An insight into Australian agricultural trade during the COVID-19 pandemic – and beyond
Australian Bureau of Agricultural and Resource Economics and Sciences’ (ABARES) latest Insights report confirms that our agriculture exports have stayed strong during COVID-19 despite disruptions to supply chains and logistics.
‘Analysis of Australian agricultural trade and the COVID-19 pandemic’ released today (5 June) finds that government and industry’s nimble response to rapidly changing market conditions has been critical to ensuring the strength of Australia’s trade profile.
Co-author and ABARES’ Head of Forecasting and Trade, Dr Jared Greenville, said this positioned Australia well to take advantage of opportunities during the global economic post-pandemic recovery.
“Supply chain and logistics disruptions observed in the early stages of the pandemic are benefiting from government and industry responses, and despite the risks, overall export performance has remained strong,” Dr Greenville said.
“While seafood exports experienced a significant decline in February 2020, March saw a slight rebound in export values for crustaceans and molluscs.
“The government acted quickly to establish the International Freight Assistance Measure.
“We saw government and industry respond to labour challenges, through, for example, visa extensions and permission for agricultural workers to stay with one employer for a longer period.
“Importantly, government has safeguarded the continuation of services that facilitate trade, such as certification, accreditation and other regulatory services, to ensure exports and imports still flow.
“Live animal exports are a watch point as the pandemic evolves, as demand from Indonesia and Vietnam declines, but export values remain above the five-year average.”
Dr Greenville said while the pandemic precipitated a global economic downturn, it was unlikely to have a significant impact on demand for essential food products.
“This persistence of demand was seen during the Global Financial Crisis when agricultural trade remained steady,” Dr Greenville said.
“But not all products from the agriculture, forestry and fisheries sectors are essential items.
“As economic activity declines and global incomes are reduced, products consumed through more discretionary spending have been more significantly affected.
“These include high quality foods for cafés and restaurants. These effects were seen for seafood where the outbreak in China has been estimated to have led to a fall in export earnings of around $200 million in 2019–20.”
The pandemic is also driving some changes that will likely remain part of the future trade landscape.
These include shifts in consumers buying more online, higher demand for stable and safe food, a greater awareness of supply chain risks, increased use of digital trade systems and the risk of creeping protectionism.
“The prospects for recovery for Australian agricultural trade are good,” Dr Greenville said.
“Australia’s agricultural sector and trade profile have a long history of adaptation, evolution and growth in the face of external challenges and pressures.”