Australia would significantly boost agricultural and other exports to China if a free trade agreement (FTA) were forged with the key Asian country, officials and analysts said on Friday.
Australia's overall trade with China has trebled to A$23 billion ($16 billion) since 1996, making China Australia's second-largest export market after Japan.
Australian grains, particularly wheat, together with beef and dairy goods, faced a "tremendous potential" for rising exports to China, Vivek Tulpule, Deputy Executive Director of the Australian Bureau of Agricultural and Resource Economics (ABARE), told an Australia-China conference.
Banks would also be presented with many opportunities by an FTA, Zhu Min, executive assistant president of the Bank of China (BOC), the top foreign exchange bank, told Reuters.
"All the Chinese banks are looking for strategic investors," said Zhu, whose BOC plans to float on the stock exchange.
Wool and cotton would receive the greatest payoff among farm goods, said analyst Peter Gallagher of Inquit Pty Ltd.
Ian White, Chief Executive of Australian monopoly sugar exporter Queensland Sugar Ltd, told Reuters China could become a structural importer of "some millions of tonnes" of sugar a year. Australia would welcome becoming a regular supplier, he said.
China's consumption of 5 kilograms of beef per person per year, much less than 10 kgs in South Korea and 12 kgs in Japan, showed enormous potential for growth, ABARE's Tulpule said.
China's consumption of less than 10 kgs per capita a year of dairy products, compared with more than 70 kgs in South Korea, also showed tremendous potential, he said, adding China's increasing beef production would also create strong demand for Australian exports of feed grains barley, feed wheat and sorghum.
Pressure on water availability was expected to squeeze China's grains production, creating very good opportunities for Australian wheat, said Tulpule.
Other Australian products which would receive a major payoff from an FTA with China include automobiles, vehicle parts, petroleum oils, iron ore, aluminium, alumina, coal, iron ore, titanium and copper ores, Inquit's Gallagher said.
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