INDONESIA has relaxed its trade restrictions on secondary beef cuts, re-opening a market that was worth $42 million to Australian exporters two years ago.
The breaking down of technical barriers in a market considered extremely important to Australian beef, given Indonesia’s geographical location and population size, has been high on the agenda of industry leaders for some time.
While it has been a gradual loosening, this latest development augurs well for negotiations on the Indonesia Australia Comprehensive Economic Partnership Agreement (IA-CEPA) which recommenced in May, according to the Australian Meat Industry Council.
National director processing Steve Martyn said Indonesia had struggled to get right the balance between encouraging domestic beef production and importing to ensure its people had access to high quality, reasonably-priced product.
“Yes, Indonesia has focussed too heavily on self sufficiency in recent times, given the growth of demand for animal protein among its population,” he said.
“We have invested a lot of time and money into building the relationship with Indonesia, both politically and trade-wise, and like to think this gradual relaxation of barriers to trade is a reflection of that.”
The revised regulations came into effect mid-August and provide for an expanded list of eligible beef cuts to be exported to Indonesia, including edible offal such as liver, heart, feet and lungs.
Asked if the development was particularly optune given current demand decline in key Australian export markets, courtesy of Australia’s cattle shortage, Mr Martyn said Indonesia would always be a very important market to Australia’s beef and cattle industries, irrespective of market conditions at any given time.
Indonesian importers can now also apply to import beef at any time of the year, with import permits valid for six months.
Acting Prime Minister Barnaby Joyce said that provided more certainty for commercial partnerships between importers and exporters, reducing costs in the supply chain and allowing for better planning to ensure demand could be reliably met.
Before restrictions were put in place in January 2105, Australia shipped almost 20,000 tonnes of secondary beef cuts to Indonesia.
Australia’s total boxed beef trade with Indonesia in 2014 was worth $327m.
Mr Joyce said over the next few decades significant economic and population growth was expected to changed Indonesia’s demand for food.
“Diets will become more diverse and demand for quality protein will increase,” he said.
“The total population of Indonesia is forecast to increase by almost 25 per cent or 62 million people to 322 million by 2050.