Market Access

Introduction

The citrus industry is a mature export industry and despite some challenges has enjoyed export success since the mid-1990s.

The industry has access to almost every major citrus market in the world and accordingly, has no new market access requests. However, maintaining access to existing markets, improving trade protocols and optimising the existing export trade conditions remain key priorities for the industry.

For the industry to remain competitive against other southern hemisphere suppliers, it must address cost and efficiency from every angle. As Australia’s National Plant Protection Organisation, the Department of Agriculture, Fisheries and Forestry (DAFF) has a critical role in providing export certification and resolving technical market access issues when they arise. Similarly, the Department of Foreign Affairs and Trade (DFAT) has a role to play in maintaining diplomatic relations in export markets and ensuring that trading partners adhere to commitments made under bilateral and multilateral trade agreements.

Maintaining access to existing markets

Policy position

• Citrus Australia expects that DAFF will maintain a strong and capable workforce to resolve trade and market access issues when they arise.
• Citrus Australia advocates for efficient use of resources in government, including the Horticulture Exports Program. DAFF should aim to attract, develop and retain appropriately trained and competent plant health professionals with high level negotiation skills. Such personnel must be dedicated, enthusiastic and responsive to industry needs.
• The Department must develop effective stakeholder engagement mechanisms, cultivate genuinely cooperative and transparent relationships with industry, and respond quickly to industry needs.
• The Department must maintain a strong network of overseas agriculture counsellors, primarily in northern hemisphere markets. Such individuals should possess sound technical aptitude and high-level interpersonal and negotiation skills.

Issues

1. With large volumes of citrus exported each year, regulatory issues in overseas markets will most certainly occur that could result in distressed cargo, punitive measures on importers, and punitive measures on the entire industry. Possible issues include documentation errors, phytosanitary violations, agrichemical residue breaches, and food safety incidents.
2. Importing country regulators are becoming more sophisticated in their approach to managing phytosanitary risks, agrichemical residues and food safety. Import conditions are continually evolving and are seldom liberalised. In some cases, when import systems are being reformed, trade may be banned without justification.

Improving and optimising trade protocols

Policy position

• Citrus Australia expects that DAFF will continue to prosecute cases for market access improvement for the Australian citrus industry. In an environment where multiple industries are competing for limited DAFF resources with limited negotiation space, Citrus Australia expects that DAFF's market access program and prioritisation process will be informed by the likely return on investment.
• DAFF's resourcing of import risk assessments for imported plant products should be focussed on requests from countries where Australia has active market access requests.

Issues

1. The citrus industry has access to most target markets but in many cases, importing country requirements are excessively complex, onerous, costly, and restrictive to trade. Continued negotiations are required to streamline and optimise export trade through improved conditions of trade.
2. While there are some diligent and enthusiastic officers in DAFF, there is a lack of long‑term commitment to individual roles and a high rate of staff turnover. Given that progress on market access initiatives can span several decades, the constant turnover of staff within the department impacts heavily on the rate at which market access gains are achieved.
3. Government resources required to undertake market access activities are limited and importing countries typically only consider a small number of import requests at a time.
4. Overseas trading partners typically link Australia’s market access requests to progress on their own requests.

Efficient and effective assurance and certification services

Policy position

• As the only organisation authorised to provide export assurance and certification services, such services must be provided efficiently and cost-effectively. While DAFF has made significant gains by moving towards industry-based Authorised Officers to perform product inspections, there is still much work to be done. The Department must continue to explore alternative methods of providing importing countries with assurance through better use of co-regulatory approaches with industry. Such approaches should capitalise on industry management systems and industry best practice.
• The Department’s cost recovery model for export certification should be designed in a way that is fair and equitable across export industries and encourages efficiency. On that basis, recovery should be based upon transactions, not on volume.

Issues

1. The citrus industry has established trade conditions (protocols) into most markets. The protocols are written with sufficient flexibility to allow DAFF to determine what conditions must be met before providing export certification. DAFF’s interpretation of protocols continues to evolve and regulatory impost grows. This creates barriers to market for citrus export businesses. Staff turnover within DAFF also creates challenges with new policy interpretations with each management change.
2. To qualify for export to some markets, citrus growers and packers are required to undertake certain activities and be audited annually by DAFF. The audit criteria and export regulation are ever increasing and are seldom liberalised. These regulations, guidelines and standards have made the audit and approval process excessively complex. Coupled with auditor exuberance and poor administration processes, DAFF continues to represent a barrier to trade.
3. DAFF is currently the only body authorised to provide phytosanitary export certification. In the absence of competition, certification services are inefficient and unresponsive to commercial needs.
4. The Australian Government has a policy of full cost-recovery for export certification services and the costs of operating the Horticulture Exports program continue to rise. It is likely that the cost-recovery model will require continual changes.
5. The current cost-recovery model is geared towards collection of levies on a tonnage basis. This model does not encourage efficiency by greater consolidation.

Market access research and development

Policy position

• The Australian Government should continue to encourage market access research and development through the existing model of matching industry levies with government co‑investment. Processes for allocating R&D funding should be efficient and designed to respond promptly to industry needs. Hort Innovation’s role is to invest the levy in programs that reflect the strategic investment plan and the advice of industry.

Issues

1. Market access negotiations must generally be underpinned by scientific evidence. While the citrus industry currently has strong scientific evidence for its current market access agenda, it is likely that more work will be required in the future.
2. Within limits, the Australian government matches the R&D component of horticulture levies on a dollar-for-dollar basis. While there is currently no threat to this arrangement, future reviews are likely.