11/12/2020 - 14:00

Trade tension a lobster lesson

11/12/2020 - 14:00

Bookmark

Save articles for future reference.

Positioning western rock lobster as part of WA’s culinary culture could offset some of the downside of the trade dispute with China.

Pre-COVID-19, the western rock lobster industry was worth $450 million annually. Photo: Gabriel Oliveira

Alongside natural scenery, architecture, and man-made attractions, good food and drink is a major driver of international tourism.

Unique foods are essential to attract tourists who want to feel part of their destination through its flavours. For Western Australia, there is no more unique offering than western rock lobster.

Familiar fare for many older Western Australians from fish and chip shops last century, the rock lobster started to lose its cultural connection with WA in the late 1990s, when a growing number of affluent consumers in China paid a premium to acquire the product, which they believed had a taste, size, and prestige advantage over lobsters sourced from other parts of the world.

Affordability was affected in the late 2000s as the sustainability of the WA fishery came under threat, with a rapid decline in lobster numbers expected.

Decisions were taken to limit the catch size from its historical average of 11,000 tonnes down to 6,300t. This reduction in the catch size substantially increased the price to the point where the western rock lobster is now a luxury item that many younger Western Australians have never experienced.

Before COVID-19, the $450 million per annum fishery exported more than 95 per cent of its catch to China.

The problem with reliance on a single market was highlighted when the Chinese government halted the trade in late January as part of its COVID-19 public health measures.

Exports restarted before too long thanks to funding support from the federal government, which enabled live lobster shipments via air freight charters. The lobster industry would have started to hope the worst of the crisis was behind it.

Unfortunately, China has recently launched a campaign to progressively ban, threaten or disrupt imports of Australian commodities and produce, which includes western rock lobster.

China’s assault on our economy has little to do with COVID-19, although Australia’s call for an investigation into the origins of the virus was a useful pretext for the Chinese to act.

It provided the communist government with the propaganda tool it was seeking to vilify Australia to a largely compliant Chinese population.

The Chinese government’s animosity towards Australia emerged not long after Australia banned Huawei from providing equipment for 5G networks in late 2018. Australia was also at the forefront of international condemnation of the Chinese government’s repression of Uyghurs, and its violation of the 1984 Sino-British Joint Declaration concerning Hong Kong’s autonomy.

China also believes it is being singled out by Australia’s introduction of wide-ranging foreign interference laws.

However, the reason China was looking for an excuse to savage our economy was to provide an example of what happens to countries that oppose its attempt to annex two thirds of the South China Sea.

China considers Australia a weak link in the coalition opposing its illegal annexation; a link it believes can be broken through economic coercion.

Australia has shown maturity by taking China’s economic sucker punch on the chin without political or economic retaliation. It is possible, however, there will be bipartisan political support to quietly increase Australian warship operations in the South China Sea and judicious support of Taiwan’s democracy. This would not go unnoticed, so the future of exports to China will remain unpredictable.

For the western rock lobster industry, diversifying global buyers and product value adding must become urgent objectives for the WA government and industry.

With the growing importance of food tourism, western rock lobster is the one product with the potential to add value to the lobster catch and differentiate WA from other tourist destinations.

WA fishery scientists have determined lobster stocks have recovered to a stage where the annual catch can safely be raised by 1,700t, which is around 2 million extra lobsters annually. The WA government viewed this as an opportunity to increase the number of lobsters available to WA consumers and build tourist numbers.

In late 2018, the government announced a plan that would allow the western rock lobster industry to catch and sell an additional 315t. The balance of 1,385t would be caught under contract, with ownership and sales kept under the control of the state government. Strong industry opposition led to the government placing the plan on hold.

Australia is on track to reopen its borders to international travellers during 2021. Before this time, the state government and the western rock lobster industry need to find agreement on how a significant portion of the increased lobster catch can be permanently set aside for domestic use to help build a food tourist industry that has the potential to value add and diversify the market.

• David Kobelke spent 15 years managing CCIWA’s Australian industry participation unit

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options