Currently, Australia's high value food produce is being exported by airfreight to major markets under a heavy assistance mechanism called IFAM - International Freight Assistance Mechanism. This program is planned to wrap up, at the latest, in February 2021.
With this assistance mechanism nearing the end, Queensland is now in significant danger of losing freight flights.
Before our region was hit with COVID-19, kilogram rates of freight were sitting well below $1, with it now sitting anywhere between $1.20 and $1.80 under the assistance mechanism.
There is the risk that would increase to as much as $13 a kilogram when IFAM concludes, due to a whole range of issues around supply and demand, and airlines committing to the flights without bookings on them.
At this point, the Queensland government does not have an international air freight strategy or any idea how they will maintain the air freight industry in Queensland.
This will have significant ramifications on regional producers who will have to road freight their produce to Sydney airport, which has the freight capacity.
The higher costs from this additional road freight requirement is extremely cost inhibiting for our exporters. These increased costs could also make it more challenging for our region to welcome new businesses investing in value-added food production.
The Queensland government needs to build a regional freight strategy immediately to ensure our export security.
Sydney airport receives inbound freight because companies like FedEx, DHL and Amazon all land their products at their airport.
I urge the Queensland government to strongly commit to an air freight strategy, to ensure more inbound freight is arriving in Queensland.
It will help keep the people who get our product overseas employed in our state. Inbound freight opportunities will be essential to make sure that when our agricultural product is value-added here and becomes a high value product in our region, it can go directly from our region to the rest of the world.
If we don't focus on our local air freight strategy, Queensland will be known only as a bulk commodity supplier of beef, grains and other supplies, which is not something that our producers want to occur.
We must maximise the value of our industry to ensure farm gate returns are as high as possible.
- TSBE Food Leaders Australia general manager Bruce McConnel
