Interview on 5AA, Mornings, with Leon Byner
Leon Byner: Now, this is a good news story because as you know South Australia is a wonderful food producer. As a country, as you would know, we produce enough food for 75 million people which means that we can feed ourselves first - we should - and then when we've got an abundance of extra we can sell that to the world. Now, you would know that the seafood industry has been under some duress for some time because, for example, there were a lot of fishers who rang me and said: look, it's not worth our while fishing for, say, lobster because the ability to export it to other people who would normally buy it - at a premium price by the way - has been diminished. Well, that's changing because the Federal Government has announced that hundreds of tonnes of lobster and abalone is going to be flown on emergency freight flights out of Australia in a $110 million push to stop a massive downturn across the seafood sector.
So let's talk to the Federal Trade Minister, Senator Simon Birmingham. Simon, good morning. Are we going to ask the normal freight runners to do this? Or are we going to Virgin and Qantas and saying: listen we want to borrow a few of your aircraft?
Simon Birmingham: Well, good morning Leon. Look, we will be putting out a request for proposals that will be open to all of those who carry freight. Of course, much of Australia's freight traditionally, in terms of air freight, goes out in the belly of passenger aircraft that's what's created the real crisis that we've got at present – that more than 90 per cent of that air freight capacity is now lost because passenger aircrafts no longer travelling. But Qantas and Virgin do manage some of the freight and logistics so I'm sure they'll be interested parties in this; and if we can support Australian airlines then we'll be looking to do that.
But the primary objective is, first and foremost, to make sure that our fishers and our farmers are able to get their high quality, valuable produce back into those export markets and to do so at affordable rates for them to be able to keep employing Australians and generating export dollars for our country.
Leon Byner: Alright. I need to clarify something because the information – and we're going back some time when the world was even different as we know it – where some of the first people to give hit for this coronavirus issue were in fact many of the seafood exporters - they weren't the only ones but that's the sector we're talking about now. And they made the point that they couldn't get their product to where it needed to go because the where it needed to go didn't want it or didn't want to take it. Is that the case?
Simon Birmingham: That is but that is a while ago now, Leon. So you're right, at the outset of this crisis, which of course hit in China first and foremost, China basically locked down their population. Chinese Lunar New Year celebrations were all cancelled and therefore, Australia's live seafood market and many of our premium goods that would normally go into the Chinese market at that very busy time of year for their hospitality sector suddenly had no customers there because nobody was going out to the restaurants and nobody was purchasing those sorts of premium goods.
We now find a situation where China is actually starting to have normal activity return to a degree as they have seemingly passed the peak in their country. And yet, because of the loss of air capacity around the world, we now can't physically get the goods to China or to any of the other markets that we rely upon such as Japan or the key freight hubs like Singapore and Dubai.
So, this measure is really focusing on making sure that we fill the gap where there is still demand. We’re obviously we’re not going to be sending Australian food and produce to countries that don't have a demand at present. But where there is still that demand we want to make sure that our farmers and fishers don’t miss out on selling their produce just because there aren’t planes flying. We need to get those freight aircraft in the air, servicing Australian ports so that our farmers don’t miss out.
Leon Byner: Alright. Now, once these aircraft have landed and offloaded their freight, they’re going to bring things back aren’t they?
Simon Birmingham: That’s our aim, that wherever possible the backhaul - so the goods that are coming to Australia on these aircraft - will meet the priority medical supplies, protective equipment, pharmaceuticals, the types of things that we have in high demand at present, that appropriately are high value goods, important goods and would have a place on a freight aircraft. I want to emphasise, Government’s not intending to pick up the whole tab for these things. Our farmers and fishers will still have to paying normal commercial rates.
Leon Byner: Which I’m sure they’re more than prepared to do. They just want to be able to get their product somewhere.
Simon Birmingham: That’s right. They want to know that there will be planes flying and they don’t want the cost of that to be so prohibitive that it’s not worth them sending their goods. But normal commercial rates, possibly even at a premium, they’ll happily contribute. Government will then underwrite to an extent the remaining gap but importantly, we do want to make sure that we're using the capacity to bring things back into Australia, all the goods that we desperately need at present to make sure that we get all Australians safely through this pandemic.
Leon Byner: Now, again, I think there's a very basic question here. Do you now, as - I mean you're a very important minister in the scheme of things and you're a South Australian Minister which is good because you've got a bit of clout - I want to ask you this question: is there now a recognition by you that there are certain essentials that it's time we start making ourselves because of what's happened to us with this virus crisis?
Simon Birmingham: Leon, it is important that we have the capability to be able to step up where necessary. And our Australian manufacturers have shown some extraordinary capacity just in the last few weeks of pivoting where necessary - we've had the wonderful story of Bickford’s turning their manufacturing lines onto hand sanitisers and Detmold there in South Australia as well, now cranking out the protective equipment. And indeed we sent the army in to help a business in Victoria to convert their operations to be able to expand - they were already a manufacturer of facemasks, but to be able to expand their capability quickly and dramatically and we used military engineers to help do that quickly.
So we've demonstrated a capacity but it does firmly show that we need to make sure that we always have that capability - whether it is to always be manufacturing all of these goods - but certainly to make sure we have the capability to pivot our manufacturing rapidly and quickly for these essential goods when and where they're required.
Leon Byner: Where will the majority of these fish exports go? China?
Simon Birmingham: China possibly. Although I'm expecting the first flight probably to head to Japan and from Japan it may well be that some of it then expands out into Korea, China and across those north Asian economies. But the Chinese market is one where our fishing industry tells me emphatically that they have customers, they have demand returning, they just need to find a way to get the product there.
Leon Byner: Alright. So we're starting with seafood but there are probably other places where exporters want to get into markets. Are they going to get help as well? Or are we just starting with seafood and seeing what happens?
Simon Birmingham: Seafood, premium meats, horticultural products, and they are all firmly in our line of sight for support through this mechanisms, so they're all important sectors. They are of course all produce that needs to be shipped when it's fresh and while it's high quality and that's why- the different markets will no doubt have different goods on board them as well. So what we send to Dubai may well be quite different to what we send to Shanghai.
Leon Byner: Alright Minister, thanks for joining us today. That’s the Federal Trade Minister, Simon Birmingham, just explaining what is a very good initiative to ensure that we can make our exports work.
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