Trade Minister Don Farrell has asked the Trump administration to consider sparing Australian sheep farmers from further tariff pain in exchange for Australian investment in the lamb industry in the US.
Senator Farrell floated the idea, which could see Australians’ superannuation savings invested in American meat-processing facilities, during this week’s G20 trade meetings in Milwaukee.
The proposal aims to get ahead of a US trade investigation into lamb imports, which could result in new tariffs.
Australian lamb exports to the US are already subject to a 12.5 per cent tariff, along with many other Australian products.
But American sheep producers, backed by dozens of Republican members of Congress, have been lobbying for tariffs specifically on sheep meat and wool from Australia and New Zealand.
Senator Farrell’s office has confirmed he discussed a possible lamb-industry “support package” with US Trade Representative Jamieson Greer during the G20 event. Mr Greer is a key architect of Donald Trump’s tariff policies.
Senator Farrell also spoke to US Agriculture Secretary Brooke Rollins.
Representatives for Mr Greer and Ms Rollins have not responded to an ABC request for comment, but Senator Farrell told The Australian newspaper he had received a “positive” response from them.
Don Farrell has been arguing against US tariffs on Australian products. (ABC News: Brett Worthington, file)
However, Mary Delahunty, the chief executive of the Association of Superannuation Funds of Australia (ASFA), said the idea had “not been raised with the superannuation sector”.
Senator Farrell argued Australia’s superannuation sector has an obligation to the national interest, but the funds ultimately decide for themselves where to invest their members’ money.
“We have an opportunity for Australia and the United States to work together to grow the lamb industry,” Senator Farrell said in a statement.
“We want to see industry, both in Australia and the United States, succeed so that more consumers can enjoy high-quality lamb.”
Proposal ‘not raised with superannuation sector’
Ms Delahunty said the ASFA would “welcome a discussion with the government” on the issue.
“If investment in the US lamb industry offers good returns for working Australians, super funds, like other international pension funds, will likely be interested. Each fund will assess any opportunity on its financial merits,” she said in a statement.
She noted the ASFA was “always on the lookout for how funds can bring good financial returns home to Australian savers” but added “a super fund’s obligation is set in law, and it is to act in the best financial interests of its members as they save for retirement”.
“Super funds’ investments often do support the nation’s trade interests; that is a byproduct, not a purpose, of investing well for members,” she said.
Misha Schubert, the chief executive of the Super Members Council, said the comments from the trade minister were “ill-informed”.
“Super funds invest completely independently of governments for very good reason; they invest only in the interests of their members,” she said.
“The role of super is to deliver the strongest possible investment returns for members and not anything else.
“It is not the job of super funds to solve other policy problems, nor should it ever be.”
The argument over Australian, NZ lamb
Australia supplies more than 70 per cent of the US’s lamb imports, according to government figures.
Last year, Australia exported about 100,000 tonnes of sheep meat to the US, valued at more than $1 billion.
American sheep farmers have long argued that imports from Australia and New Zealand threaten the domestic industry.
In January, 29 Republican members of Congress signed a letter to Mr Greer, which said:
“Our foreign competitors, particularly Australia and New Zealand, have consistently taken advantage of our relaxed barriers and used them to undercut and infiltrate the US lamb market.
“They have abused imports and suffocated our sheep producers for far too long.”
But Sheep Producers Australia argues Australian lamb “complements domestic production and helps meet year-round consumer demand for lamb” in the US.
Several Australian meat industry groups have been working on responses to the US trade investigation ahead of a public hearing later this month and a preliminary decision expected by November.
Australian diplomats in Washington have also been pressing the case for no new tariffs, with a particular focus on the lamb investigation.
