'Yearly $1.66 Million' Australia Export Agricultural Food Dedicated Shipping Space Route Established in November

Expansion of Dedicated Shipping Space Routes from US West Coast to Australian Cities Sydney, Melbourne, and Brisbane

Additional 7% Logistics Cost Support for Export Items Until Year-End... 5% for Southeast Asia

The 16,000 TEU ultra-large container ship 'HMM Nuriho,' which set sail for the first time from Busan on March 22. 1 TEU refers to one container approximately 6 meters in length. (Image source=Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] Starting next month, dedicated export shipping routes for agricultural and food products will be expanded from the United States to Australia. The government is stepping in to reduce logistical difficulties in exporting Australian agricultural and food products worth 1.66 million USD (approximately 1.9854 billion KRW) annually.

The Ministry of Agriculture, Food and Rural Affairs announced on the 11th that from next month, dedicated shipping routes for agricultural and food products will be expanded from the US West Coast to Sydney, Melbourne, and Brisbane in Australia. Currently, Korea exports mushrooms, pears, kimchi, and other products worth 1.66 million USD annually to Australia. Earlier, in July, the government signed an agreement with the national shipping company HMM to secure a monthly 200 TEU (1 TEU is approximately one 6-meter container) capacity of dedicated shipping space for agricultural and food products on trans-Pacific routes and provided an additional 5% logistics cost support to exporting companies using this service. However, considering the deepening concerns of the agricultural and food export industry due to the resurgence and prolongation of COVID-19, additional support measures have been introduced.

Until now, dedicated shipping routes for agricultural and food products have operated only on the US West Coast, and dedicated routes for small and medium enterprises have been limited to the US, Europe, and Southeast Asia. With the government's acceptance of industry requests, starting next month, a monthly volume of 36 TEU is expected to be transported via the dedicated Australian shipping route. According to the Ministry of Agriculture, Food and Rural Affairs, 36 TEU per month corresponds to about 80% of the demand for fresh agricultural and food product shipping space to Australia. Companies wishing to receive support can check vessel schedules on the 'aT Exporter Comprehensive Support System' website and submit an online shipping space allocation application.

Additionally, the government has decided to provide an extra 7% logistics cost support for all agricultural and food product categories until the end of the year. Air freight will also receive an additional 5% logistics cost support across all categories. This decision was made considering that last month's shipping freight rates surged by 316.7% compared to January, and air freight rates rose by 48.8%. However, for Southeast Asian export logistics costs, where the freight increase was not significant, only an additional 5% support will be provided, and routes to Japan and China, where freight rates have decreased compared to the beginning of the year, will be excluded from support.

Jung Hyunchul, Food Industry Policy Officer at the Ministry of Agriculture, Food and Rural Affairs, said, "The Ministry is implementing various support measures such as securing dedicated shipping space and providing additional logistics cost support to assist producers and exporters facing crises due to the global logistics disruption. We will continue to listen to field difficulties and do our best to discover projects to expand exports."

This content was produced with the assistance of AI translation services.