APAL has developed a Technical Market Access Strategy for both apples and pears to prioritise the new market access and market improvement priorities of the Australian industry.

This roadmap combines an overview of existing technical market access status with industry preferences for future market access and market improvement from a technical point of view, in line with available supporting efficacy data for the treatment of pests and disease.

The Technical Market Access Strategy should be read in conjunction with the Apple & Pear Export Market Development Strategy (McKinna 2017) which was an economic analysis of market opportunities from a commercial perspective funded by Hort Innovation. Since completing the Technical Market Access Strategies in mid-2020, APAL has communicated industry’s market access and market improvement priorities to Government, and worked with technical experts to engage with some of Australia’s bilateral trading partners to discuss issues and consider solutions.

The Technical Market Access Strategy is a living document that will be continually updated by APAL as new scientific evidence becomes available and negotiations with trading partners’ progress. Whilst this body of work will take many years to transpire, APAL is proactively working to bring the industry closer to unlocking new potential markets for Australian exporters.

If you are interested in apple & pear exports or have questions about market access, please contact APAL Head of Trade, Jenny Van de Meeberg, at jenny@apal.org.au

Apple trade overview

In 2020, the highest priorities for Australian apple export growth are:

• Market improvements for China, Japan, Thailand and Canada.
• Market access for Taiwan and Vietnam.

In 2019, exports of Australian apples totalled 4,251 tonnes worth A$9.8 million (International Trade Centre (ITC), calculations based on Australia Bureau of Statistics). Export represented 1 per cent of total apple production, with the remaining 69 per cent being consumed by the domestic market and 30 per cent being used by the processing industry (2018-2019 Australian Horticulture Statistics Handbook).

Apples are Australia’s 13th largest fruit export by value and 11th largest by volume (2018-2019 Australian Horticulture Statistics Handbook). Between 2009 and 2019, Australian apple exports have decreased in volume by 16 per cent but increased in value by 26 per cent. This is critical to understanding the apple export opportunity for Australian growers; this data evidences an improvement in value per piece over time.

The Australian apple unit-value in 2009 was 69 per cent higher than the word average. This increased in 2019 to 89 per cent higher than the world average. Australia’s increase in unit-value means we have moved exports to the premium end of the market which yields a higher return.

Over the past ten years, the largest market for Australian apples has consistently been Papua New Guinea, representing almost 20 per cent of all exports. Other Pacific Island imports are individually negligible however cumulatively, they total another 5 per cent, meaning almost a quarter of all Australian apple exports are bound for the Pacific region. It is worth noting however, the average unit-value of apples exports into the Pacific is lower than markets in Asia, Europe, or the Middle East, indicating it is a good destination for non-premium fruit. Demographic and economic indicators suggest the Pacific Islands are unlikely to see significant demand growth or become consumers of premium-priced fruit, which means these markets are not a feature of McKinna’s 2017 Apple & Pear Export Market Development Strategy due to their modest commercial opportunity.

Over the same decade, stand-out markets with exceptional growth have been Hong Kong and China (which is only supplied with Tasmanian produce). They are now the second and fourth largest export destinations for Australian apples respectively. In South-East Asia, Singapore has been the most consistent market since 2009, whilst Thailand, Malaysia and Indonesia have been the least consistent, fluctuating greatly between years.

Finally, a unique feature of Australian apple exports is their footprint in Europe which is unusual in Australian horticulture. Combined, European countries represent almost 23 per cent of Australian apple export trade with Italy, Belgium, Netherlands and France showing tremendous growth over the last few years.

Taiwan and China are two of the highest priorities for apple market access and improvements. In Taiwan, where Australia seeks to gain access, the average unit-value in 2019 was AUD$2.31 kg and the New Zealand product averaged AUD$2.40 kg whilst holding 12 per cent market share (ITC calculations based on Directorate General of Customs Administration, Ministry of Finance statistics). Similarly, in China, the average unit-value in 2019 was AUD$2.52 kg and the New Zealand product averaged AUD$3.16 kg whilst holding 43 per cent market share (ITC calculations based on General Customs Administration of China statistics). Clearly, there is room for Australia to compete and win substantive market share at a commercially viable price point. High-value Asian markets have a proven record of paying for high-quality imported fruit which makes them an ideal fit for Australian apple exporters operating above the global average unit-value in their category.

