Australian bush foods heading for Britain: Removal of tariffs to boost imports

Mike Fewster’s family Jarrah honey business in Perth has big ambitions.

“Our aim is to bring our honey to Harrods,” he said.

Fewster’s Forest Fresh business is one of many in Australia hoping the UK is about to become a lucrative market again, and it is targeting the world-famous department store in London’s Knightsbridge as a potential customer.

More than 50 years after Australia was given the cold shoulder by Britain when it joined the European Economic Community, a free trade agreement between the two former allies and partners will take effect at midnight on May 31.

The deal was hailed by Boris Johnson as a “new dawn” in the relationship when it was agreed in principle almost two years ago.

Despite the hype, the economic impact will be negligible given that Australia is the UK’s 19th largest trading partner.

Treasury economists have estimated the pact will add around £2.3bn to British exports, representing less than 0.1 per cent of the economy.

But as the first free trade deal to be discussed since the 2016 Brexit vote, it represents a significant moment for the Leavers, who have promised Britain would become a global trading nation once freed from the shackles of Brussels.

In more practical terms, the removal of swinging tariffs on 99 per cent of exports should mean more Australian goods, from Wagyu beef to walnuts, lamb chops and lobster, slowly infiltrate supermarket shelves.

Similarly, more UK products such as Scotch will be exported Down Under.

Some of these Australian products, such as Jarrah honey, will be unfamiliar to most British consumers.

Derived from the Jarrah tree, a variety of eucalyptus unique to Western Australia, this expensive “superfood” has similar antimicrobial and antibacterial health properties to manuka, which is grown more widely in Australia and New Zealand.

Honey exported to the UK is subject to a 16 per cent tariff. This, combined with the high cost of shipping or flying it to the UK, has made Britain an unattractive market for Australian honey producers.

Fewster hopes this is about to change and British consumers who source their honey from abroad will start buying it from the Commonwealth rather than Europe.

“We still have the King as our head of state, so if anyone deserves a break it’s us Australians,” he said.

In addition to honey, the Australian Trade and Investment Commission (Austrade) in London believes that bushfoods could soon make their way to UK plates.

He cites the example of the lemon myrtle, a native Australian shrub that grows in the wetter coastal areas of New South Wales and southern Queensland.

The herb, which has an intense citrus flavor, has long been used in Aboriginal cooking and medicine.

Austrade has forecast an influx of products made from Australian seaweed, also prized for its health benefits, including pasta, granola, supplements and skin care products. Inevitably though, people are more concerned with Australian lamb chops than lemon myrtle.

British farmers have expressed fear that the UK will suddenly be flooded with cheap Australian meat produced on the continent’s vast cattle ranches and sheep farms. This helps explain why it took so long for Parliament to sign off on the deal, which has been criticized as being biased in favor of Australia.

Farmers have reason to be a little nervous.

Before Britain joined the EEC in January 1973, the UK was Australia’s largest market for red meat. The first shipment of frozen Australian red meat arrived in 1879, shortly after Britain stopped sending convict ships the other way.

When the trade peaked in 1959, Australia exported 153,000 metric tons of beef and 46,000 tons of lamb and mutton.

During the Covid pandemic in 2021, beef and veal exports to the UK dropped to just 803 tonnes and sheepmeat exports dropped to 9,017 tonnes.

Tariffs of up to 12 percent shut down the UK for many Australian meat producers, who have focused on more profitable markets closer to home, particularly Asia.

The trade deal has at least provided some protection for UK farmers. While the tariffs will be removed immediately for items like Australian lobster and fish, they won’t be removed for beef and lamb for ten years.

A transition period will be introduced, during which Australia will have immediate access to a duty-free quota of 35,000 tonnes of beef, rising to 110,000 after ten years.

A similar arrangement has been introduced for lamb and ram. This still means Australian farmers can dramatically increase exports to the UK without paying a penny in tariffs.

However, the reality is that they start from a very low base.

Andrew McDonald, chairman of agricultural trade body Meat and Livestock Australia, said: “Predictions of a tsunami of Australian meat hitting UK supermarket shelves are overblown.” It will be more of a slow burn.

Australia’s wine industry has also expressed concern that Prime Minister Rishi Sunak’s recent decision to increase taxes on alcohol will remove any benefits of removing import duties.

Its trade body Australia Grape and Wine recently warned that the tax increase could make Australian wine more expensive for buyers in the UK and reduce the amount stocked on supermarket shelves.