Australian canola seeds make welcome return to Pakistan
Australian Government acts quickly to secure export opportunity
Australia canola growers are looking forward to a golden future in the growing market of Pakistan after a joint effort by government and industry reopened exports to the country. This will be the first time in five years that Australian canola seeds will be available in Pakistan.
Austrade, the Department of Agriculture, Water and Environment, and the Department of Foreign Affairs and Trade worked with Pakistani authorities to resolve phytosanitary and technical import issues.
As a result of their coordinated approach, Pakistani importers were granted permits to import Australian canola seeds in late May. Agribusiness trading company Cargill and other traders can now resume exporting canola seeds to Pakistan.
“We now have access to a market we haven’t been exporting to for several years,” says Peter McBride, Director, Corporate Affairs – Asia Pacific, Cargill. “It opens up opportunities for Australia to diversify its canola exports to a growing market, which will ultimately benefit Australian canola growers.”
The Australian Government is providing $72.7 million to help Australian farming, forestry and fishing exporters to expand and diversify their export markets as part of the Agribusiness Expansion Initiative.
Read more Australian agribusiness export success stories.
Export opportunity emerges
Australia was sending bulk shipments of canola seed to Pakistan for processing up until 2016–17. Around that time, the European Union and to a lesser extent China became the main markets for Australian canola seed exports. However, trade flows shifted when Pakistan required Australian canola seeds.
Fast-forward to early 2021, when Pakistan began offering contracts for Australian canola seeds. McBride received a call from Cargill’s office in Pakistan alerting him to the opportunity for Australia to resume exporting canola seeds to Pakistan.
The timing was ideal: the Australian agribusiness industry, including traders like Cargill, was looking to diversify into new markets.
“Pakistan has a growing middle class and the potential to become a significant market for Australian agribusiness in the long term,” McBride says. “It represents an important diversification opportunity for Australian exporters.”
Australia’s agricultural exports to Pakistan grew 35% year-on-year to $194 million in 2020 (primarily pulses, cotton, horticultural products and live breeder cattle).
Importers reach out for assistance
Importers in Pakistan were eager to start importing canola seeds from Australia again. However, they discovered Pakistan’s Department of Plant Protection (DPP) was not issuing import permits for Australian canola seeds.
The DPP wanted to conduct a biosecurity risk assessment to find out what pests and diseases were in Australia. This would help the DPP determine if access could be granted to import seeds from Australia; and if access is granted, what conditions would need to be applied.
A group of importers reached out to Austrade to see if there was anything the Australian Government could do to expedite the risk assessment process, including working with the DPP to iron out technical import protocols.
Australian Government takes action
Austrade swung into action. The agency immediately contacted the Australian High Commissioner in Islamabad to reach out to the Agriculture Counsellor in New Delhi. The High Commissioner asked the Agriculture Counsellor, who looks after the South Asia region, to request assistance from the Department of Agriculture, Water and Environment (DAWE).
In Australia, Cargill and other agribusiness traders had also reached out to DAWE and the Agriculture Counsellor for New Delhi. They also engaged with the Minister for Trade, Tourism and Investment, Austrade and the Grain Industry Market Access Forum.
“We heard Canada was exporting canola seeds to Pakistan and we wanted similar conditions to them,” McBride says. “Cargill and the industry as a whole worked with DAWE and the Agriculture Counsellor to resolve the phytosanitary and technical issues.”
Over the next few months, DAWE and the Agriculture Counsellor undertook extensive negotiations with the DPP to resolve these issues and agree on protocols. They were supported by Austrade and the Department of Foreign Affairs and Trade during this time.
Austrade provided Cargill and importers with updates throughout the negotiation process between the Australian and Pakistani authorities.
Import permits secured
In mid-May 2021, the negotiations concluded successfully. The DPP invited importers to apply for import permits and granted them at the end of May.
As part of the negotiations, Pakistani authorities also agreed that methyl bromide treatment could take place on arrival in Pakistan, rather than pre-shipment. This provides the operational flexibility required for exporters such as Cargill to make trade flows work.
“If the various government agencies had not gotten involved in the negotiation process, the review process would probably have taken much longer,” McBride says.
Cargill will look for export opportunities when the the new season crop begins to be harvested later in the year. Australian canola farmers are expecting a bumper crop this year, increasing their revenue prospects.
Read more Australian agribusiness export success stories.
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