Seafood industry wants Australians to support origin labelling review

The Australian seafood industry has called on consumers to support the expansion of the current Country of Origin Labelling (CoOL) laws to include seafood sold in foodservice  the Government begins an evaluation of legislation which came into effect two years ago.

“In the retail sector CoOL provides consumers with clear information on where their food has come from and allows consumers to make informed purchasing decisions, we want to see this origin labelling extended to seafood sold in the foodservice sector,” Seafood Industry Australia (SIA) Interim CEO Veronica Papacosta said.

“In July 2018 it became mandatory for food sold in retail to be labelled with its country of origin, and the wheels didn’t fall off. In fact, labelling improved the level of communication and trust between a retailer and their customers. However, there was no requirement placed on places like restaurants and cafes. Foodservice should have never been exempt from the original labelling requirements and we hope this loophole will finally close.

“Seventy per cent of the seafood eaten in Australia is imported, the majority of this consumption is in the foodservice sector, and many people don’t realise this. Consumers assume their iconic seafood meals are made using iconic Australia seafood, however we know this is often not the case. We know people want to support our Australian seafood producers, but people cannot buy Australian seafood if they can’t tell where it’s from.

The Australian seafood industry has appealed to the government to make origin labelling mandatory for seafood sold in foodservice, and Papacosta believes the country has the opportunity to make this happen.

More than 86,000 consumers have signed petitions asking for Australia seafood labelled in foodservice, and two Senate inquiries have called for it.

“Now, for a fourth and hopefully last time, we need as many people as possible to take this survey and express their support for the labelling to be expanded to cover seafood sold in foodservice. It’s been demonstrated that the current voluntary labelling system does not work. The change to mandatory, legislated labelling is wanted by consumers and is inevitable. We strongly urge the government to take action this time,” said Papacosta.

“In 2008, Country of Origin Labelling for seafood sold in foodservice was introduced in the Northern Territory with minimal disruption, and the Queensland Liberal National Party (LNP) has made an election promise to implement local labelling should they come into office in this year’s election.”

A 2018 report found demand for Aussie grown produce both domestically and internationally was on the rise, with the coronavirus pandemic further strengthening support for domestic produce.

“Australians are more interested in the provenance of their food than ever before, and demand for all Aussie-grown produce is on the rise,” Ms Papacosta said. “As the world continues to grapple with the coronavirus pandemic, clear labelling for Australian seafood not only allows consumers to support our domestic producers, but the entire supply chain including processors, truck drivers and regional communities more broadly.

“It is important to note that we do not want to vilify imported seafood. There is some excellent seafood coming into Australia which is already being enjoyed by consumers. We simply believe that consumers should be provided with the same level of information in a restaurant as they are at the fish counter so they can make an informed choice. Next to freshness, country of origin is the second most influential factor for consumers choosing which seafood they buy.

“What we would like to see is Australian seafood be clearly identified on foodservice menus. The level of detail should be at the discretion of the business, for example you could say Humpty Doo Barramundi, Tasmanian Salmon or simply Australian Whiting. Australian seafood is a drawcard for consumers and eateries can proudly display it as a badge of honour on their menus. Imported seafood should have no origin referred, or a small identifier following the menu description, similar to ‘gf’ for gluten-free.”

Unlabelled allergens rife in imported food

Scientists who tested a shopping trolley-sized collection of food imported from Asia have found that nearly half of the samples were contaminated with potentially deadly, undeclared allergens.

Professor Andreas Lopata, head of James Cook University’s Molecular Allergy Research Laboratory led the study and said the findings were alarming.

After fellow Australian Institute of Tropical Health and Medicine researcher Michael Sheridan bought 50 packaged food items from six Asian grocery stores in Melbourne, the team checked the labelling and tested the contents.

“Allergens not listed on the product labelling were detected in 46 per cent of the products analysed, with 18 per cent containing multiple undeclared allergens,” Lopata said.

Undeclared allergens detected included egg, gluten, milk and peanut, some in very high concentrations.

