Why Free Trade Agreements are good for Australian Exporters
Six years after Australia gained market access for table grapes to Japan and South Korea in 2014 (after many years of negotiation by the Australian Government, supported by industry and state government partners) – and amidst possibly the most difficult economic conditions in decades – Australian grapes growers and exporters are enjoying bumper sales to both Japan and South Korea.
Australia exported 16 containers of table grapes to Japan and one trial container to South Korea. By the end of 2019, sales to Japan had grown to $50.4 million and to South Korea $14.8 million.
The growth in sales to both markets is testament to the efforts of a number of organisations and initiatives undertaken over the past five years following a promotional launch in early 2014 supported by the Victorian Government, the Australian Table Grape Association (ATGA), Horticulture Innovation Australia Ltd (HIAL) and Austrade.
Educational materials were created specifically for importers and retailers, which discussed the key quality attributes of Australian table grapes. Additional Point of Sale Materials were developed to support in-store retail promotions conducted in Japan and South Korea.
Victoria also welcomed a delegation of Japanese importers, retailers and media in early 2015 to visit table grape growers in Sunraysia and meet with exporters in Melbourne. The visit program further enhanced the standing of Victorian and
Australian table grapes as a premium quality product suited to the discerning Japanese market.
While exports to Japan grew quite quickly, sales to South Korea have increased at a more gradual pace since the implementation of the Korea–Australia Free Trade Agreement (KAFTA) in December 2014, which phased out tariffs from 45 per cent to zero, effective January 2020.
However, with the benefit of zero tariffs, table grape exports to South Korea for the month of April 2020 experienced a massive increase of 286 per cent compared to April 2019.
The Victorian Government continues to support the industry and most recently facilitated a visit to Victoria in early February by South Korean horticulture buyers, food service and wholesale companies to meet with growers in the Sunraysia and Loddon Mallee regions. In addition, the Victorian Government with partners such as the ATGA have maintained engagement with wholesalers and retailers in South Korea to promote varieties attractive visually and to the palate of the South Korean consumer.
eCommerce and TV shopping network marketing of Australian table grapes in South Korea during March and April this year also contributed to the turbocharge in April sales.
The table grape success in Japan and South Korea has reinforced Victoria’s reputation as a source of safe, high quality produce. Hopes are high for another bumper season in 2020 –21 and for the introduction to South Korea of Victorian cherries.