The reduction in tariffs has led to export increases of close to 5000 per cent for some commodities hitting the Korean market as part of the Korea–Australia Free Trade Agreement (KAFTA).
Today, January 1, the third round of tariff cuts begins and is set to continue delivering export returns to Australian farmers.
Minister for Agriculture and Water Resources, Barnaby Joyce, said the next round of tariff cuts would deliver increased returns for Australian agricultural products destined for Korea.
“The third round of tariff cuts will be particularly beneficial to a number of Australian agricultural exports to Korea and will allow producers and exporters to continue to build their commercial relationships in Korea,” Mr Joyce said.
“Fresh, chilled and frozen beef, one of our major exports to Korea worth A$1.07 billion in 2014-15, will have the current tariff of 34.6 per cent further reduced to 32 per cent. This is down from the original pre-KAFTA level of 40 per cent.
“Nuts are becoming an important export commodity to Korea, worth over $10 million in 2014-15. Almonds in shell will have the current tariff of 6.4 per cent reduced to 5.6 per cent, and macadamia nuts will have the current tariff of 18 per cent reduced to 12 per cent.
“Table grapes will have the current tariff (for our export season) of 18 per cent reduced to 12 per cent.
“Exports of Brussels sprouts will also become more commercially attractive with tariffs being lowered to 15.4 per cent from the current 19.2 per cent. This is down from 27 per cent pre-KAFTA.”
Since entering into force just over 12 months ago, Mr Joyce said KAFTA had provided welcome increases in export revenue for many farmers.
Mr Joyce said this result was providing options for producers to develop new supply chains and increase farmgate returns.
“There’s no doubt Australia’s clean, safe produce is in demand in Korea, with exports of agrifood products flourishing since the introduction of KAFTA—and I witnessed this first-hand on my recent visit to Korea,” he said.
“Exports of a whole raft of products have risen strongly — for example, Brussels sprouts and fresh cherries which have both increased by nearly 5000 per cent, albeit from a low base. The elimination of the 24 per cent tariff on cherries has resulted in exports worth $3.5 million in 2014-15.
“Fresh navel oranges have also seen strong growth, with exports increasing almost 700 per cent to $486,000 in 2014-15, as well as almonds which are up over 400 per cent to $0.5 million.
“Meat exports have always been one of our biggest exports to Korea, and as well as our top export of chilled and frozen beef, shipments of lamb have increased by approximately 35 per cent.”
In 2015 the federal government signed a number of free trade agreements across Asia and the Pacific, and Mr Joyce said they were now working on similar agreements with India and the EU.
