THE introduction of the China-Australia Free Trade Agreement (ChAFTA) was the best move for the sheep meat industry in 20 years, according to Fletcher International Exports managing director Roger Fletcher.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
By eliminating tariffs on exports of dairy products, wine, fruit and vegetables, meat and resources, a process which Mr Fletcher said would take about eight years, the market would then be opened up to a whole new pace of trading.
As managing director for one of the largest meat exporters in the country, Mr Fletcher said he had spent a fair amount of time fighting for the ChAFTA to finally be implemented.
Fletcher International Exports has a strong affiliation with sheep meat trading in China, which they had been doing long before beef trading, he said.
"In 2013 we traded 97,000 tonnes of sheep meat to China and 90 per cent of that was sheep skin."
He said the ChAFTA was vital for farmers in the sheep meat industry.
"As much as the traders will enjoy it, all the money feeds back to the farmer."
Mr Fletcher said the removal of the current 12 to 23 per cent tariffs on sheep meat would boost export returns.
In eight years' time when the agreement was in full swing, Mr Fletcher said he expected to see a return of about $150 million a year.
He said traders would begin see a 2 per cent drop in the tariffs in 2016.
In the long term, Mr Fletcher said the ChAFTA would build more confidence in the sheep industry and a better prospectus of bargaining around the world
"It's still got to get through the Senate, but I have no doubt it will drive traders to be more competitive," he said.
A huge jump for the trading industry, Mr Fletcher said Australia now had a chance "to catch up to the Kiwis".
New Zealand, he said, were at a real advantage having had a similar agreement in place for years.
"They've had a big 15 per cent jump on us, but this will finally put us on the same pegging level," he said.
