Food and beverage to Papua New Guinea

(Last updated: 8 May 2009)

Trends and opportunities

The market

The value of Australia’s food and beverage exports to Papua New Guinea was estimated at A$280 million in 2008.

Papua New Guinea has an estimated population of 6.2 million people of which 15 per cent of the population dwell in urban areas throughout the 19 provincial centres. It is primarily the urban population, especially the expatriate community, which is the market for imported food and beverages.

The majority of the remaining 85 per cent of the population derive their livelihood through subsistent and small cash crop farming and have very little influence on the import of fresh food, processed food, and beverage products.

Opportunities

The major opportunities for Australian exporters in Papua New Guinea's food and beverage industry include:

• Fresh fruit and vegetables – stone fruit, deciduous fruits, exotic vegetables, salad greens
• Dairy products – fresh milk, cheese, butter, ice cream
• Meat – beef and lamb cuts
• Beverages – wine, fruit juice, flavoured milk, sports and health drinks
• Ethnic food – Asian, Indian, Italian and Mexican
• Grocery products – pasta, breakfast cereal, snacks, condiments
• Frozen foods – vegetables, pizza, pastry
• Gourmet foods – salamis, flavoured cheese, dips and pates
• Food ingredients for the manufacturing sector in Papua New Guinea

Competitive environment

There has been an increase in food and beverage imports from Asia. This is due to an increase in the Asian community in Papua New Guinea and that members of that community are developing businesses. 

There is consumer demand for an increasing variety of food types. This is consistent with trends in the region.

Tariffs, regulations and customs

Papua New Guinea has a single rate value added tax (VAT) of 10 per cent. The VAT is collected as part of the normal procedure at the point of entry. The customs valuation is calculated according to the cost, insurance and freight (CIF) value of the imported goods and the VAT is also charged on any customs or excise duty paid. 

Papua New Guinea Customs use the single column based on the Harmonised system. Most duties are applied ad valorem using the World Trade Organisation (WTO) valuation code guidelines of CIF value (as per Incoterms 1990)

Papua New Guinea has undertaken a process of steady reduction in tariff rates since 1997.

Tariffs have in general been reducing under the PNG Government’s tariff reduction program. However a moratorium on any further reduction was announced in the 2009 PNG Budget. Exporters should consult the PNG Internal Revenue Commission for advice.

Customs authority contact details:

Papua New Guinea Internal Revenue Commission
Bureau of Customs
PO Box 777, Port Moresby
Tel: +675 322 6600
Fax: +675 321 4249

Quarantine authority contact details:

National Agriculture Quarantine & Inspection Authority
PO Box 741, Port Moresby
Tel: +675 311 2100
Fax: +675 325 1673

Samples of no commercial value are admitted duty-free although sales tax may still be levied. Valuable samples are admitted, subject to invoice declaration, under a deposit or bond equivalent to normal duty. The deposit is refunded on re-export of the samples.

Industry standards

Regulations for food labelling are similar to Australia. Exporters are advised to apply Australian standards for packing and packaging. The product content details and manufacturer details must be in English.

Marketing your products and services

Market entry

It is important to establish that products are suitable for the Papua New Guinea market, taking into account that it is a relatively unsophisticated, price-driven market. 

Exporters must be prepared to supply minimum volumes, in most cases less than container load (LCL), often using consolidators. Although volumes may be low, frequency of orders may be more regular.

Exporters are encouraged to fund marketing activities, including media advertising, point-of-sale material and promotional incentives. Supermarkets advertise in the two daily newspapers but not as frequently as in Australia.

There are no trade fairs for the food and beverage industry in Papua New Guinea, although some businesses do conduct in-store promotions and external promotions: for instance, Holiday Inn hosts a monthly wine club dinner; the food prepared using imported produce used and served with a selection of imported wines.

Distribution channels

Australian producers and manufacturers can distribute products to Papua New Guinea using either Australian-based wholesalers/agents or retailers/wholesalers and agents based in Papua New Guinea.

Austrade Port Moresby can assist new exporters identify the most effective distribution chain for entry of their product into the Papua New Guinea market.

Many of the major retailers in Papua New Guinea are involved in an array of categories that are not usual in the Australian market: for instance, hardware and groceries. The major food and beverage retailers in Papua New Guinea include:

• Garamut Trading
• TST
• City Pharmacy (Stop n Shop)
• Papindo Trading
• SVS (including Andersons Foodland)
• Seeto Kui
• Bingtangor
• Tropicana

Transport

Despite the close proximity of Australia and Papua New Guinea, freight charges tend to be relatively high.

Transit time can vary significantly from a few days to weeks. Rapid delivery of shipping documents is essential as wharf storage dues are levied four days after the discharge of cargo. This is strictly enforced.

All goods must be air or sea freighted for the most part and consolidators are frequently used as consignments are often requested as a size or quantity that can fit on to a small truck or the back of a utility vehicle.

Physical distribution within Papua New Guinea can be complex due to:

• Geographic fragmentation
• Small market centres
• Contrasting demographic centres
• Lack of an extensive transport network

For these reasons, most goods are air or sea freighted. Air courier services are the faster means of means of delivery.

Qantas/Air Niugini and Virgin Blue/Airlines of PNG service the international passenger and cargo market.

Links and industry contacts

Food and beverage-related resources

National Agriculture Quarantine and Inspection Authority (NAQIA)
PO Box 741
Port Moresby NCD
Papua New Guinea
Tel: +675 311 2100 or 311 2113/4
Fax: +675 325 1673

Manufactures Council of PNG
PO Box 598
Port Moresby NCD
Papua New Guinea
Tel: +675 325 9512
Fax: +675 323 0199

Importers (traders/wholesalers/retailers)

Super Value Stores
PO Box 12988
Lae, Morobe  Province
Papua New Guinea
Tel: +675 472 1688
Fax: +675 472 1603

Seeto Kui (Holdings) Pty Ltd
PO Box 456
Lae Morobe Province
Papua New Guinea
Tel: +675 472 1111
Fax: +675 472 1335 or 472 6408

Garamut Enterprises Pty Ltd
PO Box 96
Wewak Sepik Province
Papua New Guinea
Tel: +675 856 2106
Fax: +675 856 2324

City Pharmacy Ltd
PO Box 1663
Port Moresby NCD
Papua New Guinea
Tel: +675 325 9044
Fax: +675 325 0942

BNG Trading Co Ltd
Po Box 148
Port Moresby
Papua New Guinea
Tel: +675 323 3366
Fax: +675 323 3355

Caterers

Eurest South Pacific Ltd
PO Box 459
Port Moresby NCD
Papua New Guinea
Tel: +675 320 1100
Fax: +675 320 1007

NCS PNGDF Limited
PO Box 707
Port Moresby NCD
Papua New Guinea
Tel: +675 321 5577
Fax: 675 321 5579

Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

• Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
• Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
• Administers the Export Market Development Grants scheme.
• Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
• Provides advice to the Australian Government on its trade and investment development activities.
• Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au