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Australia-China Free Trade Agreement defines future landscape for farmers

17 November 2014

The National Farmers’ Federation (NFF) has today welcomed the Prime Minister’s announcement of a free trade agreement with China – cementing Australian agriculture’s place in the world’s biggest market and providing millions of dollars in export value to Australian farmers.

NFF President Brent Finlay said the deal recognises agriculture as one of the nation’s economic pillars and will further expand the excellent trading relationship that Australian farmers have with China already.

“China is already our major trading partner with Australian farm exports doubling in five years to be valued at over $7 billion in 2013,” Mr Finlay said

“The agreement is an outstanding achievement that will build on Australia’s important trading future with China and provide significantly improved international market access for Australian agricultural goods.

“Based on our own growth and the New Zealand experience we could conceivably see a tripling in agricultural exports to China within the decade. We must strive to take full advantage of the improved outcomes.

“The landmark agreement will see the elimination of tariffs on Australian lamb, beef, horticulture and dairy products to China. It’s an enormous achievement that will deliver increased options and improved returns for Australian farmers,” Mr Finlay said.

Tariffs on dairy products such as cheese, milk powder and butter will be phased to zero, resulting in millions of dollars in tariffs saved. Similarly, tariffs for products like strawberries, potatoes, cut flowers and other horticulture products will be reduced to zero over five years. In the red meat sector, Australian lamb and beef will see an elimination of tariffs across the board, including products like skins and hides.

“After almost ten years of negotiations, we are pleased that the Australian and Chinese Governments have reached an agreement largely equivalent to the outcomes New Zealand achieved with China. This presents Australian farmers with not only a level playing field, but more opportunities to market product resulting in increased incentive to invest, innovate and grow.

“With pressure being placed on our mineral exports – agriculture offers a stabilising influence to our economy. By removing the tariff shackles from many of our key products, we expect to see accelerated growth in what is a rapidly expanding market for high-quality and safe produce that Australian farmers can provide.

“While the agreement reduces tariffs across a number of sectors, it must provide a platform to improve outcomes for certain products like sugar, rice, cotton and some grains, which regrettably, were excluded from the agreement. These products will be in high demand in China over coming years and must be included in the review arrangements after three years.

“Beyond border issues, protocols and technical measures that facilitate trade must be improved going forward. We see this agreement as a critical step to help improve the current situation,” Mr Finlay said.

The NFF congratulates Trade Minister Andrew Robb and the Government for completion of the agreement as a major milestone in the relationship between the two countries. More importantly this marks the third significant agreement led by Minister Robb in a twelve month period, paving the way for a golden age of Australian agriculture in the Asian century.

Whilst led by Minister Robb, this result has been a collaborative effort involving departmental staff, industry and grass roots farm advocacy.

“Ultimately, we see this FTA as a staged approach with any unresolved commodity issues open for discussion and able to be worked upon over the coming years,” Mr Finlay said.

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