Chocolate maker eyes top-end Chinese market

Since China is most likely to become the world’s largest gourmet chocolate market, Barry Callebaut’s gourmet business in China is busy catering to the needs of chocolatiers, pastry chefs, bakeries, hotels, restaurants and caterers, the company said.

The Barry Callebaut Group, the world’s leading manufacturer of high-quality chocolate and cocoa products for the food industry, has strengthened its capabilities and expanded its offerings to meet the needs of the fast-growing segment of professional users of chocolate in China.

Gourmet products chocolate and cocoa products that are typically used by professionals such as chocolatiers, pastry chefs, bakeries, hotels, restaurants and caterers have fueled the business growth of Barry Callebaut in China which has doubled in volume over the last four years.

According to George Zhang, Managing Director for Barry Callebaut in China, higher disposable income of the rapidly growing middle- to high-income consumers in China will drive the expected growth in the sales of gifts as well as premium and sophisticated gourmet chocolate products in the coming years.

Zhang also said that consumers seek new chocolate trends, for example chocolate with health benefits, new tastes such as green tea flavor chocolate and innovative chocolate forms for a variety of exciting chocolate experiences.

The USD$ 2.8 billion chocolate confectionery category in China is estimated to grow to approximately USD$ 3 .9 billion by 2021.

 

 

Coca-Cola launches Aussie summer ‘sweat smasher’ with sports stars

Coca-Cola  has announced details of Powerade’s new Australian Summer campaign ‘Smash the Sweat’.

The campaign is designed to encourage consumers to smash the sticky, humid conditions associated with the season through the launch of limited edition Powerade sport-themed ‘shrink packs’ aimed at generating cut-through during the key summer period.

The strategy, said the company, revolves around tapping into the Aussie’s love of sports through collectable summer sports-themed packaging, featuring imagery from a range of sports including rugby, cricket, basketball, tennis, soccer and athletics.

The signature packs are signed by sporting legends and Powerade Ambassadors Greg Inglis, Mitchell Johnson and Andrew Bogut.

Appearing from early November, the limited edition packs will be promoted in-store at point-of-sale and supported on social media channels in the build up to summer.

As the summer sport season kicks off, the campaign will be boosted through outdoor media calling on consumers to ‘Smash the Sweat’.

Sarah Illy, Brand Activation Manager, Powerade, said: “We all love an Aussie summer, but with the hot, sticky conditions it becomes even more important to stay hydrated. So this summer we are challenging people to ‘Smash the Sweat’. Being a sports-obsessed nation, we decided to tap into that trend through our collectable sport-themed packs to encourage people to be active and stay hydrated.”

“The limited edition bottles have been inspired by Australian sporting legends with the objective of keeping Powerade ION4 top of mind for rehydration needs. Powerade ION4… is scientifically formulated to help replace four of the electrolytes lost in sweat and is an ideal way to ‘Smash the Sweat’ this summer,” said Illy.

 

Free Trade Agreement with China signed

Australia’s dairy industry, agriculture sector and beef and sheep farmers are the big winners of the Free Trade Agreement signed today by Minister for Trade and Investment Andrew Robb and his counterpart, Chinese Commerce Minister Gao Hucheng.

Australia’s agriculture sector will be able to capitalise on its well-deserved reputation as a clean, green producer of premium food and beverage products. Tariffs will be progressively abolished for Australia’s $13 billion dairy industry. Australia’s beef and sheep farmers will also gain from the phased abolition of tariffs ranging from 12-25 per cent and all tariffs on Australian horticulture will be eliminated.

China is Australia’s largest trading partner, with total trade worth almost $160 billion in 2013-14, and a growing source of investment.

The China-Australia Free Trade Agreement (ChAFTA) will lock in existing trade and provide the catalyst for future growth across a range of areas including goods, services and investment.

The Agreement secures better market access for Australia to the world’s second largest economy, improves our competitive position in a rapidly growing market, promotes increased two-way investment and reduces import costs. It is a win for households and businesses alike.

On day one of the ChAFTA, more than 85 per cent of Australian goods exports will be tariff free, rising to 95 per cent on full implementation.

Tariffs will be eliminated on a wide range of Australian manufactured goods, including pharmaceutical products and car engines.

Tariffs will be removed on almost all Australian resources and energy products, including the 8 per cent tariff on aluminium oxide on the first day of the Agreement, benefitting our exports worth around $1.3 billion a year. The tariffs on coking coal will be removed on day one, with the tariff on thermal coal being phased out over two years.

ChAFTA completes a trifecta of trade agreements with Australia’s top three export markets, accounting for more than 55 per cent of our total goods and services exports.

Australia’s FTAs with Korea and Japan are only months old and according to a joint release by Tony Abbott and Andrew Robb, Australia is already seeing increased exports compared to a year ago – like a 26 per cent increase in frozen beef prime cuts to Korea and a 84 per cent increase in the same product to Japan. Macadamia exports to Korea have more than doubled, and Japan is importing 82 per cent more of Australian rolled or flaked oats. Increases have also been seen in wine, lamb, horticulture and many other products.

