Australia-UK FTA a big boost to farmers

18th June 2021 | Eativity editors

Australian farmers are applauding the new free trade agreement (FTA) between Australia and the UK, the first trade agreement reached by the UK since its separation from the European Union. The agreement will guarantee tariff-free, quota-free access to the UK market for all agricultural products, after phase-in periods of up to 15 years.

National Farmers’ Federation (NFF) President Fiona Simson says this is a significant leap forward in Australia’s market access and heralds a new beginning in a relationship between two countries who share a long history. 

“Australian and UK farmers share a commitment to meeting the highest standards when it comes to caring for their land and their livestock, and that commitment shows in the quality of our produce,” she says. “UK customers will benefit from the increased availability of high-quality Australian products on their supermarket shelves, alongside their homegrown options. The UK deal will create new opportunities for Australian farmers.”

Specific outcomes relevant to agriculture include the elimination of beef and sheep meat tariffs after 10 years, sugar tariffs will be eliminated over eight years and dairy tariffs will be eliminated over five years. During the transition period, Australia will have immediate access to duty-free quotas that will increase each year. Rice will receive immediate duty-free access for short and medium grain milled rice when the agreement enters in force.

Australia’s red meat and livestock industry makes a significant contribution to the Australian economy.

The Australian Meat Industry Council (AMIC) and its members have been providing advice and consultation throughout the deal’s process, and AMIC CEO Patrick Hutchinson has called the new deal a “momentous outcome”.

“At a time when processing and the export industry has been grappling with workforce issues, record-high livestock prices and the COVID-19 pandemic, this is a great opportunity for the Australian red meat industry to further develop and deliver into the future,” he says.

Andrew McDonald, Chair of the Australia-UK Red Meat Market Access Taskforce, says that the UK and Australia have a long, shared commercial history.

“In the 1950s, the UK was one of Australia’s steadfast export customers,” he says. “A lot has changed since then, and we have responded to strong demand in markets closer to home.

“While our ability to service the UK market has previously been constrained by a highly restrictive UK [and prior to 2021, European Union] import regime, the Australia-UK FTA will facilitate an easier response to UK consumers seeking to ‘buy Aussie’.”

Australian rice production can feed up to 20 million people per day.

The Ricegrowers Association of Australia (RGA) is “very pleased” with the new agreement. As one of the world’s most important basic food staples, rice is critical to the security of many nations and has therefore been one of the most highly protected agricultural commodities internationally. The Australian rice industry has been forced to compete against subsidised product from other key exporting countries and, in the past, rice has been omitted from Australian Free Trade Agreement negotiations on many occasions.

“This will see Australian farmers receive a significant boost through greater access to the UK market,” the RGA said in a statement. “A strong Australian rice industry delivers up to $400 million to our economy and is integral to the survival of many rural communities.”

One downside is the proposed removal of the regional work requirement for UK backpackers to extend their stay in Australia. In the wake of these changes, the NFF has cautioned the government that action on an agriculture visa can no longer be delayed.

“Given the acute labour shortfalls already wreaking havoc across our industry, any good work achieved by the in-principle agreement on trade will be undone if the government continues to delay the implementation of a dedicated agriculture visa,” Simson says. “Taking away a source of farm labour now could be a devastating blow for Australian farmers, in an environment of existing shortage.”