Chapter 7.3
Wool
Industry
Cotton
Industry
Wheat
Industry
Sugar
Industry
Tobacco
Industry
Horticultural
Industries
Wine
Industry
Meat
Industry
Pet
Food Exports
Dairy
Industry
Prospects for value-adding in specific industries
7.79 There have been a variety of trends evident over recent years that
have had an impact on value-adding production, including:
- increasing power and influence by consumers who are demanding a greater
variety and quality in the foods they eat, particularly as people become
more health conscious;
- large retailers becoming a dominant force in the food marketing system;
- increasing importance of biotechnology in relation to agricultural
productivity;
- the trend towards larger corporate farms at one end of the spectrum
while at the other end a trend towards small farms producing specialised
crops; and
- a tendency for farmers to acquire technical and entrepreneurial skills.
[86]
These trends are likely to continue to impact on agricultural value-adding
activities in Australia over the medium to long term.
7.80 In investigating the prospects for value-adding to Australia's
agricultural production the Committee has selected the following industries to
examine in some detail in relation to their value-adding prospects:
- wool;
- cotton;
- wheat
- sugar;
- tobacco;
- horticultural;
- meat; and
- dairy.
Wool industry
7.81 In the view of Department of Primary Industries and Energy new opportunities
for wool processing in Australia lie primarily in early stage processing
and production. Later stage processing is seen as being largely confined
to specialist niche markets. [87]
Dr Alistair Watson, an agricultural economist, was even more pessimistic
than DPIE concerning the likelihood of Australia ever value-adding significantly
to its wool production beyond the early processing stage. Dr Watson attributed
his view to three factors:
The difference of hemisphere and the ordering schedules of the
textile and clothing industries mean that Australian spinners and designers
would have to anticipate fashion trends eighteen months in advance.;
Just in time management methods being adopted in the textile and
clothing industries in wealthy countries are a significant barrier to
Australian participation in those industries.; and
The almost medieval structure of the textile and clothing industries
in some countries ... is fundamentally biased in favour of processing
wool close to the point of consumption. [88]
7.82 Dr Alistair Watson was concerned whether Australia is able to process
wool at a lower cost than other countries. He was of the view that Australia's
output has to be exported as scoured wool or tops since later stages in
the textile and clothing industries - yarns, fabric and apparel - are
uncompetitive in Australia as indicated by the long standing protection
given through tariffs and quotas [89]
7.83 Scouring is the essential first step in preparing Australian wool
for consumption by the international textile industry. Overseas there
is increasing pressure to reduce pollution related to the scouring processes.
As a result of this situation it will become increasing likely scouring
will have to be carried out in Australia. It has been asserted that Australia
has the geographical capacity and population density to manage the environmental
consequences of the large scale discharge of wool scour effluent at low
cost. [90]
7.84 In October 1993 a working group on wool scouring within the Commonwealth
Environment Protection Agency (CEPA) was formed to develop guidelines
for wool scouring in Australia. The Committee understands that a draft
of these guidelines was made available for public comment. The deadline
for receipt of comment was the end of May 1996 with the guidelines expected
to be finalised in early 1997. Once these guidelines are put in place
they could serve to limit the working life of some mills now in operation,
particularly those that have little or no control over the discharge of
pollutants, and where additional investment to correct these shortcomings
may not be warranted. [91]
7.85 Mrs Kay Dal Bon, Assistant Secretary with the Environment Standards
Branch of the Environment Protection Agency, when commenting on wool scouring
in Australia stated:
I do not think we have had as much experience in the cleaner production
stakes as other countries have; nor do we have the same culture of pursing
best management practice which regulations overseas have enforced upon
companies and which they therefore see as part of the normal cost of
business. I am not sure that we have the same culture in Australia at
this time, but that is the direction we are trying to move in. [92]
7.86 Later in her evidence Mrs Dal Bon agreed that Australia should not
become a dumping ground for overseas wastes and that it should not be
involved in value-adding that is going to create large areas of pollution.
[93]
7.87 The production of wool tops has expanded from a low of just over
15 mkg (millions of kilograms) in the mid- 1970s to almost 40 mkg in 1992-93.
The expected further expansion of combing capacity will take this figure
to 80 mkg in 1997, more than 90 per cent of which will be exported. [94]
7.88 However, the long term potential for significant returns from the
export of wool tops should not be overestimated. In its evidence to the
inquiry the International Wool Secretariat painted a realistic picture of the
prospects of value-adding to Australia's wool production. In its submission to
the inquiry the International Wool Secretariat warned that there is a limited
market for wool tops. According to the Secretariat world consumption of wool
tops in 1991 was running at around 87 per cent of total capacity, with
countries in Western and Eastern Europe and Asia all operating below potential
maximum capacity. In its submission to the inquiry in March 1994 the IWS
stated:
In the two years since [1994], world consumption of wool has fallen
in most markets, yet Australia has added or is in the process of adding
a further 30 to 40 mkg in combing capacity which will exacerbate the
gap between world consumption of tops and available combing capacity.
[95]
7.89 The IWS submission suggested that the rate of expansion in Australia's
combing capacity would probably cause Australia to attempt to sell into
traditional markets in Western Europe and Japan which may raise the questions
of access if imports of part processed wool encounter opposition from
processors already operating in these countries. [96]
7.90 The Secretariat stressed that there are some very widely held misconceptions
about where Australia is competitive and where it is not. [97]Due
to discrimination against processed wool in most of the major markets
for Australian wool there is limited growth potential in these areas for
the export of value-added wool. [98]
7.91 Although none of the world's major spinners have established in
Australia the IWS was of the view that there are grounds for believing
that Australia can be competitive in spinning since this activity is not
labour intensive. However, the Secretariat warned that once you go beyond
yarn, the situation changes quite fundamentally. [99]According
to the IWS the weaving and knitting of wool fabrics into sweater type
garments, where value-adding is high, takes two routes. The first route
is the production of relatively low valued products where labour costs
are important. China is the main participant in this area of low cost
production. The other route involves the production of high fashion, high
quality clothes. This market is dominated by Italy, Japan and Germany.
As a result of this situation Mr John O'Connor, Director of Corporate
Strategy with the International Wool Secretariat, in giving evidence to
the inquiry, stressed that the IWS did not see a situation where Australia
will be competitive in weaving and beyond stages. [100]
7.92 There is an ongoing trend in the world fibre markets to shift processing
capacity away from wealthy countries, including Australia, to countries
with low unit labour costs such as China, India and Pakistan. These countries
have the highest growth rates in mill consumption while growth in processing
wool has either stagnated or declined in wealthy developed countries.
Japan is an example of a country where rising costs have resulted in a
trend away from producing apparel to importing apparel. [101]
With Australia's relatively high labour costs it is unrealistic to expect
that Australia could become a major producer of wool apparel, particularly
for the export market.
