Australian dairy industry makes inroads in China

by Simon Panegyres, Nicole Radice and Ryan White

A recently negotiated quarantine clearance agreement between New South Wales dairy Norco Co-operative Limited (Norco), export agent Peloris Global Sourcing Pty Ltd (PGS) and the Chinese government has paved the way for the export of fresh milk by Norco into China.  The development opens a new market for Norco (and dairy farmers supplying Norco) amidst the price wars between major Australian retailers.

In this Alert, Partners Simon Panegyres and Nicole Radice and Associate Ryan White summarise the revised process for the export of fresh milk from Australia to China.

Reduction in quarantine and exportation timeframes

Strict testing and quarantine processes both within Australia prior to shipment and in China upon arrival had previously resulted in an export time of between 14 – 21 days, meaning fresh milk could not be exported within its shelf life.  That export time has now been reduced to approximately nine days, meaning that the exportation of fresh milk from Australia to China is now a realistic option.

The agreement follows a lengthy process of collaboration between PGS and officials in China, to satisfy the relevant Chinese agencies that the quality assurance protocols in place on the Australian side are not only adequate, but align with Chinese food safety regulatory requirements.  It remains to be seen whether other Australian food producers and exporters seek similar concessions in order to expedite their export process for products with similarly short shelf lives.

China’s import requirements

Significantly, the concession comes at a time when China is introducing increasingly stringent import requirements for dairy products, requiring approval of government authorities of exporting countries, mandatory registration of all overseas producers, new health certification attestations and details of testing against China’s quality standards.

New regulations came into force on 1 May 2014 requiring that entities manufacturing or storing milk products for export to China be registered by the Certification and Accreditation Administration of the People’s Republic of China (CNCA).

Australian producer register

The registration process for Australian producers will be managed by the Department of Agriculture, which has submitted a list of the dairy processing and storage establishments registered for export as at 4 April 2014.The Department will be responsible for submitting updates of this list to the CNCA.

Goods from unregistered producers will not be approved for import, making it critical that all Australian producers intending to export to China ensure they have gained registration. Exporters must also ensure they source products from export-registered producers.

These developments signal both an increasing desire on the part of the Chinese government to establish a robust food safety regime and a growing recognition that Australian producers can provide a “clean and green” source of premium fresh food products to service China’s significant consumer base.

For assistance on strategic and day-to-day matters for livestock and fresh produce companies, please contact a member of HopgoodGanim’s Agribusiness team.

Now in its 40th year and with offices in Brisbane, Perth and a presence on-the-ground in Shanghai, HopgoodGanim offers commercially focused legal advice, coupled with reliable and responsive service, to clients throughout Australia and across international borders.


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