Remaining tariffs on frozen beef imports will be cut from 5% to zero either immediately or five years after the agreement enters into force.
Tariffs of 5% on frozen offal will be eliminated immediately.
Meat Industry Association trade and economic manager Sirma Karapeeva said it does not appear Australia has snatched any significant, immediate advantage over NZ exporters though the Kiwis will pay a 5% tariff on bone-in frozen beef from 2020 when their Australian rivals will pay nothing.
“That is a little bit of an upside for them but looking at our trade stats we have sold mainly frozen boneless,” Karapeeva said.
Meanwhile, scrapping the tariff on frozen offal means Australia has now caught up with the deal NZ got in the previous deal.
Where there is potentially more significant downside is in the streamlining of import procedures for live cattle.
Australian breeders can now supply 575,000 head of live male cattle tariff-free annually, rising by 4% a year to 700,000 after five years, with unlimited numbers of females allowed.
Annual import permits will be granted automatically with no seasonal restrictions.
While NZ does not compete with Australia in that market any increase in live cattle imports could eventually feed through to increased local beef production and decreasing demand for frozen imports.
“The live cattle aspect is the bit that might start to kick in at some point but that is very hard to predict,” Karapeeva said.
Australia’s live cattle trade with Indonesia has seldom been plain sailing and it is not certain it will become so with the stroke of a pen.
In the meantime this year’s 10-year review of the Asean deal could provide relief for NZ exporters should it be needed.
“So, hopefully, if NZ has slipped back behind the bilateral with Australia that might be an opportunity to tidy things up,” Karapeeva said.
If the Australian deal puts NZ exporters on the back foot it will be just the latest in a series of setbacks.
Sales of NZ beef to Indonesia fell from $184m in 2010 to just $58m in 2015 after the country’s authorities threw up a series of non-tariff barriers to encourage its own farmers to produce enough to remove the need for imports.
Those measures were found to be illegal after NZ and the United States challenged them at the World Trade Organisation.
However, sales haven’t recovered as an influx of Indian buffalo meat has kept exporters focused on higher-returning markets such as China.
