Sugar can sweeten Australia's trade with UK and Europe

Queensland’s sugarcane farmers are being strongly represented in a National Farmers’ Federation ‘Team Australian Agriculture’ delegation in Europe and the United Kingdom this week.

“The planned withdrawal of Britain from the European Union offers the Australian sugar industry a fantastic opportunity,” CANEGROWERS CEO Dan Galligan said. “We want to reopen an historic sugar export market which was lost when the UK joined the European Common Market and we also want to increase opportunities for EU refiners to source Australian sugar.

“This NFF-led reconnaissance mission is ahead of formal Australian Government talks on our trading relationship with the region post-Brexit, including a future Free Trade Agreement with the EU. It will involve industry-to-industry talks, finding out exactly what food processors and manufacturers want from Australia.”

CANEGROWERS Head of Economics Warren Males will travel with representatives from the sheep meat, dairy, grains and horticulture industries.

“Prior to joining the EU, the United Kingdom was a major buyer of Australian sugar with British refineries taking around 30% of our raw sugar exports,” Mr Galligan said. “But that trading door was slammed closed in 1973.

“Australia’s access to the whole EU is now restricted to a small quota of just 9,925 tonnes and EU refiners are forced to source their sugar elsewhere.

“While Australia has strong markets in the Asia-Pacific, if the economics stack up, there is no reason why European and British sugar refiners shouldn’t be able to buy our high-quality product.

“We have no interest in jeopardising the future of EU or UK sugar beet growers.  There is a strong demand for raw cane sugar in Europe and in the UK alone there is an 800,000-tonne shortfall between domestic sugar production and consumption. We want British refiners to be able to source Australian raw sugar to help fill that gap.”

The European Union has recently signed trade agreements which have increased market access to sugar from Panama, Colombia, Peru, Ecuador and South Africa at zero duty but Australian sugar remains capped at a non-commercial amount subject to a €98/t CXL duty. Out-of-quota sugar is subject to a prohibitive €339 per tonne duty - so it’s no wonder no further trade occurs!

“The NFF delegation provides an opportunity for CANEGROWERS to strengthen relationships in Europe and the UK and discuss the opportunities that lie ahead for European and British importers,” Mr Galligan said.

“The big benefit for the Australian sugar industry is stronger demand for our raw sugar.”

The NFF-led delegation is an initiative of and funded by the Australian Government Department of Agriculture and Water Resources under the Agricultural Trade and Market Access Cooperation programme.