Lopata said food allergies are increasing globally with Australia having one of the highest incidences of food allergy among children.

“Hospital admissions for food-induced acute allergic reactions rose by about 350 per cent in Australia between 1997 and 2005 and increased a further 150 per cent over the next seven years to 2012,” he said.

China was the source of products with the highest number of detectable, undeclared allergens, followed by Thailand and South Korea.

Professor Lopata said while food labelling appears well regulated in Australia, it’s less well-regulated in some Asian countries.  “That’s of concern, with Australian imports from ASEAN countries (Association of Southeast Asian Nations) increasing from 18 to 23 per cent from 2002 to 2012, and the food trade from Asia to Australia continuing to increase by about 2.5 per cent each year.”

He said authorities in Denmark, Norway, Sweden, and Finland performed extensive studies of imported food in those countries and found that 10 per cent of products where not correctly labelled with the detected allergens.

 

Australian Made welcomes support for Aussie manufacturers and exporters

The Australian Made Campaign Ltd (AMCL) has welcomed today’s announcement from the Federal Government outlining its commitment to support Australian manufacturers here and abroad.

The commitment will see AMCL receive up to $5M to promote the famous Australian Made, Australian Grown (AMAG) logo in key export markets, as well as establishing trade mark registrations in the United Kingdom, European Union and Canada. The announcement also details the establishment of a Manufacturing Modernisation Fund aimed at assisting manufacturers access new technologies to expand and thrive into the future.

“It’s really encouraging to see this level of commitment to Australian manufacturers,” said Australian Made chief executive, Ben Lazzaro.

“It’s important that we foster a manufacturing environment that encourages and assists manufacturers to innovate and build on their success, as well as providing pathways to new markets. The end result being a healthy manufacturing sector, job creation and better access to markets.”

The famous green and gold kangaroo brand is ideally positioned to play a key role in the Government’s effort to support local manufacturers in Australia and those taking their goods abroad.

“The AMAG logo has a proven 33-year track record in making the ‘Australian connection’ here and overseas, so it makes real sense to enhance its effectiveness as export markets continue to open up for Aussie manufacturers,” said Lazzaro.

“While much work has been done in extending the reach of the AMAG logo domestically and into Asia, with the Government’s support, AMCL will be able to further strengthen Australia’s reputation for high-quality, clean, green products further afield.”

The AMAG logo is currently used by nearly three thousand businesses across thousands of products sold all over the world. It is also a central element of the Government’s recently introduced food labelling laws in Australia; it will therefore be featured on the labels of thousands of food products exported from Australia (in addition to the thousands of non-food Australian exports).

It is also a registered trade mark in USA, China, South Korea, Singapore and India, with legal proceedings having commenced to register it in 7 other Asian countries – Hong Kong, Indonesia, Japan, Malaysia, Taiwan, Thailand and Vietnam.

“AMCL looks forward to working with the Government to help deliver this initiative and help extend the reach of the AMAG logo and that of Aussie manufacturers and exporters,” said Lazzaro.

Woolworths wins cider duties dispute

Woolworths Limited has won a tariff dispute with the Australian government following a ruling by the Administrative Appeals Tribunal (AAT) on its import of Savanna Dry alcoholic cider.

Woolworths had been required to pay duty on the cider after the Department of Home Affairs claimed the product, which features caramelised apple juice, did not meet the specific definitions of a cider under the relevant act. Meeting those conditions would have enabled the company to import the drink duty-free.

The outcome of the dispute turned on AAT deputy president Bernard J. McCabe’s analysis of the NaturBrown caramelised concentrate that is added to the fermented apple juice concentrate during the manufacturing process.

The  Department of Home Affairs said this additive has the effect of taking the product outside of the definition of “cider”.

McCabe said that, following his research of relevant literature – the Cook’s Illustrated “Caramelizing vs. Browning” and Science of Cooking “What is Caramelization” webpages – and evidence from expert food technologist Dr Simon Brooke-Taylor, he was satisfied the product conforms to the definition of cider under the relevant act and overturned the Department’s ruling.

