WITH the full impact of Japan’s recent earthquake and tsunami still unfolding, National Australia Bank is predicting an increase in demand for key agricultural commodities such as beef.
Analysis by NAB Agribusiness reveals Australian exporters are likely to see higher prices for some rural commodities and export opportunities in the medium term as a result of food safety concerns and production shortfalls in Japan.
Khan Horne, NAB Agribusiness General Manager, said Australia had a strong trade relationship with Japan.
“Natural disasters can have a devastating impact on a country’s agricultural industry, and we in Australia are unfortunately well aware of this. However, while natural disasters have a tendency to cause volatility in global commodity markets in the near team, we are confident in the outlook over the medium term.
“The affected region of North Tohoku is Japan’s fourth-largest food bowl, producing around 20 per cent of the country’s rice and a major portion of beef, poultry and pork. It is therefore likely that Japan will need to lift its food imports to supplement the damage to the region’s commodities.
“Japan is already Australia’s largest agricultural export destination for beef, sorghum, cottonseed, cheese and seafood, totalling $3.9 billion in 2009-10. We anticipate any significant shift in demand for agricultural imports will have a positive impact on Australian producers.
“In addition, fears about radiation contamination, either perceived or real, and damage to key food producing regions are likely to result in a lift in Japan’s food import program and create demand for Australian agriculture commodities.”
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