JAKARTA, INDONESIA — Australia and Indonesia on March 4 signed the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA). The agreement is expected to pave the way for more feed grain export opportunities for Australian growers.
Australia’s two-way trade with Indonesia was valued at $16.8 billion in 2017-18, making Indonesia Australia’s 13th largest trading partner.
“This is a great deal for Australia: it means that 99% of Australian goods (by value) will enter Indonesia duty-free or under significantly improved preferential arrangements by 2020,” said Scott Morrison, prime minister of Australia, and Simon Birmingham, Australia’s minister for trade, tourism and investment. “A stronger economic partnership with Indonesia will provide a major boost for Australian farmers. Under the agreement, producers of grains, live cattle and meat, dairy and horticulture, and many other products will benefit from lower tariffs and improved access to Indonesian markets.
“For example, Australian grain growers will be able to export feed grains into Indonesia tariff free, building on our substantial milling wheat exports.”
Morrison and Birmingham said reducing trade barriers will allow both Australia and Indonesia to grow their economies.
GrainGrowers, a national representative body for Australian grain growers, applauded the signing of the agreement.
“We are excited about the benefits this trade agreement will bring for Australian grain farmers,” said Luke Mathews, general manager of policy and research for GrainGrowers. “Previously, Australia’s existing trade with Indonesia has been almost exclusively wheat for milling purposes. Under this trade agreement, Australian farmers will now be able to access the rapidly growing Indonesian feed grain market, providing new opportunities for Australian feed wheat, barley and sorghum. In addition, we have had both governments commit to the landmark grains specific cooperation initiative, the Australia-Indonesia Grains Partnership.”
Brett Hosking, a grower from Victoria and chairman of GrainGrowers, said the agreement includes a quota of 500,000 tonnes of Australian feed grain to Indonesia per year.
“That figure will increase year on year,” he said. “As a grower myself, knowing that Australia is the only country with formal access to Indonesia’s feed grain market gives me confidence when thinking about our position against other grain export countries.”
Full text of the agreement is available here.