The Agreement will enter into force after the completion of domestic legal and parliamentary processes in China and Australia, including review by the Australian Parliament’s Joint Standing Committee on Treaties, and the Senate Foreign Affairs, Defence and Trade References Committee. Both countries are working to complete these steps and bring the Agreement into force as soon as possible.

The full text of the Agreement is now publicly available online at: dfat.gov.au/chafta.

 

Not many facilities could test for Hep A: Patties CEO

Patties Foods ran into a number of difficulties when conducting their Nanna’s berries recall, but the most surprising was the lack of Hepatitis A testing facilities in Australia.

“The difficulty in Australia is up until recently, there hasn’t been a rigorous testing regime around Hepatitis A in food products because it hasn’t been considered to be a high risk virus in food production, so not many laboratories actually tested for it so when this recall incident came about, it was very difficult to get people quickly doing the testing because they had to effectively learn how to do the tests,” said Steven Chaur, CEO and Managing Director of Patties Foods.

Following the recall in February, there were a number of tests carried out both in Australia and overseas.

Both the Department of Health and Patties used the South Australian Research and Development Institute (SARDI), as according to Chaur, they were “the most advanced on setting up regular protocols on testing for Hepatitis.”

Patties Foods also sent 380 samples to specialist laboratories in the United States and Italy that specifically tests for Hepatitis in food products, none of which found a conclusive link to Hepatitis or E.Coli.

The Department of Health found two samples that tested trace positive to Hepatitis.
“One of those was from a consumer that had Hepatitis and also had a packet of berries and that test result came back inconclusive in relation to where the Hepatitis source came from,” Chaur said.

“There was another packet which was randomly purchased by the Health Department from a store in Geelong and they had that tested but it came up trace positive for Hepatitis but bordering on the limits of what they would call scientifically significant. So from that one sample, it was very difficult to draw a specific conclusion if it was indeed the berries that were the ultimate cause of the Hepatitis.”

But the difficulties for Patties didn’t end there.

“During the course of the recall it was actually very difficult to undertake proper product traceability tests because many of the 34 cases actually didn’t have any product left, they didn’t have any pack samples, they didn’t have any residual product, no use-by date codes, no barcodes, so it made it very much like looking for a needle in a haystack,” Chaur said.
In addition to testing samples for Hepatitis A, according to Assistant Minister for Health, Senator Fiona Nash, the Department of Health conducted rigorous scientific analysis of information from interviews with affected people, comparisons with people who were not ill and traced the source of berries eaten by affected people.

This led to the Department of Health's conclusion there was “very strong evidence that consumption of Nanna's 1kg fresh frozen mixed berries led to an increased risk of developing Hepatitis A infection in this outbreak.”

Chaur said despite this conclusion, there hasn’t been any scientifically definitive cause-related evidence to suggest it was the Nanna’s berries.

“The Health Department were relying on epidemiological surveys where they basically interviewed patients who’ve contracted Hepatitis A and undertook a questionnaire around trying to identify where the Hepatitis came from and in all cases, people consumed berries and by that there was a link drawn supposedly to Nanna’s being the common source.

"The facilities were tested in China, the product in our warehouses was tested, the product returned from supermarkets was tested and there was no evidence that there was a systematic amount of any virus of pathogen in the products,” he said.

The impact

Patties has announced it expects a loss of earnings of approximately $1.5m NPAT during FY15 resulting from the frozen berries recall.

“It’s fair to say that the sales of frozen berries was severely affected, and not only for Patties but for everyone in the category, this category has gone from a $200 million category growing at 40 percent per annum in supermarkets to now growing at 14 percent per annum and something like $50 million has been shaved off the retail sales value of the category.

“In terms of Patties products, our core savoury business, which is about 90 percent of our business, is actually in growth. We didn’t see any detrimental impact of the recall for brands like Four ‘n’ Twenty, Herbert Adams or Patties and those brands continued to remain in growth and interestingly enough, Nanna’s Apple Pies, which the brand is most famously known for, is actually in growth as well and we didn’t see any direct impact of the fruit recall,” he said.

“We saw definitely an impact in the first one to two weeks but certainly the brand has recovered since then.

Patties has since set up a laboratory in Sydney and implemented a ‘positive release’ protocol on all its frozen berry products, which means every batch is now tested in Australia for HAV and E.coli, and are only released to market when negative test results are provided.

All Nanna’s and Creative Gourmet berries now being released to supermarkets have passed this test with nil detection. Nanna’s and Creative Gourmet berries are amongst the most rigorously microbiologically tested berries now sold in the Australian market.

Are we better prepared?

Last month, FSANZ said they would not be increasing their surveillance of imported ready-to-eat (RTE) berries.

FSANZ completed a risk statement on hepatitis A virus and imported RTE berries which looked at the likelihood of a food safety issue occurring, the consequences and mitigating factors. The risk statement concluded that RTE berries produced and handled under Good Agricultural Practices (GAP) and Good Hygienic Practices (GHP) are not a medium to high risk to public health.

