The Chinese market is dynamic, and the more Australian agribusinesses understand how it is changing, the better they can take advantage of the opportunities it has to offer.
That’s the advice from NAB Agribusiness General Manager Khan Horne, who’s been a regular visitor to China, and is leading his third tour there for customers in May 2017.
“Australian agribusinesses are always looking for new markets and opportunities, and understanding what the market wants, and seeing it first hand, is critical to getting the right outcomes, particularly in China,” Mr Horne said.
“The Chinese place a strong focus on face-to-face meetings to build business relationships, and it’s great that more Australian agribusinesses are travelling to all parts of China.
“Gaining an understanding of how the supply chain works, and your customer’s role in it, can also provide insights on how to value-add, and you can then develop an appropriate business strategy in response.”
In 2016, China purchased $10 billion of exports from Australia’s agriculture, forestry, and fisheries industries, up from $5 billion in 2010 and 2011.
“There are enormous opportunities for Australian agribusiness following the signing of the China-Australia Free Trade Agreement (ChAFTA), but there is also fierce competition for those markets,” Mr Horne said.
“There’s also a fluid regulatory and commercial environment that needs to be skillfully navigated. The best way to do that is to get assistance from organisations that have a base in China, such as Austrade, as they can provide knowledge, connections, strategies, and insights.”
NAB was the first Australian bank into China, with branches in Beijing and Shanghai that service many of Australia’s largest exporters.
Mr Horne said, despite the rapid and enormous change happening in China, it’s not a place where business relationships progress quickly.
“Like many agricultural investments, you need a long-term strategy to do business in China, as well as a degree of cultural sensitivity.
“Be prepared to visit several times to meet the right people, cultivate relationships, and lay the groundwork for potential investment opportunities or contracts for the future.”