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Victorian government on Middle East agribusiness trade mission

BUSINESS deals done in the Middle East require a good introduction.

For businesses to be taken seriously, that introduction has to come with some political punch.

This is according to Agriculture Minister Peter Walsh, speaking to Weekly Times Now ahead of a Victorian Government-lead Middle East trade mission which sets off on Saturday.

Seventy five food, beverage and agribusiness companies are part of the delegation, the largest to leave Victoria.

Mr Walsh said the opportunities in the Middle East for Victorian meat, dairy and grain products were huge. But so was the competition.

Business often revolved around forming personal relationships with those who Victorians were hoping to export to.

Having a Minister in a delegation is not just a nice look, Mr Walsh said.

At times, in the case of Saudi Arabia, it meant whether entry was permitted into a country or not.

Last time a Victorian contingent visited, they were turned away because they did not have a Minister with them, Mr Walsh said.

The Middle East was an increasingly important strategic market for Victorian exporters to target, he said.

Many of the countries were heavily reliant on imported food.

Red meat and dairy were a huge growth markets, but competition from countries like New Zealand to tap into the markets was fierce.

“There aren’t a lot of trade barriers into these areas, but it is very much about forming personal relationships, and we (the Government) will help exporters form long-term relationships,” Mr Walsh said.

Bega Cheese executive chairman Barry Irvin, whose company is one of the delegates, said  Asia remained the company’s largest market and the Middle East represented less than $40 million of sales.

“But we continue to have a presence and grow in it, it’s a good opportunity for our company,” he said.

“We have been selling product to the Middle East for a great many years as Bega Cheese we bought Tatura Milk in and have done recent upgrades.

“It’s a natural market for us. The (Middle East countries) varied between getting dairy product from EU or Australasian but it is a competitive market place.

“We have had a presence at Gulf Foods biggest international food conference in the world for the best part of a decade and we will continue to have that presence, last year was our biggest stand.”

Mr Walsh said food and fibre exports from Victorian ports had increased 11 per cent to reach a record $9 billion in 2011-12.

“In the same period the value of exports to the Middle East and North Africa rose 17 per cent to $1.1 billion, collectively making those regions the third most important market for our food and fibre exporters,” Mr Walsh said.

“With meat, dairy products and grain making up over 85 per cent of the value of farm exports to the Middle East and North Africa, the trade mission will provide exporters with a prime opportunity to substantially expand their footprint in the region.”

The mission will visit the United Arab Emirates, Turkey and Saudi Arabia and focus on opportunities in food, tourism, agribusiness, water, equine, infrastructure, defence, higher education, vocational education and marine industries.

Another company taking part is Emerald Grain, the fifth largest grain marketing company in Australia and the third largest grain storage and handling company in Eastern Australia.

The Middle East makes up a sizeable component of Emerald’s current three million tonne export program, accounting for 30-40 per cent of export sales each year.

Emerald Grain group general manager trading and marketing Brian Dalitz said part of the company’s strategy for continued growth was to focus on Middle Eastern destinations like the United Arab Emirates.

He said Emerald was working towards exporting about one million tonnes of grain and oilseed exports into the region.

“Deregulation of the grains industry means grain marketers have to establish more consistent and diverse contacts in international markets,” Mr Dalitz said.

“The Middle East is an important export destination for us with its large stock feeding requirements and appetite for hard milling wheat for flat bread.

“This mission will help Emerald to take advantage of our location and make better connections with our customers.

“Customers in Dubai are crying out for direct contact with their suppliers.

“They want to speak to us face-to-face to hear about what’s happening out in key grain growing regions.

“Its about connecting the Mallee to the Middle East.

“Missions like these create new opportunities for Emerald but there’s also a flow-on effect to Victoria’s grain growers and the regional economies they operate in.

“If we can develop a wider market for the grain and oilseed grown by Victorian farmers it benefits everyone.”

Another participant is Ararat Meat Exports, which for 20 years has been one of Australia’s largest export sheep abattoirs.

The company employs 300 people and exports more than 2.6 million tonnes of sheep meat and related products annually.

Sales and livestock manager Michael Stapleton said Ararat Meat Exports specialised in Australian halal lamb and mutton with the Middle East accounting for approximately 65 per cent of total sales.

“As the Middle East region makes up such a large percentage of our sales annually, it makes sense to invest resources in the region and focus on this continually growing market,” Mr Stapleton said.

“Traditionally the Middle East has been a fairly strong market for us, but over the past 10 years it has grown significantly.

“The Mission assists companies like ours to establish strong relationships with customers as well as opening new doors within our market.”

Source: Simone Smith & Kate Dowler, The Weekly Times, http://www.weeklytimesnow.com.au/article/2013/02/20/560941_national-news.html