“From Patties Foods’ perspective that’s quite frustrating because we’re only one of thirty suppliers of berries into the country and we’ve taken extraordinary steps to make sure that these products are so rigorously tested, we’re testing up to four times from farm, to production, to export to landing in Australia, before it gets to consumer and that same standard doesn’t necessarily need to apply now to any other importer.

“We’ve worked with a number of suppliers locally to make sure that we’ve got capability to do Hepatitis A testing and of course we test every batch sample before it gets released to supermarkets in Australia so that same rigour doesn’t necessarily need to apply to any other supplier and we’d actually call for that standard to apply to everybody,” Chaur said.”
 

Final wording of China-Australia Free Trade Agreement to be known soon

The
full details of the Chinese-Australian Free Trade Agreement are expected to be
released before the end of June.

The ABC reports that the wording of the agreement, which had its negotiations
conclude last November, is being finalised.

Michael Clifton,
Austrade’s Senior Trade Commissioner in china, told ABC’s The Business, “My understanding is that we’re on track towards a signing
of the agreement, in the next six to eight weeks,” he said.

“And we would hope to see entry
into force before year’s end.”

The exact details of the agreement
have been a mystery since the November 17 signing. According to the office of trade minister Andrew Robb, finalisation was likely to be made before June’s end.

At the time of the signing, the federal government said
that “ChAFTA” would see 95 per cent of Australian exports to the People’s Republic eventually be
tariff-free, and wine and dairy to both be tariff-free after four years.

China is Australia’s biggest trading
partner, with two-way trade worth nearly $1600 billion in 2013-2014, according
to the Department of Foreign Affairs.

Australia’s biggest export, by far,
was “iron ores and concentrates”, worth $57 billion. The number one import from
China was clothing, worth $5.1 billion.

Image: https://dfat.gov.au/

Thirst for champagne continues: export figures

Last year, Australia imported over 6.5 million bottles of Champagne, making Australia the sixth largest export market for Champagne in the world.

The UK was the largest market for Champagne, importing over five times as much as Australia, with 32,675,232 bottles, followed by the USA (19,152,709 bottles), Germany (12,605,297) and Japan (10,429,638).

To be exact, Australia imported 6,524,220 bottles of Champagne, an increase of 501,055 bottles on 2013.

2014 worldwide shipments recorded a rise of 1 percent by volume compared with 2013 (305 million bottles).

Annual turnover totalled 4.5 billion euros, which constitutes the second best performance in the Champagne region's history thanks to the dynamism of export markets.

2014 saw 337 million bottles of Champagne harvested, a yield of 11,548kg/hectare

Top 10 Champagne export markets:

  1. United Kingdom: 32,675,232
  2. USA: 19,152,709
  3. Germany: 12,605,297
  4. Japan: 10,429,638
  5. Belgium: 9,741,262
  6. Australia: 6,524,220
  7. Italy: 5,795,957
  8. Switzerland: 5,553,703
  9. Spain: 3,420,322
  10. Sweden: 2,608,825

 

The case for country of origin branding

Provenance is increasingly important to consumers in Australia – more and more they are becoming interested in where the food they are buying has come from.

This reflects a growing awareness of health and safety issues surrounding what we eat and also the positive consequences of ‘buying local’; and driven by concerns about health and safety, the issue of provenance is even more pronounced amongst the bourgeoning Asian middle class.

This is all good news for Australia’s farmers, manufacturers and food processors because there is no question being Aussie is an advantage in the marketplace. Our clean, green image, coupled with the recognition of our high health and safety standards for growing and processing food, gives the ‘Australian brand’ a flying start in the marketplace.

Research shows that country of origin branding has a direct impact on purchasing behaviours – both here and overseas. While many Aussie businesses are competing against cheaper products, particularly in the Asian marketplaces, those selling genuine Aussie products have a card up their sleeve that can help them get ahead – and that is country of origin branding. There is very often a premium that consumers will pay for genuine Aussie products and getting this can be crucial for our exporters and import competitors alike.

Aggressive country of origin branding can also reinforce corporate philosophies – boosting staff morale and demonstrating corporate social responsibility. It can open up new business opportunities when tendering for government contracts and major projects.

The green-and-gold Australian Made, Australian Grown (AMAG) logo is the only registered, certification trade mark in Australia across all 34 classes of goods. It instantly establishes the connection of the product carrying it with Australia; and this happens both here and overseas.

According to Roy Morgan Research, over 98 percent of Australians recognise the logo, and 89 percent trust it to identify genuine locally made and grown goods. Research by YSC Online also found that products carrying the logo in export markets were more likely to have increased sales than those which did not.

Today more than 2,000 Australian businesses are registered to use the logo on over 15,000 products sold here and around the world. Indeed for many small businesses involved in export, the logo, with its proven, established links to Australia, becomes their strongest brand in the marketplace.

The same can also be said for state, territory and local government branding activities overseas, where the AMAG logo creates the overarching connection to Australia and therefore the framework for their ‘sub-brand’.

