Australian Agricultural Trade 2020/21

20

20

/21 Australian

agricultural trade

CattleCrops Sheep Dairy Horticulture MiscCottonSeafoodWoolWine

NZ$1.7b

+0.1%

VIETNAM$2.4b

+34.1%

SOUTHKOREA

$2.8b

-5.0%

JAPAN$4.4b

-14.3%

INDONESIA$2.8b

+32.3%

CHINA$10.8b

-26.2%USA$4.0b

-13.4%

THAILAND$1.3b

+33.1%

MENA$3.7b

+32.6%

EU–27$2.8b

+51.4%

Australian agricultural trade 2020/21

2 AUSTRALIAN AGRICULTURAL TRADE 2020/21


Executive summary

Australian agricultural exports declined in value for a second consecutive year in 2020/21 as demand weakened as a result of the impacts of COVID-19 and restrictions on trade to China were imposed on some key commodities.

A decline of $399 million, or 0.8 per cent, in 2020/21 brought the value of Australian agricultural exports to $49.6 billion, the lowest level since 2015/16. However, agricultural exports could rebound to a new record high in 2021/22 on the back of favourable production outlooks for most commodities and an anticipated improvement in demand as key export markets recover from the impacts of COVID-19.

Rural Bank’s Australian Agricultural Trade 2020/21 report examines the performance of agricultural exports in the financial year. The report analyses 12 major agricultural export sectors at a national and state level and investigates trends to major export markets to measure performance in the last 12 months and forecasts the state of the industry in the coming year.

The COVID-19 recovery in Australia’s export markets will be a key factor determining the outlook for Australian agricultural exports. Weaker demand was a key theme across many commodities in 2020/21, softened by the economic downturn and restrictions on dining in foodservice outlets. This was evident in lower average export prices for red meat, wine, wool, seafood and horticultural products. Signs of improvement have been evident already in 2021 as vaccination programs have supported economic recovery and allowed for restrictions to ease in many countries. Further improvements are still possible and expected to be realised in the coming year which should support demand for premium agricultural products.

Continued favourable seasonal conditions are driving strong production outlooks for many commodities which should be reflected in increased export volumes in 2021/22. Favourable conditions in 2020/21 drove a $5.6 billion recovery in cropping exports and supported improved horticultural, dairy and wool export volumes.

Depleted livestock numbers from multiple years of drought restricted export volumes from the red meat sector, however wet conditions have allowed producers to rebuild herds and flocks which is expected to drive a recovery in export volumes in 2021/22. The effect of improved seasonal conditions on production is also set to be realised in 2021/22 for wine, wool and dairy exports.

Unfortunately, the outlook for commodities such as barley, beef, wine, rock lobsters and table grapes will remain weakened by restricted trade access to China. The introduction of tariffs, suspensions, and customs delays arising from trade tensions between Australia and China contributed to a $3.8 billion decline in the value of exports to China in 2020/21. Despite the decline, China remained Australia’s most valuable export market, accounting for 21.8 per cent of total exports.

Increased diversification of export markets will remain a key theme for Australian agriculture as it navigates restricted access to China. Evidence of diversifying export markets was recorded in 2020/21 as exports to countries outside Australia’s top five markets (China, Japan, United States (US), Indonesia, South Korea) increased by $4.3 billion (20.8 per cent). However, it will take larger growth to alternative markets for commodities impacted by restricted access to fully mitigate the loss of export value to China. Improved access to the United Kingdom (UK) under the recently signed Australia-UK Free Trade Agreement could provide new opportunities for Australian exporters to explore once ratified.

The Australian Agricultural Trade 2020/21 report is designed to be used as a tool for farmers and others in the agriculture industry to examine the key trends and outlook for agricultural exports in Australia. As a specialist agricultural lender, Rural Bank understands the importance of regular updates in what is an everchanging and at times uncertain operating environment.


4

for most commodities are positive, as wet conditions continue in 2021. Export volumes of red meat, dairy and wool are expected to increase following efforts to rebuild livestock numbers in the last 18 months. Favourable conditions should also drive increased wine, cotton and horticultural production and support a high level of broadacre cropping exports. Prices for export commodities could also be boosted as the recovery from COVID-19 in key markets should support improvements in demand. However, prices for commodities such as barley, beef, wine, rock lobsters and table grapes will remain under pressure from restricted access to China, which is likely to continue into 2021/22.

The total value of agricultural exports was $49.6 billion in 2020/21.

The total value of agricultural imports was $21 billion in 2020/21.

The value of agricultural exports decreased by -0.8% in 2020/21.

The Australian dollar averaged 74.7 USc in 2020/21.

The value of Australian agricultural exports declined by $399 million in 2020/21, the second consecutive year of decline following nine years of growth. The decline in 2020/21 brought the value of agricultural exports to its lowest level since 2015/16 and 2.2 per cent below the peak of $50.7 billion in 2018/19. The value of exports has remained relatively stable in the last five years after exceptional growth of 73 per cent between 2009/10 and 2016/17.

Cropping was the most valuable commodity export sector in 2020/21, overtaking the cattle industry to return to this position for the first time since 2016/17. Record winter crop production in 2020 drove an increase in export value of $5.6 billion (+73.3 per cent) from the drought affected 2019/20 season. However, the large gain in cropping exports was insufficient to offset declines in export value for most other commodities. Cattle and sheep industry exports led the decline in export value with falls of $3.3 billion and $560 million, respectively. Livestock industry exports were restricted by reduced supply as the improvement in seasonal conditions allowed producers to switch into rebuilding depleted herds and flocks. Low supply resulted in cotton exports also recording a large decline of $330 million (-34.3 per cent). The impacts of COVID-19 and trade disruptions with China weakened demand for commodities such as wine, wool, seafood and horticulture and contributed to year-on-year declines in export values for these commodities. Dairy was the only other commodity sector to record an increase in export value in 2020/21, rising for a third consecutive year. The increase of $184 million (+7.3 per cent) lifted dairy exports to their highest value since 2001/02.

Agricultural exports accounted for 10.8 per cent of Australian goods and services exports in 2020/21, up from 10.5 per cent the year before. The increased share of exports was the result of a relatively larger decline in total goods and services exports which fell by $18.2 billion (-3.8 per cent).

Australia imported $21 billion of agricultural products in 2020/21, a decline of $793.6 million (-3.6 per cent) from 2019/20. This was the first decline in import value in 11 years. The most valuable import commodities were miscellaneous prepared food ($3.3 billion) and wine, whiskey and beer ($2.8 billion combined). Australia’s largest sources of agricultural imports were New Zealand ($3.2 billion) and the US ($2.1 billion).

The Australian dollar averaged 74.7USc in 2020/21, 11.2 per cent higher than 2019/20 and 2.4 per cent above the five-year average. The dollar trended higher between July and December from a start of 68.9USc to a high of 77.0USc before remaining relatively steady between 75–80USc in the first half of 2021. A higher Australian dollar flew under the radar for most commodities as other factors such as COVID-19 were more prevalent forces impacting demand. Australian crop prices were some of the cheapest in the world in 2020/21 due to decreased supply from key global producers, while a disconnect between Australian and global beef prices were driven by domestic factors.

Australian agricultural exports could recover to a new record high value in 2021/22 after declines in the last two years, supported by continued favourable seasonal conditions and improved demand as key export markets recover from the impacts of COVID-19. Production outlooks

National trade summary

Australian agricultural exports declined in value for a second consecutive year in 2020/21.

Growth in crop and dairy exports was insufficient to offset declines in all other commodities.

49.6

21.0 74.7

-0.8

(USc)($b)

(%)($b)

A$

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Value of Australian agricultural exports

55

35

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30

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0

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Export markets

The ranking of Australia’s top ten agricultural export markets remained relatively stable in 2020/21. The only shifts from the previous year were Indonesia overtaking South Korea for 4th place and Thailand jumping from 11th to 8th which saw Singapore fall out of the top ten. A key theme in 2020/21 was increased diversification of export markets. This was evident in the share of export value to the top ten markets falling to 66 per cent in 2020/21, down from 73 per cent in 2019/20.

The increased diversification of export markets in 2020/21 was largely borne out of necessity to mitigate the impacts of restricted access to China for some commodities. Growth in Chinese demand had been a driving force behind the rising value of Australian agricultural exports in the last decade. Exports to China reached a peak of $14.6 billion in 2019/20 which accounted for 29.3 per cent of the total value. Disruptions to trade to China in 2020/21 resulted in a decline of $3.8 billion (-26.2 per cent) in exports which reduced China’s share of total export value to 21.8 per cent, the lowest since 2016/17.

In addition to a decline to China in 2020/21, export value also declined to another three of Australia’s top five export markets in Japan (-$744 million), the US (-$624 million) and South Korea (-$148 million), largely driven by reduced beef exports. Despite a $683 million increase in exports to Indonesia, the combined decline in trade to Australia’s top five markets was $4.7 billion (-15.8 per cent). This led to the share of total export value to Australia’s top five markets falling to 50 per cent in 2020/21, down from 59 per cent in the prior year, and the lowest level since 2015/16.

Fortunately, there was growth to smaller markets to partially offset this substantial decline as the value of exports to markets outside the top five increased by $4.3 billion (+20.8 per cent). The largest growth market in 2020/21 was Saudi Arabia which recorded an increase of $795 million (+204.2 per cent) on the back of renewed purchases of Australian barley. Increased crop exports also drove strong growth to Vietnam (+$619 million), Belgium (+$394 million), Thailand (+$313 million) and Germany (+$312 million). Encouragingly, there were 23 markets to which agricultural exports increased by at least $50 million in 2020/21, up from seven in 2019/20.

A further measure of the increased diversification of export markets is the rise in the number of countries to which Australia exported at least $10 million of agricultural products which rose to a new record high in 2020/21 of 82, up from 69 in 2019/20. A growing range of export markets highlights the expanding reach of Australian agricultural products and a broadening demand base. Of those 82 countries, 56 recorded an increase in export value in 2020/21.

Diversification of export markets is set to remain a key theme in the success of Australian agricultural exports in 2021/22 as access to China is likely to remain restricted for some commodities. While no single market will be able to replace any additional lost value to China, the potential for further growth opportunities among a range of smaller markets should offer some encouragement to exporters and Australian farmers. Progress towards free trade agreements with the European Union and India could provide opportunities for longer-term growth to these two large markets which currently only account for 5.7 per cent and 0.8 per cent of Australian agricultural exports, respectively.

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Value of exports to Australia's top five markets

16

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USAJapan South KoreaIndonesiaChina

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Value of top 10 Australian export markets

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2019/202020/21

Australia’s top 10 export markets accounted for 66 per cent of total exports in 2020/21 down from 73 per cent.

Export value declined to four of Australia’s top five export markets in 2020/21, with growth only to Indonesia.


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Value of Australian export commodities to China

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2019/202020/21

Share of export value to China

Wool 20%

Cattle 19%

Sheep 11%Crops 10%

Dairy 9%

Wine 5%

Nuts 3%

Seafood 3%

Fruit 3%Cotton 2%

Misc 15%

China market profile

China has been Australia’s largest agricultural export market for the past 11 years with $109 billion of agricultural products exported in that time. Due to trade tensions between the two countries and COVID-19 disruptions, export value decreased by $3.8 billion (-26.2 per cent) in 2020/21. Most major agricultural exports decreased in export value last year, except for wool (+9.2 per cent) and dairy (+43.9 per cent).

Wool (19.6 per cent), cattle (19.2 per cent), and sheep (11.1 per cent) exports combined comprised half of Australia’s export value to China in 2020/21. Australian cattle export value to China declined by 40.3 per cent compared to 2019/20 but was only four per cent below the five-year average. The US-China Phase One trade deal contributed to reduced Chinese demand for Australian beef while restrictions on certain Australian meat processors also impacted exports.

The wool industry had a difficult period during the beginning of the COVID-19 pandemic as global demand sharply declined. Fortunately, China made a quick recovery and resumed processing Australian raw wool. As a result, wool export value to China rose $178 million (+9.2 per cent) in 2020/21. China will continue to be Australia’s largest wool export partner, having increased market share from 35 per cent at the turn of the century to 86 per cent in 2020/21.

Sheep industry exports to China decreased by $257 million (-17.7 per cent) in 2020/21 to $1.2 billion. This was more reflective of reduced Australian sheepmeat supply than of reduced demand from China. Despite the decline in value, China was still Australia’s largest sheep export market for the fourth year running, accounting for 31 per cent of Australian sheep exports.

Australian crop export value to China was down 31.3 per cent in 2020/21, resulting in China dropping to be the second largest export partner behind Indonesia. The reduction in export value was primarily due to the tariffs imposed on Australian barley in May 2020 which resulted in a $487 million (-88.5 per cent) decline in barley exports to

China. China’s share of Australian barley exports dropped from 40 per cent in 2019/20 to only three per cent last year. Saudi Arabia replaced China in terms of barley export volume but accounted for less value as they import feed barley as opposed to higher value malt barley like China. Australian wheat exports to China were largely unaffected by trade tensions and recorded a modest increase in 2020/21 of $18 million (+3.2 per cent).