Value-adding to wool overseas
7.93 Increases in the prices received for processed wool must outweigh the
costs of the materials and services used to produce the product. It has been
argued that each stage of wool processing being located where it is most cost
effective serves the best interests of Australia's wool industry. As stated in
the publication Wool: Structuring for Global Realities :
As with globally competitive suppliers of branded garments everywhere,
they can be competitive only if they can have the most labour-intensive
garment making, this is most likely be in the developing countries in
Asia. [102]
7.94 The argument has been raised that further processing of wool in
Australia simply generates unproductive competition between raw and processed
product in overseas markets, with unknown implications for the value of
greasy wool. [103]
7.95 Mr Anthony Botsman of the Professional Resource Group expressed doubts
concerning the extent to which value-adding to wool production can be carried
out in Australia. He told the Committee that value-adding was not necessarily
best done in Australia. Mr Botsman went on to state:
There have been numerous commentators and extensive commentary on the
case for and against value adding in Australia. The current situation
would suggest that the case against is stronger than the case for. [104]
7.95 7.96 Later in evidence to the inquiry Mr Botsman questioned the
desirability of trying to duplicate in Australia the value-adding activities
then being carried out overseas. Mr Botsman noted that:
Starting from where we are starting, is reinventing the wheel. The
wheel is already in existence in a number of countries around the world
and working perfectly well. My proposition is to get on that wheel which
is already working, not reinvent it. [105]
Export markets
7.97 In 1994 Australia supplied about 70 per cent of the international
trade in wool compared to 64 per cent in the early 1980s. Australia's
dominance was even greater in apparel wools where it provided over 70
per cent of traded products, exported primarily in greasy form for processing
overseas. By 1994, on average Australia exported more than 90 per cent
of its wool production in raw or semi-processed form. During the ten years
to 1994 the sale of wool overseas had returned a total of $37.7 billion
in export income to Australia. [106]
7.98 A major problem facing any attempt to increase the value-added content
of Australian wool through further processing is access to markets. According
to the IWS there had been a significant growth in early stage processing
of wool in Australia in recent years, largely as a result of the perception
that there are opportunities for selling large quantities of semi-processed
wool as well as raw wool to China. [107]However,
during 12 months to April 1995 China imposed a tariff of 15 per cent on
wool tops and 10 per cent on raw wool. At the same time India, another
growth market for Australia, considered imposing a 50 tariff on tops and
a 25 per cent tariff on raw wool. According to IWS these limitations would
greatly reduce our ability in Australia to undertake early stage processing
of our clip and to export tops competitively. [108]
Conclusions
7.99 The Committee is of the view that Australia should be aware of the
danger of becoming a dumping ground for polluting industries. As time goes on
it is likely that Australia may be pressured into carrying out increased wool
scouring by companies in countries where this practice has become less
acceptable. The Committee sees considerable advantages for Australia if wool
scouring systems can be operated in an environmentally acceptable
manner.
7.100 Regrettably the Committee has concluded that Australia may struggle
to become competitive in the weaving of wool and the production of wool
garments. It would appear to be more productive for the industry to
concentrate on what it does best, namely the production of the world's best
wool.
7.101 As noted earlier the Committee expressed the belief that it is
essential for Australia to be flexible in marketing its value-added products
overseas. It is in line with this belief that the Committee accepts the
suggestion, that in relation to wool, most of the more complex value-adding
processes appear to be more competitively carried out overseas.
7.102 Ms Mary Scott Gilbert, Manager of Marketing and Communications
with the Colly Farms Cotton group of companies noted in February 1996
that five trends have emerged which may be of importance to the future
marketing of the Australian cotton crop. [109]
These trends are:
- a more competitive marketing environment;
- increased demand for coarse cotton;
- a loss in cotton's market share;
- a shift in mill use to producing countries; and a shift in demand
between developing nations. [110]
7.103 Ms Gilbert went on to state:
The five trends occurring throughout the world cotton industry combined
with the subsidised marketing activities of other countries, indicate
that the marketing for Australian cotton will become increasing competitive.
[111]
7.104 Total Australian cotton exports to Japan, Korea, Hong Kong and
Taiwan are predicted to decline by 361 000 tonnes by the year 2000-2001.
Despite approximately 453 000 additional tonnes of cotton being exported
to Thailand, Indonesia , Malaysia, China and the Philippines these increases
will not be sufficient to take up the potential export volume from Australia.
According to Ms Gilbert if Australia's maintains its current market share
of cotton in these countries only 278 000 tonnes of the total 562 000
tonnes available for export will be consumed by our key target markets.
[112]
Ms Gilbert went on to state that:
If Australia's exports reach 562 000 tonnes by the year 2000, significant
increases in market share, combined with new market development will
be required to market this additional volume. [113]
7.105 It was expected that the shift in cotton processing away from the
industrialised countries towards countries with lower labour costs such
as Brazil, Indonesia and Thailand would continue in the medium term. [114]
7.106 The Australian Cotton Foundation told the Committee that although
Australia cannot compete with low wage manufacturing countries in the
final assembly of a product such as cotton shirts Australia can compete
in the area of secondary processing, such as the spinning of raw cotton
into textiles. [115]
The Cotton Foundation based this view on the use of technology that would
reduce the number and therefore the cost of workers employed in milling
cotton in Australia. [116]
7.107 During his evidence to the inquiry Mr Henry Pepper, a consultant
with the Australian Cotton Foundation, claimed that if the cotton and
wool currently produced in Australia were exported as a textile as a
opposed to raw fibre, we conservatively believe that there could be an
increase as much as five-fold in the gross value of the cotton and wool
produced. [117]According
to Mr Pepper these exports could have been worth $25 billion in 1992-93
values which would have eliminated Australia's then $15 billion current
account deficit. [118]
7.108 Despite the optimism of Mr Pepper concerning the ability of Australia
to produce and export textiles to Asia due to our proven ability to supply
quality on time he admitted that he had no knowledge of how tariffs in
overseas countries would affect such exports. [119]
7.109 In its submission DPIE noted that the export of bread dough, noodles,
cake and biscuit pre-mixes presented considerable export potential for
Australia. The Department of Primary Industries and Energy also saw considerable
scope for Australia in its marketing activities to capitalise on its reputation
to as a supplier of clean grain. [120]
7.110 It had been predicted that the world market for white sugar would
expand by about 2 per cent a year during the remainder of the 1990s. [121]
In 1994 the Australian Bureau of Agricultural and Resource Economics suggested
that if Australia became involved in the export of white sugar the premium
paid for white-raw sugar would contract while the raw sugar price would
increase. According to ABARE the Australian raw sugar industry would benefit
from a relatively small shift into the refining of Australian raw sugar
for export. The Australian Bureau of Agricultural and Resource Economics
claimed that:
Whether a refiner would proceed with refining for export will depend
critically upon the refiner's actual costs of production, perceptions
about the outlook for the white-raw sugar premium, risk preferences
and also the extent of current operations. [122]
7.111 In February 1996 the Bureau claimed that white sugar's current
price premium over raw sugar was expected to weaken over the medium term
as a result of recent expansion of world refining facilities. [123]
7.112 CSR does not have an optimistic view concerning the prospects of
Australia increasing its exports of refined white sugar. CSR advised the
Committee that Australia has a relative competitive advantage in exporting
raw sugar compared to the export of white sugar. [124]
Mr Peter Frawley, Executive General Manager for Sugar with CSR, told the
Committee that Australia was primarily an exporter of raw sugar instead
of refined sugar because:
- the international demand was for raw sugar;
- refined sugar is more easily stored and moved from locations near its
point of consumption;
- many countries want to use their own labour and facilities to process
raw sugar instead of importing refined sugar; and
- most countries have a higher tariff on refined sugar than on raw sugar.
