Free Trade fears for canola growers

FREE Trade Negotiations between the European Union and Australia will formally launch in June after recently being given the green light by the European Union.

A POTENTIAL free trade agreement between the European Union and Australia has elicited mixed responses from peak grain bodies in Australia, with some worried strict trade conditions could impact upon grain producers.

Negotiations between the EU and Australia will formally begin in June after recently being given the green light.

While the news of a potential trade agreement has been welcomed by some peak grain bodies, some have reservations over potential strict trade conditions on Australian grain, in particular on canola. GrainGrowers trade and economics manager Luke Mathe­ws said the EU was Australia’s largest canola export market.

“Australia has exported on average 1.6 million tonnes of canola to Europe in recent years, worth more than $900 million per annum.

“In 2016 Europe accounted for 87 per cent of total Australian canola exports,” Mr Mathews said.

“Maintaining and expanding this trade with Europe is of critical importance to Australian farmers.”

Andrew Weidemann from Grain Producers Australia said a “massive amount of red tape” could prove to be a logistical nightmare for local canola farmers.

“It’s all well and good to have these free trade agreements, but there are technical barriers to trade and in the EU they’re quite keen on reducing chemicals,” Mr Weidemann said.

He said the EU might try to impose conditions on grains being imported, which could make it difficult for Australian canola to make its way into the European market.

“An open market could be at the cost of being too hard on producers,” he said.

Mr Weidemann said canola could potentially be the most in-demand Australian grain for European export.

“Realistically the canola market is the only serious market from Australia to go into the EU. Whether they are able to source it from other countries, that’s something the EU will have to consider,” he said.

“From our perspective, the bottom line is we’d like to provide it, but at a cost to who?”

The EU may look to Canada for canola, according to Mr Weidemann.

“But nearly 100 per cent of their canola is GM, and the EU want non-GM grains,” he said.

Mr Mathews said a trade agreement would need to reinforce support for an effective rules-based trading system, improving market access and facilitating efficient trade.

“It is crucial that all non-tariff measures that are put in place to protect ecosystems and plant and animal health are based on sound science and existing international standards,” he said.

According to the Department of Foreign Affairs and Trade, the EU is Australia’s second largest trading partner, third largest export destination, and second largest services export market.