreements with South Korea, Japan and China, highlighting potential growth for Australian service providers as well as producers.