[125]
7.113 The greatest potential market for Australian sugar is Asia where
consumption per person is rising in line with increasing standards of
living. [126]
7.114 As a result of changes to the European Union's sugar regime on
1 July 1995 ABARE estimated that the Australian sugar industry would increase
its earnings from export of between $10 million and $40 million a year.
The extent of such gains depends on whether reductions in tariffs or other
tariff equivalents lead to lower domestic prices in overseas countries
and therefore increased imports. As a result of the GATT agreement tariffs
on both raw and refined sugar were reduced in Japan during 1994. It has
been suggested that Japan could become an importer of white sugar following
rationalisation of the refining industry in coming years. Such developments
could be of benefit to Australia's sugar exporters. [127]
7.115 Despite these improved opportunities for Australian sugar exports
ABARE was of the view that the sugar industry was not expected to benefit
significantly from the GATT agreement. According to ABARE there are unlikely
to be any major changes to the domestic sugar policies regarding market
access and domestic support. [128]
7.116 Japan has been a particularly difficult country to export refined
sugar into. Mr Macarthur-Stanham, Manager of Special Projects with CSR,
told the inquiry that in Japan you cannot even get in the front door
with your value added products and you are forced to rely on your raw
material. [129]
Ethanol production
7.117 The production of alcohol from sugar cane presents a significant
opportunity for value adding in the sugar industry with Brazil providing
a model that Australia could learn from. Brazil is the world's largest
producer of sugarcane producing about 225 million tons per year. Sixty
five per cent of this production is used to produce alcohol. In 1993-94
11.2 billion litres of alcohol were produced in Brazil with a large proportion
of this being used to produce ethanol. Ethanol is blended with 78 per
cent gasoline to produce a fuel used in cars and trucks. Brazil's alcohol
production represents the equivalent of nearly 200 000 barrels of gasoline
a day which in turn represents about 20 per cent of total fuel consumption
in Brazil's transport sector. The use of ethanol saves Brazil about $2
billion a year in foreign exchange. It has also been estimated that the
Brazilian Alcohol Program has created 500 000 jobs or about 65 per cent
of the total jobs in the sugar cane industry in rural areas. [130]
7.118 Brazil was the first country in the world to totally eliminate
the mixture of lead in gasoline. This was possible because the use of
ethanol significantly increased the octane level of the blended gasoline
and alcohol fuel making the addition of lead unnecessary. [131]
7.119 In its submission to the inquiry the Australian Cotton Foundation
drew the Committee's attention to the difficulties Australia has experience
in getting its ethanol industry up and running. According to the Foundation
the confusing number of government instrumentalities overseeing ethanol
processing has altered market signals and confused potential investors.
[132]
The Cotton Foundation told the Committee that:
In late 1993 the Energy Research and Development Corporation, while
noting that most ethanol technologies are mature and commercialised,
found that there does not appear to be a coordinated approach for setting
up an economic biomass infrastructure and huge amounts of ethanol source
matter are discarded as waste instead of producing upward of 1 billion
litres of easy-to-blend ethanol. [133]
Conclusions and recommendation
7.120 The production of alcohol from sugar appears to the Committee to
offer a significant opportunity for value-adding. The Committee appreciates
that the production of ethanol is a complex operation and that at times its
economic and social benefits have been overestimated. Nevertheless, the
Committee is of the view that every possible encouragement should be given to
the production and use of ethanol alcohol. The Committee recommends that the
Commonwealth Government give substance to this encouragement by:
- reviewing, in cooperation with the relevant States and industry bodies,
what actions can be taken to simplify barriers to ethanol production; and
- ascertaining what changes are necessary to overcome problems which may
occur in existing strategies and programs designed to promote ethanol
production in Australia.
7.121 Cigarettes are exported from Australia but volumes are currently
small but increasing. Philip Morris Limited has exported cigarettes at
a compound annual rate of 37.9 per cent for the three years to 1994. The
company estimated that in 1995 it would have a favourable balance of trade
in cigarettes of 4:1 with net exports of around a billion cigarettes with
a sales value of approximately $26 million. [134]
7.122 At present tobacco is brought in from Japan and Taiwan for
re-processing and then exported back to these countries. In 1995 Philip Morris
Limited was working on the possibility of blending some Australian grown
tobacco with this imported tobacco during processing before it was exported.
In May 1995 to Mr Scott Operations Director for Philip Morris Limited
stated:
We are now working on other opportunities in some of the countries
in Asia where we will be taking a blend of tobacco which will be largely
imported, but there will be quite a content of Australian in it as well,
and sell it as a special processed tobacco in a format that will value
add quite a bit to the agricultural product. [135]
7.123 The Asian market provides the best prospect for the export of Australia's
manufactured cigarettes. It was estimated that cigarette consumption in
this market will increase at the rate of two per cent annually. [136]However,
in evidence to the inquiry Mr John Scott, stated that the export opportunities
we are availing ourselves of right now are in the Middle East and eastern
Europe. [137]
7.124 During his evidence to the inquiry Mr Scott agreed that Philip
Morris Limited' parent company could prevent it from entering a particular
market. However, Mr Scott stressed that because Philip Morris Limited
in Australia was considered to meet world's best practice it was in
a strong position to bid for business overseas within the multinational
organisation. [138]
7.125 Philip Morris Limited argued that Australian tobacco producers
cannot take advantage of potential export opportunities until the quality
and standard of local leaf production can match overseas producers at
competitive prices. As of April 1995 Australian tobacco leaf is approximately
50 per cent more expensive than comparable leaf from major producing countries.
[139]
7.126 Australia currently produces filler tobacco that does not substantially
impact on the taste profile of cigarettes. Lower labour cost countries
can supply this type of tobacco which therefore places them in superior
competitive positions compared to Australian tobacco producers. [140]
7.127 Philip Morris Limited was of the view that the potential for Australian
tobacco growers to be competitive would be significantly enhanced if they
moved from producing tobacco in the lower priced filler end of the market
to producing for the mid level, semi-aromatic sector. This sector would
provide higher prices for growers. [141]
According to Philip Morris Limited:
Upgrading the Australian crop to the semi-aromatic category will require
a consistent commitment to quality cultural practices. This is the single
most important factor in future success and an essential strategic direction
to ensure a sustainable future for the Australian industry. [142]
7.128 Later in its submission Philip Morris Limited argued that the export
of Australian made cigarettes offered the best opportunity for maintaining
a prosperous tobacco industry in this country with flow on benefits to
the Australian economy. The company stated that the best opportunity
for Australian tobacco growers to participate in exports is through the
inclusion of their leaf in value added manufactured cigarettes and semi-processed
leaf. [143]
7.129 Past government support for the tobacco industry has been viewed as
detrimental to the industry in the long run. Philip Morris Limited told the
Committee that government schemes have encouraged manufacturers to use 57 per
cent locally grown tobacco leaf, irrespective of quality and price. According
to Philip Morris Limited:
This effectively provided a guaranteed market for Australian growers,
and shielded them from the need to improve production methods or reduce
costs. The consequence of this is that Australian leaf prices remain
significantly above international levels, local leaf has virtually no
market outside Australia. [144]
7.130 Philip Morris Limited welcomed the January 1995 termination of
the Tobacco Industry Stabilisation Plan (TISP) and the Local Leaf Content
Scheme (LLCS). The company saw this termination as having the potential
to dramatically enhance the productive capacity of an important agricultural
sector and contribute significantly to the nation's economic well-being.
