Australian exporters of fresh milk to China are set to benefit with the lifting of duplicated quarantine procedures that will help ensure the product is sold to consumers quicker.
The Chinese quarantine regulator has recently acknowledged that its testing regime for imported fresh milk essentially duplicates the testing programme that is applied to fresh milk before it leaves Australia.
Consequently, it seems increasingly likely that the Chinese regulator will adopt a fast track quarantine process for imported Australian fresh milk.
Existing regulatory requirements in China have historically meant that fresh milk would often sit in quarantine for anywhere between 14 and 21 days, which meant that the remaining shelf life for the milk made the exercise too risky from an Australian exporter’s perspective.
The fast track programme will substantially reduce the quarantine period, meaning that a much greater proportion of the product’s shelf life will be spent on the shelf in Chinese supermarkets, instead of in quarantine.
Peloris Global Sourcing Pty Ltd (PGS) and Norco Co-operative Limited (Norco) have confirmed a successful pilot shipment in March 2014 of almost 1,000 litres of fresh milk to China pursuant to the newly negotiated framework.
This development is the culmination of 12 months of negotiation between PGS and Chinese officials, with both sides collaborating to develop quality assurance measures that satisfy the relevant food standards agencies in both China and Australia. This has been complemented by changes to China’s import clearance procedures for fresh milk, to reduce the import clearance time.
This development is largely contrary to the current trend of increasingly strict import requirements being imposed by China in respect of dairy products following several dairy-related contamination scares in recent years. Most recent of which is the requirement that, from 1 May 2014, all entities manufacturing or storing milk products for export to China must be registered with the Certification and Accreditation Administration of the People’s Republic of China (CNCA).
For Australian businesses, the process of registration with CNCA is managed through the Department of Agriculture, which has already published an approved list of dairy processors and storage facilities registered for export and will provide regular updates of this list to CNCA directly.
Australian dairy operators will note the significance of being registered with CNCA as, not only will unregistered producers not be allowed to export products to China, but registered entities must ensure that they source products only from other registered entities otherwise, despite themselves being registered, their exports may not be approved for export to China.
The fast track programme is a signal of the countries’ respective flexibility and cooperative nature towards facilitating the export of fresh Australian produce for consumption in China, subject to an open dialogue ensuring Chinese food safety requirements are met at all times.
On the back of these recent developments, the Victorian Government has expressed its support for local milk exporters, saying it: “is committed to improving market access through advocacy to the Commonwealth on free trade matters but also on a product to product basis by working with individual companies to access market opportunities.”
Holding Redlich’s key contacts below would be happy to provide you with further information in relation to dairy exports to China, or Agribusiness generally.
Alistair Salmon, Partner
T +61 2 8083 0467
Ron Eames, Partner
T: +61 7 3135 0629
This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed above.