The Australian Made Campaign has welcomed the private industry initiative being championed by Andrew Forrest of Fortescue Metals Group – the Australian Sino Hundred Year Agricultural and Food Safety Partnership (ASA 100), to position Australia as a primary food and fibre supplier to China. The ASA 100 proposal, with its emphasis on a collaborative, cohesive approach to export marketing incorporating a single brand and a single logo, is a fantastic opportunity for consistency in labelling and a global approach for our food exporters.

The idea of the public and private sectors working together to build the global impact of ‘brand Australia’ is an exciting one. The power of consistent branding, both here and overseas, cannot be overstated. There is definitely a pivotal role for the Australian Made, Australian Grown logo in that strategy.

It is also important to be aware of the legal requirements. All country of origin claims must meet the following criteria:

• Australian Made: The product has been substantially transformed (made) in Australia and at least 50 percent of the production cost has been incurred in Australia.
• Australian Grown: All significant ingredients are grown in Australia and all significant (if any) processing has been carried out in Australia.
• Product of Australia: All significant ingredients come from Australia and all or almost all of the manufacturing/processing has been carried out in Australia.
• Australian Seafood: All significant ingredients are grown/harvested in Australia and all significant (if any) processing has been carried out in Australia.

It is also important to note that, for food products, the rules for using the AMAG logo with an ‘Australian Made’ claim are more stringent than those applying under the government’s Australian Consumer Law. A stricter set of criteria about what actually constitutes ‘substantial transformation’ was introduced several years ago to reduce any confusion about a food product’s true country of origin.

It is for this reason that consumers look for the AMAG logo when they shop so they can be sure that they are buying genuine Aussie products and produce.

 

Imported prawns labelled as Australian: Prawn Association

The seafood industry is looking for technology which can decipher if imported products are being sold as Australian, a practice which the Australian Prawn Farmers Association describes as “rife.”

According to the ABC, Helen Jenkins from the Australian Prawn Farmers Association said some Australian retailers are mislabelling cheaper, imported prawns as Australian.

“It’s rife. It’s fraudulent,” she said. “Some of the retailers are selling imported prawns as Australian.

“It’s not fair for consumers.”

The industry is searching for technology which can identify fraudulent labelling, and Jenkins said there may be some solutions in testing technology used in other food industries.

The industry is calling for clearer labelling of seafood products, with Chris Calogeras from the Australian Barramundi Farmers Association claiming it would help to reduce confusion amongst consumers.

"Barramundi has an iconic Australian name and so when people buy Barramundi they assume their buying Australian fish, and their not,” he said.

The ABC reports that between 5,000 and 6,000 tonnes of barramundi are produced in Australian each year, valued at $50-60 million. Approximately 1,500 tonnes are wild-caught, and 13,000 tonnes are imported.

Helen Jenkins said prawn farming could be as much as 17 times bigger in Australia if red tape was removed for local producers and clearer labelling was introduced, with overseas investors keen to buy into production systems in Australia.

Each year, Australia produces about 4,000 tonnes of prawns in ponds, 22,000 tonnes are wild caught and 46,000 tonnes are imported.

Just last week a new campaign promoting accurate labelling was announced, with chef Matthew Evans partnering with Greenpeace and the Australian Marine Conservation Society to drive reforms.
 

State of the Industry report released

The Australian Food and Grocery Council (AFGC) has released its annual State of the Industry Report, shedding light on key issues such as industry turnover, employment and international trade.

This is the sixth edition of the State of the Industry Report, which provides a comprehensive report of the food and beverage manufacturing industry’s turnover, employment, international trade, capital expenditure and research and development.

It uses data from the Australian Bureau of Statistics as its primary source, and where data from 2013-14 isn’t available, findings from 2012-13 are used.

Turnover
The Report found that the Australian food and beverage, grocery manufacturing and fresh produce industry had a total turnover of $114 billion in the 2012-13 financial year. Food and beverage processing contributed $91.6 billion, grocery $16.2 billion and fresh produce $6.2 billion.

Meat and meat product manufacturing continues to comprise the largest share of the total sector turnover, at 24.6 percent, despite contracting slightly (0.7 percent in 2012-13). Dairy product manufacturing was the second largest at 14.7 percent, increasing 9.1 percent. Seafood processing comprises the smallest share of the total sector turnover (1.2 percent), with a decline of 4.2 percent.

The fresh produce sector recorded a turnover of approximately $6.2 billion in 2012-13, representing an increase of 12.3 percent on the previous year. The vegetables category and the tropical and other fruits category, which includes nuts, bananas and berries, contributed the most to the growth, increasing by 10.6 and 22.5 percent respectively, due to recovery from adverse weather conditions.

The food and beverage, grocery manufacturing and fresh produce industry represents 28.9 percent of the total Australian manufacturing industry by turnover.

Employment
Employment decreased slightly, down 2,571 or 0.9 percent from the previous financial year. In 2013-14, the industry employed approximately 299,731 people, down from 302,302 in 2012-13.