[145]
Philip Morris Limited argued that:
By exposing the local growing industry to international market forces,
the local growing and manufacturing industries will be better placed
to participate in the international marketplace. [146]
Conclusions and recommendation
7.131 The issue of value-adding in the tobacco industry and any support
that should be provided by governments to this industry is a controversial
subject.
7.132 Given the health dangers related to tobacco consumption the question
arises whether governments should be encouraging value-adding in this
industry and supporting the export of tobacco overseas where its use may
lead to medical problems in a number of consumers? This is not an easy
question to answer. It is perplexing that Australian governments are financing
campaigns to curtail tobacco consumption in Australia while at the same
time encouraging value-adding in the industry. [147]
7.133 The Committee accepts that tobacco use will continue in Australia and
overseas for the foreseeable future and if Australian producers and processors
do not supply tobacco other countries will. Nevertheless, the Committee
considers that any expenditure by governments to support the production of
tobacco has the potential of being viewed as providing a double standard.
Given the limited amount of government funds available to support value-adding
in Australia the Committee recommends that no funds or assistance should be
provided to the tobacco industry, except assistance for growers to leave the
industry.
7.134 Mr Brian Carroll of the Australian Vegetable and Potato Growers
Federation in February 1996 set out a number of factors which have impacted on
horticultural produce consumption patterns. These changes in consumption
patterns will have a continuing impact on value-adding in Australia's
horticultural industry. Factors affecting trends, both in Australia and
internationally, in the consumption horticultural products include:
- improved education and exposure to international cuisine has led to
demands for imported foods;
- an increase in two income families has led to a demand for convenience
foods;
- increasing concern by consumers about food quality and safety issues;
and
- increasing demand for the year round supply of particular fruits and
vegetables. [148]
7.135 In this section the Committee has chosen to comment on the prospects
for both fresh and processed horticultural products. The prospects for wine,
which is a horticultural product, is also examined in this section.
Fresh and processed agricultural products
7.136 The economic development of Australia's horticultural industries,
involved in producing either fresh or processed products, depends on two main
factors:
- increased volume of production; and
- improved marketing, particularly involving the presentation of a quality
product. [149]
7.137 In order to service increased domestic consumption and increased
exports of fresh and processed horticultural products the gross value
of production will need to increase to approximately $5 billion by the
year 2000. [150]
7.138 Australia's exports of fresh and processed horticultural products
are likely to increase in value to approximately $2 billion by the year
2000. The major destinations for Australian horticultural produce will
be the countries in North and South East Asia and the Pacific. Smaller
levels of exports will continue to be made to opportunity and niche markets
in Europe and North America. [151]
7.139 The Committee was told that at as of 1995 99 per cent of fresh
vegetables were marketed as loose product. However, in Europe 13 per cent
of fresh vegetables were then marketed as value-added. This figure is
estimated to reach 20 per cent by the year 2000. In the United States
in 1995 value-added packaged vegetables total six per cent of the market
and this figure is expected to grow to 15 per cent by the year 2000. [152]These
figures indicate that there is a promising market for Australia's value-added
vegetable producers.
7.140 In evidence to the inquiry Mr Garry Goucher of the National Farmers'
Federation stated that the General Manager of Woolworths, Mr Reg Clairs,
had expressed the view that Asian countries were moving directly from
raw wet market sales to high quality food items ready for cooking in the
home sold through supermarkets. [153]
7.141 The view has been expressed that the large scale export of horticultural
products will require the development of large businesses able to brand
product, reliably supply, maintain a quality product and promote. [154]
7.142 A number of trends in international food marketing have been detected
that could have an impact on value-adding to Australia's horticultural
production. These trends include:
- preference being given to sourcing products from large scale producers
able to guarantee supply and quality rather than from small growers;
- the domination of retail trade by supermarkets who deal direct with
producers;
- increasing demand for the year round supply of products requiring
purchases from both hemispheres; and
- more discerning consumers concerned with quality, presentation, taste
and food safety issues. [155]
7.143 Australia's wine exports are expected to be the major contributing
factor to the growth of Australian wine production and sales over the
medium term. Domestic consumption of wine was expected to increase marginally
to just over 316 million litres in 1995-96 Domestic wine consumption was
predicted to increase moderately to 355 million litres between 1993-94
and 1999-2000. [156]
7.144 Exports of Australian have been projected to increase by 63 per
cent to 213 million litres in the year 2000. [157]If
these predictions are correct Australian will be exporting about 38 per
cent of its wine production in the year 2000. It has also been predicted
that the volume of wine exports will increase by about 114 per cent from
1995-96 levels to reach 289 million litres in the year 2000-01, representing
an increase of 17 per cent compared to 1995-96. That would represent a
real value at that time of about $787 million. [158]
7.145 The Australian Bureau of Agricultural and Resource Economics noted a
significant advantage enjoyed by Australian wines on the domestic and export
markets, namely:
Australian wines are generally regarded as good value for money, providing
consumers with a product of consistently good quality with competing
imports. [159]
7.146 Prospects for the wine industry look to be bright. The industry
appears to be responding to developing consumption patterns, both in Australia
and overseas. For example, wineries appear to be prepared to meet the
increasing demand for premium wines, specifically red wines. The demand
for premium red wines was expected to increase by 27 per cent over the
1993-94 to 1996-97 period. The demand for premium white wines was predicted
to increase by 22 per cent over the same period. [160]
It is expected that higher average returns from wine exports will accompany
an increase in export volumes over the medium term as premium wines make
up a greater proportion of export wine. [161]
7.147 However, there are dangers on the horizon that could impact on
Australia's ability to be competitive in the international wine market place,
as ABARE warned:
Exchange rate movements and wine grape supplies will influence the
continued price competitiveness of Australian wines. ... consumer preference
for Australian wine will also influence demand. [162]
7.148 ABARE advised in 1996 that:
The future rate of growth in the value of Australian wine exports will
rest on retaining current export markets and successfully developing
new markets in which higher priced wine is sold. [163]
The Bureau went on to warn:
Continued exports to Australia's current major export destinations will
not be sufficient to absorb the projected increase in wine grape supply
over the next five years without an increase in the competitive position
of Australian wine. [164]
7.149 The Department of Primary Industries and Energy expressed the view
that the major opportunities for value-adding in the meat and livestock
industries centre on improving the operational efficiency of existing
meat processing works along with investment in new capacity and technology.
