November 24, 2004

 

 

Australia's Dairy Industry To Boost Exports to China

 

Australia's dairy industry is preparing to forge closer links with China, which Netherlands-based Rabobank has identified as the world's fastest and largest growing market in the sector.

 

Australian Dairy Farmers (ADF) will reportedly take part in annual dairy talks between the Australian and Chinese governments.

 

Australian Dairy Farmers was a key player in a memorandum of understanding signed by the two governments on Monday that sets out the framework for the discussions.

 

The body's president Allan Burgess said his group plans a leadership role in developing trade opportunities with the Chinese market.

 

In a report released at the world dairy summit in Melbourne on Tuesday, Rabobank vice-chairman Wouter Kolff said China's dairy market was the world's fastest growing at 14 percent.

 

Other growth areas include South-East Asia, which is expanding at five percent, the 10 latest members of the European Union with four percent growth, Latin America at three percent and the Indian sub-continent at 2.4 percent.

 

The report comes as Australia prepares to launch formal talks on a free trade agreement with China, its fastest growing market where Canberra says two-way trade expanded by an extraordinary 50 percent in the last year.

 

Kolff revealed that China's dairy market, with 5.7 billion US dollars in sales last year, had a compound annual growth of 31 percent between 1998 and 2003.

 

Per capita dairy consumption was 13 kilograms, but was much higher in urban areas with 26 kilograms compared with the four percent in rural areas.

 

Kolff said that despite the rapid growth, China was still well behind its Asian peers, where consumption per head was 70 kilograms in Japan, 58 kilograms in Korea and 56 kilograms in Taiwan.

 

"This indicates huge growth potential, to be explored through a combination of income growth and better familiarity with dairy products," he added.