Australia to subsidise air freight for agri exports to offset virus freeze

by Reuters
Wednesday, 1 April 2020 03:50 GMT

By Colin Packham

SYDNEY, April 1 (Reuters) - Australia's government said on Wednesday it will spend A$110 million ($67.40 million) to subsidise air freight for exports of agricultural products after flights were severely disrupted due to the global coronavirus pandemic.

About 90% of Australian air freight is usually transported in planes carrying tourists. But with scores of countries closing their borders to stop the spread of the virus, many Australian exporters have been unable to export their products.

To kickstart sales, Canberra said it will subsidise flights to China, Japan, Hong Kong, Singapore and the United Arab Emirates, markets that typically pay a premium for Australian products such as Wagyu beef, rock lobster and cherries.

"By getting flights off the ground, full of Australian produce, we're supporting our farmers and fishers who have been hit hard by this crisis," Australia's Minister for Trade Simon Birmingham said in an emailed statement.

The logistics of the freight flights are still being worked out, but Birmingham said many of the planes will return to Australia carrying medical supplies.

The funding will come from Australia's first economic stimulus package in response to the coronavirus outbreak that included A$1 billion for regional communities hit hard by the coronavirus outbreak.

Australia's agriculture sector, one of the nation's biggest exporters with shipments worth about A$35 billion a year, said the funding would be critical in keep the industry afloat.

"Being able to get back into China for us is absolutely essential. We are delighted," said Jane Lovell, chief executive officer of the industry body, Seafood Industry Australia.

Fruit and vegetables, red meat and dairy products are among the other exports expected to benefit from the flights. ($1 = 1.6321 Australian dollars) (Reporting by Colin Packham; Editing by Muralikumar Anantharaman)

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