In regards to the number of businesses in the industry, in the 2013-14 financial year there was an estimated 27,469 businesses, 183 fewer than in 2012-13. The vast majority of these businesses were in the fresh produce sector (18,609 businesses), while grocery manufacturing has 1,353 businesses and food and beverage manufacturing has 7,507 businesses.

“Turnover is up slightly but job numbers are down. This is a microcosm of the broader economy – growth is below trend and unemployment is creeping higher,” said Terry O’Brien, chairman of the AFGC in the Report’s foreword.

“In the food and grocery sector, the juxtaposition of growth and declining employment reflects the reality of companies automating to reduce labour costs and drive higher efficiency and productivity.”

Trade
In 2013-14, Australia’s total international trade (exports plus imports) increased by 7.3 percent to $55.9 billion.

The real value of industry imports increased by 6.1 percent, while industry exports increased by 8.6 percent (from a smaller base). This resulted in a contraction of 20.9 percent in overall trade deficit to $1.8 billion in 2013-14, with total imports in 2013-14 valued at $28.8 billion, and exports valued at $27 billion.

In 2012-13, food and beverage, grocery and fresh produce exports accounted for 21.3 percent of total industry turnover. During this period, 86.8 percent of all fresh produce grown in Australia went to the domestic market.

The Report quotes the weakening of the Australian dollar and growing global demand, particularly in processed meat, seafood and cheese and other dairy (exports grew by 24.5, 23.1 and 19 percent respectively), as the key drivers for strong export growth.

Australia’s top 10 trading partners for the industry remained the same in 2013-14 as in the previous year, with the US our largest overall trading partner and also surpassing Japan as Australia’s largest export market. Japan imported 21 percent of Australia’s meat products and dairy products in 2012-13. The US was the largest importer of wine and other alcoholic beverage products from Australia in the same year.

The US and New Zealand were the top two supplier countries for imports into Australia. Imports of fresh produce from New Zealand grew by approximately 60 percent from 2012-13.

The 2013-14 fresh produce figures indicate there has been a 23 percent increase in imports of fresh produce.

Capital expenditure and R&D
According to the State of the Industry Report, the food machinery manufacturing industry provides a proxy for the level of capital expenditure by the food and beverage industry.

It is estimated that the food processing machinery manufacturing industry revenue grew from $965 million in 2007-08 to $1.09 billion in 2012-13, a compound annual growth rate of 2.4 percent. However, the industry has been subject to fluctuations over time. For example, growth of 6.4 percent in 2010-11 followed revenue declines of 0.2 and 2.6 percent in 2007-08 and 2008-09 respectively when the global recession took its toll on demand for machinery and equipment.

Revenue is expected to grow at a compound annual growth rate of 0.6 percent over the five years through 2017-18 to a total of $1.12 billion. The forecast growth rate is based on observed trends such as increasing technological advancement, higher automation, downstream price increases, economic recovery over the next five years, introduction of new products and consolidation required in the industry to make new technological investments economically viable.

Capital investment in the food, beverage and tobacco product manufacturing industry flat lined at $3.1 billion in 2012-13 increasing only by 0.3 percent from 2011-12.

In 2011-12 the total amount spent in the food and beverage sector on research and experimental development was $541.8 million, an increase of 5.4 percent. The sub-sector with the largest expenditure on R&D was the dairy product manufacturing sector ($109.3 million), followed by meat and meat product manufacturing with $95.9 million. Significant growth was recorded in the sugar and confectionery manufacturing segment where estimated R&D expenditure rose by 56.1 percent from $26.7 million to $41.6 million, while most other segments recorded a decline over the same period.
 

Cider sales predicted to jump: IBISWorld

Although Australia’s per capita alcohol consumption is decreasing, cider sales are expected to grow 21.5 percent for the five years through 2019-20.

According to IBISWorld, Australians will spend $1 billion on cider this financial year.

Sales of cider have grown at an annualised 33.9 percent over the past five years, with continued strong annualised growth of 21.5 percent forecast for the five years through 2019-20.

IBISWorld Australia general manager Daniel Ruthven, said cider’s popularity is coming at the expense of ready-to-drink beverages such as pre-mixed vodka or whiskey drinks.

The trend away from strictly apple-based varieties of cider is attracting new drinkers, and is also leading to a rise in the number of specialty ciders available on tap.

“While many consumers have switched to craft and imported beers, others have changed to wine and cider,” Ruthven said. “Cider producers have found great success in marketing the beverage as a refreshing alternative to beer. Additionally, ciders have benefited from increased taxes on ready-to-drink mixes, with many young partygoers now opting for cider as a cost-saving exercise.”

As Australians embrace the trend of premium alcoholic beverages, imported and speciality ciders are enjoying particular success.

“Beer consumption is falling, but revenue is increasing as consumers opt for imported and craft varieties,” said Mr Ruthven. “This willingness to pay a premium for quality and variety is also driving revenue in the cider market.”

Over the past five years, cider imports have grown from 25.8 percent to 27.0 percent of domestic demand. The increasing popularity of premium foreign ciders – such as Swedish favourites Rekorderlig and Kopparberg, and the New Zealand-based Monteith’s – has driven this significant import penetration.

