FTA with Indonesia positive for Australian grain

Cargill Australia has welcomed the signing of the Free Trade Agreement between Australia and Indonesia.

Managing Director, Erik Wibholm, said the agreement was important for the Australian grains industry.

“Wheat is the single largest Australian agricultural export to Indonesia and Indonesia is Australia’s largest wheat trading partner, valued at approximately $1.3 billion,” Erik said.

“While the majority of the grain trade to Indonesia is for milling, the agreement should support an improvement in trade for feed grains. Indonesia’s feed grain consumption is estimated at 18 million tonnes in 2017 and is growing by 1.1 million tonnes per annum.”

Under the proposal, improved feed grain market access conditions include import permits granted automatically for 500,000 tonnes per annum of Australian feed grains at a 0% in quota tariff. Tariff rate quota volumes will grow at 5% annually.

As part of the FTA, an Australian-Indonesian Grains Partnership is proposed, which will bring together decision makers from government and industry to maximise the opportunities and collaboration amongst the Australian and Indonesia grains, food processing and livestock sectors.

Cargill believes in the benefits of trade to improve the social and economic development of countries and better outcomes for farmers, agricultural businesses and food processors.

The FTA is subject to ratification of the Australian and Indonesian governments.