“It has not been transformed into something else; it has just been made more delicious,” said McCabe.

“Nothing has been added; it is ultimately the same thing as the juice concentrate to which it is added.”

McCabe said that in making his decision he was not focusing on how NaturBrown should be classified if it were being imported, but was making “a commonsense determination about classification of the cider product” which required him to reach a view as to whether NaturBrown has been transformed into an additive that is something other than juice or the must of juice.

“I am satisfied from the evidence provided by Dr Brooke-Taylor that NaturBrown is ultimately ‘juice or the must of apples’ for present purpose,” he said.

The AAT decision will save Woolworths about $70 per litre of the cider that it imports into Australia.

Australia sets new trade conditions following prawn ban

Australia is planning temporary trade conditions for uncooked prawns as the end of an enforced six-month suspension is anticipated.

The department of agriculture and water resources is pencilling interim import conditions to allow the “safe resumption of trade in uncooked prawn and prawn meat”.

The ban was declared on January 6 by the director of biosecurity and will lapse on July 6.

Some prawn products, including dried prawns, uncooked Australian prawns, and uncooked prawns and prawn meat marinated for human consumption, have been exempted from the suspension.

To manage the biosecurity risks of the exempt prawn products, interim import conditions were developed which include strict pre-export and on-arrival testing for prawn diseases, including white spot syndrome virus and yellow head virus.

It is intended that requirements for pre-export and on-arrival testing will be maintained for those categories of prawns currently exempt from the import suspension.

It is also expected that the interim import conditions developed for the remaining categories of prawns will include similar stringent measures.

“In preparation for the end of the suspension, the department is informing prawn importers about expected changes to import conditions for all prawn products, including the uncooked prawn products which are still subject to the suspension,” a department spokesperson said.

“These interim import conditions are likely to apply until the formal review of import conditions for prawns and prawn products for human consumption is finalised.

“This thorough review is considering the biosecurity risks of imports from all countries and will recommend appropriate import conditions to manage them. This process is expected to take up to two years.”

Prawn importers will be informed of any decisions concerning interim import conditions before the July 6.

Greece’s best wines coming to Australia

For the third year in a row, Greece’s leading winemakers and educators return to Australia 19 – 26 June 2017 to showcase up to 80 of the country’s best and latest wines.

First-time visiting winemakers will join wineries from previous tours at a series of trade and consumer tastings in Sydney, Melbourne and Adelaide including the most in-depth masterclasses ever on Greek wines led by Greece’s second-only and newest Master of Wine, Yiannis Karakasis MW.

Up to 20 winemakers will show a huge range of wines including Greek indigenous varieties such as xinomavro, agiorgitiko and mavrotragano plus new-wave wines from the next generation of winemakers emerging from oldest culture of wine in the world. With one of the world most diverse micro-climates and vast array of indigenous varieties, Greece produces wines with a true sense of place and is finally earning recognition across the world for wines that are truly unique.

Consumers will also have the opportunity to taste and meet the people behind the wines at two events, the Greek wine extravaganza, Oinofilia, at Melbourne’s Meat Market on Saturday, 24 June (held by the team behind Pinot Palooza and Game of Rhones) and at Georges on Waymouth in Adelaide on 21 June.

Wines of Greece President, Vangelis Argyris said the winemakers were looking forward to returning to Australia for the third time.

“There is unprecedented demand for Greek wines with a 30 per cent increase in sales in Australia over the last two years. Our native grape varieties are leading this demand and we’re hoping to bring some new varieties in June that haven’t been widely seen in Australia before.

“We are thrilled Australia has fell in love with Greek wines and so excited for this third tour in as many years.”

Wines of Greece is also running private masterclasses for retailers, distributors, hotels and restaurant groups throughout their time in the country.

China increases regulation of online imports

Chinese authorities have increased restrictions on food and other products imported through online sales, in an effort to entice consumers back to the domestic market.

