NATIONAL grain farmers’ representative body, GrainGrowers, has welcomed news the federal Government has launched free trade agreement (FTA) negotiations with the Pacific Alliance – a major trading bloc made up of Mexico, Colombia, Chile and Peru.

GrainGrowers trade and economics manager, Luke Mathews, said while the region currently represented only a small market for Australian grains, any progress in opening doors towards increased liberalisation of trade in a market where grain consumption and imports were growing annually was welcomed by the industry.

“Pacific Alliance grain consumption exceeds 84 million tonnes a year and is growing at nearly 4.5 per cent per annum, driven by strong population growth (currently 224 million and rising) and changing diets,” Mr Mathews said.

“The four countries currently import more than 41 million tonnes of grain with a growth rate forecast at 7.4pc per annum.

“Although grain trade in the region is currently dominated by corn from the United States, Australia already has a modest presence in the region, mostly driven by oat exports to Mexico.

“But even our modest presence in this large market is worth on average AUD$23.5 million a year.

Mr Mathews said the benefits to the Australian grains industry of strengthened business relationships and industry collaboration wrought by a Free Trade Agreement could only increase prospects for increased exports.

And further reductions in both bound and applied tariff rates resulting from a Pacific Alliance FTA would further benefit efforts to supply these markets.

“The current and future success of the Australian grain industry depends on strong open and fair market access for our exports and GrainGrowers will always welcome efforts to achieve this,” he said.

Federal Minister for Trade, Tourism and Investment, Steven Ciobo, launched negotiations of the FTA at the 12th Presidential Summit of the Pacific Alliance in Cali, Colombia.

Source: GrainGrowers