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Processed Food and Beverages
Sector Profile(1) - Australia
June 2003
Canadian High Commission in Australia
Commonwealth Avenue
Canberra, ACT 2600, Australia
Contact: Sarah Powles, Business Development Officer
Tel.: (61-2) 6270-4000
Fax: (61-2) 6270-4069
E-mail: sarah.powles@dfait-maeci.gc.ca
Internet: http://www.canada.org.au
MARKET OVERVIEW
Australia is a major producer and exporter of agricultural products, which represent approximately 60% of Australia's total exports. In the year ended March 2002, Australian food and beverages exports totalled approximately $20.6 billion(2), of which 68% was exported throughout the Asia-Pacific region. Australian food imports are generally sourced to increase the variety of available products, as well as to stock levels of seasonal supplies. In 2001, Australia imported close to $4.2-billion worth of agri-food products.
The processed food and beverages industry is Australia's largest manufacturing sector with revenues exceeding $40 billion in 2001. Australian processed food products are recognized worldwide for their variety and healthy image. The industry is also well-known for its innovative processing and packaging technologies. The largest segment of this sector is processed meat products, accounting for 22% of total revenues, followed by beverages (18%) and processed dairy products (17%).
Although Australia is a net exporter of processed food and beverages, Canadian companies will find opportunities in this market. In 2001, Australia imported $3.4-billion worth of processed food and beverages--nearly 82% of total agri-food imports. Leading imports included processed seafood, processed fruit and vegetables, beverages, processed cereal and bakery products.
Growth in Australia's processed food and beverages sector is driven by an increased demand for convenient, easy-to-prepare and healthy food. Australian consumers have become more conscious of food-safety issues and tend to look for quality products. Furthermore, consumers have become increasingly busy and favour meal solutions that do not compromise taste or freshness.
As consumers become more health-conscious, Australia's markets for bottled water, pure fruit juices and energy and sports drinks are expected to grow significantly. In 2002, abundant growth was experienced by the energy and sports drink segment, which jumped 187% to $24.6 million. Sweetened carbonated waters and mineral waters account for over half of Australia's non-alcoholic beverages market. Mineral water was valued at $44.2 million in 2001, increasing 3% over the previous year. Furthermore, still water sales grew 12%, totalling approximately $61.2 million. The largest segment of the Australian juices market was 100% pure fruit juices. In 2001, the fruit juice market was valued at $382 million and is expected to grow by 21% by 2006. The market for carbonated soft drinks, valued at $1.5 billion in 2001 is also expected to rise 13% by 2006.
Australia's nurturing growing climate in addition to its innovative technology and advanced research and development have made Australia a world leader in the production of premium quality wine. Growing nearly 90 different types of grapes, the Australian wine industry produced over 1.1 billion litres of wine in 2002, a 47% increase in production since 2000. The most popular wines produced include Shiraz, Cabernet Sauvignon, Merlot, Pinot Noire, Chardonnay, Sultana, Semillon, Riesling and Sauvignon Blanc. In that same year, wine sales reached approximately $3.2 billion or 802.6 million litres of wine. Imports accounted for 4% of total domestic sales. As the fifth-largest exporter of wine, a large proportion of Australia's production is distributed worldwide. The Australian wine industry reached a record high of $1.7 billion in export sales--accounting for over half of wine sales in 2002. Its top export destination is the United Kingdom, followed by the United States, Canada, New Zealand and Germany.
As the Australian market for processed foods and beverages continue to mature, the Australian government has increased its efforts to sustain the profitability of this significant industry. In September 2001, the National Food Industry Strategy (NFIS) was implemented in an effort to sustain the competitiveness and profitability of Australia's food manufacturing sector. Over a course of five years (2002-2007), the Australian food industry and government have allocated $82.1 million toward a number of initiatives aimed at strengthening Australia's position in the global marketplace. These initiatives will address a range of issues in areas such as innovation, international market entry and integrity of food products. For instance, the Food Innovation Grant Program, which will receive nearly $28 million, matches funding for firms undertaking new research and development projects that will improve the Australian food processing industry. For complete details about the NFIS, visit http://www.nfis.com.au.
OPPORTUNITIES
The Australian food market is well developed and highly competitive. Canadian exporters will find good opportunities catering to niche markets. For instance, while only 4% of wine consumed by Australians is imported, opportunities exist for Canadian companies to supply specialty wines such as icewine. In the year ended March 2002, Australian imports of wine amounted to nearly $93 million, a 25% increase over the previous year. Furthermore, the Australian wine industry has set new targets for export sales, opening the doors to foreign exporters to supply the domestic market.
Opportunities also exist for health/energy food and drinks, convenience foods and prepared meals. Canadian companies interested in entering the Australian processed food and beverages market should carefully evaluate their marketing strategy before approaching potential importers. Australian manufacturers focus on innovative packaging that provides greater flexibility for the consumer, such as eat-on-the-run designs.
