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LH Benchmark_Nineteenth_Ed

Agricultural Overview Exports 1.2 1.1 1.0 0.9 0.8 0.7 4 | www.landmarkharcourts.com.au The Australian dollar is under renewed downwards pressure, falling below US$0.74 in June for the first time since December ‘16 A lower Australian dollar is generally a positive outcome for the economy; promoting exports and boosting demand for Australian products and services. At the end of June 2018, the Australian dollar was trading at US$0.7391; its lowest end of month value since December 2016 and 8.4% lower relative to the recent high in January 2018 (US$0.8073). Recent exchange rate forecasts from Westpac’s economic team indicate the Australian dollar is likely to remain around US$0.74 through the second half of 2018 before falling to US$0.70 by the end of 2019. A lower exchange rate would provide additional stimulus for export reliant industries such as the agricultural sector. European Union countries remain as Australia’s largest agricultural trading partner Based on an aggregation of the balance of payments data issued by the ABS, Australia’s trade surplus on agricultural products was recorded at $7.41 billion over the twelve month to May 2018. The European Union remains as the largest export market for agricultural products, with a trade surplus of $1.598 billion. Amongst the EU nations, the largest trade surplus for agricultural products was in Italy ($348.6 million), Netherlands ($266.7 million) and Belgium ($240.2 million). Outside of the European Union, the agricultural trade surplus with New Zealand, China and USA comprises the vast majority of net agricultural export demand. Australia's Top 10 Agricultural Exports by Value – Year to May '18 Major agriculture export products A$million Share of Total (%) Total Australian Agricutural Exports $47,928 Meat $12,429 25.9% Cereals $8,074 16.8% Textile fibres $6,049 12.6% Vegetables and fruit $4,227 8.8% Misc edibile products $3,151 6.6% Beverages $3,106 6.5% Dairy and eggs $2,413 5.0% Crude fertilizers $1,939 4.0% Live animals (exc fish) $1,711 3.6% Oil-seeds and oleaginous fruits $1,418 3.0% Australian meat continues to be the most valuable agricultural export product, with a trade surplus of $12.429 million over the twelve months to May 2018 Data published by the ABS on international trade in goods and services shows that Australian agricultural exports (excluding fish products and forestry goods) totalled $47.928 billion over the twelve months to May 2018, with 25.9% of this value comprised of meat and meat preparations. Cereals and cereal preparations accounted for almost 17% of total agricultural exports. Highlighting the importance of meat products and cereals to the agricultural export sector, these two categories made up 43% of the value of all agricultural exports last year followed by textile fibres (12.6%) and vegetables and fruit (8.8%). JUN-10 JUN-11 JUN-12 JUN-13 JUN-14 JUN-15 JUN-16 Exchange Rate ($US to $AU) JUN-17 JUN-18 0.6 Source: RBA, CoreLogic Australian dollar exchange rate with the $US Source: ABS Catalogue Number 5368.0 International Trade in Goods and Services, Australia. Data represents the trade surplus (exports less imports) estimates for agricultural goods in the year to May 2018. Agricultural goods are classified by the WTO definition, which excludes fish and fish products and forestry goods. Note this data is limited to broad economic ABS classifications. It excludes some products such as yarn and wool. Source: ABS Catalogue Number 5368.0 International Trade in Goods and Services, Australia. Data represents the trade surplus (exports less imports) estimates for agricultural goods in the year to May 2018. Agricultural goods are classified by the WTO definition, which excludes fish and fish products and forestry goods. Note this data is limited to broad economic ABS classifications, analysing fruits and vegetables, meat, dairy, organic materials, cotton, yarn and non-crude fertilizer. It excludes some products such as wine and tobacco. Australia's Top 10 Trading Partners by Trade Surplus (Exports less Imports) for agricultural products – Year to May '18 Total trade surplus $ 7,405,000,000 Share of Total (%) European Union $ 1,597,800,000 21.6% New Zealand $ 1,186,900,000 16.0% China (excluding SARs and Taiwan) $ 1,040,300,000 14.0% United States of America $ 1,039,600,000 14.0% Saudi Arabia $ 240,200,000 3.2% Viet Nam $ 200,000,000 2.7% Qatar $ 190,600,000 2.6% Switzerland $ 171,600,000 2.3% Thailand $ 152,600,000 2.1% Turkey $ 139,600,000 1.9%


LH Benchmark_Nineteenth_Ed
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