These statistics show that Australian apple exports continue to grow and investments in technical market access and market improvements will yield positive returns for the industry and the Australian economy.

Pear trade overview

In 2020, the highest priorities for Australian pear export growth are:

• Market improvements for New Zealand and Thailand.
• Market access for Taiwan, China and Vietnam.

In 2019, exports of Australian pears totalled 9,860 tonnes worth A$18.3 million (ITC calculations based on Australia Bureau of Statistics). Export represented 8 per cent of total pear production, with the remaining 58 per cent being consumed by the domestic market and 34 per cent being used by the processing industry (2018-2019 Australian Horticulture Statistics Handbook).

Pears are Australia’s 12th largest fruit export by value and sixth largest by volume (2018-2019 Australian Horticulture Statistics Handbook). Australian pear exports have grown 45 per cent between 2009 and 2019 and, despite slight down-turns in some years, the overall trajectory is positive over a ten-year period.

During this same period, global pear exports rose by 51 per cent, meaning Australia performed in line with international trends, albeit with greater year-on-year fluctuations.

Between 2009 and 2019, Australian pear exports increased their unit-value by 18 per cent. This is important because it indicates exporters are successfully increasing the price premium on Australian pears whilst continuing to grow export volume. In simple terms, this means a higher price per piece and more pieces being sold.

Over the past ten years, stand-out markets with exceptional growth include NZ, Indonesia, and Singapore which, when combined, represented almost 62 per cent of total pear exports in 2019.

Pacific Islands including New Caledonia, Fiji, Papua New Guinea and French Polynesia continue to take small but consistent volumes of product which, over the years, has slowly increased but is not significant enough to make a meaningful impact on overall trade. For perspective, the Pacific Islands’ combined imports put them on par with Singapore (the pear industry’s fourth largest export market).

Understanding a market’s average import price helps estimate the size of the premium segment and therefore the Australian opportunity. Using this rationale, access to the market in Taiwan, China and Vietnam are of particular interest to the Australian pear industry.

In Taiwan, where Australia is seeking to gain access, the average unit-value in 2019 was AUD$2.69 kg and the New Zealand product averaged AUD$2.78 kg whilst holding 12 per cent market share (ITC calculations based on Directorate General of Customs Administration, Ministry of Finance statistics). Similarly, in China, the average unit-value in 2019 was AUD$2.37 kg and the New Zealand product averaged AUD$3.39 kg whilst holding 5 per cent market share (ITC calculations based on General Customs Administration of China statistics). Clearly, there is room for Australia to compete and win substantive market share at a commercially viable price point. High-value Asian markets have a proven record of paying for high-quality imported fruit which makes them an ideal fit for Australian pear exporters operating above the global average unit-value in their category.

The Apple & Pear Export Market Development Strategy, written in 2017, projected the Australian pear industry could export up to 12,300 tonnes by 2022 if targeted strategies were put in place. The industry eclipsed this target in 2018 but was not able to sustain the growth into 2019. This peak, albeit short lived, is evidence that the Australian pear industry holds great potential and is likely to exceed this tonnage target before 2022. This is noteworthy since the export strategy framed it as a ‘stretch goal’ in 2017.

Furthermore, the export strategy’s tonnage target was also translated into a value target based on average prices for Australian pear exports at the time. The export strategy projected a goal of AUD$16.1 million by 2022. In 2019, the value of trade was AUD$18.3 million. This means although less volume was exported, more value was captured. This is a terrific achievement by pear exporters.

These statistics show that Australian pear exports continue to grow and investments in technical market access and market improvements will yield positive returns for the industry and the Australian economy.