Australian dairy was the largest growth sector for agricultural exports to China in 2020/21 with a $286 million (+43.9 per cent) increase in value driven by increased purchasing and inventory holding due to COVID-19. Of the $2.7 billion Australian dairy products exported in 2020/21, 35 per cent went to China. Milk powder exports performed strongly at $538 million, up 47.5 per cent on the prior year.

Wine was a commodity hit especially hard by the deteriorated relationship between China and Australia. The imposition of tariffs on Australian wine in November 2020 saw monthly exports decline dramatically which contributed to Australian wine export value to China falling by 46.1 per cent in 2020/21. Only 22 per cent of Australian wine was exported to China in 2020/21 compared to 37 per cent in the prior year.

Ongoing trade tensions between Australia and China are likely to see the total export value struggle to recover in 2021/22. Increased production of key commodities like beef, sheepmeat and cotton could see export volume and value of these commodities rise. However, a full year of tariffs on Australian wine and a continued unofficial ban on Australian rock lobster will hurt export value of these high value commodities. China accounted for 93 per cent of the value of Australian rock lobster exports in 2019/20, which was reduced to only 46 per cent in 2020/21. This downward trend will continue if trade relations fail to improve. While export potential for some Australian agricultural commodities looks bleak, others like dairy and wool are expected to remain strong due to a lack of alternative markets for Chinese buyers.

All agriucltural exports to China fell in value in 2020/21 except for wool and dairy. Wool overtook cattle industry exports to be the most valuable agricultural export commodity to China in 2020/21.


TAS$947m

-10.6%

VIC$13.3b

-2.2%

NSW$8.9b

+14.5%

NT$571m

-22.7% QLD$8.5b

-9.3%

SA$6.1b

+8.8%

WA$7.9b

+2.2%

Cattle

Wine

Seafood

Sheep

Horticulture

Misc

Crops

Dairy

Wool

commodities came from the cropping sector with wheat increasing by $377 million and sorghum growing by $153 million as increased crop production resulted in a larger exportable surplus.

Western Australia’s export performance is inextricably linked to crop production and international demand for Australian grain. Crops accounted for 60.6 per cent of Western Australia’s export value. Barley (+29.5 per cent) and canola (+14.2 per cent) benefitted from tight global balance sheets that increased the demand for Australian grain exports. Western Australia saw the largest growth in wool export value of 7.8 per cent to a total of $512 million. Queensland was the only other state to record an increase in wool exports, with value having increased by 1.6 per cent to $17 million.

South Australia had a similar profile to Western Australia with crops outperforming all other sectors. Crop export value increased 62.1 per cent to $2.4 billion with wheat the major grain exported. Dairy also performed strongly, growing 40.3 per cent year-on-year due to elevated exports to China, this trend was evident across the main dairy producing states.

Tasmania’s export value dropped below $1 billion in 2020/21 to $947 million. Crops (-67.6 per cent), sheep (-22.2 per cent) and seafood (-11.5 per cent) had the largest decline in export value. Despite the decrease in value, seafood remained the highest value sector accounting for $259 million of export value, followed closely by cattle at $243 million.

Northern Territory relied on cattle to generate 96.5 per cent of export value in 2020/21. Cattle exports were valued at $551 million, down 20.4 per cent mainly due to a reduction in live cattle exports primarily due to tight Australian supply.

Agricultural export performance in 2020/21 was mixed across the states. New South Wales, South Australia and Western Australia were the only three states to record growth, primarily due to the strong performance of the cropping sector. Victoria continued to be the most valuable state by export value, at $13.3 billion in 2020/21, followed by New South Wales ($8.9 billion), Queensland ($8.5 billion) and Western Australia ($7.9 billion).

Victoria’s export value fell by 2.2 per cent in 2020/21, mainly due to the loss of value from the livestock sector. Cattle industry export value decreased in every state; however, the rate of decline was most prominent in South Australia (-35.6 per cent) and Victoria (-32.5 per cent). Grain exports performed strongly for Victoria with a 156.2 per cent increase in export value year-on-year. This rate of growth was only eclipsed by Queensland (+187.4 per cent) and New South Wales (+1,761.1 per cent). Despite the large growth of crop exports in other states, Western Australia remained the top state with $4.8 billion of crop exports, a 9.8 per cent increase.

New South Wales overtook Queensland as Australia’s second largest export state, contributing $8.9 billion to Australia’s total export value. Wheat exports grew by $1.4 billion, a 30-fold increase, having come off a low base due to drought years. Crop exports were similarly strong across all other major producing states with wheat exports alone contributing $6.8 billion to Australia’s export value.

Queensland export value was down 9.3 per cent in 2020/21 mainly due to a $1.5 billion decrease in cattle industry export value. Tight supply, trade tensions and disruptions due to COVID-19 all contributed to this decline. Despite the large loss of value, beef remained Queensland’s most important export commodity accounting for 57.6 per cent of export value for the state. Queensland’s largest growth

State export performance

*excludes cotton and sugar due to lack of data availability


Cropping

After consecutive tough years in eastern states, Australian crops enjoyed a rare convergence of high production, strong export demand and elevated prices in 2020/21. A positive start for winter crops in 2021 has provided optimism that continued export demand will allow growers to recover from drought years.

Greg Kuchel Regional Manager Agribusiness, Western Victoria


Export valueAustralia exported $13.2 billion of crops in 2020/21, an increase of $5.6 billion (+73.3 per cent).

Export priceAverage export price of Australian crops declined by 13.5 per cent in 2020/21.

Export volumeAustralia exported 33.4 million tonnes of crops in 2020/21, an increase of 100 per cent.

OutlookAbove average production, firm export demand and strong international prices paint a positive outlook.

Trade performance and outlookThe value of Australian cropping exports increased 73.3 per cent in 2020/21 and was 33.6 per cent above the five-year average, attributed to increased production and exportable surplus. Wheat (+76.7 per cent), barley (+85.9 per cent), canola (+78.6 per cent) and pulses (+31.5 per cent) all recorded increases in value.

Increased Australian production resulted in 33.4 million tonnes exported in 2020/21, a 100 per cent increase on last year, and 31.8 per cent above the five-year average. Gains in export volume were partially offset by a 13.5 per cent fall in the average export price of all crops, however this was only 1.7 per cent below average. This reduction in export price was more than offset by increased export demand, fuelled by reduced supply from Europe and Ukraine, as well as increased Chinese buying of feed stocks.

Australia exported $6.8 billion of wheat in 2020/21, a 76.7 per cent increase year-on-year and 45.7 per cent above the five-year average. The year-on-year increase in value was driven by a 95.7 per cent increase in volume which took export volume 35.1 per cent above average. Having lost some market share to Russia during low production years, Australian wheat recaptured lost demand in Asia and increased supply to the Middle East and Africa following poor European production and a levy on Russian wheat exports. Increased volumes offset a 9.7 per cent fall in the average export price and growers benefitted from this being four per cent above average.

The value of canola exports increased 78.6 per cent in 2020/21 to $2.5 billion. This was 63.2 per cent above the five-year average and was driven by a 76.9 per cent increase in export volume. Canola also recorded a year-on-year increase in average export price, the only crop to do so. Reduced European production, high crush margins, demand for biofuels and China buying up record amounts of soybeans supported the global oilseed complex and pushed canola prices to record highs. The average canola export price increased one per cent in 2020/21 and was 15 per cent above average.

China’s implementation of an 80.5 per cent tariff on Australian barley in May last year caused a drop in Australian barley prices. Cheaper barley, combined with production issues in Ukraine was the impetus for barley volume increasing 129 per cent in 2020/21. The average export price for barley declined 18.9 per cent and was 7.8 per cent below average. However increased tonnage saw the total value of barley exports up 85.9 per cent year-on-year to $1.9 billion, 20.3 per cent above average.

Australia exported $1.5 billion of pulses in 2020/21, an increase of 31.5 per cent driven by a 49.7 per cent rise in export volume. However near record Australian pulse production weighed on prices which saw the average export price fall 12.1 per cent and sit 16.4 per cent below average. Whilst Bangladesh, Pakistan, Egypt and Sri Lanka have been active buyers of chickpeas, faba beans and lentils, supply was sufficient to meet demand and kept a cap on prices. Low global supply and decreased Indian import tariffs kept lentils prices supported, but pricing for other pulses remained lacklustre with India maintaining other pulse import tariffs.

Cropping

Plentiful supply and firm global prices are expected to see Australian cropping export value increase in 2021/22. Wheat demand is expected to remain strong into Asian markets while barley exports may struggle with the absence of Chinese demand and increased competition in Saudi Arabia. Global canola stocks remain very tight which is likely see Australian canola export value and volume increase. Exports of pulses are expected to remain steady with Bangladesh, Pakistan and Sri Lanka providing a baseline of demand.

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Value of Australian crop exports

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CanolaWheat Barley Pulses Other coarse grains*

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Value of Australian crop exports by state

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Australian cropping exports rose to the second highest value on record in 2020/21.

Increased eastern states production led to a more even spread of exports by state in 2020/21.


Cropping

Major export marketsChina lost the mantle of Australia’s most valuable cropping trade partner in 2020/21 with market share down to 8.1 per cent and was the fourth largest market by volume. Indonesia, Saudi Arabia and Thailand purchased more tonnage, but China’s average export price of $376/tonne was 13 per cent higher than Indonesia, and 32 per cent above Saudi Arabia. China pays a premium to ensure supply, with the average price per tonne of wheat sold to China four per cent higher than Indonesia. China’s purchases of Australian wheat in the past year have been sporadic, whereas more constant demand from South-East Asian destinations is likely to see them overtake China in terms of overall value in the coming year.

Indonesia was the most valuable cropping export destination by value with 9.5 per cent market share in 2020/21. The Indonesia-Australia Comprehensive Economic Partnership (IA-CEPA) played a role in the more than 250 per cent increase in value and volume of crops sold to Indonesia. More importantly, being a price sensitive market, Australia recaptured Indonesian demand in the past year as reduced supply and higher prices in the Black Sea region made Australian wheat some of the cheapest in the world. Indonesia is forecast to remain Australia’s most valuable cropping export market in 2021/22 as Australian wheat is expected to remain competitive.

Vietnam has consistently been in Australia’s top ten cropping trading partners by value over the past ten years and continues to grow in importance, rising from fourth to third in 2020/21. A rapidly growing beer market also saw Vietnam snap up high quality Australian malt barley, becoming the third largest importer of Australian barley in 2020/21. Vietnamese demand for Australian crops is anticipated to remain firm in the coming year with export prices forecast to be competitive and Australia enjoying a freight advantage over other sources.

Saudi Arabia was Australia’s fourth most valuable cropping export market in 2020/21 after not appearing in the top five since 2013/14. Also a price sensitive market, Saudi Arabia took advantage of low barley prices in the wake of Chinese tariffs. Saudi Arabia solely purchases feed barley as opposed to China who predominantly bought malt barley. Whilst the volume of Saudi Arabia’s barley imports was comparable to China, average export price and total value was much lower. Demand from Saudi Arabia will likely remain through the coming year, however not to the extent seen in 2020/21 with stiffer competition from Black Sea origin barley.

Germany was Australia’s sixth most valuable cropping export market in 2020/21 with 4.9 per cent of export value. Being almost exclusively buyers of canola, the average export price of canola reached a record high of $750/tonne which placed them in the top ten most valuable export destinations despite purchasing relatively low volumes. With global oilseed balances tight and concerns over Canadian production, Australian canola is forecast to be in strong demand and prices are likely to remain at high levels. Purchasers of canola such as Germany and Belgium are likely to continue to feature in Australia’s top ten export markets by value in 2021/22.

Value of Australia’s top 10 crop export markets

Destination 2020/21 (A$ million)

Year-on-year % change % share

Indonesia $1,258 é +249.5% 9.5%

China $1,070 ê -31.3% 8.1%

Vietnam $1,020 é +139.9% 7.7%

Saudi Arabia $875 é +2,317.7% 6.6%

Japan $652 é +13.4% 4.9%

Germany $642 é +93.5% 4.9%

Thailand $617 é +70.6% 4.7%

Bangladesh $562 é +45.9% 4.2%

Philippines $535 é +48.3% 4.0%

Belgium $514 é +342.7% 3.9%

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Value of top five Australian crop export markets

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Value of products exported to top five markets

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Japan

CanolaWheat Barley Pulses Other coarse grains*

Indonesia overtook China as Australia’s most valuable cropping destination in 2020/21.

China’s share of barley exports shifted to Saudi Arabia.

