Head of Australian agricultural firm predicts sales surge as UK farmers warn they will struggle to compete
Fri 21 May 2021 03.02 AEST
Australia’s biggest cattle farmer has predicted that the nation’s beef exports to the UK could rise as much as tenfold if the two countries strike a free-trade deal.
Boris Johnson is determined to push through a free-trade deal with Australia, despite warnings from the National Farmers’ Union over the “irreversible damage” such a deal would do to UK agriculture. It was discussed by ministers at a cabinet meeting on Thursday.
Hugh Killen, the chief executive of the Australian Agricultural Company(AACo), said on a financial results call this week: “We are looking forward to the conclusion of free-trade negotiations with the UK.”
He told the Financial Times that a free-trade deal that removes tariffs and quotas could lead to Australian beef exports doubling or tripling, or even a tenfold increase, because exports are small at the moment. AACo manages a cattle herd of 400,000, on 6.4m hectares of farmland – equal to 1% of Australia’s land mass. It specialises in grain fed and Wagyu beef.
The UK imported 560 tonnes of beef and veal worth £4.1m from Australia last year, as well as 8,500 tones of lamb and mutton worth £45.8m, according to HMRC figures. In 2019, beef and veal imports totalled 1,766 tonnes worth £12.9m.
The NFU president, Minette Batters, has warned that a zero-tariff, zero-quota agreement could throw British family farms “under the bus”. She said the UK government “must recognise that opening up zero-tariff trade on all imports of products such as beef and lamb means British farming, working to its current high standards, will struggle to compete”.
Scott Walker, the chief executive of NFU Scotland, expressed concern about the impact on Scottish beef producers who farm small herds. “Our market is finely balanced and extra imports, produced to lower standards than required here, could drop our prices considerably,” he said.
“Granting free access to our markets to Australia would set a dangerous precedent and would see New Zealand, South America and certain African nations clamouring for similar arrangements. That is why this potential deal is so dangerous for Scottish farming.”
The Welsh first minister, Mark Drakeford, told BBC Radio 4’s Today programme he wanted a “level playing field”. “How can our hill farmers compete with Australian climate?” he asked. “How can our hill farmers compete with the space that is available for the huge farms that they have in Australia?”
Amid reports of a cabinet split, Liz Truss, the trade secretary, defended plansfor a post-Brexit free-trade deal with Australia on Wednesday. She said it would benefit farmers across the UK by opening up a key market while also paving the way for growth in exports across Asia. She is racing to conclude negotiations and come up with an agreement in principle before the G7 summit in Cornwall in early June.