ABARES report shows Australian agricultural exports robust despite coronavirus disruption

Nimble responses by government and the agriculture sector enabled Australian agricultural exports to remain strong during COVID-19 despite disruptions to supply chains and logistics, according to a report released today by ABARES. The report, Analysis of Australian agricultural trade and the COVID-19 pandemic, finds that government and industry’s response to rapidly changing market conditions was critical to ensuring the strength of Australia’s trade profile. Co-author and ABARES’ head of forecasting and trade Jared Greenville said it positioned Australia well to take advantage of opportunities during the global economic post-pandemic recovery. He cited the government acting quickly to establish the International Freight Assistance Measure as an example of responses following the reduction in air freight capacity after passenger flights were drastically reduced. Dr Greenville also noted labour challenges with, for example, visa extensions and permission for agricultural workers to stay with one employer for a longer period. “Importantly, government has safeguarded the continuation of services that facilitate trade, such as certification, accreditation and other regulatory services, to ensure exports and imports still flow,” he said. Dr Greenville said while the pandemic precipitated a global economic downturn, it was unlikely to have a significant impact on demand for essential food products. “This persistence of demand was seen during the global financial crisis when agricultural trade remained steady,” Dr Greenville said. “But not all products from the agriculture, forestry and fisheries sectors are essential items. “As economic activity declines and global incomes are reduced, products consumed through more discretionary spending have been more significantly affected. “These include high quality foods for cafés and restaurants. These effects were seen for seafood where the outbreak in China has been estimated to have led to a fall in export earnings of around $200 million in 2019–20.” Official trade data indicates that, despite the pandemic, most agricultural exports have continued to leave Australia and reach consumers in international markets. Export levels have been on par with what would have otherwise been expected during early 2020. Where results are down on five-year average levels, it was because of factors other than COVID-19, such as the effect of drought on domestic production. Seafood exports were the significant exception, ABARES said, experiencing a significant decline in exports in February 2020. This was due to an unfortunate alignment of the spreading pandemic and peak export periods for some species, the report said. “Live animal exports are a watch point as the pandemic evolves, as demand from Indonesia and Vietnam declines, but export values remain above the five-year average,” it said. The pandemic is also driving some changes that will likely remain part of the future trade landscape. These include shifts in consumers buying more online, higher demand for stable and safe food, a greater awareness of supply chain risks, increased use of digital trade systems and the risk of creeping protectionism.