*‘other coarse grains’ includes sorghum, oats, maize, buckwheat, millet, rye and rice


A decline in the value of cattle industry exports in 2020/21 was driven by tight Australian supply, coupled with weaker export demand. Higher production is expected in 2021/22, which will lead to an increase in export volume. The recovery from COVID-19 impacts will likely support stronger demand but competition could also rise and add downward pressure on export prices.

Donna Slevin, Regional Manager Agribusiness, Central and North East Victoria

Beef & cattle


Export valueAustralia exported $11 billion of cattle industry products in 2020/21, a decline of $3.3 billion (-23.4 per cent).

Export priceAverage export prices of Australian beef in 2020/21 was $8,532/t, a decrease of 2.2 per cent.

Export volumeAustralia exported 986,697 tonnes of beef in 2020/21, a decline of 23.5 per cent.

OutlookRise in Australian supply and higher global beef prices to drive an increase in value of exports in 2021/22.

Trade performance and outlookAustralian cattle industry exports recorded its first year of decline since 2016/17 with a decrease in value of over $3.3 billion in 2020/21. The value of exports was driven lower by falls in both export volume and average export price.

Beef export volume from Australia declined by 23.5 per cent in 2020/21. A total of 986,697 tonnes of beef was exported during the year, which was 13.8 per cent below the 10-year average and the smallest volume exported since 2010/11. The main reason for the decline in volume was a reduction in Australian beef production resulting from favourable seasonal conditions which supported efforts rebuild depleted cattle herds by retaining breeding stock.

Beef export prices experienced a slight drop of 2.2 per cent in 2020/21 to an average of $8,532/tonne after finishing at $8,726/tonne in 2019/20. The decline in the average export price occurred despite domestic cattle prices trending higher through the year. The average Eastern Young Cattle Indicator was 32.6 per cent higher than 2019/20 as restocker demand inflated domestic prices and caused a disconnect with the more subdued trend in global prices. International supply also remained tight but is likely to start increasing in the second half of the year as countries recover from COVID-19 impacts and increase production.

Export value is likely to increase in 2021/22 as Australian beef production is expected to begin to recover which should provide a greater exportable surplus. An increased supply of Australian beef exports could weigh on the average export price however this could be counteracted by improved consumer demand in export markets as the recovery from COVID-19 continues, supported by vaccination programs. Australian beef will likely face increased competition in Japan, South Korea and China from the US where exports are expected to increase. However, Chinese demand for Australian beef could be strengthened in response to reduced exports from Argentina which accounted for approximately 20 per cent of Chinese beef imports. A self-imposed reduction of exports by the Argentinean government only allows 50 per cent of 2020 levels to be exported. On balance, increased Australian beef production driving increased export volumes and an improvement in demand providing supporting prices should drive an increase in export value in 2021/22.

The value of live cattle exports fell 19.6 per cent in 2020/21 to $1.5 billion. Tight Australian supply along with the impacts of COVID-19 in key export markets played a strong role in the decline of live export value and volume. Indonesia remained the highest value live export market at $584 million and fell 10.2 per cent in 2020/21. The largest decline in value was to Vietnam which fell 28.1 per cent to $420 million. With the continued recovery from the impacts of COVID-19 and Australia’s cattle supply set to improve, it is likely the live export volume and value may improve in 2021/22. However, COVID-19 outbreaks are currently occurring in Indonesia and Vietnam which will likely mean it will take a few months until an improvement is seen.

Beef & cattle

A$

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Value of Australian cattle industry exports

16

12

14

10

4

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6

8

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Fresh/chilledFrozen Live Offal Hides

2000

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Value of Australian cattle industry exports by state

8

7

6

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5

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2019/202018/19 2020/21

QLD VIC NSW WA TAS SANT

Cattle industry exports decreased in value in 2020/21 after three consecutive years of growth.

Value of Australian cattle industry exports decreased across all states in 2020/21.


Beef & cattle

Major export marketsJapan overtook China in 2021/22 to be the highest ranked market for Australian cattle industry exports by value. However, the value of exports to Japan declined in 2020/21 by $533.8 million (-19.5 per cent), largely due to the impacts of COVID-19 on demand through foodservice channels and increased supply from the US. Demand for Australian beef is expected to strengthen in Japan which is likely to lead to a recovery in export value in 2021/22 as the country continues to recover from the impacts of COVID-19.

China experienced the largest decline in export value of any market in 2020/21 with a 40.3 per cent decline, which equated to a year-on-year change of -$1.4 billion. A major driver of this significant decline was the suspension of access for several Australian meat processors in 2020 which are yet to be lifted. In addition, the US-China Phase One trade deal eased restrictions for imports from the US and requires China to purchase over US$80 billion in agricultural products from the US which created new competition for Australian beef in China. These factors appeared to negate additional Chinese demand that resulted from further reductions in Chinese pork production due to African Swine Fever outbreaks. While pork production is compromised, China will need to keep importing large volumes of meat, including beef. Australia could capture some of this demand in 2021/22 as beef supply from other markets such as Argentina and Brazil are expected to be reduced.

The US also recorded a decline in export value in 2020/21, down by 29.6 per cent year-on-year but still made up 15.2 per cent of the total share of Australian beef exports. A decline in export value to the US of $700 million was partially due to increased domestic production in the US which is likely to lead to reduced need for Australian imports. The increase in domestic production in the US comes as estimated domestic demand and consumption is expected to continue increasing into 2021/22. For the near future it does appear that Australian exports to the US will be lower than previous years due to their increased beef production.

The value of exports to South Korea remained relatively stable over the past year with only a 2.8 per cent decline which saw export value reach $1.6 billion. Saudi Arabia and Hong Kong were the largest growth markets for Australian cattle industry exports in 2020/21 with growth of $16.9 million and $16.5 million, respectively, but both markets only accounted for a minor share of overall exports.

Value of Australia’s top 10 cattle industry export markets



Japan $2,201 ê -19.5% 20.1%

China $2,074 ê -40.3% 18.9%

USA $1,662 ê -29.6% 15.2%

South Korea $1,581 ê -2.8% 14.4%

Indonesia $1,000 ê -15.9% 9.1%

Vietnam $596 ê -17.3% 5.4%

Taiwan $245 ê -18.3% 2.2%

Philippines $171 ê -22.3% 1.6%

Hong Kong $167 é +10.9% 1.5%

Saudi Arabia $145 é +13.2% 1.3%

A$

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Value of top five Australian cattle industry export markets

4.0

2.0

1.0

0.5

3.0

3.5

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USAJapan China South Korea Indonesia

2010

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A$

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Value of products exported to top five cattle industry markets

3.5

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2.5

1.0

0.5

1.5

2.0

0.0

FY19

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FY21

FY19

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FY21

FY19

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FY21

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ChinaJapan USA SouthKorea

Indonesia

Fresh/chilledFrozen Live Offal Hides

A relatively larger decline in export value to China saw Japan become Australia’s most valuable export market in 2020/21.

Australia’s top five export markets accounted for a combined $2.9 billion decline in export value in 2020/21.


Sheep

Reduced Australian sheepmeat production restricted export volumes in 2020/21. Combined with weaker demand driven by the impacts of COVID-19, this resulted in a decline in the value of sheep industry exports. A recovery in Australian production and resurgent demand should support an improvement in 2021/22 export value and resume the industry’s long-term growth.

Tony Williams Regional Manager Agribusiness, NSW


Export valueAustralia exported $3.9 billion of sheep industry products in 2020/21, a decrease of $560 million (-12.6 per cent).

Export priceThe average export price of Australian sheepmeat was $8,114/tonne in 2020/21, a decrease of 9.1 per cent.

Export volumeAustralia exported 428,242 tonnes of sheepmeat in 2020/21, a decrease of 7.2 per cent.

OutlookIncreased sheepmeat production in 2021/22 will support a higher value of exports.

Trade performance and outlookThe value of sheep industry exports declined in 2020/21 after four consecutive years of growth. Decline in value was consistent across all sheep industry products due to lower average sheepmeat prices and reduced export volumes of mutton and live sheep. Mutton led the decline in export value, falling by $331 million (-24.3 per cent) to just over $1 billion. The decline in lamb export value was less severe with a $157 million (-5.8 per cent) reduction to $2.5 billion.

Most states recorded a decline in sheep industry export value in 2020/21. Victoria had the largest decline of $363 million (-18.6 per cent), followed by Western Australia which fell by $161 million (-20.3 per cent). South Australia recorded the largest increase in export value of $8.1 million (+1.5 per cent) as growth in lamb exports offset a decline in mutton exports.

The volume of sheepmeat exports declined in 2020/21 for a second consecutive year. This was driven by a 19.3 per cent decline in the volume of mutton exports as low flock numbers and retention of breeding stock kept production restricted. Meanwhile, lamb exports recorded an increase of 0.6 per cent as improved conditions in 2020/21 supported increased lambing rates and therefore lamb production. The volume of lamb exports in 2020/21 was the second largest on record behind 2018/19.

The average export price of both lamb and mutton declined in 2020/21 for the first time since 2015/16. Lamb recorded the larger year-on-year decline of 6.4 per cent, while mutton was not far behind with a fall of 6.2 per cent. The decline in lamb prices was reflective of a 6.9 per cent decline in the average Eastern States Trade Lamb Indicator in 2020/21, driven by an improvement in supply and weakened demand from the impacts of COVID-19. Contrary to the decline in average mutton export price, the National Mutton Indicator averaged 1.4 per cent higher in 2020/21. Demand from domestic buyers seeking to rebuild breeding flocks may have inflated domestic prices while export prices were weighed down by weakened demand.

Live sheep exports declined in value by 41 per cent in 2020/21 and fell to $93 million. This represented a 64.1 per cent decline in value since 2017/18 and reduced live sheep exports’ contribution to sheep industry exports to only 2.4 per cent. A prohibition on live sheep exports to Middle East during the northern hemisphere summer came into effect in May 2020 which contributed to a 44.7 per cent decline in the number of sheep exported in 2020/21. A ban on exports between June and September in 2021 will again restrict live sheep exports in 2021/22 and keep the value of the trade subdued well below long-term average levels.

Sheep industry exports are expected to rebound in 2021/22, driven by increased production and a recovery in demand in key export markets. Favourable conditions in the past two years have allowed for flock rebuilding to begin and supported increased lamb production.

Sheep

This will increase the supply of sheepmeat available for export in 2021/22. Demand is expected to also recover as key export markets emerge from COVID-19 restrictions which will support increased consumption through foodservice channels. Growing appetite for sheepmeat in emerging markets also favours a strong outlook for demand and Australian export value.

A$

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Value of Australian sheep industry exports

4.5

2.5

4.0

3.0

3.5

2.0

0.5

1.0

1.5

0

MuttonLamb Skins Live

2000

/01

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A$

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Value of Australian sheep industry exports by state

2.0

1.8

1.6

1.0

0.8

1.2

0.4

0.2

0.6

1.4

0

2019/202018/19 2020/21

VIC NSW WA SA QLD TAS

Sheep industry exports declined in value in 2020/21 after four consecutive years of growth.

Victoria accounted for 41 per cent of Australian sheep industry exports in 2020/21 but declined by 18.6 per cent.


Sheep

Major export marketsChina remained Australia’s most valuable sheep industry export market for a fourth year in a row in 2020/21, despite recording a 17.7 per cent decline in value. A decline in export value to China occurred for both lamb (-23.7 per cent) and mutton (-17.5 per cent) in 2020/21 as the volume of exports and average export price fell for both commodities. Sheepmeat export volumes between July and December were significantly lower year-on-year but began to improve in the first half of 2021. A recovery in Australian production should support a rebound in exports to China in 2021/22.

The US was the largest growth market for Australian sheep industry exports in 2020/21 with an increase in value of $37.1 million. This saw the US share of Australian sheep industry exports increase from 19.9 per cent to 23.7 per cent. American appetite for lamb was strong in 2020/21 despite the impacts of COVID-19 restrictions on foodservice for much of the year. The value of lamb exports to the US increased by $74.8 million (+10.2 per cent) which more than offset a $37.7 million (-25.2 per cent) decline in mutton exports. The outlook remains strong as increased Australian supply will coincide with resurgent US demand driven by eased restrictions on foodservice outlets and other impacts of the recovery from COVID-19.

Malaysia was another strong growth market for Australian sheep industry exports in 2020/21. Growth to Malaysia was due to a $21.1 million (+36.0 per cent) rise in the value of lamb exports which more than offset a decline of $3.1 million (-2.4 per cent) in mutton exports. Mutton remained the more valuable commodity, accounting for 60 per cent of exports.