Increasing the skills of workers, as well as changing some work practices,
were also seen as important elements in improving value-adding in the
meat industry. [165]
7.150 The Department of Primary Industries and Energy considered that
the development of new products to meet market demand, such as convenient
foods, lean meat and speciality meals represented opportunities for value-adding
in the industry. [166]
7.151 The Australian Meat and Livestock Corporation suggested that
opportunities for value-adding in the meat and livestock industries can be
grouped into the following areas:
- further processing activities, including;
- boning out product,
- improved packaging,
- the preparation of small goods, and
- preserving and canning meats;
increased utilisation of by-products from processing such as
hides-skins, edible offal, inedible offal, tallow, meat and bone meal;
the processing of meat to market requirements such as chilled and
grainfed beef;
cost reductions in the value-adding chain in areas such as;
- transport,
- distribution, and
- unnecessary regulations and restrictions. [167]
7.152 In the following section the export prospects for two important
value-adding sectors of the meat industry are discussed, namely beef and pet
food.
Beef exports
7.153 The export of beef is essential to the well being of the Australian
beef industry. The General Manager of Sandalwood Feedlot in Queensland has
commented that:
It is unrealistic to expect the domestic market to drive (beef) industry
growth. Export markets hold the key to our success. [168]
7.154 Fast growing South East Asian economies have the potential to significantly
increase their level of beef imports. According to estimates made by the
Centre for International Economics (CIE) if the APEC ideal of zero tariffs
is attained this could benefit the Australian meat industry to the tune
of at least A$1 690 million. [169]
7.155 Improvements in access to both the Japanese and Korean markets
has provided the Australian beef industry with opportunities to expand
beef and veal exports to North Asia. Australia is the major supplier of
beef to Japan. [170]In
1994-95 Australia had about 53 per cent of the Japanese beef import market.
However, this figure was expected to decline to about 49 per cent in 1995-96.
[171]
7.156 The Australian Meat and Livestock Corporation attributes Australia's
increased exports of beef into the Japanese market to three main
factors:
- the replacement in Japan of meat quotas by tariffs in 1991;
- Australian beef promotion campaigns in Japan; and
- the establishment of a uniform language by the AMLC and Australian
meat producers to describe meat. [172]
7.157 The growth in exports to Asia has led to the development of new
production systems in Australia including a substantial feedlot industry.
The Committee understands that the number of cattle on feed was less than
100 000 head in 1985. [173]
A survey by the Australian Meat and Livestock Corporation and the Australian
Lot Feeders' Association indicated that overall feedlot capacity was 56
per cent in the December quarter of 1995. The survey predicted that the
number of Australian cattle on feed will increase by around 8 per cent
to 499 058 head during the three months ending March 1996. [174]
7.158 Beef exports to the Asian market have changed over recent years with
more grain fed and more chilled grain finished beef being exported than in the
past. Grain fed beef exports to Japan have increased from 48 000 tonnes in
1991 to 132 000 tonnes in 1994. The Australian Meat and Livestock Corporation
advised the Committee that:
These increasing tonnages of grain fed exports are a clear example
of value adding by the Australian industry, but the switch from frozen
to chilled product, substantially adding value, has been even more pronounced
and chilled product now comprises 75 per cent, about three-quarters
of our beef exports to Japan. The process of chilling as compared with
freezing adds obviously substantial value. [175]
7.159 These developments have resulted in Australian producers and processors
obtaining a higher return for their beef exports. [176]
Australia exports of beef and veal to Japan reached 322 000 tonnes in
1994-95 which was a seven per cent increase on 1993-93 levels. [177]
Australian grain fed beef was expected to contribute to half this growth.
[178]During
this same period the United States export of beef to Japan increased by
19 per cent. [179]
7.160 The United States has increased its exports of beef at a much faster
rate than Australia in recent years. Mr Kevin Roberts claimed that the
US beef industry has a very strong export focus, is extremely price competitive,
has achieved good integration of government and industry market development
activities and has a well established and respected beef grading system.
[180]
7.161 With the reduced availability of cattle as a result of herd rebuilding
in Australia, export growth of beef and veal to Japan is expected to be
subdued until the second half of 1996. However, Australian exports to
Japan are expected to recover by 1997, reaching a projected 340 000 tonnes
for the financial year 1996-97 which is approximately six per cent up
on 1994-95 levels. By the year 2001 it is predicted that Australia will
export 414 000 tonnes (shipped weight) of beef to Japan, representing
43 per cent of Australia's beef exports. [181]
7.162 The Australian beef industry has attempted to meet the changing
tastes of consumers. For example, to meet the Japanese requirement for
a more even distribution of fat through their meat Australian beef producers
are leaving their cattle on feedlots for longer periods, for up to 300
days. [182]Mr
Russ Reynolds of ABARE argued that:
The projected growth in the size of Australia's grainfed beef industry
is largely attributable to the assumed growth in the Japanese market
for beef. With more cattle being finished on grain, greater market opportunities
will emerge for the supply of feeder steers into the feedlot industry.
[183]
7.163 Australia's experience in scientific beef production offers an
additional area for export income. The Beef Improvement Association of
Australia suggested that Australia's expertise in techniques for genetic
engineering and implantations could be marketed overseas. [184]
7.164 Despite the generally optimistic picture painted of Australia's beef
industry, during the inquiry there was a note of caution raised by some
witnesses.
7.165 The Australian Meat and Livestock Corporation noted that in the past
the ability of Australia to export more highly processed meat products into
some countries has been limited due to a desire in these countries to carry
out value-adding activities themselves. For example, Australia was in the
process of obtaining contracts to supply meat patties to McDonald's in Taiwan
and Korea when they were told by officials in these countries that:
7.166 Early in its evidence to the inquiry the AMLC advised that the
Corporation envisaged a bright future for Australia's meat and livestock
industries. [186]However,
later in his evidence Dr Standen of the Corporation presented a less optimistic
view of the situation the Australian meat industry was in when he commented:
I think the numbers show that our industry has performed marvellously
in places like Japan in getting the full array of qualities of product
there [sic], but our industry is not making much money. Our cost structures
still mean that our net returns from doing a great job are just not
providing a big enough incentive to grow the industry. [187]
7.167 Dr Standen went on to reflect that the value of Australia's cattle
exports:
Is now no bigger than it was, say, five years ago in terms of numbers
of cattle. Some of our exports have been redirected, our level of exports
is still much the same. We are redirecting from North America more to
Asia, but we have still got fewer than 25 million head of cattle. We
have got plants that are closing down, there is chronic lack of investment
in the processing industry. [188]
Conclusions and recommendation
7.168 To meet the increasing competition from the United States and New
Zealand to the export of Australian beef, particularly into Asia, the
Committee is of the view that Australia must concentrate on producing
beef through feedlots to meet market requirements. The Committee accepts
that feedlots provide a significant means of drought proofing the beef
industry. [189]
7.169 The Pet Food Manufacturers Association of Australia was of the view
that the brightest growth prospects for manufactured pet food were in exports.
However, the likelihood of continuing to export pet food successfully is
dependent on Australian manufacturers continuing to produce a quality product.
