WA grain growers can count on a huge windfall hidden in unreleased details of the free-trade agreement with Japan as they begin seeding for this season’s crop.
The FTA has the potential to more than double Australian wheat exports to Japan by lifting import barriers in a sector of the market dominated by the US.
The changes — yet to be announced by Tokyo or Canberra — will for the first time open Japan’s highly regulated market to the most commonly grown wheat in WA.
They come as giant Japanese trading house Mitsui prepares to add major agricultural assets in WA to its multibillion-dollar investments in the State.
Mitsui Australia chairman Yasushi Takahashi, a key participant in meetings and events around Prime Minister Tony Abbott’s visit to Japan last week to sign the FTA, revealed details of the breakthrough on wheat imports in an exclusive interview with WestBusiness.
“There is a significant enhanced opportunity for Australian wheat exports in our opinion,” Mr Takahashi said.
Mitsui, Japan’s biggest wheat importer, said the Ministry of Agriculture, Forestry and Fisheries had confirmed that Australian growers would have unprecedented access to Japanese customers.
Australia’s share of Japan’s five million tonne-a-year wheat import market is expected to jump from 20 to 40 per cent.
Under the changes, Japan will allow imports of Australian Premium White and Australian hard-grade wheat as part of a MAFF-run system that allows customers to talk directly with growers and suppliers.
APW wheat makes up close to half of WA’s entire crop in most seasons.
Seeding is about to begin in earnest in the Wheatbelt as WA continues to break export records from last season’s bumper 17 million tonnes, worth an estimated $5 billion to the local economy.
Interest in investment in port infrastructure and grain supply chains has reached fever pitch with Japanese heavyweights Mitsui and Sumitomo joining Chinese conglomerates and a host of multinationals vying for strategic assets.
Mitsui, which has traded in Australia since 1901, has invested $13 billion in the country over the past decade after helping to pioneer the minerals and energy industries. It has flagged a major focus on agriculture and paid $10.5 million for a 25 per cent stake in local grain trader Plum Grove in December 2012.
Plum Grove senior trader Tony Smith said the FTA with Japan would support premiums for WA growers.
“You add more demand and I think the premium for Australian wheat will remain strong,” Mr Smith said.