Analysis – Australian dairy exports to Chile to benefit from improved market access

13 April 2023 - 10:06 AEST13 April 2023 - 10:06 AEST

Analysis – Australian dairy exports to Chile to benefit from improved market access

Australian dairy establishments exporting to Chile will no longer be required to undergo periodic in-country audits by Chilean officials. The Chilean Agriculture and Livestock Service (SAG) agreed to exempt Australia from this requirement because of Australia’s high-quality dairy regulations.

In-country audits impose a high-cost on prospective exporters. The removal of the audit requirement and effective recognition of Australia’s regulatory system for dairy exports comes after several years of negotiation between Australia and Chile.

Australian dairy producers and exporters are now better placed to take advantage of the rapidly growing Chilean dairy market.

Implications for Australian agricultural exporters

Exempt Resolution 954 came into force last month. This means the approval and listing of Australian dairy manufacturing establishments seeking to export to Chile is now the responsibility of the Australian Department of Agriculture, Fisheries and Forestry (DAFF).

The list of Australian approved establishments is published on SAG’s webpage and updated periodically upon the request of DAFF. This will now happen without the need for SAG officials to visit Australia.

Dairy exporters seeking listing for market access to Chile should visit the Manual of Importing Country Requirements and contact [email protected].

Opportunities for dairy exporters in Chile

Chile is a high-income country, with strong economic indicators and transparent processes for doing business. There is strong demand for high-quality agricultural imports, including dairy products.

Figure 1 – The value of Chilean agricultural imports is growing

The value of Chilean dairy imports rose from US$346 million in 2020 to US$425 million in 2022. This is a rise of 23%.

Between 2020 and 2022, 66% of Chile’s dairy imports came from outside of South America, including from the US (23%), the EU (22%) and New Zealand (15%). Growth has been driven by increased cheese imports.

Australia has market access for dairy products. Exporters pay a 0% tariff rate under the Australia-Chile Free Trade Agreement.
Australia exported a yearly average of A$1.3 million worth of dairy products to Chile between 2019 and 2022.
Consumption of cheese in Chile is forecast to grow by 16% over the next decade. It will rise from 149,100 tonnes in 2021 to 170,000 tonnes in 2030 (OECD-FAO 2022).

Figure 2 – Chilean dairy imports by product type

Australia has multiple trade agreements with Chile to support exports and investment including:

Resources

Austrade has more information on the Chilean market for Australian businesses.

The Manual of Importing Country Requirements has information about Chilean import requirements for agricultural exporters.

The Australian Government’s network of Agriculture Counsellors provided information for this article. More information about the Agriculture Counsellor network, including contact details, is available on the Department of Agriculture, Fisheries and Forestry website.

This article was also published as an Austrade Insight.