According to the Association:
The Australian industry cannot hope to compete ... with products manufactured
in Thailand in terms of price and so must rely on the quality nutritional
aspects of pet food produced if export sales are to be maintained and
increased. [190]
7.170 As noted earlier it is regrettable that the Pet Food Manufacturers
Association declined to appear before the Committee to give evidence during
the inquiry. The Committee would have welcomed an elaboration on the views
expressed by the Association in its submission and additional information it
could possibly have supplied during a public hearing.
7.171 As a result of the massive restructuring that has taken place in
the Australian dairy industry since 1994 has resulted in it becoming internationally
competitive, the industry appears to have a bright future. This optimism
is reflected in the first line of the Australian Dairy Industry Commission's
submission to the inquiry where it stated that there are excellent growth
prospects and a positive export outlook for the Australian dairy industry.
[191]
7.172 Over recent years there has been a continuing rationalisation of
Australian dairy manufacturers in the form of mergers and take overs by larger
companies. The Australian Bureau of Agricultural and Resource Economics
expressed the view in 1994 that:
In the medium term, this increase in the size and investor base of
dairy processing companies and cooperatives is likely to facilitate
further improvements in manufacturing efficiency and capacity. As a
result Australian dairy manufacturers will be better placed to compete
on the world market. [192]
Export markets
7.173 It is accepted in the Australian dairy industry that its continued
growth is dependent on returns from exports. [193]
About a third of Australia's milk production is exported as processed
products, such as skimmed milk powder and cheese. [194]
By 1996-97 it is expected that the majority of Australia's milk production
will be sold on international markets, up from a third of all milk in
1990. The volume and value of dairy exports have almost doubled over the
last five years, up by 80 per cent in volume and 85 per cent in value.
[195]
7.174 Consumer pack products are among the most processed form of dairy
product and they are steadily increasing as a proportion of exports. The
packs currently represent about 25 per cent by volume of Australian dairy
exports. [196]
7.175 The Australian Dairy Industry Council dismissed suggestions that bulk
exports of Australian dairy exports was just dumb commodity driven
exporting. According to the Council:
Powders are not just powders any more than oils are just oils. When
you look at them, you find they are in fact a whole range of very tightly
specified products with particular uses. They are no more commodities
than 64K RAM chips are commodities. [197]
7.176 Murray Goulburn Cooperative told the inquiry that it produced skim
milk powder with 30 or 40 specifications. [198]
The Cooperative went on to state we believe that we add value for each
of those by differentiating in that manner. [199]
7.177 The Cooperative is concentrating on developing specialist bulk
milk powder for particular markets and uses, for example, the Cooperative
has developed a milk powder for the bakery industry called Dairy Bake.
This concentration on bulk milk powder is the strategy Murray Goulburn
Cooperative will follow in the future. According to Mr McLean of the Cooperative
this is the way that Murray Goulburn is going in terms of value adding
as opposed to more of the consumer packed items. [200]
7.178 The Asian-Pacific market accounts for more than 80 per cent of
Australia's dairy exports. [201]Australia
holds approximately a third of the market in this region for dairy products.
[202]
The success of Australia in this market can be appreciated from the fact
that Australia is now the largest supplier of natural cheese in the Japanese
market. [203]
The Committee was told that in terms of free markets, Japan is the largest
market in the world, elsewhere quotas on dairy imports normally apply.
United Milk Tasmania told the inquiry in September 1995 that it only had
a quota of 700 tonnes of cheese into the whole of Europe and a quota of
1 000 tonnes into the United States. As of September 1995 UMT was selling
some 5000 tonnes of cheese to Japan through the Australian Dairy Corporation.
[204]
7.179 Despite the obvious rewards of exporting value-added products into
the Asian market there are significant costs involved. The Committee was
told that to develop from start-up a new consumer pack product in the
greater Tokyo market you are looking at expenditures on the marketing
of that product alone which will account for more than 50 per cent of
your revenues. [205]
7.180 The Australian Dairy Corporation has taken up equity in processing
operations in Thailand, Indonesia and the Philippines. The rational behind
this move was to maintain long term access to these markets for Australian
milk and manufactured milk products. [206]
According to Mr Peter Gallagher of the Australian Dairy Industry Council,
although these markets are tightly controlled, by exporting technology
and investment to these countries Australian dairy producers have secured
markets in these countries. Butter oil and milk powder are exported to
plants in these countries and recombined to produce fresh milk using Australian
technology. [207]
7.181 In his evidence to the inquiry Mr McLean of the Murray Goulburn
Cooperative set out what he saw as a realistic picture of the prospects for
value-adding in the Australian dairy industry, particularly in relation to
exports. According to Mr McLean:
Asian countries want to capture value-adding themselves. They do not
want to import high value added products from us. [208]
Mr McLean went on to suggested that:
It is not economical to manufacture here in Australia high value process
[sic]dairy products for exports in competition with what can be made
in those countries. As an example, condensed milk used to be manufactured
in Australia, but now that has all moved overseas. ... You could not
manufacture it here and export it competitively to what is done over
there. [209]
7.182 It is expected that the market opportunities for Australia's dairy
exports to Asia will increase in the medium term due to the greater
consumption of dairy products in the region as a result of:
- increasing living standards in Asian countries;
- the inability of local producers to meet increasing demand; and
- the increasing westernisation of Asian diets. [210]
Conclusions
7.183 The Australian dairy industry presents an outstanding example of an
industry that has shown flexibility in adapting to the requirements of
overseas markets. The Committee congratulates the Australian Dairy Corporation
on taking the initiative in acquiring equity in dairy processing plants in
Asia in an effort to assure access to these markets for Australian milk and
milk products. This strategy is an example of the foresight and flexibility
necessary to achieve success, or at least the chance of success, in export
markets for Australian value-adding agricultural based industries.
7.184 The Committee accepts the view of ABARE that Australia will improve
its access to overseas markets for its dairy products as a result of the
implementation of the Uruguay Round Agreement. It is the conclusion of
ABARE, accepted by the Committee, that Australia will increase its share
of world trade in dairy products due to a lessening of exports from the
United States and Europe. This lessening will result from increased domestic
consumption in these countries along with a reduction in subsidised dairy
exports. [211]
Footnotes
[86] See International Agribusiness Trends and
Their Implications for Australia, a discussion paper prepared for the
Primary and Allied Industries Council, Canberra, 1989, p. iii.
[87] Evidence, DPIE, p. 892.
[88] Dr Alistair Watson, Further Processing of
Agricultural Productions in Australia: Some Economic Issues, Research
Paper Number 5, 14 December, 1993, Parliamentary Research Service , Department
of the Parliamentary Library, pp. 17-18.
[89] Dr Alistair Watson, Further Processing of
Agricultural Productions in Australia: Some Economic Issues, Research
Paper Number 5, 14 December, 1993, Parliamentary Research Service , Department
of the Parliamentary Library, pp. 15-16.
[90] Evidence, IWS, p. 157; Wool:
Structuring for Global Realities, Report of the Wool Industry Review
Committee, Canberra, August 1993, p. 64.
[91] Evidence, IWS, p. 156.
[92] Evidence, DEST, p. 1039.
[93] Evidence, DEST, p. 1940.
[94] Evidence, IWS, p. 162.
