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Farmers front and centre of Indonesia-Australia trade agreement

31 August 2018

The Indonesia–Australia Comprehensive Economic Partnership Agreement (IA-CEPA) was brought to fruition tonight in Jakarta by Prime Minister Scott Morrison and his Indonesian counterpart, President Joko Widodo.

Accompanying the Prime Minister to the Indonesian capital, NFF President Fiona Simson said IA-CEPA heralded a new era in the already-strong Australia-Indonesia agricultural trade relationship.

"In 2017, almost half (49.5%) of our food and fibre exports went to Indonesia, valued at $3.5 billion.

"Indonesia is the world's biggest importer of Australian wheat and Australia is Indonesia's largest supplier of red meat. Australian dairy products and sugar are also highly valued by our neighbour."

Under IA-CEPA, a diverse range of Australian farm produce will be granted even wider access to the burgeoning south-east Asian economy including cattle, beef, sheepmeat, dairy, sugar, fruit, vegetables and honey.

Importantly, the agreement will significantly grow the quota for Australian cattle to be exported with duty free access for 575,000 head of live male cattle per year, growing at 4% per year to 700,000.

Ms Simson said the trade agreement was the result of many months of negotiations between the two countries including industry-to-industry discussions.

"The NFF and its commodity group members have worked hard to achieve the good result reached today.

"We have been ably led by the committed diplomacy of the Coalition Government, including former Trade Minister Steven Ciobo."

Ms Simson said the enhanced trading arrangements were great news for farmers, many who were currently doing it tough managing drought.

"About 70 per cent of Australian food and fibre produce is exported.

"Expanded market access in existing markets and new export opportunities ultimately means more money in the pockets of our farmers," Ms Simson said.

Agriculture wins in IA-CEPA

Carrots: Tariff cut immediately to 10% (from 25%) for 5,000 tonnes per year; tariff further reduced over time, down to 0% after 15 years for an unlimited volume.

Citrus: Improved access for key Australian citrus exports:
Mandarins – tariff cut immediately to 10% (from 25%) for 7,500 tonnes per year; tariff further reduced over time, down to 0% after 20 years for an unlimited volume.
Oranges – duty free access for 10,000 tonnes of oranges per year, increasing 5% each year
Lemons and limes – duty free access for 5,000 tonnes of lemons and limes per year, increasing 2.5% each year.

Dairy: Immediate elimination of 5% tariff for Milk and cream, concentrated or containing added sugar or other sweetening matter. Immediate elimination of 5% tariff for Grated or powdered cheese, of all kinds.

Frozen beef and sheepmeat: Remaining tariffs on all Australian exports of frozen beef and sheepmeat into Indonesia reduced to 2.5% immediately, and eliminated after 5 years.

Feed grains: Guaranteed duty free access for 500,000 tonnes of feed grains per year (wheat, barley, sorghum), increasing at 5% per year. This builds on current exports of Australian wheat to Indonesia, one of our most important wheat markets.

Honey: Elimination of 5% tariff on Australian honey after 15 years.

Live cattle: Duty free access for 575,000 head of live male cattle per year, growing at 4% per year to 700,000. A review mechanism in year 6 will consider subsequent increases.

Sugar: Confirmation of the early outcome in 2017, reducing the tariff on Australian sugar to 5% (from 8-12%).

Potatoes: Tariff cut immediately to 10% (from 25%) for 10,000 tonnes per year; after five years tariff further reduced to 5% for 12,500 tonnes per year, increasing by 2.5% per year.

Media Enquiries: Laureta Wallace
P 0408 448 250

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