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People doing international business have all experienced communication mishaps due to time differences, and the chances grow with the more countries/places you engage with. Dr Edward Anderson, of the School of International Development at the University of East Anglia (UEA), found that each hour of time difference reduced international goods trade by between two and seven percent.

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EXPORTING TIMBER TO AUSTRALIA

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Where’s the opportunity?
Australia’s burgeoning building construction sector is generating higher demand for timber.  Australian demand for new housing will rise from 183,000 new dwellings p.a. now to 259,000 p.a. by 2050, driving an increase of almost 50% in demand for timber. Freestanding houses in particular use large quantities of timber, including softwoods (for roof and lightweight framing) and hardwoods (for joinery and flooring). Carpentry typically represents about 20% of the cost of the average new home. So how can you tap into this booming market? Here are our tips to take your marketing mix to the next level. IMG 0609 2
Our Export Tips:
Product 
Timber products are empowered by technological advances over the past five years. Products such as prefabricated wooden roof trusses are commonly supplied directly to homes and building sites in Australia. Make your timber products stand out by offering customers a range of manufactured timber that have superior strength attributes. These products include laminated veneer lumber, laminated strand lumber, glue laminated timber and I-beams. Furthermore, sustainability is a key feature to highlight in the promotion of timber products. Environmental certification is a voluntary market driven process. Consider using certification schemes to show Australian consumers that your timber products are sourced from responsibly and sustainably managed forests. The two major certification schemes within Australia and internationally are PEFC (called Responsible Wood in Australia) and FSC.
Price 
Current timber shortages in Australia represent attractive profit potential to suppliers seeking to enter Australia. On the one hand, rising residential construction activities have largely increased demand for timber. Strengthening demand is expected to flow through to higher prices. On the other hand, flooding in New South Wales and Queensland, in addition to the Russia-Ukraine conflict have exacerbated supply deficits. Consequently, this imbalance of supply and demand is placing upward pressure on the domestic price of timber in the current year. Experts forecast the domestic price of timber to increase by 1.8% in 2022-23, to reach 160.4 index points. Also, note that timber is a commodity with fluctuating market price. To seize this opportunity, remember to lock your prices with your Australian customers, as negotiation times can be lengthy.
Promotion
Considering the B2B nature of timber exports, mainstream advertising would be ineffective to reach your target audience. Instead, make the most effective use of your time and marketing budget by directly cold calling business development managers, procurement personnel, building construction companies and the like.
Place
Large cities such as Sydney and Melbourne have a high and increasing volume of new home construction, partially caused by strong population growth. Furthermore, consider distributing hardwood for timber flooring and timber decking in Brisbane, which has a particularly big demand for these materials.
Our Strategic Takeaways:
Australia is an attractive market for prospective timber exporters, as it is seeking more softwood and hardwood materials. Moreover, a combination of rising construction activity and supply chain deficit is driving up timber prices in Australia. Equipped with value-adding promotional features such as sustainability certification, timber suppliers can see strong profit potentials in exporting to Australia. Screen Shot 2021 02 26 at 12.20.51 pm 1
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pexels mart production 7088530
Opportunities for medical health technology Australia 5

Overseas partnership present growth opportunities for Australian medical health technology sector

Overseas partnerships are valuable growth opportunities for Australian distributors and retailers operating in the health sector. There is no doubt that as technology becomes omnipresent in our daily lives, the role of medical technology in managing and improving health outcomes among the general population will continue to grow. The sector, which is currently worth $6.1 billion, relies heavily on imports across the US, China and Germany.​ German suppliers in particular have been traditionally a well received supplier in Australia due to its perceived high quality and innovation in the field of medical technology development.

Where is the demand?

Australia’s aging population will significantly influence demand for the types of medical technology products needed. Australians have one of the longest life expectancies in the world (sixth among OECD countries) and demand for medical technology will continue to rise as its aging population increasingly relies on medical devices for care. Distributors operating in the health sector can find promising opportunities in technology that promote health upkeep and improvements in clinical outcomes. This includes products that lead to faster patient recovery, reduce hospital and rehabilitation costs, and alleviate or manage disability and chronic pain. Rising health consciousness means that Australians are taking a more proactive approach to managing their health. Wearable health devices such as smartwatches along with wearable ECG and blood pressure monitors are expected to grow in demand.

