Opportunities for Australian agricultural exports to Malaysia

Posted by Daniel Palmer on 18th August 2008

Australia can play an important role in meeting Malaysia’s food consumption and demand for food processing inputs, according to a new ABARE report.The report, ‘Changing food consumption and imports in Malaysia: Opportunities for Australian agricultural exports’ was released today by Phillip Glyde, Executive Director of ABARE.

“With continued income and population growth, Malaysian food consumption is shifting away from starchy staples such as rice and cassava and more toward wheat-based products including breads and bakery products, meat, dairy products, seafood, fruit and vegetables,” Mr Glyde said. “With limited domestic production of many agricultural products, food demand is expected to increase and to be met largely by imports.”

Australia is the leading agricultural exporter to Malaysia. The key imports from Australia are wheat, sugar and dairy products. Other imports important for Australia include wool, live cattle, vegetables, sheep meat, beef and fruits.

The food processing industry in Malaysia is growing, with many intermediate inputs being imported. For example, wheat and sugar are used for further processing for bakery products and confectionery as well as the use of meat in the production and export of halal products which provides export opportunities for Australia.

However, ABARE reports that trade with Malaysia is not without its difficulties. “Despite applied tariffs on agricultural commodities being mostly low or zero, other trade barriers such as tariff quotas and license requirements of a range of agricultural products could restrict access to Malaysia’s market,” Mr Glyde explained. “In addition, there are Malaysian government controls on domestic prices for some food products such as wheat based products and sugar. These controls could hinder growth in Australia’s exports of these commodities to Malaysia.”