Australia-United States Free Trade Agreement

AGRICULTURE

• Two thirds of all agricultural tariffs - including in important commodities such as lamb, sheep meat and horticultural products, will be eliminated immediately
• A further 9 per cent of tariffs will be cut to zero in the first four years.
• The AUSFTA provides greater access to the US market for two of Australia's key agricultural export industries, beef and dairy.
• Australia's quarantine and food safety regimes, which ensure our health and our environment are protected, and are not affected by the Agreement.

Summary

AUSFTA provides greater market access for the majority of Australia's agricultural producers - including for the beef and dairy industries - who have faced restrictive barriers in the US market.

Dairy

Under AUSFTA, the Australian dairy industry can send nearly three times as much of current tariff quota products from year one, with ongoing growth in the quotas at an average yearly rate of 5 per cent.

The increase is across the board for all dairy products constrained by quotas, providing new market opportunities for dairy processors and producers.  

The biggest market access gains are for products where the Australian dairy industry is most competitive and sees the largest prospects for growth. The deal includes access for dairy products previously excluded from the US market, such as certain cheeses, butter, milk, cream and ice-cream products. Examples include 7.5 million litres of milk, ice-cream and cream, and 2000 tonnes of European type cheeses.

In addition, Australia gained significant increases in quota access for whole-milk powder (used primarily in bakery and confectionary products), from 0 to 4,000 metric tonnes.

Beef
The AUSFTA provides greater access for Australia's number one export to the United States. In addition to the substantial WTO quota that Australia already holds, our beef producers had access for an additional 15,000 tonnes of beef in year 2, which will increase to 70,000 tonnes in year 18, and then effectively free trade.

In-quota tariffs were eliminated immediately upon entry into force, and over-quota duties will be phased out from years 9 to 18 of the Agreement.  

Tariff-only products
Tariffs on the majority of agricultural products, including most lamb and sheepmeat, and products such as oranges, cut flowers and cotton seeds, were eliminated from day 1 of the Agreement.

Further elimination of other tariffs will take place over periods of 4, 10 and 18 years.

The bulk of our lamb and sheep meat exports gained immediate tariff-free access, clearing the way for continued success in a market where Australian producers see great prospects over the long term.

The elimination of tariffs means that agricultural sectors such as horticulture can look to the US market as a serious commercial prospect.   Horticulture is a growing export industry and should benefit over-time from new access opportunities in the AUSFTA.