AUSTRALIA’S sheep meat exporters will have immediate access to a duty-free quota of 25,000 tonnes, rising to 75,000 tonnes in 10 years, on the signing of the proposed Australia-UK Free Trade Agreement.
The in-principle parameters of the FTA were announced by Australian Prime Minister Scott Morrison and United Kingdom PM Boris Johnson yesterday.
Sheep Producers Australia today welcomed their announcement that the free trade deal with the United Kingdom is the most comprehensive and ambitious in Australia’s history.
The broad outlines of the Australia-UK Free Trade Agreement (FTA) have now been agreed and will provide greater access and a significant boost to the UK market for Australian producers and farmers, SPA said.
“This means that sheep meat tariffs will be eliminated after ten years.
“Australia will have immediate access to a duty-free quota of 25,000 tonnes, rising in equal instalments to 75,000 tonnes in year 10,” SPA chief executive officer Stephen Crisp said.
“In the first five years, a safeguard will apply on sheep meat imports exceeding a further volume threshold rising in equal instalments to 125,000 tonnes, levying a tariff safeguard duty of 20 percent for the rest of the calendar year.
“FTA negotiations are all about opening up options for the Australian producers as well as the UK consumer and will be of mutual benefit,” Mr Crisp said.
The next step is to finalise the agreement in writing to enable signatures and subsequent entry into force of the FTA.
“Now is a very good time to demonstrate that supply options from Australia will be of great benefit to the UK and Australia,” Mr Crisp said.
“SPA appreciates and acknowledges the efforts of the Federal Government by having negotiated this ambitious bilateral free trade agreement that will offer sheep producers greater market access.
“We would also like to thank Meat & Livestock Australia and those within the supply chain for their work in getting the agreement to this point,” he said.
FTA negotiations signal new bilateral relations chapter
The FTA deal is also the first “new” bilateral agreement to be agreed following the UK’s departure from the European Union (EU).
Chair of the Australia-UK Red Meat Market Access Taskforce Andrew McDonald said the UK and Australia have a long, shared history, both culturally and commercially.
“For Australian red meat producers, processors and exporters, this has meant working with UK importers and distributers to supply high quality Australian red meat products to meet discerning British customer demand.
“Back in the 1950’s the UK was one of Australia’s steadfast export customers,” he said.
“A lot has changed since then, as red meat markets have evolved and we have responded to strong demand in markets closer to home.
“Despite this, the UK has remained a loyal purchaser of Australian beef and sheep meat, albeit in small volumes.”
Mr McDonald said while Australia’s ability to service the UK market has previously been constrained by a highly restrictive UK (and prior to 2021, European Union) import regime, the A-UK FTA will facilitate an easier response to British consumers seeking to “buy Aussie” – should they wish to do so.
“The securing of this phase of the A-UK FTA signals a new chapter in our bilateral relations and an opportunity for us to work collaboratively for years to come.
Mr McDonald said the deal, once signed and ratified, will result in Australian beef and sheep meat/goat meat exports entering the UK under a tariff rate quota (TRQ) regime – with initial TRQ tonnages gradually increasing over the 10-year transition period, whilst the above quota tariff will be linearly reduced. Product within the TRQ amounts will enter tariff free. Whilst there will be no TRQ regime post year 10, a volume safeguard provision will apply to the end of year 15, beyond which no safeguards will apply, he said.
NSW Farmers welcomes FTA deal
The FTA will also mean rice growers will receive immediate duty free access for short and medium grain milled rice when the agreement enters in force. NSW Farmers president James Jackson said sheep meat, beef and rice are important agricultural industries in NSW that support a lot of regional communities.
“Our friends in the UK will benefit from having more access to the best produce in the world.
“The UK is not a huge market for the agricultural sector, but now there is a real opportunity to diversify our export market potential,” he said.
Under the proposed FTA, beef tariffs will be eliminated after ten years. During the transition period, Australia will have immediate access to a duty-free quota of 35,000 tonnes, rising in equal instalments to 110,000 tonnes in year 10.
In the subsequent five years a safeguard will apply on beef imports exceeding a further volume threshold rising in equal instalments to 175,000 tonnes, levying a tariff safeguard duty of 20 per cent for the rest of the calendar year.