[95] Evidence, IWS, p. 166.
[96] Evidence, IWS, p. 166.
[97] Evidence, IWS, p. 184
[98] Evidence, IWS, p. 184.
[99] Evidence, IWS, p. 185.
[100] Evidence, IWS, p. 185; see also
Evidence, Merino Gold Limited, p. 278.
[101] T. Goesch and others, Outlook for
Wool, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, pp. 179, 181.
[102] Wool: Structuring for Global
Realities, Report of the Wool Industry Review Committee, Canberra, August
1993, p. 66.
[103] Maximising the Return: Adding Value to
Australian Wool: Report of the Wool Processing Task Force, Department of
Primary Industries and Energy, Canberra, 1993, p. 13.
[104] Evidence, Professional Resource
Group, p. 200.
[105] Evidence, Professional Resource
Group, p. 207.
[106] Evidence, IWS, p. 139; Maximising
the Return: Adding Value to Australian Wool: Report of the Wool Processing
Task Force, Department of Primary Industries and Energy, Canberra, 1993, pp.
5, 6; Wool: Structuring for Global Realities, Report of the Wool
Industry Review Committee, Canberra, August 1993, p. 48
[107] Evidence, IWS, p. 177.
[108] Evidence, IWS, p. 177. For
additional information on tariffs see T. Goesch and others, Outlook for
Wool, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, p. 181
[109] Mary Scott, Future Export Markets for
Australian Cotton, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 348.
[110] Mary Scott, Future Export Markets for
Australian Cotton, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 348.
[111] Mary Scott, Future Export Markets for
Australian Cotton, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 353.
[112] Mary Scott, Future Export Markets for
Australian Cotton, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 352.
[113] Mary Scott, Future Export Markets for
Australian Cotton, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 352.
[114] M. Forester and others, Outlook for
Cotton, Outlook 94, Vol. 3, Agriculture: collection of papers delivered at
the Outlook 94 Conference held in Canberra 1-3 February 1994, organised by
ABARE p. 134
[115] Evidence, Australian Cotton
Foundation Ltd., p. 436.
[116] Evidence, Australian Cotton
Foundation Ltd., p. 438.
[117] Evidence, Australian Cotton
Foundation Ltd., p. 438.
[118] Evidence, Australian Cotton
Foundation Ltd., p. 438.
[119] Evidence, Australian Cotton
Foundation Ltd., p. 442.
[120] Evidence, DPIE, p. 893.
[121] R. Van Hilst and P. Connell, Developments
in the World Sugar Market, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 111.
[122] R. Van Hilst and P. Connell, Developments
in the World Sugar Market, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 114.
[123] S. Landlow, Outlook for Sugar,
Outlook 96, Vol. 2, Agriculture: collection of papers delivered at the Outlook
96 Conference held in Canberra 6-8 February 1996, organised by ABARE, p. 423.
[124] During 1993-94 Australia produced
approximately 4 300 Kt of sugar of which approximately 3 455 Kt were exported
almost totally in the form of raw sugar, see Commodity Statistical Bulletin
1994, ABARE, Canberra, 1994, pp. 214, 221.
[125] Evidence, CSR, pp. 454-456.
[126] R. Van Hilst and P. Connell, Developments
in the World Sugar Market, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 109.
[127] R. Van Hilst and P. Connell, Developments
in the World Sugar Market, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 112.
[128] R. Van Hilst and P. Connell, Developments
in the World Sugar Market, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 112.
[129] Evidence, CSR, p. 456.
[130] Roberto de Moura Campos, Future
Directions of the Alcohol Program and Sugar in Brazil, Outlook 94, Vol. 3,
Agriculture: collection of papers delivered at the Outlook 94 Conference held
in Canberra 1-3 February 1994, organised by ABARE, pp. 115-116; see also S.
Ladlow, Outlook for Sugar, Outlook 96, Vol. 2, Agriculture: collection
of papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, pp. 422-423.
[131] Roberto de Moura Campos, Future
Directions of the Alcohol Program and Sugar in Brazil, Outlook 94, Vol. 3,
Agriculture: collection of papers delivered at the Outlook 94 Conference held
in Canberra 1-3 February 1994, organised by ABARE, p. 116.
[132] Submission, Philip Morris Ltd, p. 2.
[133] Submission, Philip Morris Ltd, p. 2.
[134] Evidence, Philip Morris Ltd, pp.
645,662
[135] Evidence, Philip Morris Ltd, pp.
667-668.
[136] Evidence, Philip Morris Ltd, p. 645.
[137] Evidence, Philip Morris Ltd, pp.
673-674.
[138] Evidence, Philip Morris Ltd, p. 672
[139] Evidence, Philip Morris Ltd, p. 640.
[140] Evidence, Philip Morris Ltd, pp.
639-640
[141] Evidence, Philip Morris Ltd, p. 644.
[142] Evidence, Philip Morris Ltd, p. 644
[143] Evidence, Philip Morris Ltd, p. 645.
[144] Evidence, Philip Morris Ltd, p. 642.
[145] Evidence, Philip Morris Ltd, p. 639.
[146] Evidence, Philip Morris Ltd, p. 639.
[147] See again Evidence, Philip Morris
Ltd, p. 639.
[148] Mr Brian Carroll, Emerging Horticultural
Exports, Outlook 96, Vol. 2, Agriculture: collection of papers delivered
at the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, pp. 392-393.
[149] Department of Primary Industries and Energy,
International Agribusiness Trends and Their Implications for Australia,
a discussion paper prepared for the Primary and Allied Industries Council,
Canberra, 1989, p. 48.
[150] Horticultural Task Force, Strategies for
Growth in Australian Horticulture, Canberra, February 1994, p. iii.
[151] Horticultural Task Force, Strategies for
Growth in Australian Horticulture, Canberra, February 1994, p. ii. Mr
Geoffrey Quinn, a postgraduate student at the University of New England, in
evidence to the inquiry expressed reservation concerning the importance of
niche markets. He told the inquiry:
Niche marketing is a good and useful part of a market process but it only
markets some product; it does not market a lot of product. I do not think that
the bulk of Australian agricultural produce or primary produce lends itself to
niche marketing.
Evidence, Mr Geoffrey Quinn, p. 510; see also Mr Brian Carroll,
Emerging Horticultural Exports, Outlook 96, Vol. 2, Agriculture:
collection of papers delivered at the Outlook 96 Conference held in Canberra
6-8 February 1996, organised by ABARE, pp. 392-393
[152] Evidence, Vegco Limited, p. 259.
[153] Evidence, NFF, p. 1010.
[154] Department of Primary Industries and Energy,
International Agribusiness Trends and Their Implications for Australia,
a discussion paper prepared for the Primary and Allied Industries Council,
Canberra, 1989, p. 49.
[155] Malcolm Irving,
Horticulture-International Competitiveness Prospects for Australian
Horticulture, Outlook 94, Vol. 3, Agriculture: collection of papers
delivered at the Outlook 94 Conference held in Canberra 1-3 February 1994,
organised by ABARE, p. 154 and John Pendrigh, Wider Horticultural Policy
Issues, Outlook 94, Vol. 3, Agriculture: collection of papers delivered at
the Outlook 94 Conference held in Canberra 1-3 February 1994, organised by
ABARE, p. 162.
