Tariff reduction a shot in the arm for cane farmers
BUNDABERG sugarcane farmers say reducing tariffs on exports to Indonesia by 3% will be beneficial for the entire industry and can restore Indonesia as a major sugar export destination.
Australia's sugar industry has been at a disadvantage in Indonesia since 2015 when Thailand saw its import tariff drop down to 5%.
Australian Trade Minister Steven Ciobo and his Indonesian counterpart Enggartiaso Lukita met in Jakarta on Wednesday where Indonesia agreed to lower the tariff on Australia's sugar exports to the same concessional rate enjoyed by Thailand.
Bundaberg Canegrowers chairman Allan Dingle said the tariff relief would help generate better returns for all sugar farmers.
"That's why we have been striving to get these free trade agreements in place,” Mr Dingle said.
"We are one of the few countries in the world that actually doesn't get support to produce sugar.
"Most other countries are subsidised.”
Mr Dingle said prior to 2015, Australia was exporting about 100 million tonnes of sugar a year to Indonesia.
"Indonesia put a tariff in place and that went to 200,000 tonnes a year, we lost 80% of a market,” he said.
"Hopefully that Indonesian market will grow back.”
Hinkler MP Keith Pitt welcomed the news.
"This agreement, once implemented, will allow Australian sugar - like that grown here in Hinkler - to compete on a level playing field with other suppliers,” Mr Pitt said.
"Indonesia is an important market for Australian sugar and this agreement will mean a more stable income for growers.”
Deputy Prime Minister Barnaby Joyce said the reduction in tariffs would increase the competitiveness of Australian sugar exports into the Indonesian market.
"It will ensure better returns for our exporters through improved market access, while also ensuring Indonesia can continue to have access to the world-class produce we are known for,” he said.
The estimated value of Australian sugar exports to the world was $2.2 billion in 2016-17.
Australia's total agricultural, food, fishery and forestry exports to Indonesia was worth $3.2 billion last year, and imports from Indonesia were worth $843 million.