As the China Post reports, last week he Ministry of Finance published a list of more than 1,100 imported items that will be subject to a new 11.9 per cent value-added tax. The products listed included food, baby formula, home appliances, cosmetics, clothing, shoes and so forth.

E-commerce is currently booming in China, driven by an expanding middle class that is increasingly unsatisfied with the quality of local products and willing to spend more for products from Countries like Australia with more of a “clean, green” image.

In Australia’s case this has particularly been evident in the demand for infant formula and health supplements.

As the SMH reports, apart from the tax, Chinese authorities will also impose tighter regulation over what products may be imported through e-commerce warehouses in pilot free trade zones. These enjoy lower tax rates and looser customs requirements.

It is not yet clear what goods will be involved in these new restrictions and there is a fear that this may have a larger impact than the tax hike. Higher logistics costs could be passed onto consumers.

So far e-commerce companies have mostly not passed on the tax hike to consumers.

One such company Alibaba Group Holding, for example said, “…many overseas brands and retailers on our platform don’t have plans to raise prices in the short term so that consumers can gradually adapt to the change.”

The change does not affect the grey market of so-called “daigou”, Australian-based Chinese making money by personally sending products to China. However, according to the SMH, in recent times these have been subjected to more spot-checks by China’s postal and quarantine inspection services.

‘Reverse strawberry’ hits Australian shores

A ‘reverse strawberry’ with white flesh and red seeds has been released onto the Australian nursery market and could eventually make its way to retail shelves.

The ABC reports that the fruit, known as a pineberry, was bred in Europe in the early 2000s from naturally occurring white strawberries which were collected in South American during the colonisation period.

United Nurseries is importing the fruit to Australia.

Phillip Neilsen from United Nurseries told the ABC that Australia’s strict quarantine and biosecurity requirements meant it took four years to bring the import process to fruition.

“They are still a strawberry, [but] you have a very subtle taste at the beginning of citrus or pineapple, and it finishes off with the classic strawberry flavour,” Neilsen said.

He said that initially the market for pineberries would be backyard growers but added that commercialisation was a real possibility in the future.

“The original thought pattern was just to target the public in respect to retail [nurseries],” he said.

“But what we saw over in Europe is that it is a commercial variety as well.

“You have to start somewhere, so we thought we’d start with retail and then work our way back down the other chain.”

He added that the unusual-looking fruit was not the result of genetic modification, but traditional breeding techniques.

“It’s taken them many years to develop them,” he said.

Image: United Nurseries.

Dumping protection hurts economy: Productivity Commission

The Productivity Commission has released a report today arguing that anti-dumping measures consider only a narrow set of industries, remove the need for innovation, and don’t consider the overall cost to the economy.

AAP reports that the paper by the commission, an influential advisor the federal government, has blasted the anti-dumping system, which imposes tariffs on things like dumped tinned tomatoes following complaints made by SPC Ardmona.

Dumping is the practice of exporting and selling goods below cost, and is described as a type of predatory pricing.

"Once the emotive terminology is stripped away, any general distinction between anti-dumping protection and conventional tariff protection is a fine one," The Australian Financial Review quotes the report as saying.

"Like tariffs, anti-dumping measures benefit recipient industries, but impose larger costs on other industries, consumers and the broader economy [and] reduce the need for recipient industries to innovate in order to remain competitive and to adjust to changing market conditions more generally.”

The report’s release follows research on Asian steel dumping commissioned by the federal government – announced the day after Arrium revealed it was considering shutting its Whyalla steelworks – announced last week. The commission will report in April.

The steel industry is under heavy competition from imported Asian steel as China’s economy and its infrastructure building slows.

86 per cent of investigations into dumping in 2014-15 were to do with steel imports.

Govt to impose duties on canned Italian tomatoes

The Government will impose import duties on two brands of canned Italian tomatoes, following the recommendations of an investigation by the Anti-Dumping Commissioner.

