Japan-Australia FTA creating new supply-chain demand

As Australia’s exports increase and ever-greater quantities of goods cross the countries borders, effective materials handling is going to be essential for keeping the process running smoothly. Free trade agreements are facilitating this growth, by reducing the tariffs that exporters are charged.

One of these has recently been signed – the free trade agreement (FTA) between Japan and Australia. Signed earlier this year, the agreement is set to come into force in the early months of 2015. Once implemented, tariffs on Australian goods will be considerably reduced, with many reaching zero as a result of the deal.

These tariff reductions are likely to see a big increase in the amount of goods being sent overseas, as companies look to make the most of improved trading conditions. These reductions alone are already set to make exports more profitable, with bottled wine for example set to lose a 15 per cent tariff that is currently applied to all exports.

For companies operating in this space, these lower tariffs will make it much easier to import Japanese goods as well as export Australian products. Two-way trade between the two countries has reached over $70 billion in recent years, with almost $50 billion of that coming from Australian exports.

While lower costs will make it easier to export goods, this agreement will also increase the pressures on warehouses across Australia. As exporters and importers demand greater efficiency and timely transport, facility operators need to have the right processes in place to handle greater volumes.

To meet these challenges, companies need to invest in the right materials handling equipment. Equipment like powered pallet trucks ,powered conveyors, automated pallet wrappers,  can make time-consuming processes move much faster.

Maximising the benefits that this latest free trade agreement, and others like it in the future, will bring requires a new level of efficiency from Australian warehouses.