Alan Jones: So just tell us the (trade) figures that you were talking about yesterday.
Andrew Robb: Well the fact is, because of this massive growth in the middle class, not just in China – we’re seeing it across Asia – we are in the right place in the world for the first time ever in that sense, and they are wanting protein; they want more and more protein and we’ve got the high quality. If we just pitch up to the top end of these markets; as much as we can produce, it will look to us like a mass market but it will actually be a niche market in some of these areas.
The opportunity is enormous. These three Free Trade Agreements have seen meat prices rise by nearly 100 per cent in the last 12 months. In China if we get the deal through at the end of the year, 25 per cent comes off beef and sheep meat, the 10 per cent tariff that is on the slaughter cattle; we’ve got the health protocol that has come through with the Free Trade Agreement which for the first time has allowed us to send the slaughter cattle, and as you say that could be an extra million head of cattle going into China.
That will put enormous competition into the market; another buyer on the rail at the sale yards, and Indonesia who have been chopping and changing their quantities from 200,000 a quarter down to 50,000…
Alan Jones: Well you can’t blame them after the way they were treated by Julia Gillard.
Andrew Robb: They were treated appallingly. We (Australia) withdrew or the Labor Government withdrew via an email overnight, 30 per cent of all of the protein going into Indonesia without any reason.
Alan Jones: So they would say you were an unreliable customer.
Andrew Robb: Exactly. The first rule of commerce is you look after your customer. In Indonesia we didn’t. But now, I spoke two nights ago with the new Trade Minister and he said to me he is going to increase the final quarter quota by 200-300,000 head of slaughter cattle and we will be back to our record levels into Indonesia, but I think the fact that China is emerging now as a market…
Alan Jones: Your point about the middle class is so true. There is a massive middle class emerging in Asia and they want quality, clean food.
Andrew Robb: They are obsessed with the quality, because in China 60 per cent of the water is polluted and people don’t trust the quality of the food so they are looking for Australia’s produce.
Alan Jones: Mind you Andrew, they tin some of it that is grown in that polluted water and it finishes up on our supermarket shelves but that is another story.
Andrew Robb: We’ve got the packaging rules and things which we can bring in to try and stem that.
Alan Jones: So what kind of reception did you get at Yass?
Andrew Robb: We got a wonderful reception but also to see what those people were doing; they have been selling breeder cattle to China and to Japan and other places; they are building a new set of world class sale yards, private sale yards.
Alan Jones: I was in North Queensland last weekend and this was the subject that they were talking about, this live export stuff, and of course drought really is the thing that might limit our capacity to take advantage of these opportunities.
Andrew Robb: Well it will but you see in many parts of Northern Australia, we’ve got millions of hectares of arable soil, but if you add water to it you get the high production.
Alan Jones: And that is why we’ve got to harvest the water, build a few dams. How many?
Andrew Robb: 60 per cent of our water in Australia falls in the north. We currently capture two per cent of that water. If we captured five or six per cent we could irrigate millions of hectares.
Alan Jones: Well next time we talk you can tell me how many dams you are going to build.
Andrew Robb: Okay.
Alan Jones: Good story. Well done.
Andrew Robb: Thanks Alan.
Alan Jones: That’s a good story and it puts a smile on a farmer’s face.
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