On the import stage, New Zealand holds 30.3 percent of the market, just above Sweden (29.4 percent). Ireland is another significant source of imports, with a 23.0 percent share of the market for foreign cider. Swedish giant Rekorderlig has invested heavily in product innovation to rapidly expand its range of flavoured ciders. This has helped the company quickly boost its market share in Australia, and has led Sweden to overtake previously significant sources of imports like the United Kingdom.

On the export front, the leading target market is the United Kingdom (24.4 percent of the export market), followed by New Zealand (19.8 percent) and the United States (16.3 percent).

 

Fairtrade labelled products see sales growth

Sales of Fairtrade certified products hit $7.7 billion worldwide in 2013, according to a Fairtrade International report.

The trend was mirrored locally, in Australia and New Zealand, where retail sales of Fairtrade Certified products such as coffee, tea and chocolate grew by 11% totalling over $259.3 million.

Molly Harriss Olson, CEO of Fairtrade Australia & New Zealand said, “After five years of intense focus on Africa, Fairtrade is now turning its attention to expanding in the Asian region. Australia has a vitally important role to play in scaling up the Fairtrade market in Asia Pacific, growing the number of producers and developing the supply chains for Fairtrade products.”

Australia recently received its first shipment of Fairtrade Certified cocoa from Papua New Guinea and there are commitments for 800 metric tonnes of cocoa in the pipeline via Fairtrade Sourcing Programs.

“Australians continue to increase their Fairtrade purchases, with 17% of Australians now purchasing Fairtrade Certified products at least once a month. A number of major retailers are looking to increase their Fairtrade commitments and National Australia Bank (NAB) is the largest accredited Fairtrade business in the world. So there is enormous potential here in Australia to transform the lives of some of the poorest people in our region,” Harriss Olson said.

 

Australia pulls out of world food expo

Australian food producers will miss out on next year’s World Expo in Milan due to the federal budget deficit.

Foreign minister Julie Bishop has confirmed Australia cannot spare the millions of dollars needed for a pavilion, The Australian Financial Review reports.

The Australian embassy in Rome and the Consul General in Milan will instead hold trade, tourism and networking events outside the Milan Expo.

Bishop said “this presence will support Australian organisations and business activities to participate in promotions alongside the Expo which emphasise our people-to-people and cultural connections.”

Australia has previously been part of two World Expos in Yeosu, South Korea in 2012 and in Shanghai, China in 2010.

A DFAT report on Australia’s Shanghai pavilion estimated the exhibition had generated $10 million of positive media coverage for Australia, and rated the project as an “unequivocal success”.

Shadow infrastructure minister Anthony Albanese criticised the Abbott government’s decision to pull out as an “enormous lost opportunity” to showcase Australia’s food industry to Italy and Europe.

The Victorian government, however, will put forward $1.25 million for its own exhibit and will be the only formal Australian presence at the exhibition.

The move is a means of increasing the state’s two-way trade with Italy which is worth over $1.4 billion a year.

The Napthine government said the state’s exhibition would help attract investment and celebrate the relationship between Melbourne and Milan.

 

TTIP could undermine food safety regulations, says CFS

A new report from US environmental advocacy organisation, the Centre for Food Safety (CFS) suggests that food safety in the meat industry in particular, could be negatively affected by the Transatlantic Trade and Investment Partnership (TTIP) due to the differing food safety standards between countries.

The report titled, Trade Matters: Transatlantic Trade and Investment Partnership (TTIP) – Impact on Food and Farming, states that such trade agreements allow for the harmonisation of safety standards, enabling countries with lower standards to export product into countries that have strict safety regulations.

Author of the report, international program director at Center for Food Safety, Debbie Barker says that in reality, such agreements effectively change a nation’s food safety standards.

“Many people don't know that these secret negotiations may undermine efforts on both sides of the Atlantic to protect our food, our health, and our environment,” says Barker. “Trade agreements, such as TTIP, profoundly impact our food and our farms. Education is the first step toward participation.”

The report used Australia’s adoption of a privatised meat inspection system as a prime example stating; “When Australia adopted a privatised meat inspection system that lowered standards, the US maintained the country’s “equivalency” status. This resulted in increasing incidents of Australian meat imports being contaminated with faecal material and digestive tract contents.”

 

Senate inquiry reviews beekeeping industry

A senate inquiry into the beekeeping industry has been told that some cheap imported honey is mislabelled.

The inquiry is reviewing the future of beekeeping and pollination services in Australia, ABC Rural reports.

Beekeepers want the Senators to address access to National Parks, cheap imports claiming to be honey and changes to biosecurity procedures.

CEO of the Honey Bee Industry Council Trevor Weatherhead, said "there are a couple of products here in Australia that have come from Turkey, that are labelled as honey, we have had them analysed overseas and they are actually corn syrup."

"We have put a complaint to the ACCC, but they are moving very slowly and we are very disappointed that no action has been taken. The public is being duped, because this product is mislabelled and it is also coming in at a very cheap price,” Weatherhead said.

