The UK-Australia Free Trade Agreement (FTA) was signed virtually on 17th December. It is the first FTA that the UK has negotiated from scratch since its departure from the EU. It means that all chapters of the agreement have now been agreed by both parties following the agreement-in-principle in June (click here for previous article). From an agri-food standpoint, much of what was agreed in principle is now contained within the detailed agreement and will now be laid before Parliament for scrutiny.
The key points relating to agri-food are;
- Tariffs:
- UK Imports: there will be an immediate elimination of 99% of tariffs on goods imported from Australia to the UK upon entry into force (potentially sometime in 2022). Pork, poultry and eggs are not included so the UK Global Tariff will continue to apply. However, restrictions will remain for other sensitive agricultural products as specified below.
- UK Exports: almost all tariffs on UK goods will be eliminated upon entry into force. Tariffs on whisky, confectionary and biscuits will be phased out over 5 years.
- Tariff Rate Quotas (TRQs): the duty-free TRQs remain largely the same as previously outlined in the agreement-in-principle. These are summarised in the Table below.

- More detail has been provided on what is included within each TRQ:
- Beef (TRQ 1): the products (commodity codes) which are applicable include fresh/chilled beef (0201); frozen beef (0202); and a range of other chilled and frozen beef offal, preserved beef, beef-based meat mixtures and selected blood preparations.
- Sheep meat (TRQ 2): products applicable include chilled lamb carcases/half-carcases (020410); chilled sheep carcases (020421); other sheep meat cuts with bone-in or boneless (020422; 020423); frozen sheep meat; edible flours/meals of sheep meat offal; and blood preparations.
- Milk, Cream, Yoghurt and Whey (TRQ 3): applicable products are milk/cream whether concentrated or unconcentrated (0401; 0402); buttermilk and yoghurt (0403); and whey (0404 (excluding 0404.10.48)).
- Butter (TRQ 4): all products under the 0405 HS code.
- Cheese and Curd (TRQ 5): all products under the 0406 HS code.
- Wheat (TRQ 6): this 80Kt TRQ applies to all types of common wheat but excludes seed (HS code 1001.99). Wheat seed will have its £79 per tonne duty removed in 4 equal instalments and after Year 4, the duty will be removed.
- Barley (TRQ 7): this 7Kt TRQ applies to malting and other (feed) barley (HS code 1003.90), but excludes seed. Barley seed will also have its £77 per tonne duty removed in 4 equal instalment and will be duty free after Year 4.
- Long-grained Rice (TRQ 8): a 1Kt TRQ applying to selected commodity codes.
- Broken Rice (TRQ 9): an 11.5Kt TRQ applying to broken rice of all varieties (HS code 1006.40).
- Sugar (TRQ 10): the TRQ is 80Kt (Year 1) rising to 220Kt (Year 8). It includes cane sugar, white sugar and other sugar (HS codes 1701.13; 1701.14; 1701.91; 1701.99). Beet sugar (1701.12) is excluded.
- Sanitary and Phytosanitary (SPS) Measures: both parties emphasise their commitments to a science and risk-based approach to implementing SPS measures. However, there is no mention of any changes to import standards. Such changes, if they were to be introduced, would be set-out separately in future either by the UK or Australian Governments. Therefore, this area will need to continue to be monitored closely.
- Rules of Origin: there is some more flexibility for UK exporters in terms of percentage of processed food ingredients that must be of UK origin, with a greater focus on the production process as opposed to the list of ingredients. This means that biscuits made from imported flour will qualify for tariff-free access to Australia under the FTA. It is also notable that whiskey from the Republic of Ireland used as inputs into Northern Irish whiskey will qualify for preferential access to the Australian market. Effectively, NI whiskey will enjoy the same tariffs as Scotch whisky.
Overall, the UK-Australia FTA is significant as it is the first trade agreement negotiated independently by the UK in nearly 50 years. The UK farming sector, particularly grazing livestock and sugar beet will be more exposed to competitive pressure from Australian imports in the long-term. However, it is worth emphasising that Australia is currently heavily focused on the Asia-Pacific region and that having generous quota access with eventual full liberalisation does not necessarily mean that Australian imports will reach these levels. That said, from an Australian perspective, the UK market is an important diversification opportunity, particularly given its recent tensions with China.
From a UK farming standpoint, the Australian FTA of course sets an important precedent, that other deals are likely to follow. We’ve already seen this with the NZ agreement-in-principle. The UK has also relented on its efforts to base beef and sheepmeat import TRQs on carcase weight equivalent. The HS codes included show that the TRQs will be based on product-specific weight. This is unsurprising as both Australia and NZ have been digging their heels in on this. They also have leverage with the UK in terms of its application to join the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).
The deal will now go before both the UK and Australian Houses of Parliament for further scrutiny and ratification. Once domestic ratification has been completed, both parties will notify each other. The agreement could enter into force as soon as 30 days after both parties have completed ratification. Some anticipate that entry into force could occur as soon as the middle of 2022, others think the process might take longer. More detail is available via: https://www.gov.uk/government/collections/uk-australia-free-trade-agreement