The large decline in export value to the United Arab Emirates (UAE) was emblematic of a decline in demand in the wider Middle East region. The lack of international travel in 2020/21 weighed on demand in the region and restricted air freight capacity. Overall, the value of exports to the Middle East North Africa (MENA) region declined by $294.3 million (-33.3 per cent) in 2020/21 which saw the region’s share of total sheep industry exports decline from 19.8 per cent to 15.1 per cent. Demand from Middle Eastern markets is expected to remain weak until international travel resumes in earnest, however the potential recovery in demand from a key export region bodes well for future strength in prices.

Strong growth was also recorded to some smaller markets in 2020/21. Papua New Guinea was the second largest growth market behind the US with an increase of $26.5 million (+48.3 per cent) to $81.3 million. South Korea continued its steady growth trend with an increase of $23.3 million (+15.0 per cent), the eighth consecutive year of growth. The UK could join the list of growth markets for Australian sheepmeat in 2021/22 if the Australia-United Kingdom Free Trade Agreement takes effect within the year to give Australian sheepmeat a tariff-free quota of 25,000 tonnes, almost triple the 8,600 tonnes exported in 2020/21.

Value of Australia’s top 10 sheep industry export markets



China $1,199 ê -17.7% 30.8%

USA $923 é +4.2% 23.7%

Malaysia $208 é +8.3% 5.4%

UAE $198 ê -19.7% 5.1%

South Korea $178 é +15.0% 4.6%

Qatar $143 ê -33.4% 3.7%

Japan $128 ê -22.4% 3.3%

Canada $112 é +5.3% 2.9%

Kuwait $97 ê -20.7% 2.5%

Singapore $96 ê -7.4% 2.5%

A$

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Value of products exported to top five sheep industry markets

1.6

1.4

1.2

0.6

0.4

0.2

0.8

1.0

0.0

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

USAChina Malaysia SouthKorea

UAE

MuttonLamb Skins Live

A$

billi

ons

Value of top five Australian sheep industry export markets

1.6

0.8

0.4

0.2

1.2

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1.0

0.6

0.0

USAChina Malaysia UAE South Korea

2010

/11

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/16

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The US accounted for a greater share of sheep industry exports in 2020/21 due to a modest increase compared to China’s 18 per cent fall.

Growth in the value of lamb exports to the US and South Korea were highlights amidst a year of lower overall export values.


Dairy

Australian dairy exports continued a period of sustained growth with an increase in value for a fourth consecutive year in 2020/21. Increased milk production supported an increase in export volumes of dairy products which drove the higher value. Further growth in milk production in 2021/22 is expected to drive another year of growth in dairy export value.

Dean Lalor Regional Manager Agribusiness, Tasmania


Export valueAustralia exported $2.7 billion of dairy products in 2020/21, an increase of $184 million (+7.3 per cent).

Export priceAverage export prices decreased 3.4 per cent for milk powder and 8.2 per cent for cheese.

Export volumeAustralia exported 479,122 tonnes of dairy products in 2020/21, an increase of 13.1 per cent.

OutlookMilk production growth in 2021/22 will aid export volume with strong demand for milk powder anticipated.

Trade performance and outlookThe value of Australian dairy exports increased for the fourth consecutive year in 2020/21 with a $184 million increase. Growth in the value of exports was driven by increased supply from Australia and stronger export demand, especially for skim milk powder to China. Growth in export value was driven by an increase in export volume across all dairy commodities except for cheese. The expansion of export volume was partially offset by a softening of average export prices. Milk powders generated 35.9 per cent of dairy exports by value, followed closely by cheese at 32.8 per cent.

Victoria provided 74 per cent of the value of Australian dairy exports in 2020/21 and increased by two per cent to $2 billion. Stronger growth was recorded by South Australia (+40.3 per cent) and New South Wales (+38.8 per cent), both recovering from declines in 2019/20.

Uplift in 2020/21 saw milk powder overtake cheese exports to be Australia’s most valuable dairy export. Milk powder export value increased by $162 million (+19.9 per cent) to $973.7 million. Skim milk powder rose by 22.3 per cent and whole milk powder by 18.3 per cent. Milk powder exports strengthened in 2020/21, partially due to an increase in inventory holdings for China in response to potential further COVID-19 impacts. Strong purchases took place from July to December 2020 and are expected to continue into next year.

Cheese remained a strong export commodity with a value of $890.5 million in 2020/21 but recorded a decline of 9.6 per cent. Cheese exports were the only dairy commodity with a decline in 2020/21. Cheese exports were noticeably lower to Japan which was likely due to COVID-19 impacts on foodservice. However, demand is anticipated to recover in line with the Japanese COVID-19 recovery. Although declining year-on-year, Japan has been unable to meet growing demand for cheese products from their domestically produced dairy with overall imports increasing along with consumption and awareness in Japanese consumers.

Milk and cream exports increased by $52 million (+16.4 per cent) with significant increases to China (+53.8 per cent) and Japan (+377 per cent). Growth in milk and cream exports to China and Japan offset reductions to Malaysia and Singapore. The category includes UHT milk which saw strong sales uplift across domestic and export markets because of the COVID-19 pandemic.

Butter exports increased in value by $58 million (+63.8 per cent) to $148 million. The large uplift in butter export value was driven by a 111.8 per cent increase in export volume. China was the largest growth market for butter exports which again offset declines in value to Indonesia and Japan.

Dairy export value is likely to increase for a fifth consecutive year in 2021/22 due to increased Australian milk production which will be supported by ongoing favourable seasonal conditions and high milk prices. In addition to increased export volumes, prices are expected to remain well supported by firm demand, however the longer-term effects of COVID-19 on demand for dairy exports are still uncertain.

Dairy

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Value of Australian dairy exports

3.5

1.5

3.0

2.0

2.5

1.0

0.5

0.0

Other milk products

Milk & cream

Milk powder

Butter & other fats/oils

Cheese & curd

2000

/01

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Value of Australian dairyexports by state

2.22.01.8

1.21.00.80.60.4

1.4

0.2

1.6

0

2019/202018/19 2020/21

VIC NSW TAS SA QLDWA

The value of dairy exports increased in 2020/21 to reach its highest level since 2001/02.

Victoria accounted for 74 per cent of the value of Australian dairy exports in 2020/21.


Dairy

Major export marketsChina remained Australia’s largest dairy export market in 2020/21 and recorded growth of $286 million (+43.9 per cent) to $938 million. This took China’s share of Australian dairy exports from 25.8 per cent in 2019/20 to 34.6 per cent in 2020/21. Growth to China was led by an increase in the value of milk powder exports of $173.3 million (+47.5 per cent), driven by increased purchasing and inventory holding due to COVID-19. Milk and cream exports increased by $64.6 million (+53.8 per cent) as demand continued to grow for quality milk imports. Cheese exports increased by $24.9 million (+24.9 per cent). Demand for dairy products in China is expected to continue to grow in 2021/22 with Australia ready to cater to that growth due to anticipated increase in milk supply.

Japan remained the largest market for Australian cheese exports with value of $320 million in 2020/21, however this was a decline in value of $138 million (-30.1 per cent). Japan trended lower in all areas except for milk and cream which increased by $4.5 million (+377 per cent). The decline in dairy exports to Japan was largely due to changes in foodservices during COVID-19 however cheese products have been in decline over the past three years.

Dairy exports to Malaysia surged in 2020/21, increasing by $30.9 million to $194 million. The primary driver of this growth was exports of cheese which increased by $21.1 million (+35 per cent) thereby offsetting some of the reduction of cheese exports to Japan during the same time period. Milk and cream exports declined by 15.5 per cent but were offset by all other goods rising.

The value of dairy exports to Singapore declined by $5.9 million (-3.2 per cent). Singapore’s share of exports was 6.6 per cent of total dairy exports with increased demand evident for cheese which improved by $3.7 million and butter which grew by $2.7 million. Milk powder and milk and cream products were reduced by 10.4 per cent and 22.4 per cent, respectively.

Dairy exports to Indonesia decreased by $15.8 million (-9.3 per cent) which was in line with 2018/19 results and eroded the gains made in 2019/20 of $15.9 million (+10.4 per cent). The decline was led by a fall in cheese exports of $9.5 million (-33.9 per cent) and followed by milk powder which fell by 44.4 million (-3.9 per cent). Milk and cream products were the only dairy commodity to record growth but were a minor part of exports to Indonesia.

Vietnam, despite being Australia’s 11th most valuable export market, was the third largest growth market in 2020/21 with an increase of $19 million (+34.6 per cent). This took total exports to $73.9 million or 2.7 per cent of total dairy exports.

Value of Australia’s top 10 dairy export markets



China $938 é +43.9% 34.6%

Japan $344 ê -29.2% 12.7%

Malaysia $194 é +18.9% 7.2%

Singapore $180 ê -3.2% 6.6%

Indonesia $154 ê -9.3% 5.7%

Philippines $102 é +5.3% 3.8%

Thailand $100 ê -15.9% 3.7%

Taiwan $94 ê -7.9% 3.5%

New Zealand $91 ê -3.1% 3.3%

Hong Kong $76 ê -19.2% 2.8%

Value of products exported to top five dairy markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

JapanChina Malaysia Singapore Indonesia

Other milk products

Milk & cream

Milk powder

Butter & other fats/oils

Cheese & curd

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Value of top five Australian dairy export markets

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MalaysiaChina Japan Singapore Indonesia

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China was the largest growth market for Australian dairy exports in 2020/21, increasing by $286 million.

Milk powder to China was the largest growth segment for dairy exports in 2020/21, up by $173 million.


Wine

Australian wine exports were restricted in 2020/21 by a reduced 2020 wine grape crush before being dealt a painful blow in November when tariffs were applied on exports to China. A recovery in exports is expected in 2021/22 on the back of a record wine grape crush in 2021 and strong demand in alternative markets, but prices will be weighed down by restricted access to China.

James Robinson Head of Sales – West


Export valueAustralia exported $2.6 billion of wine in 2020/21, a decrease of $273 million (-9.4 per cent).

Export priceThe average export price of Australian wine in 2020/21 was $3.70/litre, a decrease of 5.1 per cent.

Export volumeAustralia exported 709 million litres of wine in 2020/21, a decrease of 4.6 per cent.

OutlookIncreased production is expected to drive a rebound in wine export value in 2021/22.

Trade performance and outlookAustralian wine exports declined in value in 2020/21 for a second consecutive year. The decline in export value was largely driven by a reduced volume of exports, constrained by a decline in production. This was coupled with the impacts of tariffs imposed by China which resulted in weaker overall demand and a decline in average export prices. Red wine exports were the primary driver of decline in the sector with a fall in value of $301.2 million (-13.8 per cent) largely on the back of reduced Chinese demand after tariffs were imposed in November 2020.

South Australia recorded the largest decline in export value in 2020/21 with a fall of $216.6 million (-11.6 per cent). Exports also declined from Western Australia (-29.6 per cent), Victoria (-17.8 per cent) and New South Wales (-5.3 per cent). Wine exports from New South Wales were less affected by trade restrictions to China due to a greater focus on the US and UK which accounted for a combined 66 per cent of the value of the state’s wine exports in 2020/21, whereas China only accounted for four per cent of export value.

The volume of Australian wine exports declined by just over 34 million litres in 2020/21, led by a 6.2 per cent decline in red wine exports but only a 0.6 per cent fall in white wine exports. This was the third consecutive year of decline in wine export volume and the lowest volume since 2004/05 as the 2020 wine grape crush was affected by drought and bushfires which restricted volumes available for export. The 2020 crush was the smallest since 2007 and 12 per cent lower than 2019, according to Wine Australia, due to dry conditions and losses from bushfires.

The average export price of Australian wine fell in 2020/21 after six consecutive years of growth. Despite the year-on-year decline, the average export price in 2020/21 was 44 per cent higher than the recent low point in 2013/14. The decline in 2020/21 was primarily driven by an 8.1 per cent decline in the average export price of red wine. Reduced demand from China following the imposition of tariffs on Australian wine was the likely cause of this decline after growing demand from China drove eight consecutive years of growth in red wine prices.

After two years of decline, the value of Australian wine exports is expected to increase in 2021/22 on the back of a record wine grape crush in 2021. Ideal growing and ripening conditions drove a 31 per cent increase in the wine grape crush from 2020, according to Wine Australia, which will boost volumes available for export. However, red wine export prices are expected to remain subdued as significantly reduced trade to China will continue to weigh on prices as alternative markets are unlikely to pay premium prices offered by Chinese importers. This was evident in a four per cent decline in average price of red wine grapes in the 2021 crush compared to an 11 per cent rise in whites.

Wine

The value of wine imports to Australia increased by 10.6 per cent in 2020/21 to a new record high of $932.5 million. France overtook New Zealand to be the most valuable source of imports. Imports from France increased by 17 per cent and accounted for 40.3 per cent of the total value of wine imports. Wine imports from New Zealand declined in value in 2020/21, down by 0.3 per cent to account for 36.5 per cent of imports.