Demand for medical technology that serves to diagnose, manage and treat chronic conditions will also continue to remain prevalent. Approximately 50 percent of Australians have one chronic disease and 20 percent have at least two. These include cardiovascular disease, cancer, chronic kidney disease, diabetes, mental health, musculoskeletal conditions, and oral health and respiratory diseases (including asthma and COPD).

Innovation in healthcare

Medical health technology plays a crucial role in addressing challenges facing Australia’s healthcare system. Over the course of the pandemic we have seen local healthcare capabilities being stretched to the limit with strains on existing hospital systems and staffing capacities. As such, medical technology solutions particularly focused on improving patient outcomes in Australia’s broader public and private healthcare systems have been increasingly embraced. Distributors should look towards embracing new solutions like AI and predictive analysis technology in healthcare. Moving forward, healthcare leaders are looking to adopt centralized platforms of data management to improve the quality, cost and speed of care to patients and address health inequity within metropolitan and regional areas.

What next?

The Australian-Germany Medical Technology Trade Mission hosted by Smart Mango is a lucrative opportunity for Australian distributors to connect with leading innovators in the field of medical technology. 

Trade mission will run from 12 – 23 September 2022

 Book a meeting now https://cutt.ly/german-trademission

 

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Screen Shot 2022 07 29 at 2.21.30 pm EXPORTING GREEN HYDROGEN FROM AUSTRALIA
Where’s the opportunity? Green hydrogen is hydrogen generated by renewable energy or from low-carbon power. The production of this clean energy emits significantly lower carbon emissions than grey hydrogen. Australia is competitively placed to be a major global producer and exporter of green hydrogen, thanks to its abundant renewable resources and established ports for existing fossil fuel exports. Governmental support is also dedicated to make Australia a major supplier of green hydrogen globally. Australian government has already announced $500 million in funding to support hydrogen projects. In 2020, the federal government fast tracked approval for the world’s largest planned renewable energy export facility in the Pilbara region. Global hydrogen demand is predicted to continue growing, and by 2050, demand could vary from 150 to 500 million metric tonnes per year, depending on global climate ambitions and sectoral developments. Our Export Tips Product The majority of hydrogen produced worldwide is inexpensive grey hydrogen made from natural gas. However, as a clean energy alternative, green hydrogen is gaining traction for being a better long-term solution to help decarbonize economies. Applications of hydrogen as an energy source include transport, manufacturing or electricity production. Australian green hydrogen producers have an edge over foreign competitors for two main reasons: (1) possessing abundant natural resources to produce green hydrogen; (2) having a well-established connection with Asia’s major energy importers. Price Globally, although the cost of production of green hydrogen is expected to continue falling, it is still more expensive than conventional grey hydrogen: AU$4-12/kg for green hydrogen compared to AU$1.5~3/kg for grey hydrogen. Australian green hydrogen, costing between AU$4-7/kg, is at the low end of global ranges thanks to its abundant low-cost renewable resources. On the long run, competitive pricing could be a key advantage of Australian green hydrogen. Australian National University predict that, as cost of production falls, Australian green hydrogen could equal the price of conventional and grey hydrogen by 2030, which would be cost-competitive with both fossil fuels. Promotion Sustainability, flexibility and multi-usage capability are major values to communicate when promoting green hydrogen.
  1. Sustainability: Highlight green hydrogen’s sustainable production process of using renewable energy and sustainably sourced water, which in turn helps decarbonise future energy production.
  2. Flexibility: As a flexible energy source, green hydrogen can be used immediately or be stored and transported for later use.
  3. Multi-usage capability: Green hydrogen can (1) support domestic energy needs; (2) be used as a clean transport fuel; (3) provide electricity to the grid, and (4) offset the carbon from manufacturing processes in factories.
Industry events and conferences are also effective promotion channels: The Australian Trade and Investment Commission (Austrade) has led a delegation of over 25 Australian businesses to the World Hydrogen Summit in Rotterdam in May 2022 to showcase innovation in green hydrogen, providing a great opportunity to promote your products to foreign energy importers. Place Demand for Australian green hydrogen exports is expected to come from various countries currently importing Australian fossil fuel. In 2019, Australia exported almost AU$64 billion of black coal, mostly to Japan, South Korea, India and China. As these countries decarbonise, the coal industry will shrink, shaping green hydrogen as a high-potential replacement. Europe is also a key export destination. As the energy crisis stemming from the Russia-Ukraine war unfolds, Europe is aiming to cut its reliance on fossil fuels and embrace clean energy imports. The Port of Rotterdam (Netherlands) is seeking millions of tonnes of hydrogen imports in one of the world’s biggest projects to import and generate clean and transportable fuel. Among more than a dozen supplier countries, Australian green hydrogen is believed to have the most competitive price thanks to the cost profile of its renewable energy sources. Our Strategic Takeaways Australia is well placed to become a major producer and exporter of green hydrogen. The rich renewable resources and governmental green initiatives produce a conducive environment for Australia to supply competitively priced green hydrogen to various countries seeking alternative clean energy sources. To communicate the value of green hydrogen, consider highlighting its major benefits of sustainability, flexibility and multi-usage capability. Screen Shot 2021 02 26 at 12.20.51 pm  
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Exporting Tea to Australia 