The Commissioner investigated the alleged dumping of Feger and La Doria canned tomatoes onto the Australian market. (Dumping refers to the practice of selling a product at a price that is lower in the foreign market than the price charged in the market of origin).

The final decision is to apply dumping margins of 8.4 per cent to Feger tomato products and 4.5 per cent to La Doria tomato products.

The decision means that all brands of canned tomatoes imported from Italy are now subject to anti-dumping measures.

Minister for Industry, Innovation and Science, the Hon Christopher Pyne MP, said in a statement that this was a strong and decisive decision for local producers.

“This ruling will ensure that Australia’s only canned tomato producer, SPC Ardmona, can now compete equally in Australian stores and supermarkets.”

“Feger and La Doria are major competitors in the Australian market.

The Middle East is open for exports

The Middle East is often viewed with some trepidation by the Australian business community, with the language and distinct cultural differences often creating uncertainty among Australian exporters. 

However, the region is growing and offers huge potential for Australian exporters, particularly as we look to expand and diversify our export markets away from Asia.

 Like any other export market, understanding where demand exists, learning about any potential risks and taking the appropriate steps to success, can ensure more Australian SME exporters, including manufacturers, are able to take advantage of the growth opportunities in this exciting region. 

Strategic export destination  
The Middle East is strategically located between Europe and Asia, meaning historically it has been well placed to act as a trading hub for Australian companies operating there. This has meant that Australia has developed strong relationships with a number of markets in the Middle East. 
The United Arab Emirates and Saudi Arabia are our strongest export partners in the region, and were ranked 11th and 18th respectively as the most important export markets for Australian businesses in the recent Australian International Business Survey 2015. 
 

Strong industry demand 
Australia’s key export industries, including mining, agriculture and services, all have strong markets in the Middle East, providing a number of exciting opportunities for Australian SME exporters. 
The mining sector in the Middle East is growing, as many of the Gulf countries look to diversify their economies away from oil. Investment is also being made in other sectors, such as mining and infrastructure. This will create opportunities for Australian mining equipment, technology and services companies, and companies involved in the infrastructure supply chain. 
There is also a strong and growing market for Australian agricultural exports to the Middle East. For example, Australian lamb exports to the Middle East increased by 7 per cent in 2014 and beef exports to the region were worth AU$390 million, according to figures from Meat and Livestock Australia. Other strong export opportunities exist for grains, such as barley and wheat, and canola. 

Education is a key services export market for the region, with a number of Australian institutions already having a presence in the Middle East. This is likely to grow as the region looks to up-skill and diversify its labour force away from oil. Tourism is also growing, with the number of flights between the UAE and Australia, for example, having increased rapidly in recent years to support this growth. 
 

Overcome export challenges 
The Middle East has some distinct differences to doing business compared to Australia.
Understanding how these differences could impact your business and where any risks may lie is crucial before entering any markets in the region.
It is important to be aware of cross-cultural differences when doing business in the Middle East to avoid making a mistake that could damage a potential partnership. 
For example, the culture of the Middle East tends to be much more flexible and relaxed when it comes to time and schedules than Western culture, so be aware that meetings and negotiations may not progress as quickly as in Australia. 
Australian businesses also need to be aware of their legal standing when operating in the region. 
 

Research, plan, prepare
There are a range of steps that Australian SMEs looking to export to the Middle East can take to help make their transition as easy as possible. 

One of the most important tips for any SME exporter is to do their research. Any cultural barriers can be overcome by conducting careful and comprehensive research prior to entering the market. 

Exporters should read widely, talk to peers who have already entered the Middle East and engage professional advisers that have experience of operating in the region. 

When planning market entry, it’s important to get all paperwork in order. 

The Australia Arab Chamber of Commerce and Industry (AACCI) is the peak national association for trade and investment between Australia and the Arab League countries. 

AACCI certifies all export documentation for Australian exporters, which is a prerequisite for exporting to the Middle East. It also holds networking events and organises trade missions for Australian SMEs who wish to learn more about the region before making a decision to export. 

