Why the Australian coffee industry is struggling to compete
Australia is facing a new trade embargo with Honduras after it imposed restrictions on the export of coffee beans, while it also banned the sale of coffee from countries including Guatemala.
The new restrictions on imports of coffee, which took effect on March 12, are aimed at protecting Australia’s national economy and its ability to compete with the US.
But the embargo has caused havoc in the coffee industry.
The coffee trade is a key part of the country’s economy, and its exporters are struggling to keep up with the new restrictions, as is the trade in beans, which makes up nearly 30 per cent of the exports.
The trade in coffee beans was worth $3.5 billion a year in 2013, according to the Australian Coffee Association, with the biggest producers in the country accounting for more than a third of exports.
“The restrictions are so far reaching, they’re really affecting coffee farmers,” Mr O’Brien said.
“They’re affecting farmers that have been growing coffee for centuries, and their ability to continue to grow their business.”
If you look at coffee production, coffee is one of the top four industries in the world.
“We’ve got one of Australia’s largest coffee growing regions, and we’ve got about 80 per cent domestic demand for coffee.”
The new trade restrictions are being implemented under the Trade and Investment Protection Act, which allows for a temporary suspension of imports and exports if a country’s national interest is affected by the trade embargo.
“This is a temporary measure until we have a clearer understanding of what is going on with the trade restrictions,” Mr Smith said.
The government’s focus on coffee was supported by coffee industry representatives who said the ban was unfair, saying they were unable to compete and that the trade is highly competitive.
“What they’re doing is going to cost our farmers money and our suppliers money and ultimately we’re going to have to raise prices,” Mr D’Aguirre said.
He said the restrictions have forced coffee growers to go to great lengths to meet the demand.
“When we grow the beans, we’ll have to sell them, we’ve had to move our headquarters out of Australia,” he said.
Mr O’Byrne said the industry was not concerned about the impact of the new trade policy.
“I think what you have to remember is there’s a whole industry out there that’s trying to compete,” he explained.
“And I don’t think they’re going anywhere.”
The Trade Minister said the government would continue to work with the coffee sector, and the Government would continue the efforts to support the industry.
“Trade and investment in coffee is a very important part of Australia and one that we are committed to support and it is our intention to support it through this embargo,” Mr Harris said.
Topics:business-economics-and-finance,industry,international-aid-and‐trade,government-and‑politics,coronavirus,australiaContact James M. Smith
