Australian beef producers welcome UK FTA

The Australian beef industry welcomes the Australia-UK free trade agreement (FTA), which will come into force in 2022, as it allows tariff-free entry to increasing Australian meat volumes into the UK over the next decade.

The deal will diversify Australia's export markets, creating ongoing certainty for Australian producers, according to industry group Meat and Livestock Australia (MLA).

"Under the A-UK FTA, future trade will be more streamlined, removing burdensome costs from the red meat supply chain that ultimately disadvantage British consumers and stifle opportunities for market development," said Andrew McDonald, chairman of the Australia-UK red meat market access taskforce.

Under the agreement the UK will allow up to 35,000t of tariff-free Australian beef to be imported in the first year, which will gradually ramp up to 110,000t in the 10th year, before the tariff-free quota is removed altogether. For sheep meat, a tariff-free quota of 25,000t in the first year will expand to 75,000t in the 10th year, before being eliminated.

Australian beef exporters currently pay a tariff of 12pc on product sold in the UK. The 35,000t initial quota is more than 10 times the average of around 2,500-3,000 t/yr of beef entering the UK from Australia during 2015-2019.

Total Australian red meat exports to the UK were at a record high in the July 2020-June 2021 fiscal year. Australian agriculture, forestry and fisheries exports to the UK increased by A$182mn ($129mn) from A$641mn the previous year to A$823mn in 2020-21. The 2020-21 Australian exports to the UK total included A$77mn in lamb and mutton and A$11mn in beef and veal. The UK is Australia's third-largest source of foreign direct investment, which was valued at around A$123.5bn in 2020.

The prospect of increased Australian beef sales to the UK is not just encouraging news for processors and feedlots, but also for the Australian grain industry, which provides feed wheat for feedlot operators across Australia.

The Australian agricultural industry also welcomed the extension of working holiday visas to three years for UK citizens aged 18-35 years, many of whom work on farms for part of their stay and help in peak times, such as harvests.

The deal, which was agreed in principle between the prime ministers of both countries in June, was signed by their trade ministers on 17 December.

By Brandon Gallagher