A$

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ons

Value of Australian wine exports by state

2.0

1.8

1.6

1.0

0.8

0.6

0.4

1.2

0.2

1.4

0

2019/202018/19 2020/21

SA NSW VIC WA

A$

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Value of Australian wine exports

3.0

2.0

2.5

1.5

0.5

1.0

0

WhiteRed Sparkling Fortified Other

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A 13.8 per cent decline in the value of red wine exports offset growth in other wines to drive a decline in the total value of Australian wine exports.

South Australia accounted for 63 per cent of the value of Australian wine exports in 2020/21 but recorded a decline of 11.6 per cent.


Wine

Value of Australia’s top 10 wine export markets



China $577 ê -46.1% 21.9%

UK $516 é +26.0% 19.6%

USA $412 ê -7.5% 15.7%

Hong Kong $198 é +91.2% 7.6%

Canada $184 ê -1.9% 7.0%

Singapore $109 é +6.0% 4.2%

New Zealand $103 é +4.2% 3.9%

Netherlands $62 é +8.4% 2.3%

Japan $48 é +1.3% 1.8%

South Korea $45 é +106.7% 1.7%

A$

billi

ons

Value of products exported to top five wine markets

1.2

1.0

0.8

0.2

0.4

0.6

0.0

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

UKChina USA HongKong

Canada

WhiteRed Sparkling Fortified Other

Major export marketsChina remained Australia’s most valuable wine export market in 2020/21 however monthly exports declined dramatically after tariffs were imposed on Australian wine imports in late November. The prospects of tariffs being introduced was anticipated from August when an anti-dumping investigation was initiated. As the threat of tariffs loomed, Australia exported $326 million of wine to China in September and October, a 60 per cent increase on the same period in 2020. Since the introduction of tariffs in late November, Australia exported only $17 million of wine to China, 97 per cent lower than the same period in 2019/20. Red wine accounted for 97 per cent of the value of exports to China in 2020/21 and declined in value by $472.6 million (-46.1 per cent). The decline in red wine exports to China saw their share of Australian red wine exports fall from 47 per cent in 2019/20 to 29 per cent in 2020/21, and only 1.8 per cent since December. The value of wine exports to China is set to fall further in 2021/22 as tariffs of between 116.2 per cent and 218.4 per cent apply for the full financial year. If monthly export values of the last seven months continue, China would drop out of the top 10 wine export markets in 2021/22 with export value of less than $25 million.

Wine exports to the UK increased by $106.4 million in 2020/21 driven by growth in red wine of $60.9 million (+24.4 per cent) and white wine of $46.2 million (+30.3 per cent). The UK remained Australia’s largest wine market by volume, accounting for 38 per cent of total exports. Growth in the volume of red wine exports of 29 million litres accounted for just under half of the 63.7 million litre decline to China. However, the growth to the UK was not driven by exports being rerouted from China as growth was primarily between July and December 2020, before Chinese tariffs were imposed. The value of exports to the UK between July and December was 50 per cent higher than the year before, while exports between January and June 2021 were only 5.7 per cent higher year-on-year. Australian wine may be able to expand exports to the UK in 2021/22 due to a greater supply of Australian wine, however the size and value of the market will be insufficient to offset the additional decline expected from China.

The value of wine exports to the US declined in 2020/21 by $33.2 million. This was driven by a decline in red wine exports of $18.5 million (-7.8 per cent) and white wine of $14.8 million (-7.2 per cent). The US is an attractive market for Australian wine exports to explore further growth opportunities due to forecast growth in consumption of premium wines in the next five years.

Hong Kong was the second largest growth market for Australian wine exports in 2020/21, behind the UK, with an increase in value of $94.6 million. Growth was largely confined to red wine which accounted for 89 per cent of total wine exports to Hong Kong.

A$

billi

ons

Value of top five Australian wine export markets

1.2

0.4

0.8

1.0

0.6

0.2

0.0

USAChina UK Hong Kong Canada

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Growth in export value to Australia’s smaller wine markets was not enough to fully offset the decline to China.

Red wine exports declined by $473 million to China in 2020/21 and increased by only $171 million to all other markets.


Wool

The Australian wool industry had a challenging start to the 2020/21 season with COVID-19 reducing buyer appetite and impacting wool prices. Australian wool export volume increased but low export prices saw the overall value of Australian wool exports contract year-on-year. Favourable seasonal conditions and steadily increasing wool prices should translate into increased export value over the next year as advanced economies emerge from restrictions and consumer retail spend increases.

Mark Pain Regional Manager Agribusiness, QLD and Northern Rivers NSW


Export valueAustralia exported $2.5 billion of wool in 2020/21, a decrease of $47.4 million (-1.9 per cent).

Export priceThe export price of Australian wool fell to $8,506/tonne, a 17.1 per cent decrease.

Export volumeAustralia exported 289,815 tonnes of wool in 2020/21, an increase of 18.3 per cent.

OutlookExport value will increase in 2021/22 as Australian production and international demand recovers.

Trade performance and outlookAustralian wool export value declined for a third consecutive year in 2020/21. While export volumes increased, the 17.1 per cent decrease in average export price was enough to push the overall export value lower. Most wool producing states had lower export value than the previous season in 2020/21, with South Australian export value falling by the greatest amount to $106 million, a 20.8 per cent decrease. Victoria continued to have the largest wool export value of $1.3 billion, down only 0.5 per cent year-on-year. Western Australia increased its wool export value by 7.8 per cent to $512 million.

Favourable seasonal conditions helped rebuild the national sheep flock and saw 7.6 per cent more wool tested compared to 2019/20. Improved prices resulted in wool stockpiled on-farm and in stores being offered at market, which helped grow the wool export volume in 2020/21 by 18.3 per cent. All micron ranges increased in export volume except for the 24–to–27 micron range which fell by six per cent. Fine micron wools (<20 microns) were highly sought after and made up 47.3 per cent of the total volume exported. However, it was the broad (>27 micron) types that had the greatest export volume growth of 55.3 per cent. The 15,838 tonnes of broad wool exported was a product of favourable conditions increasing the length of wool shorn and recovering demand. Export volume and value of fine, medium and broad wools are expected to increase in 2021/22 as wool prices gradually rise and bales from the previous season are sold.

The Australian wool export price fell to $8,506/tonne, the lowest since the 2014/15 season. Micron price guides were lower across the board. The greatest price impact was for wool between 24–27 microns which lost $2,187/tonne on average from the prior year, a decrease of 34 per cent. The wool export price of fine wool (<20 microns) was impacted but to a lesser extent, falling by 13.5 per cent in price. The greater proportion of fine micron wools being exported helped to temper the effect of low broad wool price on export value. The average export price of wool is set to increase in 2021/22 as vaccine rollouts allow people to return to work and attend events that require high quality woollen apparel.

Wetter-than-usual conditions into spring will aid further flock rebuilding and increase the number of sheep shorn. Wool prices are anticipated to rise with the Eastern Market Indicator to return above 1,500c/kg. Increased wool production and large offerings at sale days may intermittently stall price growth. However, as global economies recover from COVID-19, strong international demand for Australian wool is expected to overcome the supply side pressure.

Wool

A$

billi

ons

Value of Australian wool exports

4.0

3.0

3.5

2.5

1.0

0.5

1.5

2.0

0.0

20–23 micron<20 micron 24–27 micron >27 micron

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

billi

ons

Value of Australian woolexports by state

2.5

2.0

1.5

1.0

0.5

0

2019/202018/19 2020/21

VIC WA NSW SA

The value of Australian wool exports fell in 2020/21 for a third consecutive year.

Victoria accounted for 54 per cent of Australia’s wool export value in 2020/21.


Wool

Major export marketsAustralia’s largest wool export market remained China in 2020/21 with over $2.1 billion worth of wool exported there. China has been Australia’s most important export partner for the past 23 years. In 1998/99, China accounted for a fifth of Australia’s wool export value, this has since risen to 86.1 per cent in 2020/21. In mid-2020, COVID-19 was spreading across the world resulting in lockdowns and reduced consumer spend on higher priced woollen clothing. The reduced demand for finished products impacted each step of the supply chain. Reduced demand for processed wool manufactured in China resulted in less appetite from Chinese buyers to purchase raw Australian wool. The lack of international demand saw the Eastern Market Indicator drop to its lowest level in over ten years, down to 858c/kg in September 2020. Since the low in September, the Eastern Market Indicator rose 66 per cent to the end of the wool season. China’s swift recovery from COVID-19 and the emergence of advanced economies from lockdowns renewed demand for Australian raw wool.

At the beginning of 2021, China raised its tariff-free quota for Australian clean wool by five per cent to 38,288 tonnes. This was consistent with the China-Australia Free Trade Agreement (ChAFTA) that outlines a five per cent increase per annum from 2018 until 2024, to a total of 44,324 tonnes. The rest of wool exported is still subject to a one per cent tariff. While this quota adjustment was expected, it signified the continued relationship between the Australian and Chinese wool industry. Wool has so far avoided becoming embroiled in trade disputes between Australia and China and is expected to stay that way given there are few suitable alternative origins for raw wool except Australia.

India and Italy have been jostling for Australia’s second largest export market for the past few decades. In 2020/21, India accounted for $88 million of Australia’s wool export value, followed by the Czech Republic ($69 million), Italy ($66 million), and South Korea ($51 million). All four countries suffered economic disruptions from COVID-19 and as a result wool export value was down sharply for all destinations. Australian wool export value to India was down 36 per cent in 2020/21 while export value to Italy was down 54.6 per cent. Italy manufacturers import primarily super fine and fine micron wool for processing woollen suits. COVID-19 lockdowns resulted in people working from home and reduced suit sales; men’s suit imports into the US were down over 60 per cent last year. The result was reduced demand for wool garments, processed wool, and ultimately raw Australian wool exports. Export value to all key markets is expected to recover in the 2021/22 season as vaccine rollouts reduce restrictions in time for the European and US winter.

Value of Australia’s top five wool export markets



China $2,123 é +9.2% 86.1%

India $88 ê -36.0% 3.6%

Czech Republic $69 ê -7.2% 2.8%

Italy $66 ê -54.6% 2.7%

South Korea $51 ê -16.0% 2.1%

A$

billi

ons

Value of top five Australian wool export markets

4.0

2.0

1.0

0.5

3.0

3.5

2.5

1.5

0.0

Czech RepublicChina India Italy South Korea

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

billi

ons

Value of products exported to top four wool markets

3.0

2.5

2.0

0.5

1.0

1.5

0.0

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

IndiaChina CzechRepublic

Italy

20–23 micron<20 micron 24–27 micron >27 micron

Australian wool export value fell to all destinations except for China.

Micron ranges stayed consistent year-on-year with fine microns making up half of exports.


Sugar

Australian sugar exports decreased marginally in 2020/21 as lower supply was balanced out by reduced demand due to the impacts of COVID-19. Production isn’t likely to increase significantly this harvest, but high international prices driven by reduced production in Brazil should see Australian growers capitalise on a better return for sugar produced this coming year.

Andrew Smith Head of Sales – East


Export valueAustralia exported $1.6 billion of sugar in 2020/21, a decrease of $8.2 million (-0.5 per cent).

Export priceAverage export price of Australian sugar in 2020/21 was $459/tonne, a decrease of -0.4 per cent.

Export volumeAustralia exported 3.5 million tonnes of sugar in 2020/21, a decrease of -0.1 per cent.

OutlookHigher global prices due to production issues in Brazil will see total value increase despite similar production.

Trade performance and outlookAustralian sugar export value recorded a year-on-year decrease of 0.5 per cent in 2020/21 after last year’s increase bucked the recent trend of declining export value over the previous two years.

The volume of Australian sugar exports recorded a marginal year-on-year decline of 0.1 per cent, which is 10.2 per cent below the five-year average. A decline in global sugar consumption resulting from the impacts of COVID-19 as well as recovering global sugar stocks slowed exports in the past year. This resulted in Australia exporting a lower proportion of sugar production in 2020/21 (74 per cent, down from 82 per cent) and increasing the amount of stock carried over to the 2021/22 season. Australia generally has very low carry over of sugar stocks from one season to the next, so exports are predominantly a result of production minus domestic demand.

After consecutive years of increasing average export price due to a global deficit of stocks, prices dropped 0.4 per cent in 2020/21 to sit just below average at $459/tonne. An anticipated return to surplus global production has been stymied by production issues in Brazil and Thailand which served to counter potential price reductions due to reduced demand, and maintain elevated prices seen in recent years of global sugar deficit.

