Raising import standards in the food bowl of Asia

CONTAMINATED Chinese berries slip through the security net.

AGRICULTURE Minister Barnaby Joyce took the obvious path by urging Australians to buy locally grown produce after it was discovered that berries imported from China were contaminated with the Hepatitis A pathogen. The nation aspires to be the premium food producer in the region, colloquially expressed as “the food bowl of Asia”. We have a natural advantage in this respect – arable land, water, sunshine – and our farmers are world-leading producers. While distant from many of the largest markets in the world, Australia has earned a reputation as a grower of clean, high-quality produce. One reason for this enviable status is our commitment to hygiene and quality. It’s why local blueberries are often $6 a punnet, making the frozen stuff attractive on price. Yet to protect consumers, we should insist that imported foods face the same rigours.

While we want to feed the emerging middle classes of Asia, we also import a growing proportion of food. That is the way of globalisation. Shoppers demand products all-year round. Last financial year we brought in $11.6 billion in fruit, vegetables, seafood, dairy, meat and live animals. The value of imported fruit has doubled in the past decade and last year was worth $1.1bn. The removal of import barriers through the World Trade Organisation process, which has especially helped agricultural nations, as well as transport and refrigeration innovations, have opened up the food market. Coupled with the buying power of Australia’s supermarket duopoly, competitively priced produce from all over the world is available to almost every Australian. On balance, and we are a trading nation, this is a good thing.

Yet the current crisis has uncovered some discomforting truths. More than a dozen people have been infected with the Hepatitis A virus after reportedly consuming frozen berries from China that were contaminated with faecal matter. At present, imported berry products have a low-risk designation for health screening. Australian and New Zealand food standards authorities have assigned these products “surveillance” status, meaning only 5 per cent of shipments are inspected; there is no routine testing for pathogens harmful to humans, only for chemical residues, such as cadmium. Mr Joyce has opened the door for a review of the testing regime. There is also a push from crossbench senators for an inquiry into the food security system. South Australian independent Senator Nick Xenophon wants a permit regime to allow exports into Australia.

The Coalition is pursuing a broad deregulation agenda, to ease the red-tape burden on businesses. Naturally, as Tony Abbott said yesterday, the government is averse to imposing more regulations so that the prices soar. Yet tough questions must be asked of the importing entities. As the Prime Minister said, “the bottom line is that companies should not poison their customers.” It’s not the first time that China has had issues with basic food hygiene, but the leadership in Beijing has vowed to raise the testing standard.

As products are recalled and consumers radically change behaviours, it is inevitable that we risk protectionist tendencies and jingoism. But, as growers argue, there needs to be a level playing field. Australian growers need to satisfy a high level of health compliance, and rightly so, to get access to retail outlets. This can be costly. The onus should be on importers to satisfy the same quality assurance criteria.

Our exporters are subject to stringent controls in other countries. Fruit exporters must often – at their own cost – allow inspectors from China into their operations. Here, importers must accept the food security burden, either at source or at the delivery docks. Mr Joyce has signalled better labelling would be a first step. Again, this should not lead to ridiculous, costly overreach by authorities. Australians rightly expect truth, clarity and common sense when it comes to stating the origin of products; they want to know where the fish was caught, for instance, not where it was covered in batter. Consumers expect clear labelling, not weasel words, in making their food choices. We have shown they are prepared to pay a premium, not necessarily an exorbitant one, for locally produced food. We should not make it easy for companies to hoodwink us into false choices.

Australia is moving into a number of free trade agreements that are by nature double-edged. We have to open our markets to partners if we are to get full access to theirs; FTAs, as well as normal WTO rules, limit our ability to enforce tougher food security standards. Maintaining high standards at home, as we must to enhance our reputation as a first-class producer, will invariably impose costs, thus making our growers less competitive. An early lesson from this episode is we must be more proactive and less reactive on food security. Another is that the best way to help our growers reach their potential is to reduce the cost of doing business here. That means pursuing broad economic reform, including tax and workplace issues, which ultimately generates more investment, jobs and export-based growth.