PRIME Minister Tony Abbott says Agriculture Minister Barnaby Joyce is “absolutely right” in declaring Australia’s practical inability to become Asia’s future food bowl.
Speaking at the Australian Food and Grocery Council’s (AFGC) industry leaders’ forum in Canberra today, Mr Abbott tackled a range of key industry issues, including the 'food bowl of Asia' myth.
“We often spoke of Australia becoming the food bowl of Asia,” Mr Abbott said about the Coalition's vocabulary on the issue prior to the 2013 federal election.
But in more recent times Mr Joyce has put the case that the food bowl option is impractical, according to Mr Abbott.
“The markets and the opportunities of Asia are so vast that even if we doubled, tripled or quadrupled our production, in fruit and vegetables, in meat and groceries, we would still only be providing a fraction of the needs for food in our region,” Mr Abbott said.
“And Barnaby is absolutely right – the markets there are so vast and the opportunities are so great that there really is unlimited potential for this industry.”
Improving business conditions
Mr Abbott’s speech touched on the forum’s key theme of industry competitiveness and growth opportunity.
He outlined several measures the government is taking to improve business conditions for the AFGC’s members, including cutting regulations, improving market competition and reducing energy costs.
His declaration that the carbon tax had been repealed by the Coalition failed to ignite more than polite applause from the 140 assembled guests.
However, Mr Abbott's declaration that food and agriculture is not just an important part of our economic past, “it is an absolutely vital part of our economic future” was far more heartening.
“The only things that limit us are the physical constraints of our land and climate and our competitiveness as a country,” he said.
“That is why we need to lift our vision and continue to remove the impediments to Australia.
“This must be a growth industry that generates more exports, creates more jobs and feeds millions more people, and I know you are up to this.
“I want Australia’s food and grocery industry to prosper and succeed.
“We all need your industry to prosper and succeed and I pledge myself to do whatever I humanly can to make that possible.”
Opening trade doors
Mr Abbott also highlighted the value of his government finalising recent Free Trade Agreements (FTAs) with Japan and Korea and potentially another with China.
“I know that our food products are the best in the world, our reputation for quality and purity and taste means that we can compete effectively in the world market wherever we have the opportunity to do so,” he said.
“That’s why we’re doing everything we can to encourage more and freer trade.”
Mr Abbott said Japan was Australia’s second-largest export market worth around $3 billion last year.
It now has more chance to grow, Mr Abbott said, with tariff cuts to beef, cheese, sugar and seafood, and improved market access for many processed food exports.
The Korea FTA also presents opportunities for food exporters with beef dairy and wine “big winners”, while tariffs were also reduced or eliminated on a broad range of horticultural products, he said.
“In government we are doing everything we can to open the doors for you but in the end you still have to walk through them if we are to maximise the benefits of these arrangements,” he said.
FTA with China: where to now?
AFGC CEO Gary Dawson said his industry was focussed on jobs and growth and future investment, not just as a means of sustaining an industry for Australia but growing one “that has great strengths and is a sector worth backing”.
Mr Joyce recently visited China with a 38-member delegation that included the National Farmers Federation, where he was asked by Chinese state owned media whether Australian food imports would be swamping their market in future and putting local farmers out of business.
But Mr Joyce said that questioning highlighted the importance of sending a message in the opposite direction telling China that won’t happen.
He said Australia represented 1 per cent of world agricultural production and fed about 60 million people and if that volume was doubled, we would only just have the capacity to feed one Chinese province.
“The idea that we’re going to somehow span out and cover the globe and swamp south-east Asia with food is an absurdity and it’s one that does cause us problems because when that rhetoric gets out there, there are people who actually believe it,” he said.
Mr Joyce said the trade delegation was successful due to quality of access gained to Chinese government ministers and officials.
“I feel that Australia was very well heard,” he said.
He also backed away from previous statements saying the China FTA could be sealed by the year’s end.
Mr Joyce said when Mr Abbott and Chinese president Xi Jinping are in same room during his scheduled visit to Australia in November, he’d like to see the FTA “as close as possible to completion at that point”.
But he added: “I wouldn’t hold any person to a timeline”.
“As you know, if I say I’m going to buy your house at 12.00 o’clock tonight, well then all the negotiation skills are in your hands because you can determine the price knowing I’ve stated publicly I’m going to buy a house,” he said.
NFF President Brent Finlay said the key take-home message from the six-day China tour was about the high level of interest in Australian food and fibre due to our food quality and safety.
“Everywhere we went in China they talked about food security and food safety,” he said.
“The interest and demand form agribusinesses and retailers and online businesses is huge in China.”
Mr Finlay also said he hoped the food bowl myth had finally been busted.
“I don’t know where that message came from but we were never going to be the food bowl of Asia,” he said.
“We’ll be the deli and that’s what I’m talking about.
“A big take away message from the China delegation was all about the importance of our biosecurity systems behind the farm gate and through the supply chain.
“We’re not going head-to-head with Chinese farmers but we know there’s a gap in the market, around those premium markets that are trusted and safe, and that’s our opportunity.”
Mr Finlay said the reality was Australian farmers currently feed 60 to 70 million people.
But he said it would be a huge task to even double production due to limited resources like land and water.
However, even if that happened we would still only cater for feeding 120 or 130 million people “but there’s 1.39 billion people in China alone”.
“The level of middle class wealth is increasing dramatically in Asia and we heard a lot about that in China,” he said.
“More people are living in the cities and being paid high wages and with that increase in income they are changing their dietary habits and eating more of the safe clean food we produce very in Australia and that’s our opportunity.”