Sugar

The total value of Australian sugar exports is expected to increase in 2021/22. The trend of reduced area planted to sugar is forecast to continue, however positive seasonal conditions are anticipated to see improved yields lead to a similar or slightly increased volume of cane crushed and sugar produced from last year. Prices are forecast to increase from 2020/21 with forward prices for the season pushing $550/tonne. Global production was expected to return to surplus, however reduced production in Brazil due to drought and frost, and in Thailand due to drought is likely to see global balance sheets tighter than expected which will support prices. Increased exports from India, where elevated global prices have made sugar exports viable despite having government subsidies removed, will fill some of the supply hole left by reduced global production. Australia is also positioned well to capitalise on rebounding demand and global production issues and should see a higher return per tonne.

Note on data availability: Official statistics on sugar exports (including export markets and state of origin) are unavailable due to confidentiality provisions. Data is published on a quarterly basis and released six months after the reference period. Estimates from the Australian Bureau for Agricultural and Resources Economics and Sciences (ABARES) have been used in this report.

A$

billi

ons

Estimated value of Australian sugar exports

2.5

0.5

2.0

1.0

1.5

0.0

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

mill

ion

tonn

es

Estimated volume of Australian sugar exports

4.5

1.0

4.0

0.5

1.5

2.5

3.5

2.0

3.0

0.0

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Despite increased production, reduced global demand resulted in volume of sugar exports similar to 2019/20.

Total value of sugar exports remain largely unchanged year-on-year.


Horticulture – Fruit

Despite a general increase in fruit production following favourable growing conditions, export conditions in 2020/21 were challenging due to logistical issues and ongoing trade tensions with China. This led to a decline in both export value and volume while average export prices remained relatively steady. The outlook for fruit exports in 2021/22 is positive due to expected increased production driven by favourable conditions and the recent extension of the International Freight Assistance Mechanism to June 2022.

John Reilly Regional Manager Agribusiness, WA South


Export valueAustralia exported $1.3 billion of fruit in 2020/21, a decrease of $267.5 million (-17.4 per cent).

Export priceA decline in table grape export price was offset by increases to citrus and stone fruit prices.

Export volumeChallenging export conditions saw an 18 per cent decline in total export volume to 433,555 tonnes.

OutlookExports will be supported by a favourable production outlook in 2021/22 though ongoing export challenges are likely to remain.

Trade performance and outlookThe value of Australian fruit exports declined in 2020/21 for the first time since 2010/11 with a fall of $267.5 million (-17.4 per cent). The overall decline in export value was driven by an 18 per cent fall in export volume with the average export price of fruit essentially unchanged for the year.

Victoria accounted for 57 per cent of Australian fruit exports but recorded a decline of $178.4 million (-19.7 per cent) due to reduced table grape and citrus exports. Queensland recorded the second largest decline of the states, down by $36.7 million (-17.1 per cent), followed by New South Wales which fell by $27.7 million (-17.5 per cent). South Australia and the Northern Territory saw exports decline by $2.4 million (-1.7 per cent) and $3.5 million (-58.1 per cent) respectively. Only Tasmania reported an increase in exports with a rise of $5.5 million (+13.8 per cent) driven by a substantial jump in cherry exports thanks to strong production.

Table grapes recorded the largest decline in export value in 2020/21, falling by $168.4 million (-25.8 per cent) to $485 million. This was the first time since 2010/11 that table grape export values has declined, primarily due to ongoing trade tensions with China. Exports declined in response to reported delays of up to 20 days at Chinese customs which impacted the quality and value of fruit. While China remained Australia’s largest table grape export destination, export value to the country declined by 40 per cent in 2020/21. The volume of grape exports was 18 per cent lower in 2020/21 and the average export price fell by 6.4 per cent.


The value of orange exports fell by $23 million (-7.4 per cent) in 2020/21 to $287.2 million following a poor season. Reduced production saw the average export price increase by 7.4 per cent to $1,654/tonne. Orange exports declined to China which also placed additional pressure on growers, although this was partially offset by increased exports to Hong Kong, Japan, Vietnam and Indonesia. A strong season is currently in progress which will see supply remain high, although reduced export demand from China may make things difficult for exporters.

Stone fruit exports were one of the only major Australian fruit exports to report an increase in value in 2020/21. Total export value increased by $3.6 million to $174.4 million (+2.1 per cent) driven by cherries, peaches and plums. An increase of over 47 per cent in plum exports was the main driver for increased stone fruit exports with peaches and cherries relatively stable. Export volume was essentially unchanged while the average export price increased by 10.7 per cent.

Mandarin exports recorded a significant decline in value in 2020/21 following strong growth in 2019/20. Export value fell by $39.7 million (-21.2 per cent) to $147.4 million driven by a 21.4 per cent decline in export volume. A strong mandarin harvest is currently being reported across much of the east coast despite some issues sourcing labour. This should see volumes rebound over the coming year, though ongoing trade issues with China will continue to negatively impact exports.

A$

mill

ions

Value of Australian fruit exports by state

1,000

900

800

500

400

600

200

100

300

700

0

2019/202018/19 2020/21

VIC QLD SA NSW TAS WA

A$

billi

ons

Value of Australian fruit exports

1.6

1.4

1.2

1.0

0.4

0.2

0.6

0.8

0

OrangesGrapes Stonefruit Mandarins Other

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Tasmania was the only state to record an increase in export value in 2020/21 thanks to increased cherry production.

The value of Australian fruit exports declined for the first time in ten years, driven by significant falls in table grape and citrus exports.



Major export marketsFruit exports to China fell in 2020/21 for the first time since 2009/10, declining by $182.6 million (-35 per cent) as trade tensions between Australia and China continued to build. Chinese fruit importers noted that the import fruit market has grown more diverse and the competitive advantage of Australian fruit is not as strong as it previously had been. Table grapes accounted for 48.4 per cent of fruit exports to China but declined by $112.6 million in 2020/21 despite a bumper season. Citrus exports to China also fell, down by $63.8 million (-37.9 per cent) following a poor season which was significantly impacted by drought and bushfires. With harvest currently underway, a bumper crop should see exports increase in 2021/22 though reports of hold ups of Australia fruit at Chinese ports have some citrus producers concerned. Tariff reductions for Australian mandarins did not have the positive impact that many producers were anticipating with exports to China almost halving.

The value of fruit exports to Hong Kong rebounded in 2020/21, rising by $29.3 million (+23.7 per cent) on the back of increased citrus, table grape and stone fruit exports. Orange exports increased by $9 million (+23.5 per cent) with table grapes exports increasing by $8.7 million (+23.5 per cent). Stone fruit exports also recorded a sharp rise in exports, driven by cherries which increased by $9.9 million (+61.3 per cent) following strong production in Tasmania.

The value of fruit exports to Japan increased for a ninth consecutive year in 2020/21, up 1.5 per cent to $135 million. Increased export value to Japan was again primarily driven by growth in orange and mandarin exports of $3.6 million (+5.8 per cent) and $4.2 million (+46.3 per cent). In contrast, table grape exports declined for the third consecutive year in 2020/21, falling by $9.7 million (-20.4 per cent). Fresh melon exports continued to grow following the removal of tariffs in April 2019, increasing $3.7 million (+59.2 per cent).

Indonesia recorded the second largest increase in value of Australian fruit exports during 2020/21 of $12.3 million (+17 per cent) thanks to the signing of the IA-CEPA in late 2020. This agreement eliminated almost all tariffs on Australian fruit exports to Indonesia. This increase in exports was driven by a $15.9 million (+35 per cent) jump in table grape exports. In contrast, exports of stone fruit declined by $1.5 million (-26.0 per cent) alongside a $2.9 million decline in mandarin exports.

Value of Australia’s top 10 fruit export markets



China $339 ê -35.0% 26.7%

Hong Kong $153 é +23.7% 12.0%

Japan $135 é +1.5% 10.6%

Indonesia $85 é +17.0% 6.7%

Vietnam $72 ê -0.6% 5.7%

Singapore $69 ê -20.0% 5.5%

Thailand $62 ê -15.3% 4.9%

New Zealand $50 ê -14.6% 4.0%

Philippines $45 ê -3.0% 3.5%

Malaysia $42 ê -25.5% 3.3%

Value of top five Australian fruit export markets

JapanChina Hong Kong Indonesia Vietnam

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

600

400

200

300

100

500

0

Value of products exported to top five fruit markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

HongKong

China Japan Indonesia Vietnam

A$

mill

ions

600

400

200

300

100

500

0

OrangesGrapes Stonefruit Mandarins Other

Increases in exports to Hong Kong, Japan and Indonesia was not enough to offset the decline to China.

The decline in fruit export value to China was led by a fall in table grapes despite a bumper season.


Seafood

Weakened demand drove a decline in the value of Australian seafood exports in 2020/21 as the combined impacts of COVID-19 and an unofficial ban on rock lobster exports to China led to lower prices. While demand for some seafood products may improve as export markets recover from COVID-19, the lingering ban on rock lobsters to China will keep export value subdued into 2021/22.

James Robinson Head of Sales – West


Export valueAustralia exported $1.1 billion of seafood in 2020/21, a decline of $152 million (-11.9 per cent).

Export priceAverage export price of Australian seafood declined by 22.7 per cent in 2020/21.

Export volumeAustralia exported 59,774 tonnes of seafood in 2020/21, an increase of 14.0 per cent.

OutlookLower prices and unfavourable terms of trade will prevent growth in seafood exports in 2021/22.

Trade performance and outlookThe value of Australian seafood exports declined in 2019/20, driven by a significant reduction in average export price of 23.8 per cent. A decline in the average export price more than offset a 22.9 per cent increase in export volume, leading to a 6.4 per cent decline in the total value of exports.

The spread of COVID-19 since the beginning of 2020 has had a noticeable impact on the value of Australian seafood exports. The value of Australian seafood exports in the first half of the financial year was up 12.6 per cent year-on-year, whereas the second half of the financial year saw the value of seafood exports decline by 25.3 per cent year-on-year. Market access to key importers of Australian seafood became an issue which left seafood markets with effectively no option but to allocate stock previously bound for export back to the domestic market. In some instances, prices for consumers have reportedly been back at levels not seen since the turn of this century. Given the impacts of COVID-19 on both trade flows and Australia’s relationship with China, Australia’s largest seafood export market, further reductions in export value are likely for 2020/21.

Seafood

Crustaceans have been the mainstay of Australian seafood exports by value for some time but recorded a decline in value of $189.2 million (-22.5 per cent) in 2019/20. The decline in value was the result of a 24.2 per cent decline in the average export price which more than offset a 2.3 per cent increase in export volume.

The average price of fish exports increased by 0.3 per cent in 2019/20, with volume increasing by 35.6 per cent. This led to an increase in the value of fish exports of $129 million (36 per cent) which helped offset a portion of the gap left by the decline in crustacean exports.

Contrary to the events of 2019/20, average seafood export prices have been much more stable than volumes over the past five years. During this time, export prices for fish have increased 3.5 per cent while crustacean prices have declined 8.4 percent (largely due to events in the past year). The inverse is true of export volumes, with crustacean export volumes coming in 11.9 per cent below levels from five years ago and fish export volumes showing a 79.1 per cent increase across the same period.

A$

billi

ons

Value of Australian seafood exports

1.6

1.4

1.2

0.6

0.2

0.4

0.8

1.0

0

Rock lobsterFish Abalone Other

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

Value of Australian seafood exports by state

600

500

400

200

100

300

0

2019/202018/19 2020/21

WA TAS SA VIC QLD NSW

Western Australia accounted for 25 per cent of Australian seafood exports in 2020/21 but recorded a decline of 21 per cent.

Growth in the value of fish and abalone exports in 2020/21 was not enough to counteract a 30 per cent decline in rock lobster exports.


Major export marketsChina remained Australia’s most valuable seafood export market for a fourth consecutive year in 2020/21 despite a decline in value of $406.8 million (-53.1 per cent). The decline in value was driven by a dramatic fall in the value of rock lobster exports of $329 million (-65.3 per cent). This followed a decline of $203.8 million in 2019/20 to place rock lobster exports to China in 2020/21 below the 2018/19 peak by 75.3 per cent. Reduced rock lobster exports to China were driven by an unofficial ban which began in November 2020. This ban saw exports to China grind to a halt from an average monthly volume of 550 tonnes between July and October to only 12 tonnes since November. The sudden and dramatic decline in exports was devastating for the industry as China accounted for 93 per cent of the value of Australian rock lobster exports in 2019/20, with few alternative markets to mitigate the loss. The value of fish exports to China also declined in 2020/21, albeit by a more modest $57 million (-36.7 per cent). Seafood exports to China are likely to fall further in 2021/22 if the ban on rock lobster exports persists for the full financial year.

Hong Kong overtook Japan to be Australia’s second most valuable seafood export market in 2020/21 on the back of a doubling of export value. The rise was driven by a $111.2 million (+672 per cent) increase in the value of rock lobster exports. The increase in rock lobster exports to Hong Kong coincides with the decline to mainland China as the average monthly volume increased from 13 tonnes between June and November to 369 tonnes since December. The scale of the sudden increase in exports to Hong Kong was presumably driven by increased activity in ‘grey trade’ between Hong Kong and mainland China.