"The import price it came in at was $1.83 a kilogram, already prepacked in tubs so it is being sold at a price that is a lot cheaper than Australian honey, which sells at the farm gate for $4 a kilogram."

 

China’s agricultural soil contaminated with toxic metals, AUSVEG

Peak industry body for potato and vegetable growers, AUSVEG is calling for further strengthening of Australia’s country of origin labelling laws after fresh reports have shown that almost 20 percent of China’s agricultural land is contaminated with heavy toxic metals, which can be carcinogenic and cause kidney damage.

Recent data released from the Communist Party of China has indicated that 19.4 percent, or around 1.05 million square kilometres of China’s agricultural land is contaminated with an array of toxic metals including cadmium, nickel and arsenic.

AUSVEG spokesperson, Hugh Gurney said that the findings are ‘mortifying’ especially considering that China is the second highest source of vegetable imports to Australia.

“In 2012-13, it was estimated that approximately $110 million worth of vegetables were imported to Australia from China, however, it’s highly likely that the amount of potentially harmful Chinese produce reaching Australian dinner plates is much higher than official figures suggest,” said Gurney.

“Under current trade agreements with China, New Zealand may import processed vegetables from China, repackage them as ‘Made in New Zealand from local and imported ingredients’, and ship the product to Australia for consumption.”

“…The risk associated with the consumption of Chinese produce is now indisputable. We should not allow inadequate Country of Origin Labelling requirements continue to put the health of Australian consumers at risk,” he said.

The House of Representatives Agriculture and Industry Committee recently announced that it will be conducting an inquiry into country-of-origin labelling for food. The inquiry has been referred by the Minister for Agriculture, Barnaby Joyce MP, and Minister for Industry, Ian Macfarlane MP.

The terms of reference for the inquiry:

  • Whether the current Country of Origin Labelling (CoOL for food) system provides enough information for Australian consumers to make informed purchasing decisions
  • Whether Australia's CoOL laws are being complied with and what, if any, are the practical limitations to compliance
  • Whether improvements could be made, including to simplify the current system and/or reduce the compliance burden
  • Whether Australia's CoOL laws are being circumvented by staging imports through third countries
  • The impact on Australia's international trade obligations of any proposed changes to Australia's CoOL laws.

Gurney says that AUSVEG has welcomed the inquiry, stating that it is paramount that Australian consumers are able to easily identify foreign produce.

“Australian growers follow the strictest environmental and on-farm protocols to produce some of the world’s safest vegetables. It would be shameful to continue to let ineffective Country of Origin Labelling legislation impede Australian consumers from making well-informed choices at the supermarket,” he said.

 

Anti-Dumping Commission makes recommendations for dumped Italian tomatoes

Peak industry group for Australian vegetable and potato growers, AUSVEG has welcomed the announcement made yesterday by Parliamentary Secretary to the Minister for Industry, Bob Baldwin regarding the dumping of canned tomato products from Italy.

An investigation was launched by the antidumping commission on 10 July last year in response to an application lodged by Australian fruit and vegetable processor SPC Ardmona, who alleged that Italian tomatoes were being exported to Australia from Italy at margins which constituted dumping.

SPC said that the influx in imported Italian tomatoes caused material injury to local producers and also resulted in reduced profitability and lower sales volume for the business.  

The investigation has now recommended that a dumping notice be published to a number of Italian tomato products which were found to have been dumped into the Australian market and additionally, exporters of these types of products sent to Australia since 1 November 2013 may be forced to pay a dumping duty to the Australian Government.

“The Commission found that a range of Italian tomato products have been entering the Australian market at prices which are below the cost of production for these items, and the publication of this dumping notice acknowledges this and will hopefully help to prevent further injury to the Australian tomato and vegetable processing industry, which in the past three years has been beset by a spate of factory closures,” said AUSVEG spokesperson Hugh Gurney.

“AUSVEG is calling on the Federal Government to use the dumping duty collected from these Italian exporters employing questionable tactics to support Australian vegetable and tomato growers and processors who have been injured by this predatory pricing.”

According to AUSVEG, in 2012-13, Australia imported $52 million worth of prepared or preserved tomato products, $49 million of which came from Italy.

“With 93 per cent of tomatoes imported into Australia originating in Italy, this announcement will serve to discourage those exporters who refuse to play by the rules,” said Gurney.

“The last three years have been unfortunately punctuated by the closures of Australian tomato processing factories for Heinz and Rosella, so the local industry has already borne the brunt of dumped Italian product. It is hoped that this dumping notice will allow remaining processors in Australia, like Kagome and SPC Ardmona, to continue employing hundreds of workers and Australian vegetable growers.”

 

First PNG Fairtrade cocoa beans expected soon

Confectionery brand Cadbury is expecting the first shipment of Fairtrade cocoa beans from Papua New Guinea to arrive in Australia in the coming weeks.

In partnership with Fairtrade ANZ and Monpi Cocoa Exports, Cadbury has been supporting Club 3000, a group of 629 cocoa farmers in Madang Province on the northern coast of Papua New Guinea, to sell its cocoa under Fairtrade terms.

