Staples shore up food push to region

PRAWNS, fine wine and fresh cheese produced in WA may be in demand in the Middle East, but it is the more mundane, staple foods such as meat and wheat that are supporting WA exports.

The Middle East has, in recent years, become the third most significant export market for WA after the North and South East Asian regions.

For the past five years annual primary produce exports to the Middle East have contributed between $622 million and $1 billion to WA’s economy. WA agricultural exports in 2000-01, were valued at $706 million compared to just $77 million to North America and $364 million to Europe.

Australia continues to maintain a good market share for exports of live sheep and cattle exports.

In 2000, 208,000 head of cattle were exported to Egypt in 2000 at a value of $129.7 million. In 2001 despite exporting 4,000 head less than the previous year, the value of the trade increased by more than $20 million.

Sheep exports to Jordan were 542,000 head in 2001.

Israel has also emerged as a strong market. Cattle exports to there increased from 32,700 head in 2000 to 196,000 in 2001.

Major WA exports to the Middle East are fresh meat, predominantly lamb exports of $7 million, $3 million in cheese exports, $4 million, carrots, and $1.8 million in melons.

The largest destination for WA agricultural and fisheries export market was Iran. It took $150 million of WA’s agricultural produce in the past financial year.

Egypt bought $101 million of WA produce, Iraq $63 million, Kuwait $75 million and Saudi Arabia $86 million.

Department of Agriculture Middle East manager Berko Trhulj said there were now great trade opportunities for WA growers and produce agents existing in the perishable food market.

Food can be picked in Perth on one day and be on supermarket shelves in Dubai the next morning.

Mr Trhulj said the region was becoming increasingly anti-American with many consumers now boycotting US goods. Middle Eastern supermarket chain Spinneys reported that this was leading to US goods being left on the shelves longer than normal.

Spinneys representatives were in WA recently seeking to increase its WA produce.

The Department of Foreign Affairs and Trade made its position clear on the future importance of the region for trade in its 2002 Outcomes and Objectives Statement.

Changing Middle East demographics and a young generation with high expectations, reinforced by oil boom inheritances, is exerting strong pressures on social services.

Austrade has developed a strategy to introduce new food and beverage consumer products, targeting the growth in the retail sector and supporting the shift from the neighbourhood stores to supermarkets and hypermarkets as in Dubai.

According to Mr Trhulj the threat of war should also not discourage would-be food exporters to the Middle East.

“One of the major issues is war. But people still have to eat during war,” he said.

On the grains front an AWB Limited delegation last week went on a rescue mission following threats from Iraq to cut Australian wheat purchases if Australia continued to follow the US line on the Iraqi regime.

This threat provoked harsh words from Australian grain growers who feared losing a very lucrative, and surprisingly, stable market. They were insisting that the Australian Government should not be so keen to follow the US lead on Iraq.

Iraqi wheat buyers were also raising quality issues about current Australian wheat shipments.

Besides reaching a solution of sorts over the Iraqi situation, the delegation also came home with two new wheat markets in the Middle East – Jordan and Libya.

The delegation was led by AWB Limited managing director Andrew Lindberg who said Iraq had warmly welcomed it.

“In meetings with the Iraq Grain Board it was agreed that both parties would work together to solve these current issues and clear the way for the full resumption of our current contract for the supply of 500,000 tonnes of Australian wheat, that is part of a 1.8 million tonne export program this year,” he said.

“I am hopeful that the trust and goodwill that has been built up between the people of Iraq and Australia through our 50-year trading relationship in trading wheat will facilitate diplomatic solutions and increased trade into the future.”

The AWB sells approximately two million tonnes a year to Iraq through the United Nations’ Oil for Food Program.

Jordan has committed to 50,000 tonnes in the first order since 1996.

Libya also committed to buying 50,000 tonnes. Together they are expected to increase grain trade to the region by $25 million.

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