Seafood exports to Japan declined by $18.3 million in 2020/21 to the second lowest level in data going back to 1995/96. Tuna accounted for 72 per cent of seafood exports to Japan and was the primary driver of the overall decline, falling in value by $16.6 million (-11.7 per cent). Japanese demand for tuna was weaker in 2020/21 due in part to restricted travel and foodservice consumption resulting from the impacts of COVID-19 and drawdown of tuna stockpiled in early 2020 ahead of the then-planned Tokyo Olympics. Japan accounted for 89 per cent of the value of Australian tuna exports in 2020/21 and will be the key market to determine a recovery in Australian tuna prices in 2021/22.

Seafood exports also doubled in value to the US in 2020/21 to return above $100 million for the first time since 2006/07. Growth to the US was primarily driven by salmon exports which rose to $34.2 million in 2020/21, up from $2 million in 2019/20. This saw the US rise to be Australia’s second most valuable export market for salmon, behind China.

Growth in export value to the smaller markets of Vietnam, Taiwan and Thailand were driven by increased value of salmon and rock lobster exports to these markets. Seafood exports to these three markets grew by a combined $79.5 million (+92.8 per cent) and raised their share of Australian seafood exports from 6.7 per cent in 2019/20 to 14.6 per cent in 2020/21.

Value of Australia’s top 10 seafood export markets



China $360 ê -53.1% 31.7%

Hong Kong $221 é +109.4% 19.5%

Japan $174 ê -9.5% 15.4%

USA $101 é +104.7% 8.9%

Vietnam $70 é +83.7% 6.2%

Taiwan $56 é +75.2% 5.0%

Thailand $39 é +150.9% 3.4%

Singapore $27 ê -1.1% 2.3%

Indonesia $19 é +75.9% 1.7%

New Zealand $16 é +85.3% 1.4%

Seafood

A$

mill

ions

Value of top five Australian seafood export markets

1,000

600

400

200

300

100

800

900

700

500

0

JapanChina Hong Kong USA Vietnam

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Value of products exported to top five seafood markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

HongKong

China Japan USA Vietnam

A$

mill

ions

1,000

600

200

400

100

800

900

700

500

300

0

Rock lobsterFish Abalone Other

China’s share of Australian seafood exports fell from 59.6 per cent in 2019/20 to 31.7 per cent in 2020/21.

Rock lobster exports to China declined by $329 million, while fish exports to China decreased by $57 million.


Horticulture – Nuts

Australian nut production reached near record levels in 2020/21, which drove a surge in the volume of exports. However, the value of exports fell as an increase in global supply saw the average price of Australian nut exports fall significantly. Demand for Australian nuts could rebound as a drought-affected almond season in California may tighten global supply in the next 12 months.

Neil Verringer Regional Manager Agribusiness, South Australia and Northern Territory


Export valueAustralia exported $912 million of nuts in 2020/21, a decline of $78.6 million (-7.9 per cent).

Export priceAverage export price of Australian nuts declined by 27.9 per cent in 2020/21.

Export volumeAustralia exported 130,018 tonnes of nuts in 2020/21, an increase of 27.7 per cent.

OutlookThe outlook for Australian nut exports is strong with a reduction in global supply expected to lift prices and thus export value in 2021/22.

Trade performance and outlookThe value of Australian nut exports decreased by 7.9 per cent in 2020/21 despite a significant rise in the volume of exports following a significant production increase across most major growing regions. This added to record production in California, the world’s largest almond producer, to drive a rise in global supply which ultimately saw the average export price for Australian nuts plummet by 27.9 per cent. This significant decline in price was the primary reason for the overall decline in export value.

Victoria recorded a 36.7 per cent increase in the volume of nut exports in 2020/21, however a reduction in average export price of almonds saw the value of nut exports fall by $61.4 million to $401.3 million. Queensland overtook both New South Wales and South Australia to be the second largest exporter of nuts in Australia with a $78.1 million surge in the value of exports (+84.9 per cent) driven by an increase in macadamia exports of $111.8 million (+200.9 per cent). South Australia and New South Wales both recorded significant declines in the value of nut exports of $28.3 million and $146.9 million, respectively, on the back of lower almond prices.

Almond exports declined in value by $95.2 million (-14.7 per cent) in 2020/21 to $552 million, despite a 31.7 per cent rise in export volume.


This substantial increase in export volume both in Australia and globally saw the average almond export price fall by 35.2 per cent as a result. Drought conditions in California should see almond prices begin to slowly appreciate towards the back end of 2021 and into early 2022 while Australian export volumes are expected to rise on the back of strengthening global demand for both natural almonds and as a value-added food ingredient, in products such as plant-based milks.

The value of macadamia exports increased by 7.3 per cent to $326.5 million, eclipsing record high exports from 2019/20. The increase in export value was driven by a jump in export volumes which rose by 12.6 per cent. This jump in volume was accompanied by a minimal decline in average export price which fell by 4.7 per cent. A forecast increase in production will continue to support export volumes over the next 12 months.

The value of walnut exports increased substantially in 2020/21 by $4.6 million, (+31.6 per cent) to $19.2 million. This followed two years of decline and was primarily due to an 87.7 per cent jump in export volume. Increased export volume was partially offset by a 29.9 per cent fall in average export price. The rise in walnut export volume was driven by increased production throughout the major growing regions in New South Wales.

A$

mill

ions

Value of Australian nut exports

1,1001,000

900800

300

100

500400

200

600700

0

MacadamiasAlmonds Walnuts Other

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

Value of Australian nut exports by state

600

500

400

100

200

300

0

2019/202018/19 2020/21

VIC QLD SA NSW

Queensland recorded an increase in nut export value on the back of growth in macadamia exports.

The value of Australian nut exports plummeted in 2020/21 on the back of falling almond export prices.



Major export marketsGlobal demand for nuts across traditional export markets in India, Europe and China remain high. China remained the largest export market for Australian nut producers in 2020/21, despite a decline of $104.1 million (-21.9 per cent). The primary driver of this decrease was the substantial fall of $119.4 million (-35.4 per cent) in almond exports to $217.9 million. This decline was a result of COVID-19 supply chain disruptions, trade tensions between China and Australia and a bumper harvest in California which provided additional competition. Deteriorating crop conditions throughout California are likely to see a decline in the Californian almond crop with the United States Department of Agriculture forecasting a 10 per cent reduction from last year. This will benefit Australian almond exports with a rebound in demand for Australian almonds expected from China as a result. In contrast to the decline in almond exports to China, macadamia exports performed strongly in 2020/21 despite some disruption from COVID-19. The value of exports increased by $25.5 million (+21.2 per cent) following strong production in Queensland. Export volumes also lifted by 25.2 per cent with the average export price declining by 1.9 per cent.

The value of nut exports to India rebounded in 2020/21 with an increase of $41.8 million (+79 per cent). Increased almond consumption in India was the key factor behind the growth in exports, with this trend expected to continue over the next 12 months. Rising demand for Australian nuts was also evident in Vietnam where almond exports increased by $15.2 million (+64 per cent). The increase in exports to India and Vietnam was a result of reduced almond exports to China.

The quantity of nut exports to the EU-27 increased in 2020/21 by 5,182 tonnes. Despite this increase in quantity, the value of Australian nut exports to the EU-27 declined by $9.7 million (-6.3 per cent) driven by a lower average almond export price thanks to increased global supply. Almond exports to the EU-27 increased by 3,400 tonnes to 15,994 tonnes, but the value of exports fell by $11.4 million (-10.1 per cent). Macadamia exports followed a similar trend, with the quantity increasing slightly while the value of exports was down by $3.4 million (-10.6 per cent). With reduced global supply over the next 12 months the average price of nuts is expected to rise, increasing the value of Australian nut exports to EU-27 in 2021/22.

A recent $550,000 grant from the Federal Government should boost nut exports over the coming years with the additional funding to be used to launch a market expansion program in an attempt to give Australian nut products more market share overseas. The program will look to bolster export market diversification and improve Australian nut producers international reputation.

Value of Australia’s top 10 nut export markets



China $371 ê -21.9% 40.7%

India $95 é +79.0% 10.4%

Vietnam $63 é +9.9% 6.9%

Japan $53 ê -0.1% 5.8%

Germany $47 ê -16.8% 5.2%

USA $39 ê -9.5% 4.2%

Netherlands $36 é +94.9% 3.9%

New Zealand $25 ê -21.2% 2.8%

UAE $23 é +74.5% 2.5%

South Korea $21 é +23.0% 2.3%

Value of top five Australiannut export markets

VietnamChina India Japan Germany

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

500

400

200

300

100

250

350

150

50

450

0

Value of products exported to top five nut markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

IndiaChina Vietnam Japan Germany

MacadamiasAlmonds Walnuts Other

A$

mill

ions

500

400

200

300

100

250

350

150

50

450

0

China remained the largest market for Australian nut exports in 2020/21, despite a significant decline in the value of almond exports over the past 12 months.

Almonds remain Australia’s largest nut export though a rise in demand for macadamias from both Japan and China have driven macadamia exports higher.


Reduced cotton production in 2020/21 restricted volume available for export and in turn saw export value decrease significantly year-on-year. Cotton export volume and value is expected to recover in 2021/22 as improved seasonal conditions boost production. Global recovery from COVID-19 restrictions will help increase demand for Australian cotton as consumer confidence returns.

Andrew Smith Head of Sales – East

Cotton


Export valueAustralia exported $631.3 million of cotton in 2020/21, a decline of $330.3 million (-34.3 per cent).

Export priceThe average export price of Australian cotton fell 14.2 per cent in 2020/21 to $2,458/tonne.

Export volumeAustralia exported 257,000 tonnes of cotton in 2020/21, a decline of 23.5 per cent.

OutlookThere is a positive outlook for 2021/22 as increased production is expected to boost export volume.

Trade performance and outlookAustralian cotton export value fell by 34.3 per cent on the back of low production and supply chain disruptions in 2020. Export value of $631 million was the lowest since 2008/09. Consecutive drought years across cotton planted area resulted in the lowest volume of cotton exports this century with only 256,843 tonnes exported, a 23.5 per cent decrease. The export price of $2,458/tonne was in line with the ten-year average, meaning the lack of volume was the key contributor to low export value.

New South Wales (66 per cent) and Queensland (33 per cent) produce most of Australia’s cotton and rely on irrigation to grow cotton crops. Low production in the last couple of years is a result of reduced area planted due to lack of rainfall or reduced water entitlements. In 2019/20, just under 59,000 hectares was planted producing 590,000 bales. Good summer rainfall increased the hectares planted in 2020/21 to 274,354 hectares with bales produced anticipated to exceed 2.6 million bales. The outlook for 2021/22 is for increased prices and production if summer rainfall eventuates.

Export price in 2020/21 was 14.2 per cent lower year-on-year as slightly more supply than 2019/20 put some pressure on prices in addition to lower offshore demand due to COVID-19 disruptions.

Despite being lower than the previous season, the export price for 2020/21 is very close to the ten-year average of $2,469/tonne. The export price is expected to stay in line with the longer-term average into the new season as increased international demand for cotton as economies recover from COVID-19 will outweigh increased supply.

The large decline in cotton exports in 2020/21 was due to a combination of low carry in, reduced international demand and lower prices. Cotton export volume was down for a second consecutive year in 2020/21 with Australia’s major export destination of China taking significantly less. Years of drought and low production reduced the stock available for export in 2020/21. Production is expected to increase in 2021/22 as long-range predictions look promising for increased rainfall that will improve water availability for irrigated cotton. Cotton export value is set to increase more strongly in 2021/22 than most other agricultural commodities because they are coming off a low base.

A$

billi

ons

Value of Australian cotton exports

3.0

1.0

0.5

1.5

2.5

2.0

0.0

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

mill

ion

tonn

es

Volume of Australian cotton exports

1.4

1.2

0.2

0.6

1.0

0.4

0.8

0.0

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Cotton

Poor cotton production resulted in the lowest volume of exports in at least the last 25 years.

Low cotton export volumes reduced cotton export value by 34.3 per cent in 2020/21.


Major export marketsChina remained Australia’s largest export market for cotton in 2020/21, valued at $205 million, despite export value being down 66.4 per cent year-on-year. The average value of Australian cotton exports to China was $545 million over the five years prior to the 2020/21 season. Trade tensions between China and Australia resulted in Chinese mills being “discouraged” from purchasing Australian cotton with concerns of tariffs being imposed. Despite tariffs not being implemented, the tension remains and the loss of export value to China has been notable. While the trade stoush with China did not help the cotton industry, the low level of production in in the past couple of years was also a key driver of poor export performance.