A strong personal relationship is key to doing business successfully in the Middle East. This requires committing significant time and resources to investing in building relationships before entering the market. 

This will likely involve conducting a number of visits to get to know potential customers, partners and suppliers before entering into a formal relationship. 

For Australian SMEs that choose to service their Middle East market remotely, it is also important to have a good relationship with distributors. 

Australia is well-placed to meet growing demand in the Middle East in a range of industries. 
However, being aware of the potential difficulties and risks around entering the Middle East will help ensure Australian SME exporters are well-positioned to leverage the export opportunities available in this region. 

Australian wine exports increase by 14 per cent to $AUD2.1 billion

The Wine Australia Export Report for December 2015 shows that the value of Australian wine exports jumped 14 per cent to $AUD2.1 billion in 2015, reaching its highest value since October 2007.

Wine Australia CEO Andreas Clark said “Pleasingly, our latest Export Report shows that the value of Australian wine exports grew in each of the top 15 export markets in the year ended 31 December 2015.”

“This export growth should be warmly welcomed by the Australian grape growing and winemaking community as it is largely a result of their hard work.”

This is the first time that there has been growth in each of the top 15 markets in a calendar year, with the strongest growth being in China, which grew 66 per cent to $AUD370 million.

The value of exports increased at each price point and the largest increase was in wines with a free on board (FOB) value over $10 per litre. Sales of these wines grew by 35 per cent to a record $AUD480 million. They now make up 23 per cent of the value of Australia’s wine exports.

Bottled wine has been the key driver of the export success. Bottled exports increased by 17 per cent to $AUD1.6 billion and the average value increased by 7 per cent to $5.20 per litre. This is the highest value since 2003 on a calendar year basis.

There were 1,517 active exporters in 2015 (up from 1,395 in 2014) and Australian wine was exported to 122 destinations. 

The top five markets by value are:

1. USA, which increased by 4 per cent to $443 million
2.   UK (Australia’s number one market by volume), which increased 0.2 per cent to $376 million
3.   China, which increased 66 per cent to $370 million
4.   Canada, which increased 7 per cent to $193 million, and
5.   Hong Kong, which increased 22 per cent to $132 million.

Australians being urged to buy local ham this Xmas

Australia’s most awarded butcher, Adam Stratton, is urging people to “buy local” this Christmas when it comes to selecting their festive hams.

Adam Stratton is a master butcher and runs the successful Tender Gourmet Butchery chain in Sydney. 

“Around 22 million kilograms of ham is sold in Australia at Christmas, but unfortunately, not all of that is sourced locally,” said Stratton.

“I think customers should know if the ham they serve for Christmas lunch might have spent three months on a boat being shipped in from overseas. Who knows what refrigeration has been used to get the produce here.”

“Pork products are flooding the local market from places such as Scandinavia, Asia and North America. When it comes to Christmas hams, there is no substitute for local produce. Australian produce is a clear winner for appearance, taste and value.”

“Customers need to look for the hot pink Australian PorkMark logo – this is a guarantee that the ham is made with 100 per cent Australian home-grown pork.

“In fact, research shows that around 90 per cent of Australians prefer to buy Australian produce because they believe Australian pork is fresher, of a higher quality and tastes better,” he said.

Latest figures show that nearly $10 million worth ($9.4m) of imported pork arrives in Australia every week destined to be made into ham and bacon.

Choice urges government to come clean over TPP

With the negotiations for the Trans-Pacific Partnership (TPP), completed, consumer group Choice has urged the Federal Government to make all details publicly available as soon as possible and for the Productivity Commission to conduct a full cost-benefit analysis of the agreement.

 “At about midnight last night, Trade Ministers confirmed that the TPP negotiations were finished, however, the text of the agreement still won’t be publicly available for a number of weeks,” says Choice Campaigns Manager Erin Turner.
 
More than 7,400 Australians signed a petition calling for the Department of Foreign Affairs and Trade to release the text of the TPP.
 
