Domestic and Export Market Access and Trade Viability Issues – A Strategy to Address
Despite a long and somewhat obvious set of impediments, Australia retains a foundation in vegetable exporting that can be used to deliver additional export success. Comparative advantages include commercial and personal relationships in Asia; world class food safety systems; mechanisation of production in some crops; relative proximity to Asia and the Middle East; technological developments that improve fresh vegetable shelf life; and innovations in domestic market value-adding and category management that have potential in overseas markets. The research has shown that a subset of levied Australian vegetables has potential for additional sales in export markets. Products with additional export potential include beans; broccoli; capsicum; carrots; celery; leeks; lettuce (baby leaf salad and head) and sweet corn. Australia is not competitive on price in export markets selling traditional undifferentiated commodity lines. Australia’s successful carrot export sector has demonstrated how a sector can differentiate itself on the basis of food safety, quality and reliability. Additional sales in both domestic and export markets will require a ‘package’ that includes product development; targeting market segments; building relationships; promotion and long term commitment. Markets with additional sales potential were selected following application of appropriate criteria including current and future market access; trade relationships with Australia; demographics and capacity to pay; vegetable consumption and production; relative size of market segments; supply windows; freight and logistics. Preferred destinations and specific market segments were selected in East Asia, the Middle East and New Zealand. China may not be as prospective for sales of fresh Australian vegetables as believed by some industry stakeholders. Recommendations to assist the Australian vegetable industry to open new markets and make existing markets more viable include domestic and export market access, as well as specific actions for priority levied crops, industry development, market development, marketing and a program of policy initiatives. Twenty seven actions are identified, prioritised and presented in a format that facilitates their funding under the Vegetable Industry’s Strategic Investment Plan. Specific actions within the trade improvement plan target improved domestic market access. The most important action is research to support improved interstate access for Queensland vegetables through continued investment in fruit fly research – additional data sets, appropriate lures and a trial of the domestic protocol for fruit fly irradiation. To facilitate export development the potential of an export/import agent accreditation program was explored. The goal of such a program would be to provide additional assurance of payment to vegetable growers contemplating export for the first time. The program would also be applicable to established vegetable exporters interested in expanding their business. Despite a number of prima facie benefits associated with a legislation backed accreditation scheme, it is unlikely that government, and many established businesses in the vegetable export industry, would be convinced of its overall merit. The preferred approach for vegetable growers concerned about credit risk is a combination of Credit Risk Assessment Training and the keeping of a simple information register by AUSVEG or a similar body. Finally, an export viability checklist is provided for growers contemplating expansion of their business into export markets.