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Monday, 11 July 2016

The China-Australia’s Free Trade Agreement (ChAFTA) and its impact on the agriculture industry was in the spotlight at The University of Western Australia’s Institute of Agriculture industry forum held on Thursday.

Western Australia’s agricultural exports to China were valued at $1.7 billion in 2014-15, led by barley, wool, canola and wheat, and with numbers set to increase, industry experts came together to tackle how to use the agreement to our best advantage.

Parliamentary secretary to the WA Minister for Agriculture and Food; Transport Hon Jim Chown officially opened the forum, emphasizing the importance of China as a trading partner to Australia.

Grain Growers trade and market access manager Dr Cheryl Kalisch Gordon gave the keynote address and described the key elements of the free trade agreement. She said the ChAFTA is timely, and provides opportunity for Australian agriculture as China faces enormous challenges to meet the changing demands of the rapid increase in urban population and rising middle class incomes.

Dr Kalisch Gordon said that whilst tariff reductions have helped level the playing fields in Australia’s grain export industry, the ChAFTA does not mean all barriers to trade have been removed. Australia must nurture relationships with its trading partners to ensure commercially meaningful trade benefits.

Focusing on grains sold into China, CBH Group’s head of trading Trevor Lucas painted a positive picture of the Australian grain industry but said that limited Australian grain production growth dictates that growers will align their future production and sales programs into markets providing the highest sustainable value.

“China’s growing demand for gain imports will continue to provide opportunities for Australia, leveraging off its high quality products,” Mr Lucas said.

“Free trade tariff concessions must be passed on by Chinese buyers to ensure they are competitive with other regional Australian customers. China will need to provide value to the Australian grain industry to focus on it as a key trading partner,” Mr Lucas said.

Australia China Business Council (WA Branch) executive president, and executive director of China Business at MinterEllison Ms Lili Pan agreed, saying there is strong demand for WA agricultural products but also significant challenges.

Co-presenting with colleague Mr Bryn Davis, special counsel corporate/mergers and acquisition, MinterEllison, the duo discussed specific challenges on the Chinese demand side, such as scale and commodity mix, and the need to embrace different agri-investment models that focus capital where it is most needed.

“Numerous studies have identified that WA agri-industry needs significant capital to expand to meet demand for products and potential products,” Ms Pan said.

“China can be a major source of that expansion capital, if we are able to harness the potential investment. This will require productive land expansion ahead of investor capital.”

Celebrating the tenth industry forum, The UWA Institute of Agriculture director Hackett Professor Kadambot Siddique said he was encouraged to see the event cemented in the agriculture industry calendar and the positive feedback from attendees.

The Industry Forum was supported by CSBP Fertilisers through the CSBP and Farmers Ltd Golden Jubilee of Agriculture Science Fellowship.

Media references

Hackett Professor Kadambot Siddique (+61 8) 6488 7012

Diana Boykett (Communications Officer, The UWA Institute of Agriculture)  (+61 8) 6488 3756 / (+61 4) 04 152 262

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