Senate Foreign Affairs, Defence and Trade Legislation Committee [Part 2], , 1:52:20 to 1:57:11
Senator Ghosh explores the impact of the FTA on Western Australian exports, including wine, wheat, barley, and livestock.
Topics: EU free trade agreement, Exports, Agricultural productivity
Speakers: Senator Varun Ghosh, Cathy Raper, George Mina, Unknown Speaker
>> Thank you very much, Chair. Um my questions relate to the impact of the free trade agreement on uh Western Australian trade. I appreciate we don't always talk about it in terms of state WA is an externally facing economy. uh and the current environment is therefore particularly volatile for the Western Australian economy. Um and trade's a pretty essential enabler for our success and continued prosperity. Now, as a state, we exported something like $237 billion worth of goods globally last year, but about 4 billion or as I do it on the back of an envelope about 1.6 or 1.7% only to the EU. And so I sort of see this market given its size as an opportunity area for Western Australia. I really sort of want to explore what this agreement means for certain WA industries. And I want to start with with agriculture. Uh Western Australia has some of the best wine regions in the country. uh though just at the minute uh Western Australian wine makers are struggling a little bit and I just wanted to know what's going to be the effect of the EU free trade agreement on WA wine exports into Europe.
>> Um thank you Senator. Um so currently uh the European Union charges Australian wine a tariff of $56 per 100 lers of wine. Um on entry into force of this agreement that tariff will be
And so in just in lay terms, the practical effect of that is it makes Western Australian wine more price competitive in the EU.
>> Absolutely. Um and compared to our competitors as well. Remember, of course, New Zealand already has an FTA with the EU, so they have that um tariff advantage. We don't. And so do other competitors. Mercur includes wine producing countries as well, even >> Okay. We're behind all of those because we're paying the tariff and they are
>> Obviously export a tremendous amount of wheat um and related products from Western Australia. What's the impact on wheat exports to the EU in terms of tariffs out of this EU free trade agreement?
>> So currently Australian wheat and mezlin to the European Union is paying up to $166 per ton under this FTA that will be eliminated over five years. Um and also um tu uh tariffs on Durham wheat of up to $259 um dollars a ton um will also be
>> And are you able to do effectively that comparison with our competitor nations that is to say the countries that otherwise export wheat to the the EU nations um in competition with Western Australian wheat. Well, Australian wheat but Western Australian wheat for my
particular interest. Uh yes, again competitors who are wheat producing, wheat exporting countries who have FTAs with the EU um will have a tariff advantage, a significant tar advantage on Australian um wheat uh exporters at the moment, >> which will be eliminated under this FTA.
>> And is that the same for barley?
>> Uh yes. Um barley um we are currently paying $163 a ton. That will be eliminated within 5 years after entry into force of this
How about um in relation to obviously there's a Western Australian cattle industry and there's a Western Australian sheep industry. Can you talk to me about those exports to the EU and the impact of this free trade agreement?
>> Um yes. Um as we've discussed uh um a short time ago, um currently our our access to the European Union for both beef and sheep meat is extremely limited. um is 4,400 tons currently for beef. At full implementation, that will increase to 35,000 uh tons with commercially favorable conditions um attached. Um our sheet meat access will increase to 25,000 tons. And
>> if I can just add on that um to Mr. Ra's evidence, uh we did achieve a a a five-fold increase on on sheep meat. Senator, uh neither the Merkasaur countries uh nor Mexico achieved any increase in their deals with the European Union on on sheep meat. Of course, New Zealand did achieve a very big increase, but we judge that that will not have a meaningful impact on their uh export performance given that they've substantially underutilized their existing quotas. So our our uh uh deal on beef not only a 500% increase but a but a uh it stacks up very well in