The 12 month project, delivered by Monpi Cocoa Exports, is training Club 3000 farmers to produce high quality Fairtrade certified cocoa in order to bring a sustainable income to farmers, their families and the community.

According to the Fairtrade website, the initiative delivers a better deal for farmers and producers in the developing world through:

  • A fair and stable price for their produce
  • Security of long-term contracts
  • Investment in local community development
  • Improved working conditions
  • Environmentally sustainable farming methods
  • Support in gaining the knowledge and skills needed to operate successfully in the global economy

Stephanie Saliba, Cadbury spokesperson said, “While relatively small in terms of the global cocoa market, the PNG cocoa industry offers great potential.  Sustainability initiatives like Club 3000 are helping farmers to improve the efficiency of their farming, increase their yields and in doing so improve their livelihoods and lives.”

Following on from the Club 3000 project, Cadbury and Monpi have announced a further partnership to provide training and support to 1,000 farmers in the northern Morobe Province of Papua New Guinea, under the banner of the $400 million global Cocoa Life program.  An NGO will also join the partnership later this year to work with Morobe farmers and the community on a holistic approach to improving the region’s cocoa industry and the lives of farmers.

“Our vision is that in partnership with Monpi Cocoa Exports, and our NGO partner, we will work with farmers, their families and local communities to address areas of need with a particular focus on empowering women. Those needs will be identified by the farmers and communities involved in the project,” said Saliba.
 

It’s time to innovate: SPC’s plan for the future [video]

Fruit processor SPC, will use the $100 million co-investment from the Victorian government and its owner, Coca-Cola Amatil, to make productivity and efficiency gains, and innovate in-line with consumer demands.

Food magazine recently sat down with Bronwyn Powell, marketing and innovation director at SPC, who spoke about a number of challenges the brand has faced in recent times, and the progress they’ve made in keeping it afloat.

She said SPC has been a leading force in the recent anti-dumping legislation, adding that cheap imported produce, specifically tomatoes, have made competing in the local market a significant challenge.

While SPC’s struggles have been well publicised (read more here, here and here), the $100 million co-investment is expected to go a long way for the company. Powell said the money will be put to good use, and will fund innovation including a move away from canned products, in response to consumer demands.

You can hear more about what SPC’s got planned in the video interview below.

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Tomato tariff will punish consumers, Woolworths

Supermarket giant Woolworths has said that tariffs on ‘dumped’ Italian organic tomatoes will directly affect consumers.

In February this year, the Anti-Dumping commission announced a 5.06 percent tariff on prepared and preserved tomatoes exported from Italy with a 26.35 percent tariff applying to ‘uncooperative producers’.

The tariff was introduced after fruit and vegetable processor, SPC Ardmona successfully applied to the anti-dumping commission to introduce a penalty on exported produce sighting that the domestic industry has suffered material damage as a result of an influx in cheap imports.

However Woolworths has now warned that consumers will have to bear the brunt of the charges should they wish to purchase tinned organic tomatoes as there is no real Australian for them, The Weekly Times Now reports.

“To meet the needs of consumers, Woolworths imports canned organic tomatoes from Italy as there is no Australian supplier of these products,” said the supermarket.

“While still a relatively small part of the total food market, organic foods are an imported segment and are strongly preferred by some Australian consumers.”

Woolworths says that 96 percent of the fruit and vegetables that it sells are Australian grown with the remaining four percent of imported food only sourced to cover seasonal shortages.

The ruling to impose tariffs has also received criticism from the European Union who have accused the Anti-Dumping Commission of flouting World Trade Agreement rules in its inquiry. The EU also accused the commission of failing to conduct a proper impact analysis.

According to the Weekly Times Now, Federal Industry Minister Ian Macfarlane is expected to announce a final ruling on the tariffs by March 21.

 

Federal government to ramp up anti-dumping measures

Industry minister Ian Macfarlane has announced that the federal government plans to increase penalties against processors of illegally dumped imported tomatoes, as well as introduce legislation that will reverse the onus of proof on foreign suppliers.

According to Macfarlane, tomato importers that have illegally dumped product earlier this month are also likely to be penalised, The Weekly Times Now reports.

However trade advocates together with the labor government have stated that the reversing of the onus of proof could be in breach of World Trade Organisation rules.

Liberal MP Sharman Stone, who has been very public about her support for struggling food processor SPC Ardmona, says that ‘urgent’ action needs to be taken. She also dismissed concerns regarding potential retaliation from trade partners.

“Let’s test it and see. If we are the poor little pathetic scared people who always worry that someone might say ‘Just a minute’, then let’s forget our anti-dumping regime and continue as before,” said Stone.

SPCA recently secured $22m from the Victorian state government, and $78m from parent company Coca-Cola Amatil as part of a restructure plan over the next three years.

CCA announced this week that it had taken in excess of a $400m hit to profits due to write-downs related to SPC Ardmona. CCA says that the write-downs are a result of dumped imported product and the high Australian dollar.