[156] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE pp. 273-274,
T. Stanford and others, Outlook for Wine Grapes and Dried Vine Fruit,
Outlook 96, Vol. 2, Agriculture: collection of papers delivered at the Outlook
96 Conference held in Canberra 6-8 February 1996, organised by ABARE, p. 358.
[157] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE p. 274.
[158] T. Stanford and others, Outlook for Wine
Grapes and Dried Vine Fruit, Outlook 96, Vol. 2, Agriculture: collection
of papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, p. 361.
[159] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE p. 274. For
a summary of Australia's performance in various export markets see L. Stanford
and others, Outlook for Wine Grapes; Outlook 95, Vol. 2, Agriculture:
paper delivered at the Outlook 95 Conference held in Canberra 7-9 February
1995, organised by ABARE pp 274- 276.
[160] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE p. 277.
[161] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE p. 279.
[162] L. Stanford and others, Outlook for Wine
Grapes; Outlook 95, Vol. 2, Agriculture: paper delivered at the Outlook 95
Conference held in Canberra 7-9 February 1995, organised by ABARE p. 274.
[163] T. Stanford and others, Outlook for Wine
Grapes and Dried Vine Fruit, Outlook 96, Vol. 2, Agriculture: collection
of papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, p. 362.
[164] T. Stanford and others, Outlook for Wine
Grapes and Dried Vine Fruit, Outlook 96, Vol. 2, Agriculture: collection
of papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, p. 363.
[165] Evidence, DPIE, p. 892.
[166] Evidence, DPIE, p. 892.
[167] Evidence, AMLC, pp. 315-318.
[168] Kevin Roberts, Producing to Meet the
Market, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, p. 228.
[169] Dr Bruce Standen, Significance of APEC
for Australian Agriculture, Outlook 96, Vol. 2, Agriculture: collection of
papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, p. 50.
[170] C. Collimore and others, Outlook for
Australian Beef and Veal, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 261. For information on likely developments in
the Korean market see D. Barrett and others, Outlook for Beef and Sheep
Meat, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, p. 209.
[171] D. Barrett and others, Outlook for Beef
and Sheep Meat, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 210.
[172] Evidence, AMLC, pp. 325-326.
[173] Evidence, AMLC, p. 333; see also C.
Collimore and others, Outlook for Australian Beef and Veal, Outlook 94,
Vol. 3, Agriculture: collection of papers delivered at the Outlook 94
Conference held in Canberra 1-3 February 1994, organised by ABARE, p. 262.
[174] D. Barrett and others, Outlook for Beef
and Sheep Meat, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, pp. 206-207.
[175] Evidence, AMLC, p. 335.
[176] C. Collimore and others, Outlook for
Australian Beef and Veal, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, pp. 261, 263.
[177] D. Barrett and others, Outlook for Beef
and Sheep Meat, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 209.
[178] C. Collimore and others, Outlook for
Australian Beef and Veal, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 262; see also Dr Bruce Standen, Significance
of APEC for Australian Agriculture, Outlook 96, Vol. 2, Agriculture:
collection of papers delivered at the Outlook 96 Conference held in Canberra
6-8 February 1996, organised by ABARE, p. 49.
[179] D. Barrett and others, Outlook for Beef
and Sheep Meat, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 209; see also John Kerin, The Australian Beef and
Sheep Meat Industries - Future Challenges, Outlook 96, Vol. 2,
Agriculture: collection of papers delivered at the Outlook 96 Conference held
in Canberra 6-8 February 1996, organised by ABARE, p. 218.
[180] Kevin Roberts, Producing to Meet the
Market, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, p. 229.
[181] D. Barrett and others, Outlook for Beef
and Sheep Meat, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, pp. 209-210.
[182] Florence Chong, Trading Policies: Trading
Costs of Value-adding, the Australian newspaper, 16 June 1993, p. 29.
[183] C. Collimore and others, Outlook for
Australian Beef and Veal, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 263. For information on other markets for beef in
Korea and other Asian countries see ibid, pp. 263-264.
[184] Evidence, BIA, p. 92.
[185] Evidence, AMLC, p. 341.
[186] Evidence, AMLC, p. 328.
[187] Evidence, AMLC, p. 345.
[188] Evidence, AMLC, p. 345
[189] See Kevin Roberts, Producing to Meet the
Market, Outlook 96, Vol. 2, Agriculture: collection of papers delivered at
the Outlook 96 Conference held in Canberra 6-8 February 1996, organised by
ABARE, p. 229.
[190] Submission, PFMAA, p. 5.
[191] Evidence, Australian Dairy Industry
Council, p. 106.
[192] J. Bills and others, Outlook for the
Australian Dairy Industry, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 239.
[193] J. Bills and others, Outlook for the
Australian Dairy Industry, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 231; see also T. Gleeson and others, Outlook
for the Dairy Industry, Outlook 96, Vol. 2, Agriculture: collection of
papers delivered at the Outlook 96 Conference held in Canberra 6-8 February
1996, organised by ABARE, p.255.
[194] Florence Chong, Trading Policies: Trading
Costs of Value-adding, the Australian newspaper, 16 June 1993, p. 29.
[195] Evidence, Australian Dairy Industry
Council, p. 107.
[196] Evidence, Australian Dairy Industry
Council, p. 107. See chart tilted Consumer Pack Exports to Selected
Countries for an indication of the dramatic increase in the export of this
product that has taken place since 1992, Evidence, Australian Dairy
Industry Council, p. 107.
[197] Evidence, Australian Dairy Industry
Council, p. 128.
[198] Evidence, Murray Goulburn Cooperative
Company Limited, p. 248.
[199] Evidence, Murray Goulburn Cooperative
Company Limited, p. 248.
[200] Evidence, Murray Goulburn Cooperative
Company Limited, p. 245
[201] Evidence, Australian Dairy Industry
Council, p. 107.
[202] Evidence, Australian Dairy Industry
Council, p. 114.
[203] Evidence, Australian Dairy Industry
Council, p. 114.
[204] Evidence, UMT, p. 853.
[205] Evidence, Australian Dairy Industry
Council, p. 122.
[206] Nigel Austin, The Universal Farm,
Bulletin Magazine Vol. 112., 27 March 1990, p. 119.
[207] Florence Chong, Trading Policies: Trading
Costs of Value-adding, the Australian newspaper, 16 June 1993, p. 29; see
also Evidence, Australian Dairy Industry Council, p. 131
[208] Evidence, Murray Goulburn Cooperative
Company Limited, p. 251.
[209] Evidence, Murray Goulburn Cooperative
Company Limited, p. 252.
[210] J. Bills and others, Outlook for the
Australian Dairy Industry, Outlook 94, Vol. 3, Agriculture: collection of
papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, pp. 237-238.
[211] See T. Gleeson and others, Outlook for
the Dairy Industry, Outlook 96, Vol. 2, Agriculture: collection of papers
delivered at the Outlook 96 Conference held in Canberra 6-8 February 1996,
organised by ABARE, p. 262,