Processing

Unfair trade barriers targeted

Beef Central, December 10, 2018

IT is not just foreign markets where Australian exporters need help to remove unjustified non-tariff trade barriers, but within Australia itself.

The message comes as the Federal Government launches a new action plan designed to help Australian farmers and businesses tackle unjustified non-tariff trade barriers and get goods into overseas markers faster, eaiser and at lower cost.

Minister for Trade, Tourism and Investment Simon Birmingham acknowledged that despite the improvements Australia’s free trade agreements had made to market access, exporters are still being hampered by non-tariff barriers such as excessive regulation and red tape.

The Action Plan will provide a more coordinated and collaborative approach with industry to identifying and addressing unfair obstacles for Australian exporters and will give them more clarity on the range of government support services available to them.

It will also look at the capabilities of Australian trade officials, technical experts and diplomats to ensure they have the skills and knowledge to better support Australian exporters.

More details on the action plan can be viewed here.

Processors welcome pledge, but say creative thinking needed

The Australian Meat Industry Council (AMIC) representing red meat processors welcomed the Government’s commitment to addressing non-tariff barriers, and said creative thinking and a whole-of-government approach to overcome what has been a stubborn and long-term challenge.

But it added the focus should also be within Australia.

AMIC CEO Patrick Hutchinson said AMIC is keen to work with government to ensure that Australia itself does not set unjustified NTMs for our own exporters, such as through high-cost regulatory charges for market access negotiations, as well as inspection and certification fees.

“Non-tariff barriers to trade (NTBs) are a major concern for AMICs members. By our calculations, the potential for loss of business in the red meat sector due to these barriers runs to more than $3 billion.

“Mature exporters like the meat processing industry have spent a lot of time and effort identifying and reporting NTBs and have been working with government to try to resolve them.

“What we’ve learned is that there is no easy solution here. Traditional government-to-government negotiations have not yielded significant outcomes to date so its clear that some out of the box thinking is needed.”

Mr Hutchinson said technical barriers to trade for Australian red meat processors included export plant accreditation requirements, product shelf-life restrictions and labelling issues.

“We need a concerted and focused effort to address those barriers that make it harder to get our product where it needs to go, quickly and easily,” he says.

In 2016, the Harris Report produced for AMIC and Meat and Livestock Australia identified 245 NTBs in Australia’s international red meat markets.

“AMIC has already done a lot of work towards addressing some of these barriers, including establishing standing market crisis management groups for China, Malaysia/Indonesia and the Middle East,” he said.

“We look forward to working closely with government to build on this important groundwork. To make headway, government and industry must work together, closely and with great determination.”

AMIC said it will seek periodic reviews with the federal government on progress with the action plan and will request an initial review two months from now, in early February.

 

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  1. John Gunthorpe, December 11, 2018

    Some NTBs are unseen but effective. The USA domestic market purchase their beef meals from supermarkets as prime beef, choice beef or select beef. They are confident the eating quality of the beef will mirror the guarantee provided by this promise delivered by processors. Actually the promise is delivered by their federal government who provide inspectors in all domestic slaughter houses where carcasses leave the chillers. This relationship is critical to their beef supply chain and rewards their chain players for the quality delivered to domestic consumers.
    Less than 10% makes it to prime beef, about 75% to choice and 15% to select. Of course these categories of beef represent the majority of the beef supplied to their market. They are fed steers and heifers harvested after spending time on feedlots to improve their eating quality. Dairy and cull cows and spent bulls are not examined by the government officials and pass through as “no roll” beef indicating the carcass was not rolled by the inspector with either prime, choice or select. They also inspect for yield from each carcass.
    Our industry has spent millions of dollars of levy funds over 20 years on MSA to provide a similar system for guaranteeing eating quality to our domestic consumers. Our service provider argues it is for our beef processors so they can develop brands based on our system and then market these brands to our consumers. Unlike the USA system, here unfortunately delivery does not match promise.
    USDA inspectors are not allowed to inspect beef off USA soil. So Australian beef cannot be sold in the US market as prime, choice or select. It can only be sold as “no roll” with all the other lower quality domestic beef. So we are denied the premium prices paid by US consumers for guaranteed eating quality. Would it be so difficult for our government trade negotiators to develop a protocol where MSA levels of eating quality were matched with USDA standards and, say MSA star 3 product was able to be sold in the US market as choice. MSA could then deliver real value as we increase eating quality confidence in overseas markets. If we could achieve acceptance in the US, other markets would quickly follow this lead. It would underwrite the future growth of our feedlot industry.
    Vlado always told me he could deliver beef of equal eating quality off grass in Victoria as AMH supplied from our Beef City feedlot. Beef City had a special cut for Vlado and aged 9 weeks before delivery. Grass fed beef demand is growing in the US and so this may also be an opportunity for our beef exporters.
    Not permitting USDA inspectors to inspect carcasses off US soil is a major NTB and needs to be addressed by AMIC and the government trade negotiators.
    Australian Cattle Industry Council

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