Global trading: the key to a $100 billion ag sector

Around 70 per cent of Australia’s total agricultural production is exported. Barriers to free and open trade prevent us from maximising the value of these exports.

If Australian agriculture is to grow to a $100 billion industry by 2030 – as proposed in the National Farmers’ Federation’s (NFF) 2030 Roadmap – it is vital that trade barriers – tariffs, quotas and non-tariff barriers – are removed.

“Make no mistake – technical trade barriers between countries impact the profitability of every farm business in Australia. Their removal is at the top of the Australian farming sector’s agenda.” NFF CEO Tony Mahar said.

Cargo being loaded into an airplane

Taking action on trade barriers

Australia’s FTAs are creating real commercial opportunities for our exporters through new or improved market access for Australian goods and services, reduced regulatory barriers and greater mobility for business travel.

Australia has 11 FTAs in place with countries including the United States, China, Japan, South Korea and New Zealand. We are in the final stages of ratifying an FTA with Indonesia, the world’s biggest importer of Australian wheat.

FTAs are a major pathway to improving trade access, yet Australian exporters continue to encounter a range of measures that restrict or exclude them from some overseas markets.

When rules and requirements are not transparent, are overly restrictive, or arbitrarily applied, they can become barriers to trade. These restrictions fall outside traditional tariffs and are known as non-tariff barriers.

NFF CEO Tony Mahar at the signing of the Indonesia-Australia Free Trade Agreement in Jataka.

What is a non-tariff barrier?

Non-Tariff barriers can be any kind of red tape or trade rules that unjustifiably restrict the follow of goods and services. Non-tariff barriers can occur at the border, where products or services enter an overseas market, or behind the border, where products or services are traded within overseas markets.

Increasingly, non-tariff barriers influence who trades what and where, presenting new challenges for governments and businesses alike.

Limitations on where agricultural produce can be sold can limit Australian farmer’s productivity and livelihoods.

By working with trading partners, government and industry are able to address some non-tariff barriers quickly. Others are more complex, require greater advocacy, and may take considerable time to resolve.

Many of these measures – such as import processing fees, labelling and packaging requirements, health and safety certification, and in-country testing – are in place to protect a community’s health and wellbeing.

Some countries may impose rules and requirements, however, which make it difficult, costly or impossible to do business.

NFF’s General Manager of Trade & Economics Pru Gordon with NFF President Fiona Simson on a trade mission in Brussels, Belgium.

How is Australia improving unjustified trade restrictions?

Non-tariff trade restrictions are a growing issue for many Australian exporters. By some estimates they cost as much as three times the cost of formal trade barriers, such as tariffs.

“In December 2018, the Australian Government launched a Non-Tariff Barrier Action Plan,”

 “The Action Plan was developed in consultation with industry and business, and aims to strengthen the partnership between the government and exporters to tackle non-tariff barriers.

“The Action Plan outlines several objectives including: to make it easier for business to report trade barriers; build the capability of frontline expertise to service Australian exporters; and increase transparency of the government’s actions to address non‑tariff barriers”

The NFF’s 2030 $100B Roadmap has established a goal of reducing the number of agricultural exporters experiencing non-tariff barriers each year by 50 per cent.

Dr Pru Gordon, General Manager for Trade and Economics at the NFF, says the Non-Tariff Barrier Action Plan will “materially assist Australian farmers in achieving this goal”.

“The action the government is taking complements other efforts to strengthen trading rules, open markets, and facilitate global commerce through international bodies like the World Trade Organisation.

More information

There are a range of government agencies and departments working together to help Australian businesses find solutions to improve or remove non-tariff trade barriers. The trade barriers coordination team is available to assist with your queries.

To find out more go to www.tradebarriers.dfat.gov.au, email DFAT’s trade barriers coordination team at ntb@dfat.gov.au, view Business Envoy, or call +61 (0)2 6178 4300.

For general business support visit www.business.gov.au or call 13 28 46.

Learn more about Tariffs here



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