Several other export destinations benefitted from the China-Australia trade relationship breakdown with Vietnam (+97.3 per cent), Turkey (+1,015.6 per cent) and Thailand (+62.5 per cent) all increasing in export value. Vietnam surpassed Indonesia as Australia’s second largest export partner for cotton, accounting for 29 per cent of market share. Australian cotton exports to Vietnam were valued at $183 million, an increase on the prior year but still 31 per cent below the five-year average.

Indonesia was Australia’s third largest export destination despite export value being down 15.9 per cent to $82 million. Low Australian cotton production was the primary driver behind reduced exports to Indonesia as well as disruptions from COVID-19. Indonesia imported more cotton from China, the US, Brazil, and Hong Kong than Australia in 2020/21.

The outlook for cotton in 2021/22 is for increased export volume to destinations except for China. As economies emerge from COVID-19, retail spend is expected to increase and subsequently demand for processed and raw cotton. Australia’s cotton production will increase if favourable summer rainfall eventuates at the end of this year and more hectares are planted.

Reported* value of Australia’s top 10 cotton export markets



China $205 ê -66.4% 32.5%

Vietnam $183 é +97.3% 29.0%

Indonesia $82 ê -15.9% 12.9%

Turkey $45 é +1,015.6% 7.2%

India $29 ê -22.1% 4.6%

Thailand $27 é +62.5% 4.3%

Bangladesh $25 ê -38.5% 4.0%

Malaysia $9 ê -68.1% 1.5%

Japan $9 ê -51.6% 1.5%

Pakistan $8 ê -19.0% 1.3%

Cotton

Value of top five Australian cotton export markets

IndonesiaChina Vietnam Turkey India

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

billi

ons

2.0

1.2

0.4

1.6

0.8

1.4

0.6

0.2

1.8

1.0

0.0

Value of top five Australiancotton export markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

VietnamChina Indonesia Turkey India

A$

mill

ions

1,000

600

200

400

100

800

900

700

500

300

0

China remained the largest export market for Australian cotton in 2020/21, despite a 66.4 per cent decrease in export value.

Exports to China and Indonesia were down sharply while exports to Vietnam and Turkey increased strongly.


Horticulture – Vegetables

Despite strong vegetable production across most of Australia in 2020/21, the value and quantity of all major vegetable exports declined with the exception of carrots. This decline in exports was a result of the COVID-19 pandemic, with shipping disruptions and logistical issues leading to an increase in shipping costs, impacting the viability of vegetable exports. Favourable growing conditions and a rebound in global foodservice demand should see Australian exports bounce back in 2021/22.

Neil Verringer Regional Manager Agribusiness, South Australia and Northern Territory


Export valueAustralia exported $288.6 million of vegetables in 2020/21, a decline of $6.6 million (-2.2 per cent).

Export priceThe average export price of Australian vegetables declined by 4.4 per cent in 2020/21.

Export volumeAustralia exported 221,002 tonnes of vegetables in 2020/21, an increase of 2.3 per cent.

OutlookThe outlook for 2021/22 is strong with increased production and rebounding global demand providing a boost for exports.

Trade performance and outlookThe value of Australian vegetable exports declined for the second year in a row in 2020/21, decreasing by $6.6 million (-2.2 per cent) to $288.6 million. All vegetable exports recorded a fall in export value except for carrots and onions. The primary driver of the decrease was a decline in export volume across all key varieties again with the exception being carrots and onions which recorded increases of 4.7 per cent and 24.8 per cent, respectively. The general decline in vegetables export volumes was driven by the COVID-19 pandemic coupled with shipping disruptions and logistical issues which led to an increase in shipping costs.

All states except for Queensland and Western Australia recorded a decline in vegetable exports during 2020/21. Western Australian exports increased by $1.9 million (+1.6 per cent) primarily due to growth of carrot exports which increased by $4.7 million (+6.9 per cent) while Queensland exports increased by $2.6 million (+6.4 per cent).

Carrots continued to be Australia’s most valuable vegetable export, increasing by $6.3 million (+6.9 per cent) to $97.4 million in 2020/21. This was driven by a 4.7 per cent increase in export volume and 2.1 per cent increase in average export prices thanks to a spike in consumers preparing meals at home following the downturn in the global foodservice industry throughout the back half of 2020. This jump in global consumer demand for Australian carrots was led by markets in Asia and the Middle East which continued to account for the majority of Australian carrot exports.


Australian potato exports declined by $5.3 million (-12.7 per cent) in 2020/21, but still achieved the third highest value of exports at $36.3 million. The decline was driven by an 8.5 per cent decline in export volume and a 4.8 per cent fall in average export price on the back of stagnant demand.

The value of onion exports bounced back in 202/21, increasing by almost $580,000 (+1.9 per cent) to $30.8 million after recording a significant fall in 2019/20. Export volume increased by 24.8 per cent per cent, partially offset by an 18.3 per cent decline in the average export price. This increase in exports was primarily driven by a rise in exports to Thailand, Taiwan, Malaysia and Singapore. This was enough to offset a decline in exports to Australia’s primary onion exports markets in Europe as exports to the EU-27 declined by $2.9 million (-28.8 per cent). European demand was weakened by extended lockdowns seen throughout most of the member states during the year. An increase in onion production throughout parts of the EU-27 also pushed onion exports lower.

The value of asparagus exports fell by $5.3 million (-21.4 per cent) to $19.6 million, driven by a 38.9 per cent reduction in export volume. This reduced export volume was primarily due to a fall in demand from Japan which had been Australia’s largest asparagus export market in previous years. Similarly, broccoli and cauliflower exports dropped in value in 2020/21 by $4.8 million (-22 per cent) to $17 million.

A$

mill

ions

Value of Australian vegetable exports

350

150

300

200

250

100

50

0

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

Broccoli & cauliflower

Onions

Carrots

Asparagus Other

Potatoes

A$

mill

ions

Value of Australian vegetable exports by state

120

100

80

20

40

60

0

2019/202018/19 2020/21

WA VIC QLD SA NSW TAS

Vegetable exports from Western Australia and Queensland increased due to a rise in carrot exports.

Carrot exports increasing by $9.2 million in 2020/21 while other major vegetable exports declined in value.


Major export marketsThe value of vegetable exports to Singapore decreased in 2020/21 by just over $690,000 (-1.3 per cent). This was first decline in the value of vegetable exports to Singapore in eight years. The decline was led by broccoli and cauliflower exports which fell by $930,000 (-8.4 per cent) and accounted for 19.7 per cent of vegetable exports to Singapore. Potatoes were the only major growth commodity with a rise of $245,000 (+11.8 per cent) while carrot exports remained relatively stable year on year at $12.2 million.

Vegetable exports to the UAE declined in value for a third consecutive year, down by almost $870,000 (-2.6 per cent). Onions and asparagus exports recorded the largest declines of $1.1 million and $940,000 respectively, while broccoli, cauliflower and carrots also recorded a decline. Potatoes were a strong growth commodity to the UAE with an increase of $2.4 million (+10 per cent) and accounted for 78.9 per cent of vegetable exports to the UAE. The decline to the UAE in 2020/21 was emblematic of the wider MENA region to which Australian vegetable export value fell for the first time in 12 years. Potato and onion exports decreased by $1.8 million (-34.2 per cent) and $1.9 million (43 per cent), respectively. In contrast, carrot exports grew by $3.8 million (+6.9 per cent). The value of exports to the region in 2021/22 is likely to increase as the region’s economy continues to recover from COVID-19.

Malaysia maintained its place as Australia’s third most valuable export market for vegetables in 2021/21 after taking over from Japan the year prior. The value of exports increased by $2.1 million (+7.5 per cent) to $29.8 million, led by an 11 per cent increase in carrot exports.

The value of vegetable exports to Japan fell in 2020/21 for a second consecutive year, declining by $4.4 million (-17.1 per cent) to $21.3 million. All major vegetable varieties reported a significant reduction in exports during 2020/21 with the exception of carrots which saw an increase of 8.3 per cent. Asparagus, Australia’s most valuable vegetable export to Japan, fell by $3.6 million (-19.8 per cent) after also recording significant falls the year prior. Increased production throughout the coming season will contribute to a rebound in export value in 2021/22, though continued closures due to COVID19 will continue to temper demand for Australian asparagus due to the impact upon the foodservice industry.

Value of Australia’s top 10 vegetable export markets



Singapore $51 ê -1.3% 17.8%

UAE $33 ê -2.6% 11.5%

Malaysia $30 é 7.5% 10.3%

Japan $21 ê -17.1% 7.4%

Hong Kong $20 é 0.5% 7.0%

Saudi Arabia $18 ê -4.7% 6.4%

USA $16 é 22.6% 5.4%

South Korea $14 é 32.7% 4.7%

Qatar $11 ê -5.9% 3.9%

Thailand $11 ê -21.0% 3.8%


Value of top five Australian vegetable export markets

MalaysiaSingapore UAE Japan Hong Kong

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

60

40

20

30

10

50

0

Value of products exported to top five vegetable markets

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

FY19

FY20

FY21

UAESingapore Malaysia Japan HongKong

A$

mill

ions

60

40

20

30

10

50

0

Broccoli & cauliflower

Onions

Carrots

Asparagus Other

Potatoes

Vegetable exports to Singapore increased for an eighth consecutive year in 2020/21.

Carrots remained Australia’s most valuable vegetable export to Singapore, the UAE and Malaysia.


Other agricultural exports

A$

mill

ions

Value of forage exports

600

500

300

400

200

100

0

Other foragesHay/chaff*

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

A$

mill

ions

Value of other meat and offal exports

300

250

150

200

100

50

0

Pig meat

Poultry meat and offal Other

Goat meat

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

2016

/17

2017

/18

2018

/19

2019

/20

2020

/21

2019/20 export value (A$ million)

2020/21 export value (A$ million)

Year-on-year % change Top two export destinations

Prepared foods including malts, cocoa, pet food, baked, other

$4,260 $3,535 -17.0%China ($1,060m)

New Zealand ($839m)

Other plant products including milling products, seeds, coffee, other

$1,291 $1,262 -2.3%USA ($259m)

Vietnam ($151m)

Other animal productsincluding fats, oils, hides, fibres, honey, eggs

$1,124 $1,096 -2.5%Singapore ($266m)

China ($219m)

Foragesincluding hay, chaff, lucerne, straw, other

$745 $667 -10.4%Japan ($231m)

South Korea ($132m)

Other meat and offalincluding goat, pig, poultry, other

$597 $533 -10.7%USA ($113m)

Singapore ($78m)

Beverages excluding wine

$545 $405 -25.7%New Zealand ($101m)

Philippines ($55m)

Food industry residues and waste$269 $266 -1.1%

USA ($42m)Taiwan ($40m)

Other live animalsincluding horses, buffalo, goats, other

$195 $171 -12.4%Hong Kong ($81m)

New Zealand ($58m)

*hay and chaff excluding lucerne


44

About the research

The Australian agricultural trade research is based on the reported values and quantities of goods at Australia’s ports sourced from Global Trade Atlas (with the exception of sugar which is sourced from ABARES). The report includes all agricultural, food and fibre products including processed products. Wood and articles of wood are not included.

The reported values are quoted Free On Board (FOB) in Australian dollars, unless otherwise noted, and not adjusted for inflation or foreign exchange rates.

In some instances, the export destination and/or state of origin is not identified in the data for confidentiality purposes. Figures may not reflect the actual export total.

Commodity groups may not include all products relevant to that group. For example, miscellaneous edible preparations is a significant commodity group by value and volume where individual products are not specified and therefore cannot be attributed to another commodity group.

Where appropriate, European and Middle East and North African nations are referred to as the European Union (EU-27) and the Middle East and North Africa (MENA).

EU-27 includes: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

MENA includes: Algeria, Bahrain, Djibouti, Egypt, Gaza Strip, Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Qatar, Saudi Arabia, Syria, Tunisia, United Arab Emirates, West Bank, Yemen.

This report is intended to provide general information on a particular subject or subjects and is not an exhaustive treatment of such subject(s). The information herein is believed to be reliable and has been obtained from public sources believed to be reliable. Rural Bank, a Division of Bendigo and Adelaide Bank Limited, ABN 11 068 049 178 AFSL/ Australian Credit Licence 237879, makes no representation as to or accepts any responsibility for the accuracy or completeness of information contained in this report. Any opinions, estimates and projections in this report do not necessarily reflect the opinions of Rural Bank and are subject to change without notice. Rural Bank has no obligation to update, modify or amend this report or to otherwise notify a recipient thereof in the event that any opinion, forecast or estimate set forth therein, changes or subsequently becomes inaccurate. This report is provided for informational purposes only. The information contained in this report does not take into account your personal circumstances and should not be relied upon without consulting your legal, financial, tax or other appropriate professional.©Copyright Bendigo and Adelaide Bank Ltd ABN 11 068 049 178 (1643593–1643428) (08/21)


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Australian Agricultural Trade 2020/21

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