Farm business in China

If you want to do business in China, you have to go there. Developing relationships and understanding the intricacies of doing business are vital to successfully taking advantage of the opportunities presented by Asia’s growing population and wealth. This is the message from the NAB Agribusiness team following a study tour to China with over a dozen beef, dairy and grain customers.

NAB’s General Manager of Agribusiness, Khan Horne, led the 10 day tour and says food safety and high quality are drivers of demand for Australian food products. Most Australian agribusinesses understand the opportunities in the region, but aren’t necessarily sure how to take the next step. Building relationships, understanding the market and exploring opportunities on the ground are crucial for long standing and successful partnerships in China.Mr Horne said the most important elements when considering opportunities in Asia are:

  1. Building relationships and networks on the ground. Partners such as Austrade, the Department of Agriculture, Fisheries and Forestry, and industry associations can help to facilitate this.
  2. Getting the structure right. This includes business structures such as joint ventures, accessing finance, understanding tax regimes and getting profits back to Australia.
  3. Understanding the market. What customers want and how your product fits into existing requirements, and distribution networks.
  4. Being patient and flexible. Doing business in Asia takes time and may require more than just products; it may require Australian businesses to share information, genetics or technology as part of the partnership.
  5. And finally, spend as much time as feasible in China. Face to face discussions and negotiations are highly valuable in building a successful venture and are much more effective than interacting remotely.

The aim of the study tour was to educate customers on what’s needed to enter relationships in China and to support them to make some of those connections. “It was evident, even from day to day interactions during the tour, that it’s not just about the big things; a casual conversation can make all the difference to the end result, saving time and money. For instance, one of the customers on the trip is expanding into China and was discussing finance. It can take months to set up a bank account over there, and getting the money back to Australia can also be a lengthy process. However, there are several alternative options that allow transactions to happen immediately, including trade finance options which can widen the number of Chinese companies Australian exporters trade with as transactions are settled in Renminbi (RMB).

“Our relationship with China’s largest card payment network, China UnionPay, is another option that enables Chinese businesses to pay online directly into an Australian merchant account,” Mr Horne said. The participants all agree that it was well worth the visit and the connections they’ve made will be invaluable. Having visited China 22 years ago Michael Jackson, from Jackson Agri Investments, was impressed at the sheer growth the region had experienced over this time.

“China has transformed itself enormously since my last visit. The growth can only be appreciated by visiting the region first hand. Australian agribusiness can really take advantage of the opportunities across the beef, dairy powder and sheep industries in particular,” Mr Jackson said.

“I encourage any agribusiness interested in knowing more about China to contact their local NAB Agribusiness Manager to start the conversation,” Mr Horne said. NAB has been established in Asia for more than 30 years, and its bilingual staff are supporting customers throughout Australia to expand their existing network and knowledge of the region.

For more information on Australia’s trade with China, including specific figures for dairy, beef and veal download our fact sheet.

 Source :
Hong Kong is also a major bridge to China.
Sean Rothsey has been travelling to Hong Kong and China since 1981  and Since September 2012 Sean has been a Committee Member  of   the Australian Chamber of Commerce Hong Kong and Macau ’s  Finance , Legal and Taxation Committee. Sean Rothsey can facilitate introductions to  Chambers in Hong Kong and China , Government , business or professionals and as a consultant can assist you in an unregulated and unlicensed capacity in a buy sell or other transaction and makes no legal warranties or representations of any kind as to the Buyer, Seller or Transaction.For example, Sean can assist in equity, negotiating offtake , joint ventures and numerous other agribusiness related transactions.

Sean can also facilitate introductions to licensed entities in a regulated regime where required and can both represent and assist any party in those regimes.

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