As a result of NFIS initiatives, Australian importers are currently seeking out potential partnerships with international suppliers to build strong, sustainable supply chains in an effort to strengthen their position in the global marketplace. Forming partnerships and building strong relationships with key Australian food processors would be a good strategy for Canadian companies to help them meet buyers and foster trade with Australian importers.
Trade Shows
Event:
Fine Food Australia
September 9-12, 2003
Sydney Convention & Exhibition Centre
Darling Harbour, Sydney Australia
The largest food and drink exhibition in Australia. Canada's Trade Commissioner Service is organizing a joint program--New Exporters to Australia and New Zealand (NEXANZ)--to bring Canadian agri-food companies to the region to experience the show, meet key contacts and learn about these countries' import regulations.
Organizer:
Australian Exhibition Services Pty Ltd.
Illoura Plaza, 424 St. Kilda Road
Melbourne, VIC 3004, Australia
Tel.: (61-3) 9261-4500
Fax: (61-3) 9261-4545
E-mail: food@ausexhibit.com.au
Internet: http://www.foodaustralia.com.au
KEY PARTICIPANTS
Australia's processed food and beverages sector is highly concentrated with a few large companies dominating the industry. Approximately 20 large food processing companies represent nearly half of the industry's turnover. The remainder of revenues is generated by several small and medium-sized companies.
Similarly, Australia's top 20 wine companies accounted for over 80% of total branded wine sales in the year ended March 2001. Approximately 1400 small and medium-sized companies contributed the remainder of wine sales. However, the industry is becoming increasingly fragmented, with the establishment of one new wine producer every few days.
In the non-alcoholic beverages segment, the market for health/energy drinks is primarily dominated by two major brands, Red Bull and V. Combined, Red Bull and V account for over 60% of market share. Coca Amatil and Pure & Natural are the key suppliers of bottled water in Australia, representing half of the market. However, still water is controlled by Mount Franklin and Peats Ridge. Private labels also play a key role in the non-alcoholic beverages market, with an average market share of 16%.
International suppliers also play a role in Australia's processed food and beverages sector. New Zealand is Australia's largest supplier. Other key international players include companies from the United States, Thailand, Ireland and Brazil.
PRIVATE-SECTOR CUSTOMERS
Shorter distribution channels have become increasingly popular in the Australian food and beverages sector. In an attempt to strengthen ties with suppliers, wholesalers and retailers now buy their products directly from the food producer.
Exporters will face a 5% tariff on most products entering Australia. Canadian exporters must be aware of Australia's stringent quarantine requirements. A number of products are prohibited due to concerns that there may be a potential public danger or that they may introduce outside diseases. Canadian exporters are recommended to confirm whether their product is permitted and under what conditions. Exporters of highly processed products will not face the same restrictions; however, they should determine whether an import permit is required. The Australian Quarantine & Inspection Service has a searchable on-line database with regulatory information on specific products (see Useful Internet Sites).
In addition, exporters should be familiar with the Australia New Zealand Food Standards Code, to ensure compliance with the Australian food standards and labelling regulations; visit http://www.foodstandards.gov.au/foodstandardscode.
KEY CONTACTS AND SUPPORT SERVICES
Canadian Contacts
Canadian High Commission in Australia
Commonwealth Avenue
Canberra, ACT 2600, Australia
Contact: Sarah Powles, Business Development Officer
Tel.: (61-2) 6270-4000
Fax: (61-2) 6270-4069
E-mail: sarah.powles@dfait-maeci.gc.ca
Internet: http://www.canada.org.au
Agriculture and Agri-Food Canada
Sir John Carling Building
930 Carling Ave.
Ottawa, ON K1A 0C5
Contact: Charles Charron, Deputy Director, Asia Pacific Division
Tel.: (613) 759-7696
Fax: (613) 759-1667
E-mail: charronc@agr.gc.ca
Department of Foreign Affairs and International Trade (DFAIT)
125 Sussex Dr.
Ottawa, ON K1A 0G2
Internet: http://www.dfait-maeci.gc.ca
International Business Opportunities Centre (IBOC)
Tel.: (613) 944-6000
Fax: (613) 996-2635
E-mail: iboc@dfait-maeci.gc.ca
Internet: http://www.iboc.gc.ca
Korea and Oceania Division (PKE)
Contact: David Korth, Desk Officer
Tel.: (613) 995-7652
Fax: (613) 996-1248
E-mail: david.korth@dfait-maeci.gc.ca
Market Support Division (TCM)
Contact: Richard Philippe, Trade Commissioner
Tel.: (613) 995-1773
Fax: (613) 943-8820
E-mail: richard.philippe@dfait-maeci.gc.ca
Contact: Jennifer Gowan, International Market Analyst
Tel.: (613) 996-1835
Fax: (613) 943-1103
E-mail: jennifer.gowan@dfait-maeci.gc.ca
Export Development Canada (EDC)
151, O'Connor St.
