Home World Business Agriculture groups push for Australia-UK free trade agreement after Brexit

Agriculture groups push for Australia-UK free trade agreement after Brexit

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Key segments of Australian agriculture believe that Brexit creates an “unprecedented opportunity” to lift exports to Britain, and potentially generate significant new export earnings from products as diverse as beef, lamb, rice and wine.

Australian rice exports to Britain in a post-Brexit, free trade relationship – partly underpinned by the “sushi revolution” – could realistically increase “40 fold” on current levels, according to the Australian rice company SunRice.

Australia's red meat industry sees significant potential export opportunities in Britain after Brexit. Australia’s red meat industry sees significant potential export opportunities in Britain after Brexit. Photo: Cody Whiteman

The red meat industry says European Union trade rules, including quotas and high tariffs, significantly constrain Australia’s ability to meet strong demand in Britain for high-quality red meat, and hurt Australia’s ability to compete equally with other suppliers.

But in a submission to a federal parliamentary committee examining Australia’s trade and investment relationship with Britain, the red meat industry says that before Britain joined the EU, it “was one of Australia’s largest export destinations for red meat”.

To illustrate how big a buyer Britain was before it joined the EU in the early 1970s, the red meat industry cited figures showing that it bought 93 per cent of Australia’s sheepmeat exports in 1955 (or 47,000 tonnes). In 1959, it said Australian beef exports to Britain hit a peak of about 149,000 tonnes (65 per cent of all Australian beef exports at the time).

“Brexit provides an unprecedented opportunity for the Australian red meat industry to enhance its trading relationship with the UK,” says the submission from Meat and Livestock Australia, on behalf of the red meat industry. “Capitalising on import reform opportunities in a timely manner (ie. a re-examination of the previously mentioned EU access arrangements) will help position the Australian red meat industry for more competitive access and set up an advantageous trading regime for years to come.”

SunRice is similarly buoyant about the prospects for Australian rice exports after Brexit.

Britain’s exit from the EU, and a possible free trade agreement between Britain and Australia “represents a significant opportunity for Australian rice exports into a market where there is demonstrable and increasing demand for high-quality Australian rice”, SunRice says, in its submission to the joint standing committee on foreign affairs, defence and trade.

SunRice said the total amount of Australian milled japonica rice exports to Britain rose 626 per cent between 2010 and 2016.

“Without any trade restrictions, SunRice considers that Australian rice export volumes to the UK could match annual levels achieved by major competitors, such as the US. An annual export target of 40,000 tonnes of milled rice (a 40-fold increased on current levels) would not be an unrealistic expectation and would generate revenues approaching $60 million,” SunRice says.

“A major factor underpinning the material increase in UK japonica rice imports has been the ‘sushi revolution’ – the phenomenal increase in the popularity of Japanese cuisine, which requires specialty and niche short and medium grain rice varieties,” SunRice says.

Australia is one of the two main exporters in the world of the japonica variety rice used in Japanese cuisine. But while Australia has a quota of 1019 tonnes per year of rice exports to the EU before tariffs kick in, the US has a much bigger quota, of 41,109 tonnes before tariffs kick in, giving the US a significant advantage over Australia.

National Farmers’ Federation CEO Tony Mahar said: “The Australian agricultural industry is well placed to take advantage of the trading opportunities provided by the UK exiting the EU. Currently the import demand in the UK for many of Australia’s agricultural goods exceeds import quotas.”

The chairwoman of the trade sub-committee of the joint standing committee on foreign affairs, defence and trade, Bridget McKenzie, said the inquiry had been very successful and had had strong participation.

“Overwhelmingly, whether it’s our beef guys, our fish guys, NFF, Minerals Council etc. very much want a UK free trade agreement as soon as possible post-Brexit, and do see significant opportunities, not just for ag but obviously financial services and the like,” she said.

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