AMIC: China meat ban export backlog “small in the extreme”

AMIC: China meat ban export backlog “small in the extreme”

Farm Online News

AUSTRALIAN meat exporters have rejected claims large volumes of unwanted frozen product destined for China is now stranded in cold storages.

Australian Meat Industry Council CEO Patrick Hutchinson

Australian Meat Industry Council CEO Patrick Hutchinson

AUSTRALIAN meat exporters embroiled in the Chinese market ban caused by labelling non-compliance issues have rejected new claims suggesting large volumes of unwanted frozen product is now stranded, unsold in cold storages.

Despite the market suspension being lifted for six of seven suspended facilities, China has refused to allow access for any Australian meat product processed and stored during the non-trade period, from July 24 to October 30.

Exporters have estimated the shock ban has conservatively cost the local industry an estimated $1 million per day, with the overall losses gauged at about $90m.

The stand-off has also occurred while talks are continuing between government officials in both countries to allow expanded access for chilled beef exports into China, through more approved meat processing facilities, which would bolster export volumes by tens of thousands of tonnes for the market which took $670m worth of Australian product in 2016.

But now, sources exposed to industry negotiations and sensitive feedback from delicate talks between Chinese and Australian government authorities, say the suspension has produced a concerning backlog of stranded, frozen meat product.

“Thousands of kilograms of product has been left in limbo in local storages that was destined for China,” said one source caught up in the suspension, who asked not to be named.

“For some processors this is just an inconvenience but for others it’s a major catastrophe.”

However, meat processors were warned of the need to seek alternative markets for any stranded product, originally destined for sale to China prior to July 24 or made during the ban period, and that it should be re-worked to meet importing requirements to suit individual access protocols for other countries like Korea, Indonesia and the Middle East.

The Australian Meat Industry Council said it surveyed its members with suspended meat processing plants, to identify product caught in the pipeline around the suspension, to identify what needed to be managed; with the bulk of it subsequently re-reworked to suit other market destinations.

AMIC CEO Patrick Hutchinson said on Wednesday November 1, AMIC’s Executive sent an email to its four member companies that had temporary suspensions for export to China lifted, seeking an indication of how much inventory product might possibly be in storage, if any at all.

“This information was to assist AMIC to guide its members on management of any pipeline product, and the best way to manage this product - if in fact it had not already been managed,” he said.

“This was simply for the AMIC Executive to gain an understanding of the impact on members of the suspensions being lifted and also to help AMIC in assisting members in clarifying the Department of Agriculture and Water Resources’ requirements around export certification.

“This is standard practice.

“Tonnages are small in the extreme and the bulk has already been effectively managed by those companies.”

Mr Hutchinson said on Monday this week, the Department confirmed AMIC's understanding that China's lifting of suspensions meant that product produced from the affected plants from October 30, 2017 would now be accepted.

“The information provided by the Department and clarified with assistance by AMIC is great news for all companies and they are working on finalising their new shipment protocols to China,” he said.

“This is only impacting those companies that have recently had temporary suspensions to China over the last three months which were lifted within the last 10 days.”

While China has strict import protocols related to high food safety demands, Australian officials have stressed the recent trade ban on frozen product was only related to technical labelling issues and not any food safety concerns.

But speculation has persisted about the exact cause of the ban and whether it was politically motivated or due to technical labelling protocols, like the date when product is cut-up, packed and frozen and when it’s then boxed and stored pre-export.

AMIC has stressed the ban was caused by technical labelling matters - but it’s understood the Chinese have regarded the non-compliances as a food safety risk, with tougher measures subsequently imposed on Australian facilities around verification and reporting processes, to maintain access into the Chinese market.

Trade Minister Steve Ciobo says the ban was due to “mismatching” of labelling by some meat processors - but he’s also welcomed the suspension being lifted in three-months as an indication of “high level” co-operation between government authorities in both countries and the red meat industry.

Before being suspended from parliament due to dual NZ citizenship late last month, former Agriculture and Water Resources Minister wrote to Australian meat exporters warning further failure to comply legally with foreign import standards and regulations risked the multi-billion dollar trade into China and other Asian markets.

Mr Joyce’s stern correspondence expressed concern and disappointment that despite the initial suspension of trade to China in July due to labelling issues, more instances of non-compliances had surfaced.

His letter also stated it was vital to the Australian meat export industry’s sustainability that market confidence in inspection and certification systems be maintained, while giving a pointed warning about the strict need to fully comply with China’s import requirements, at all times.

He also delivered an unambiguous message about the inherent financial risk and trade damage associated with jeopardising the Australian agricultural industry’s broader reputation for exporting clean, green and safe foods into Asian markets, by meat exporters ignoring the higher standards of those importing nations, not just China, and breaching their regulatory requirements.

It’s understood the cloud over Mr Joyce’s political fate, due to his citizenship issue which largely overlapped with the suspension period, also restricted the Nationals leader from being able to travel to China and meet with government officials, to try to have the suspension overturned sooner.

A Department spokesperson said it was unaware of any issues with stranded product from the seven meat establishments, affected by suspension from import inspection in China.

But the spokesperson said the Department had welcomed the lifting of the suspension for import inspection of six Australian meat establishments and was continuing to work with Chinese authorities on one remaining suspension for import inspection.

“The Department of Agriculture and Water Resources - as the Australian Government regulator - treated this matter very seriously and worked directly with our counterparts at the General Administration of Quality Supervision, Inspection and Quarantine and was able to resolve this matter swiftly,” the spokesperson said.

“This is a positive outcome which reflects the high level of cooperation between Chinese and Australian authorities and our industry.

“We respect the Chinese government’s strong commitment to food safety for their consumers and understand the importance of meeting their import requirements.

“The Department worked in close consultation with industry and no consignments from the affected establishments were presented for import inspection in China after the suspensions.”

The six facilities banned from the Chinese market were Australian Country Choice, Primo JBS, JBS Beef City, Northern Co-operative Meat Company, Kilcoy Pastoral Company, and Thomas Foods International, while Monbeef in Cooma NSW is the seventh suspended facility still waiting for its ban to be lifted.


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