“The agreement has the potential to impact every aspect of the Australian economy. It’s too big to ignore the fine print which is why we need a dull and transparent assessment of its impact before its impact.”
 
TPP has described the transformation as a modern agreement that will deliver huge benefits to citizens of nations involved.
 
“Now the agreement has been signed in the dark, all Australians will be waiting nervously to see what the government has traded away,” Ms. Turner says.
 
“Choice urges the Government to commit to a full cost-benefit analysis of the TPP before Australia signs on to complex new rules, governing everything from financial regulations to copyright provisions,” says Ms. Turner.

Free trade agreements fail to boost Australian agriculture and food manufacturing

Many claims are made that Free Trade Agreements (FTAs) with select trading partners will benefit Australian agriculture. OECD statistics say otherwise.

The balance of trade positions of Australian agriculture and food manufacturing have deteriorated since FTAs with New Zealand, the United States and Thailand have come into play.

The long-standing 1983 New Zealand arrangement shows growing imports of processed food products, especially since 2000. Australian food exports to New Zealand have levelled off since 2011 with a US$600 million Australian deficit on food products in 2014. Agricultural goods have been close to balance with just over US$270 million of raw or minimally processed product flowing each way.

The net result (shown in black) has been a persistent and generally worsening deficit for Australia in its agriculture and food trade with New Zealand for the whole period.

 

Author developed using OECD STAN bilateral trade in goods database

 

The agreement with the United States came into effect in 2005. Again agricultural products are close with Australian imports of US$210 million slightly exceeding exports since 2007. Australian food exports have always exceeded imports but the surplus halved between 2004 and 2013. The basis for the almost doubling of food exports in 2014 is unclear, but meat products driven by beef herd rundown in drought affected Queensland would be part of what may be a one-off spike.

The net result (again shown in black) has been a persistent but generally narrowing surplus for Australia in its agriculture and food trade with the US since the FTA came into play. The Australian 2014 surplus of around US$2 billion appears likely to settle back to around US$700 million or less in the years to come.

 

Author developed using OECD STAN bilateral trade in goods database

 

Thailand also signed a bilateral agreement in 2005 and the result has been a generally worsening agriculture and food trade deficit.

 

Author developed using OECD STAN bilateral trade in goods database

 

The rise in Australian food product imports from over US$200 million to more than US$800 million in the decade to 2011 is pronounced, as is the subsequent levelling off. Australian agricultural and food exports to Thailand generally travelled together until 2008 but after this, agricultural exports rose markedly for three years before falling back. The rise and then fall of commodity prices explain much of this hump.

Clearly, these three FTAs have failed to deliver. There has been no improvement evident in the agriculture and food trade position under any of the three agreements. Rather, deterioration has been evident in each case.

Turning now to the world, Australia’s agriculture and food balance has been a persistent and generally growing surplus. This is the opposite effect. Australian trade performance has been better with non-agreement partners. Again commodity price effects are evident in recent years for agriculture exports.

 

Author developed using OECD STAN bilateral trade in goods database, Author provided

 

New Zealand, USA and Thailand account for about 30% of the rising food imports but only around 15% of rising food exports to the world. They also account for only around 5% of agricultural exports but 35% of imports.

Further analysis can be undertaken, but on these figures, FTA partners have clearly been able to outperform Australian enterprises. On the other hand, where no Agreements have been struck, Australian enterprises have outperformed partners to record a generally improving agriculture and food trade surplus.

How might things change with three new North Asian trade, regulation and investment agreements (Japan, Korea and China), and perhaps a Trans-Pacific Partnership? History suggests no necessary gains and trending losses on merchandise trade for both food manufacturing and agricultural industries.

It seems we should be more closely monitoring the realities of trade, not fixating on rhetoric and so far empty promises.

There is nothing “free” about these trade agreements.

The Conversation

Mark McGovern, Senior Lecturer, QUT Business School, Economics and Finance, Queensland University of Technology

This article was originally published on The Conversation. Read the original article.