ELDERS Goulburn livestock manager, Steve Ridley believes southern NSW beef producers will benefit from the Australia/Japan Free Trade Agreement (AJFTA) announced by Prime Minister, Tony Abbott last week.
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“The majority of beef produced in Southern NSW goes to our export markets already,” Mr Ridley said.
“This progressive tariff reduction should make beef more affordable to the overseas customers and increase demand for the quality Australian product.
“We are not as reliant on Japan, as an export customer, as we used to be because Australia has built a reputation for the quality and safety of its meat compared with many of its competitors,” Mr Ridley said.
“We have broadened our markets but Japan is still a very important trading partner.
“The live weight prices for cattle particularly slaughter ready animals are at near record levels at present with cows reaching $1.60 per kilogram and bullocks fetching up to $2 per kg.”
Over the next 20 years sales of Australian beef to Japan are expected to rise by $5.5 billion as a result of the AJFTA.
Over the life of this agreement this boost in sales will increase the annual gross value of Australian beef production by up to seven per cent.
“Under the AJFTA over a period of 18 years, tariffs on frozen Australian beef entering Japan will drop from 38.5pc to 19.5pc and for chilled beef drop from 38.5pc to 23.5pc over 15 years,” Chairman of the Beef Industry’s AJFTA Taskforce Lachie Hart said.
“This will create opportunities for increased Australian beef sales into Japan and improve the affordability of beef to Japanese consumers.
“Pleasingly the tariff reductions on both frozen and chilled Australian beef have been ‘front loaded’ meaning that major reductions will occur in the first few years of the agreement.
“Significantly, tariffs on Australian frozen beef will drop by eight per cent in the first year and for chilled will drop by six per cent.
“This represents a major change in the trading environment to Japan in the first year of the AJFTA,” Mr Hart said.
“The Australian beef industry stands to benefit substantially from trade agreements entered into with Korea and, now, Japan under this Government.
Almost 70pc of all Australian beef produced is exported, so positive outcomes on trade negotiations are enormously beneficial for the industry.”
“Hopefully the successful completion of an AJFTA will be the harbinger of further liberalisation of the beef market into Japan, with tariffs being eventually eliminated and other impediments on the trade removed.
“We hope that this outcome represents a first step, with the industry seeking further gains through future trade reform efforts with Japan via the Trans-Pacific Partnership and Regional Comprehensive Economic Partnership negotiations.”
By volume and value beef is Australia’s largest export to Japan that is subject to significant trade impediments.
Car price drop not expected (From page 1)
On the other side of the AJFTA negotiations Australia’s cutting the tariffs on imported Japanese manufactured vehicles is unlikely to bring a substantial reduction in price.
The change, if any, will take a long time to filter through according to local automotive retailers.
Duncan Brede, Dealer Principal of Goulburn Toyota, Nissan and Suzuki pointed out that even the Japanese brand vehicles were being manufactured in countries other than Japan.
He said that the tariff removal was logical as Australia would cease to have a car industry to protect in a few years.
“Rather than lower prices purchasers could expect to see more inclusions in the Japanese manufactured vehicles and a more even playing field,” Mr Brede said.
“Dealers don’t like dropping the price on new vehicles as it has a negative impact right through the industry and reduces the resale value on second hand vehicles too.”
Goulburn Automotive Group general manager Darren Nobes had similar thoughts.
He also said that the tariff reduction was unlikely to result in lower prices but a greater emphasis on inclusions like reversing cameras, and other equipment, providing greater value for money in the new vehicles.
“What we think of as Japanese cars are often produced off shore of Japan, Mr Nobes said.
“The Japanese have sought out countries with lower manufacturing and labour costs to produce their automobiles.
“They have done this with many of their other manufacturing industries as well.”
He did not expect the effect of the tariff reductions to be felt for some time after the legislative issues in both countries were sorted out.
Both men said that potential new vehicle buyers should not wait for the changes to take effect before embarking on a purchase.
They indicated that there were plenty of vehicles already on their lots and good deals to be had.