CANBERRA: Australian exports are predicted to rise between 10 and 35% over the next five years, according to research published by IBISWorld this week. Much of this growth is expected to come from new free-trade agreements with South Korea, Japan and China as they come into effect over the coming years. The IBISWorld reports calculates Australia’s top 20 export industries to be worth $260 billion to the Australian economy, or 15.7% of GDP. Food is at the forefront of Australia’s export boom, making up seven of the top 10 fastest growing industries.
Rice growing is tipped to be the fastest growing food-export industry, expecting to increase by $380 million dollars, or nearly 30% by 2021. Nearly 97% of the industry is based in New South Wales and has been affected by drought and flooding over the past five years.
However, Alen Alday, from IBISWorld, says the next five years are predicted to be more stable for the industry due to the development of genetically modified crops. Seafood processing is forecast be worth over a billion dollars in 2021, up 27.3% from today’s levels. “International trade has become increasingly important for the Seafood Processing industry over the past five years,” says Jem Anning, senior analyst at IBISWorld. Imports accounted for the majority of domestic demand and exports made up an increasingly large proportion of total revenue over the past five years,” Anning says.
Vietnam is the eventual home of 62% of seafood experts, as Australian fish is seen as “higher quality,” meaning “many Asian markets are prepared to pay a premium for produce, increasing revenue over the period.” Cider has had the biggest improvement over the past five years, but has come from a relatively low base. The cattle industry is expected to remain Australia’s biggest food export, climbing just under 20% to be worth $1.6 billion, despite “challenging conditions” plaguing the industry over the last few years.
Government policy, varying weather patterns and fluctuating turnoff rates have all had an impact on the industry, but a strong demand from the Middle East and South-East Asia is expected to help Australia’s beef stocks bring more in. The end of the el nino over the past week has brought relief to cattle farmers, as the industry is more reliant than others on good rains. By 2021, IBISWorld expects the beef industry to be turning over $15 billion dollars annually. Fruit exports, in particular grapes, are another area which is expected to do well over the next five years.
“The majority of fresh grapes grown in Australia are exported, mainly to markets in Asia. Local grape producers have experienced a notable upturn in exports due to trade agreements signed in 2014 and 2015,” Anning says. The industry is expected to grow 26% to be worth $285 million in 5 years. “The free trade agreement with South Korea lifted tariffs on imported Australian fresh grapes and the Japanese and Chinese agreements will gradually remove tariffs over the next seven and four years, respectively,” she adds.
