Food exports continue to dominate ‘packaged’ exports: it’s a meaty thing

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Australia’s exports of products and goods likely to be packaged in fibre contracted 12.9% by value over the year-ended February 2021. Valued at AUD45.768 billion, the value of these goods exports fell as a result of the pandemic, from AUD52.570 billion. The likely effect was a small decline in the amount of fibre packaging used to export mainly food products to the world.

One of the most significant features of the goods likely to be exported in fibre packaging is they are dominated by food products (54%), and by one food product in particular: proteins, or as we typically know it: Meat. Of the total export value, Meat accounted for 30.4%, well ahead of second placed Pharmaceutical products (11.3%). We can see this, for the year-ended February 2021, in the chart below.

 

Selected Australian Exports: YE Feb ’21 (AUDM)

Source: ABS derived, and IndustryEdge                    Note: Orange bars are assessed as mainly food products

 

There are other inclusions that could be made to this list (historically IndustryEdge leaves out Seafood for instance) and there could be some exclusions that others would make.

Australia’s total exports for the year-ended February 2021 – the full pandemic year we might say – were valued at AUD370.710 billion. That is everything, from the products we assess to iron ore, coal and military equipment.

Products that IndustryEdge assesses may be routinely packaged in fibre packaging totalled just 45.768 billion, or about 12.3% of the total value of Australia’s exports. That does not mean all of those exports were packaged in fibre. As an example, exports of ‘Meat’ includes live animals, which are not packaged in boxes.

Equally important, this is trade value data, it does not tell us if more was exported at a lower price or less was imported at a higher price, and no currency movement is taken into account.

However, the utility of this data lies in its ability to be analysed consistently and over time. This headline level analysis is used in models that help understand the trends in goods exports, as we consider with clients how that impacted Australia’s exports of fibre packaging materials.

Here, in the second chart, we can see the different fortunes of these export ‘lines’ over the year-ended February 2021, compared with the prior year. If nothing else, it is instructive to see what Australia shipped to the world in the pandemic year, compared with the year prior.

 

Change in Value of Selected Australian Exports: YE Feb ’20 v YE Feb ’21 (%)

Source: ABS derived, and IndustryEdge                   Note: Orange bars are assessed as mainly food products

 

How do we assess the changes in the exports of fibre packaging over the period displayed here?

Overall, IndustryEdge considers exports are likely to have declined in value, more or less in line with the goods the packaging supported. However, we also anticipate that volumes were down marginally less than value, and we know that live meat exports were curtailed through much of 2020. That suggests that packaged meat exports were not significantly impacted.

As an estimate, we expect fibre packaging exported along with goods was down by between 5% and 7% compared with the year earlier. We expect that to be reversed over the course of 2021.

 

This is an edited extract of an item from Edition 190 (April 2021) of IndustryEdge’s monthly subscription data and analysis service, Pulp & Paper Edge. Each month, extensive analysis and commentary is linked with dozens of detailed data files for Australia and New Zealand, covering everything from latest price movements, major producer and importer activities, global market analysis and demand and consumption analysis.

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