Opening the World to Australian Produce

25 September 2003

John WebsterManaging Director

Horticulture Australia Limited

Opening the World to Australian Produce

25 September 2003

John WebsterManaging Director

Horticulture Australia Limited

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Horticulture in Australia

Horticulture in Australia• Gross Value of Production $6b (++)

Fruit 34%; Vegetables 34%

Nursery 23%; Nuts 2%

Dried Fruits 2%; Other 5%

• GVP increased 21% in last 5 years.

• Enterprises up 15% - 4 years – to 17,273.

• Employment up 26% - 4 years – to 64,000 (20% of total agriculture employment).

• Exports (fresh) up 65% - 7 years – to $715m.

• A growth industry past, present and future !!

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0

1

2

3

4

5

6

7

Beef Hort Wheat Wool Dairy Fish

GVP : $b : 2003/04GVP : $b : 2003/04

One of the largest agricultural industries

in Australia

One of the largest agricultural industries

in Australia

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… but small compared to others

… but small compared to others

Australia China

Fruit production 3,016kt 70,432kt

Vegetable production 1,799kt 278,592kt

Fruit exports 309kt 1,360kt

Vegetable exports 169kt 2,400kt

Population 19.1m 1,282.4m

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Where does HAL fit into horticulture ?

Where does HAL fit into horticulture ?

Assist industry to grow, and sell their

products more profitably

bycreating commercial

opportunities for Australian horticulture

producers

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Horticulture AustraliaHorticulture Australia

• Company – under corporations law Not for profit

Formed in January 2001

• 28 industries signed MOU (work with 40+) Nuts, nursery, fruits, vegetables

• $70m budget with staff of 42

• Service company - owned by industry Industry elects Board

R&D & Marketing

• Export control body Export licensing etc

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HAL - partnership with industry

HAL - partnership with industry

• Treat levies as an investment by industry

• Focus on producers

• Work in partnership with industry

Industry agree strategy

Industry agree annual priorities

Annual report on investment return

• Capture synergies between industries and between R&D and marketing

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R&D Marketing

levy $13.3m $9.4m

VC $16.1m $1.4m

matched $29.4m* -

Total $58.8m $10.8m

$70m

*Commonwealth government – silent partner

HAL Budget – 2003/04HAL Budget – 2003/04

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Focus with levies is vitalFocus with levies is vital

HAL investments of industry fundsR&D Marketing Total

• 2001/02 $48m $11m $60m

• 2002/03 $60m $11m +$70m

• 2003/04 $60m $11m +$70m

• 2004/05 $60m $11m +$70m

• 2005/06 $60m $11m +$70mTOTAL $290m $55m +$340m

> Third of a Billion Dollars (an awesome responsibility for HAL & Peak Industry

Bodies)

Must focus on projects that provide real return:• Strategic Plan that provides focus on explicit

goals• Annual Plan worthwhile results every year• Measurable results !!!

25/9/03

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HAL Strategic PlanHAL Strategic Plan

• Consistently meeting consumers’ requirements

Consumer satisfaction initiative

Health initiative

• Developing markets

Market access and export initiative

• Enhancing supply chain efficiency & integrity

• Production efficiency and sustainability

Water initiative

Supply of trained employees

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Access in a tough environmentAccess in a tough environment

• Australia is a relatively small producer

• Without farm support programs

• Counter-seasonal supply for major northern consumer markets

• A focus on higher end of market

• Meeting consumers’ interest in health

• Meeting consumers’ demand for sustainable production

With some advantagesWith some advantages

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0

5000

10000

15000

20000

25000

30000

35000

40000

45000

2001/02 2002/03 2003/04 2004/05 2005/06 2006/07

Almond

Macadamia

0

100000

200000

300000

400000

500000

600000

700000

800000

2001/02 2002/03 2003/04 2004/05 2005/06 2006/07

Apples

Citrus

Access important with future

growth (tonnes)

Access important with future

growth (tonnes) Almonds + 56%

Macadamia + 29%Almonds + 56%Macadamia + 29%

Apples + 18%Citrus + 10%Apples + 18%Citrus + 10%

Trees alreadyplanted

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.. So we need to open the world to Australian horticulture

produce

.. So we need to open the world to Australian horticulture

produce• Identify market access impediments /

opportunities

• Determine new market access priorities

• Establish market access targets with government agencies

• Develop industry wide policies, strategic positions & initiatives

• Develop & report against market access strategic plan

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Horticulture Market Access Committee (HMAC)

Horticulture Market Access Committee (HMAC)

• HAL

• Industry reps

• Exporters (AHEA)

• Plant Biosecurity

• AFFA – Policy

• AQIS

• DFAT

• State Dept Ag

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… with lots of challenges… with lots of challenges

• Setting new market access priorities

• Accepting that access is a two way street

• Whilst requiring high standards for imports given our disease / pest free status

• Being ‘clean & green’ as well as saying it

• Our members accepting realistic expectations

• Retaining a genuine partnership with govt Developing the strategy together

Holding Government accountable for delivery

Being accountable for our responsibilities

• Sufficient resources in Plant Biosecurity

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… US FTA looking OK… US FTA looking OK

• Roughly balanced trade in horticulture

• Aust less range of exports to USthan visa versa

• 70% Aust imports (value) from US duty free

• 2% of Aust exports (value) to US duty free

• All products small % of domestic sales

• Strong grounds to argue for immediate elimination of all tariffs across the board on Australian horticultural exports to the US

• Greatly appreciate the partnership & professionalism of our negotiating team

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… not so for Doha WTO round

… not so for Doha WTO round

• Abrupt termination of the Cancun Ministerial Conference 14 Sept is a real disappointment

• Negotiators must be urged to return to the negotiating table

• Next step is WTO General Councilmeeting in Geneva by 15 December

• Positive agriculture outcome essential – must reduce export subsidies in particular

• Holding Cairns Group together is important

• A real challenge for our negotiating team

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… but progress in China… but progress in China

• Formal access required on joining WTO

• Australia behind competitors on access

• Minister’s delegation positive commitment to strengthen cooperation

latest access priorities raised with Chinese counterparts

commitment to accelerate efforts to progress market access requests

efforts will ensure assessments are based on sound science and are consistent with protecting the plant health status of both countries. The least trade restrictive measures consistent with the scientific analysis will be applied

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We can make a real difference

if we ‘get it right’ with access

We can make a real difference

if we ‘get it right’ with accessIf we:

• Plan strategically

• Focus on outcomes with real commercial opportunity

• Concentrate where we can make a difference

• Fund the program (govt plus industry)

everything necessary to achieve outcome

• Can only do this if we are united – in focus - & within industry – & with government

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We are committed to working with you to

maximise trade and minimise riskwhile

opening the World to Australian produce.

We are committed to working with you to

maximise trade and minimise riskwhile

opening the World to Australian produce.