Ottawa, ON K1A 1K3
Tel.: 1-888-332-4593 or (613) 598-2500
Fax: (613) 598-6697
E-mail: export@edc4.edc.ca
Internet: http://www.edc.ca
Food Beverage Canada
17311 - 103rd Ave., Suite 201
Edmonton, AB T5S 1J4
Tel.: (800) 493-9767 or (780) 486-9679
Fax: (780) 484-0985
Internet: http://www.foodbeveragecanada.com
Australian Contacts
Australian High Commission in Ottawa
50 O'Connor St., Suite 710
Ottawa, ON K1P 6L2
Tel.: (613) 236-0841
Fax: (613) 236-4376
Internet: http://www.ahc-ottawa.org
Agriculture, Fisheries and Forestry Australia (AFFA)
Edmund Barton Building
Broughton Street, Barton
GPO Box 858
Canberra, ACT 2601, Australia
Tel.: (61-2) 6272-3933
Fax: (61-2) 6272-5680
E-mail: internet.section@affa.gov.au
Internet: http://www.affa.gov.au
Australian Wine and Brandy Corporation (AWBC)
PO Box 2733
Kent Town Business Centre
Kent Town, SA 5071, Australia
Tel.: (61-8) 8228-2000
Fax: (61-8) 8228-2022
E-mail: awbc@awbc.com.au
Internet: http://www.awbc.com.au
Food Standards Australia, New Zealand (FSANZ)
Boeing House
55 Blackall Street
Barton, ACT 2600, Australia
Fax: (61-2) 6271-2278
E-mail: advice@anzfa.gov.au
Internet: http://www.anzfa.gov.au
BIBLIOGRAPHY
Australia. Department of Agriculture, Fisheries and Forestry Australia.
"Australian Food Statistics," 2002. Downloaded from http://www.affa.gov.au/corporate_docs/publications/pdf/
food/foodstats2002.pdf on May 6, 2003.
------. "Australia: Wine Industry Fact Sheet," March 2003. Downloaded from http://www.affa.gov.au/content/publications.cfm?Category=Wine on June 5, 2003.
------. "Pathways to Profitability for Small and Medium Wineries," November 2002. Downloaded from http://www.affa.gov.au/content/publications.cfm?Category=Wine on June 5, 2003.
Australian Trade Commission. "Australia - Wine Overview," 2002. Downloaded from http://www.austrade.gov.au on April 4, 2003.
------. "Australia - Processed Foods Overview," 2002. Downloaded from http://www.austrade.gov.au on April 11, 2003.
------. "Australia - Food and Beverage Overview," 2002. Downloaded from http://www.austrade.gov.au on May 6, 2003.
Australian Wine and Brandy Corporation. "Australian Wine Industry.....at a glance," February 2003. Downloaded from http://www.awbc.com.au/information/statistics/austats_glance.asp on May 5, 2003.
Canada. Department of Foreign Affairs and International Trade. "Agri-Food Sector Profile: Australia," May 2002. Downloaded from http://www.infoexport.gc.ca/ie-en/DisplayDocument.jsp?did=7874 on April 4, 2003.
------. "Australian National Food Industry Strategy," November 2001. Downloaded from http://www.infoexport.gc.ca/ie-en/DisplayDocument.jsp?did=6537 on May 6, 2003.
Datamonitor Market Research. Australian Carbonated Soft Drinks: Market Profile. May 2002.
------. Australian Energy & Sports Drinks: Market Profile. May 2002.
------. Australian Juices: Market Profile. May 2002.
USEFUL INTERNET SITES
Agriculture and Agri-Food Canada. Agri-Food Trade Service:
http://ats.agr.ca/general/home-e.htm
Australia Food and Grocery Council:
http://www.afgc.org.au
Australian Bureau of Agricultural and Resource Economics:
http://www.abare.gov.au
Australian Bureau of Statistics:
http://www.abs.gov.au
Australian Quarantine and Inspection Services:
http://www.affa.gov.au (click on
Australian Quarantine and Inspection Services under "Outputs")
Department of Foreign Affairs and International Trade:
http://www.dfait-maeci.gc.ca
ExportSource:
http://exportsource.ca
InfoExport:
http://www.infoexport.gc.ca
List of Australian food manufacturers for canned food:
http://www.cannedfood.org/varieties.html
National Food Industry Strategy:
http://www.nfis.com.au
Nutrition Australia:
http://www.NutritionAustralia.org
1. The Government of Canada has prepared this Country Sector Profile based on primary and secondary sources of information. Readers should take note that the Government of Canada does not guarantee the accuracy of any of the information contained in this document nor does it necessarily endorse the organizations listed herein. Readers should independently verify the accuracy and reliability of the information.
2. All monetary amounts are expressed in Canadian dollars, unless otherwise indicated. The conversion rate to Canadian dollars is based on IDD Information Services, Tradeline, May 2003.
| Date Modified: 2004-06-30 | Important Notices |