Where’s the opportunity? 

Australia’s tea market is valued at $1.2 billion with an annual compound growth rate of 3.5 percent. There are many opportunities for overseas businesses as the majority of tea in Australia are imported, and domestic tea production remains relatively small. The tea market has evolved away from the conventional tea such as black tea to more unique speciality blends. Traditionally, exporters wishing to enter the market would need to match the large production scales and range of existing players to remain competitive. However changing consumer demand presents opportunities for businesses operating within niche and premium product segments. The growth in this segment has reduced barriers of entry, allowing small manufacturers to break into the market without the need for considerable capital investment. On the other hand, some challenges for exporters in the current industry climate include supply chain disruptions spurred on by the COVID-19 pandemic. With an appropriate cost benefit analysis, we think there are some promising opportunities for some exporters thinking of entering the Australian market.


Product

 

Our analysis shows favourable growth prospects in niche product segments. Black tea consumption has fallen over the last 12 months while speciality tea sales grew by 4 percent. Among these, green tea, fruit tea and herbal tea are emerging as popular choices. Health and wellness herbal teas are currently experiencing the highest growth rates among various categories of tea. Young tea drinkers are becoming increasingly interested in low caffeine products – often opting for fruit or herbal teas. While niche players are not expected to offer the same extensive product range as large competitors, having at least 4-5 products in its range can help brands a strong presence in the market. Brands should also think about how they can be more environmentally friendly through using biodegradable and recyclable materials in their packaging.  

 

Price

Premium tea price range varies in the Australian market. Planting Organics (Chillax tea) offers loose tea at $2.92 for 10g. The Rabbit Hole (Sweet Dreams) has price point of $8.32 at 10g for its unique blend of local Australian ingredients. Popular Australian brand, T2 offers $3.4 for 10g for its loose leaf (Sleep Tight) product.

 

Promotion

Tea drinkers are becoming interested in high quality products with a great story.  Niche brands can focus on their origin story behind the scenes of harvesting and processing its tea, as well as the people behind the business. This can help drive the premium value of the brand as well as establish a greater proximity of the brand with its customers. Businesses should also focus on market education particularly on its exotic and unique blends of tea products.

 

Place

Traditional retailers for tea in Australia include the supermarket chains such as Coles, Woolworths, and ALDI. These suppliers can be especially difficult to break into for new brands. Exporters of niche brands should consider speciality tea retailers or cafes and other beverage stores.

 

Our Strategic Takeaways

 

We see some promising signs for exporters entering the Australian market. The tea industry in Australia is in a transitionary period as we start seeing an increasing number of niche brands emerging in the market. Sustainability and wellness will be key value propositions for exporters to attract local consumers. Exotic blends of tea with unique stories will also be a key factor for players to differentiate themselves in the market.

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