“Firstly, I think attitude is important. WA is world class in resources and mining, but this should not stop us from being world class in agriculture, or in education, tourism, or downstream processing technology. We have to aim high.”

Beyond your interests in iron ore, you have been active both as an investor in the agribusiness sector and as a champion of its interests. How well placed is Western Australia (WA) to expand this sector, moving forward?

Firstly, I think attitude is important. WA is world class in resources and mining, but this should not stop us from being world class in agriculture, or in education, tourism, or downstream processing technology. We have to aim high.

Looking at agribusiness, we are barely scratching the surface. Some people say we’re only a small part of the world in terms of production, which makes us not particularly relevant. If you take Asia’s agricultural production and compare it to ours at face value, that might be correct, but that is also misleading. You need to look at exported agriculture, I’m talking about the food which other countries rely on which comes from countries like ours. Looking at the numbers like that, things look much more promising, and we are currently nowhere near our potential. I believe that WA could double or triple its agricultural produce.

I like anecdotal evidence because it gives you some reality. Our own station, Minderoo, was totally overstocked, at about 10,000 head of cattle. We brought the numbers down to 2,500 head of cattle because 10,000 was ruining the place. Since then, we’ve put in watering points, we’ve husbanded the land, we’ve added on a little bit of land. It now comfortably runs 20,000 head and the country has never looked better, whereas it used to be totally overstocked at 10,000. We’ve also bought two other stations in the Gascoyne, where we’re running 2,500 and 2,000 head. Each of those properties is capable, with harvesting, distribution of water and proper husbanding of the land to run 10,000 head of cattle. So we’re talking now double and quadruple, that was just two anecdotal examples.

I don’t believe these kinds of gains are restricted to us, that’s across the board in agriculture.

 

The capital controls appear to have had less of an impact and duration that many commentators expected, why do you believe this was the case?

It’s all about confidence. Regrettably during the previous years confidence was shaken and this had a devastating effect on our banking sector. Capital controls had to be imposed and I will not claim that this did not have a negative impact on economic activity. But through decisive action on all fronts confidence was gradually re-established. A key confidence-building development was the arrival of foreign investors who injected new capital into our largest banking institutions. This, together with the broader stabilisation of the economy, enabled us to fully lift restrictions much sooner than many expected. The lifting of the Capital controls has been the ultimate confirmation that stability and confidence in our banking sector has been restored.

 

The recent Free Trade Agreement (FTA) between Australia and China has produced tangible results, with agricultural exports rising from A$9.16bn in 2013 to A$10.75bn in 2015. Is this a sign of things to come?

Those statistics are interesting, but don’t take them for their increases in volume, take them for the trend they show. The trend is much more powerful as an indicator of what’s going to happen than those small increases in volume. Of course, you’re talking about a billion dollars here so it’s not that small, but it’s small compared to what it could be. If you’re looking for a concrete, major event, which might not have been totally inspired by the FTA, but was certainly facilitated in terms of the attitude of both countries created by the FTA, then you’d have to say that the Zhou Shan Free Trade Zone, being pioneered and championed by ASA100, is a very serious example.

 

What is the vision for the Sino 100 years Agricultural and Food Safety Partnership (ASA100) initiative? How did it come about and what are the goals?

A few years ago when I met with the Chinese Premier, Li Keying, he took the view that Australia was far too competitive with itself in the agribusiness sector. States compete against states, even the Federal Government is seen to be competitive against its own states. To the outside world, we appeared fragmented. As an Australian businessman, beef producer and exporter and now Co-Chair of the ASA100, this rankled me. Why are we not united in presenting a value proposition to our major market – China?

We know Chinese consumers are demanding premium foods and products that are clean and safe and from a source that is secure and has integrity. We know that they trust Australia as that place of origin. Chinese demand for food is projected to double by 2050, underpinned by rising middle class incomes and increasing urbanisation. This poses an extraordinary opportunity for Australia’s agrifood producers and manufacturers.

All Australians will reap the economic benefits delivered by a unified export branding campaign into China, cementing our reputation as the world’s most reliable supplier of safe premium agricultural food products. Our members have staked their reputation on coming together under a unified messaging export brand. We know there are risks involved but we also know the benefits far outweigh those concerns.

 

What are the key deliverables relating to the ASA100 initiative?

In our quest to really grow Australia’s market share in Asia, particularly in China, we were running into province by province regulations and red tape. These were not designed to stop high quality food, with very clean origins and excellent quarantine standards, they were designed to stop everything else. However, Australian exporters have been caught in that net. One key initiative we have identified and have started work on is the development of a Bonded Free Trade Zone in China. Located on the Zhoushan Islands across the gulf from Shanghai, the Bonded Free Trade Zone will provide an industrial channel dedicated to processing and distributing agricultural food and products from Australia. ASA100 members will be given first preference. The aim is to minimise bureaucratic interference from the time the Australian food and products arrive in China through to their delivery on the supermarket shelf and onto the Chinese consumer’s plate.

Australian Prime Minister, Malcolm Turnbull witnessed the signing of an MoU between China and Australian authorities in April. Considerable modelling is now underway to ensure the zone works in the way the ASA100 intends. The significance of this free trade zone cannot be over stated. This is an extraordinary opportunity for all Australian producers who want to reach deep into China and get their product onto the shelves across that country quickly and efficiently.

Alongside the BFTZ and the unified export marketing brand, ASA100 is also providing significant B2B opportunities, matching Chinese companies with Australian exporters and also to work with both governments to reduce non-tariff barriers.

All of these objectives have been strongly supported by the Australian Government with an increasing number of major companies from both countries keen to participate. This is such an extraordinary opportunity for both governments and our respective economies. This work by the ASA100 demonstrates the Chinese Australia Free Trade Agreement can work in the way it was always intended.