Transcript: A video case study on SEAPA

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>>Voiceover: Oyster farming relies on strong quality control, excellent hygiene standards, and high-tech equipment for cultivation and harvesting.

South Australian company SEAPA supplies the advanced production systems that oyster farms worldwide need to improve their yield.

SEAPA is preparing to take advantage of the free trade agreements with China, Japan and Korea, with the tariffs on products like their oyster farming equipment to be eliminated under the agreements.

SEAPA is now well positioned to build its business in Japan, and enter the Chinese and Korean markets, resulting in exciting new potential for jobs growth in the local area.

>>Alex Jack: I’m Alex Jack. I’m the sales manager for SEAPA. SEAPA is an aquacultural company who design, supply and market oyster baskets and aquacultural equipment for worldwide distribution.

We design all of our products. We’ve got 3D printers, we’ve got tooling designers that we develop the products here in house. We manufacture here in the same facility. We’ve got injection moulding machines that produce oyster baskets and our accessories and we export directly from here from our stock, around the world.

>>Voiceover: Under the Japan Agreement, the 3.9 per cent tariff on products like SEAPA’s has been eliminated, delivering the company a competitive boost in a market where it is building a strong reputation as an expert in oyster farming technology.

>>Alex Jack: So in 2013 we attended an Austrade delegation to the tsunami-devastated area near Sendai in Japan. That area lost 98 per cent of their farms and they want to start with new technologies and Australia is seen as a world-leading technology of oyster farming systems. Since then we’ve returned two more times to showcase our product, to give education about how our product works and they’ve also attended two delegations down to Australia to see our systems firsthand.

The immediate gain from the FTA will be through our Japanese distributor. They’re the ones purchasing the products off of us and with them being able to get the product cheaper without the duty rate we see it will be easy for them to distribute it into the marketplace. In turn, we see an increase in sales which comes back to us here in Australia.

>>Voiceover: Under the China Agreement, tariffs of around 10 per cent on products like SEAPA’s will be eliminated, creating a world of exciting opportunities.

>>Alex Jack: Asia’s really exciting because it is a huge market. You know, here in Australia we do 13,000 tonnes of oysters. In China alone they do about 2.2 million tonnes of oysters. It’s a commodity product for oyster meat but the middle class is growing, their demand for premium-quality oysters is increasing, so in turn we see that the demand for our product is definitely going to be increasing as well.

In China, it’s going to make much easier for us to get our product out in the marketplace, to get our feet in there at least, and that way if our product can be cheaper with our pricing strategy without the duties, it will be easy to compete against some of the other systems or other competitors out there in the market.

>>Voiceover: The agreement with Korea eliminated tariffs of around 6.5 per cent on products like SEAPA’s, prompting the company to look more closely at this market.

>>Alex Jack: Korea is quite similar to China with traditional farming systems, but we see that they are moving towards a more premium demand as their middle class expands as well. So we’ve had trials working with customers in Korea already who actually in collaboration with the government to compare SEAPA basket systems to traditional systems, and so far we’re getting really good results.

I think our product is quite unique and price hasn’t really been a driver for our product overseas so far, but when we’re looking in to competitors and what might be coming out of these other countries eventually, it’s definitely going to be helping if we can get our product at a cheaper rate.

The FTAs is definitely going to be a positive. We can look at our pricing strategies and maybe have a look at how we can market more into those countries, attend more visits and with the FTAs up our belt it’s definitely going to help us.

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