Exporting – not as daunting as it seems

Apple and Pear Australia Limited (APAL) has created a basic starting point for growers thinking about exporting their produce but don’t know where to begin.

When it comes to growing fruit for the local market, Australian apple and pear growers have a fair idea of what they need to do and how they need to do it. Expand that to the international space and it can be a very daunting thought – where do you start and how do you get there?

There are a number of questions to consider before looking to export fruit, such as: is there a market for your fruit in a specific country and what is the consumer preference for colour, size, brix and variety; is there market access – can Australian fruit be sold in that country; is it a protocol market (are specific treatments required prior to, during and after shipping the fruit), are the any biosecurity or phytosanitary treatments or certifications required, and which chemicals can be used on the fruit; is it necessary for the block to be registered for export; how will the fruit be transported without losing quality or damaging the product; and how can you ensure you will be paid?

It seems like a lot of information is required and it is quite confusing to the uninitiated, but the answer is much easier than you may think because there are people and services available to offer support every step of the way.

Where to begin?

There’s a range of ways to tackle exporting, with varying degrees of involvement – the easiest place to start is to send what you grow to an existing exporter. This means they will do all the hard work, which includes liaising with importers, organising the required documentation and packing the fruit in a registered pack house.

If you currently send fruit to an exporting pack house, continue to do so, just make sure they are a registered exporter. Your block will also need to be registered if exporting from Tasmania to Taiwan, Japan or China; and Australia-wide to Thailand. APAL is currently developing an online system for growers to register their block that will be available in the 2016-17 growing season. It’s important to note that some types of branded apples, including Pink Lady®, require specific export licences, which can be managed by an exporter.

Alternatively, if you don’t want to go through a pack house, you can find an independent trader that is interested in purchasing your fruit and selling it internationally.

Aim for quality

When it comes to export it’s important to focus on growing a high quality piece of fruit for a specified market. Growers should produce the best piece of fruit they can and consider the specific flavour profiles and preferences of the destination country. It’s not advisable to try and sell fruit to international customers that is unwanted on the domestic market, second grade or inferior.

It’s also important that your orchard block meets any protocol or non-protocol market specifications and that your chemical usage adheres to maximum residue limits (MRLs) for each market.

Many countries have lower tolerances of certain chemicals than is standard in Australia – notably DPA in Europe. The last thing you want is for your shipment of fruit to be rejected because you forgot to check the MRLs of the importing country and adjust your orchard and storage management accordingly – not only does this adversely affect you, but damages the reputation of Australian grown fruit. The National Residue Survey offers free testing of residues on apples and pears – so test before you send.

A complete list of countries that Australia has market access to for apples and pears is available on the APAL website. Major phytosanitary (plant health) requirements, such as required certification, fumigation and cold treatment instructions are also listed alongside specific tariff information.

From January to May 2016, Australia’s top five export markets for apples were: Papua New Guinea, Indonesia, Malaysia, Thailand and Hong Kong. And for pears: Indonesia, Canada, New Zealand, Singapore and New Caledonia.

Levels of engagement

Growing may be as far as you go in the export process, if this is the case, a registered pack house will take it from there and manage the fruit packing and sales.

During the packing process, fruit for export is packed individually according to the specific bin card – identifying the variety, grower and block. The pack house will receive official documentation from the Australian Department of Agriculture and Water Resources (DoA) as to what each grower is registered to export. Each package can then be traced back to the grower via its batch number. This ensures that if there is an outbreak of something from one block, in transit, the whole shipment doesn’t have to be destroyed – the offending package can be isolated and won’t affect other fruit.

Once they have the fruit, the exporting pack house will complete all paperwork and logistics, or work with a freight forwarder who will complete the documentation. The freight forwarder will liaise between the seller and importer; organise a container to be delivered to the packing shed, shipping times and arrival at the destination; complete the request for permit if sending to a protocol market; set up the quarantine inspection if necessary and sign off on the export compliance report. An Authorised Officer, certified specifically for apples and/or pears and the intended destination, will also need to see documentation and inspect the fruit at a registered establishment before shipping.

Alternatively, a DoA officer can be used and this will be arranged by the exporting organisation without the need for freight forwarder involvement.

The exporter will directly send their invoice to the customer (importer). It’s advisable for exporters to be careful on payments, especially when sending fruit overseas for the first time. Here’s where it’s important to do your homework and speak with other Australian suppliers, find out which importers they work with and get a reference from some of their other customers. It’s also important to discuss payment methods in advance and even push for full payment up-front or at least 50 per cent in advance and 50 per cent upon arrival to minimise the risk of not being paid.

The vast majority of exporters use a freight forwarder to complete their paperwork but the freight forwarder would not be involved in payments between importers and exporters. It’s important for growers exporting their produce to understand the complete process so they aren’t misled and undercut along the way.

Getting started

You’ve decided you’d like to go ahead and dabble in export – where to from here?

Step 1: Do your research, identify potential markets and international buyers, and determine your level of involvement – engage a registered pack house or a trader who exports fruit, or do it all yourself.

Step 2: Set up and register your block, if necessary.

Step 3: Check the importing country’s requirements and grow to these specifications.

Step 4: Pack yourself or send to an export-registered pack house.

If sending to a pack house they will complete the next steps

Step 5: Submit paperwork OR engage a freight forwarder.

Step 6: Present goods and documentation to an Authorised Officer.

Step 7: Export your goods.

Things to remember and consider

If you’re interested in export and don’t have a pack house, send your fruit to an exporter. Make sure you secure contracts, develop relationships and manage your fruit well. It’s advisable to speak to as many people as possible and make use of available resources.

Don’t reinvent the wheel, there are some exporters out there doing it well, look at what is currently being exported, from where and to which destination. Keep in mind the characteristics of specific markets, and grow for that market – whether it be size, colour or taste.

Be mindful of the tariffs imposed for specific destinations, as an example, fruit going to India is subject to a 50 per cent tariff, which means the Indian government receive 50 per cent of each sale.

It’s worth it

Increasing exports of apples and pears has been identified by APAL as one of the key ways growers can remain profitable and for the industry to expand in the future. By exporting fruit, not only might you establish an important new customer, but you remove fruit from the domestic market – decreasing supply, increasing competition, and supporting fairer prices for growers in the domestic market.

APAL is available to help with any export questions – please call 03 9329 3511.

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By |September 1st, 2016|Exporting|

About the Author:

Market Development Manager, Apple and Pear Australia Ltd
otait@apal.org.au
03 9999 2702