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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.  

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EXPORTING VITAMINS AND SUPPLEMENTS FROM AUSTRALIA

 

WHERE’S THE OPPORTUNITY?

Demand for Australian branded vitamin and supplements have been booming over the past years and one may be wondering if the industry is still worth entering. The short answer is yes – although new entrants will have to find innovative ways of being competitive in a changing landscape. Industry revenue is expected to rise by 2.7% annually over the next five years. Rising export earnings was initially driven by a surge in demand, particularly from China. Daigou sales have heavily influenced the industry’s performance over the past five years. Industry operators initially benefited from strong activity in downstream unofficial daigou channels. However, tightened regulatory controls in China over ecommerce sales and daigou trading have since changed buying patterns, meaning Australian companies must look for new ways to target key markets. The USA and China presents a reliable market while fast developing economies in Southeast Asia such as Thailand with a growing middle class are recognised as lucrative opportunities to capture new market share.  Around the world, the COVID-19 pandemic has changed consumer buying behaviours with digital platforms and new products with natural ingredients and boosting immunity likely to gain market traction over the next few years.

OUR EXPERT TIPS

PRODUCT

Australian branded vitamin products are very reputable in global markets. It’s well-established farming industry along with high quality ingredient sourcing give it a natural competitive advantage in marketing a clean and healthy image. The COVID-19 pandemic has spurred demand for vitamins designed to boost immunity, including high dose vitamin C and D products. Many consumers have also been seeking out energy boosting supplements and superfoods during lockdown.  Innovation is one of the driving forces of competitiveness. Australian brand Vitable for instance has online quizzes which allow consumers to decide what types of vitamins they should be taking. Subscription-based models are hitting off particularly with the trend of young people moving away from ‘quick fix’ solutions to more holistic and long term approaches to managing health.  Such models work well with young consumers who value convenience and personalisation.

 

PRICE

It is important to note that vitamin products generally have low product differentiation, hence brands in Australia generally compete on price, as well as value added services such as free nutritional consultations. . For example, Swisse’s popular high strengthen cranberry supplements which sell for $29.99 in Australia are approximately 98 RMB (approx. $17 AUD) in China, 610 Thai Baht (approx. $26 AUD). USA prices are much higher $35 USD to ($48.84 AUD). Consumers will likely focus on price and value add in their purchasing decisions. Price competition among operators is likely to force less competitive players out of the industry. It is anticipated that as more players enter the industry over the next five years, there will be an increasing trend of downward prices.

 

PROMOTION

Brands should strive to be more than just a vitamin company. Social media channels such as Instagram provides new opportunities for brands to build relationships with consumers.  It is a good idea for companies to position themselves as a holistic wellbeing brand that advocate for positive body and health messages. Running interactive and fun social media campaigns that get consumers involved is another good way of building market awareness. At the same time, when operating in overseas markets it is important to have the right promotion strategy for your target market.For instance, live streamers in China on sites such as Weibo, Little Red Book and Douyin are an invaluable channel for gaining access to wider markets. Brands should consider collaborating with Instagram or YouTube influencers in other European and/or Western markets. Understanding social media in local markets is key for success.

 

PLACE

Australian brands should consider establishing distribution facilities in key markets. Having inventory on hand to meet fluctuations in demand is an important determiner of competitive success.  It is also importance for new or smaller operators to have a strong online presence to compete with more established players.  Those that operate brick and mortar stores must ensure that have proximity to key markets including in large shopping malls or inner-city locations which can drive higher impulse shopping.

 

OUR STRATEGIC TAKEAWAYS

Brands considering exporting must tread carefully. The vitamin and supplement industry is highly saturated with existing brands well positioned to be price competitive. New market entrants may find themselves needing to cut prices to compete which means profits may be constrained. Nevertheless, for those brands that are strategically innovative in their business model and promotion have strong chances of success. Don’t underestimate the regulatory process in your target markets. Some countries are stricter than others, with variable review time and submission requirements as well as application cost

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EXPORTING SHAPEWEAR TO AUSTRALIA

 

Where’s the Opportunity?

The shapewear market is a relatively new market in Australia valued at approximately $40.02 million AUD. The industry has undergone a transformation over recent years with increasing awareness for body positivity leading to a wider range of products available for different body shapes and skin colours. Celebrities like Kim Kardashian have launched their own line of shapewear which spur on further growth and consumer awareness of shapewear. Surge in retail and e-commerce spending has created favourable conditions for shapewear businesses to expand. The growth in the female population in Australia has also been beneficial for the industry. Females aged 15 – 45 are the industry’s primary market for shapewear. This is a wide market and brands can specialise in certain age groups. Furthermore, Australia’s shapewear industry is relatively new and relies highly on imports. There are also no major players in the industry. These combined factors make it a favourable industry to target for overseas businesses. 

OUR EXPERT TIPS

PRODUCT

Consumer sentiment in Australia’s shapewear market is driven by a need for comfort and support. Local brands such as Cotton On Body focus on soft, comfortable, and breathable material. Bodysuits have been rising in popularity alongside cropped V-neck tops. Many major brands such as Skims offer multiple choice for different skin colours. Any product line in Australia should prioritise diversity and inclusion.

PRICE

Price points depend on the targeted age groups. Consumers aged 15 – 34 tend to favour lower priced items and are more inclined to purchase shapewear that are inexpensive. For example, brand like cotton on offer shape wear ranging from $25 – $40.  Online retailer SHEIN offers shapewear starting from $12.95. On the other hand, consumers aged 35 up tend to have more stead incomes and are more willing to spend on higher priced shapewear that are durable and of good quality. Premium brands are likely to do well in this age group. They range from prices $50 and up. 

PROMOTION

Promotion also depends on target age group. Consumers aged 15 – 34 tend to be highly brand conscious and follow fashion trends closely. On the other hand, those aged 35 up will likely prioritise premium quality. In general shapewear continues to be marketed with an emphasis on technological advancement (ie lighter and firmer materials) and comfort. A brands overall marketing strategy in Australia should be multicultural orientated. It should also focus on body positivity and diversity.  

PLACE

An e-commerce presence is key to capturing market share. This is important because shapewear is gaining more traction and popularity on social media, and this trend has been led by social influencers. The use of influencer marketing through affiliate links and sponsored social media posts can be a powerful way to generate new leads

Our strategic takeaways

The shapewear market continues to remain an untapped and relatively new market in Australia making it an exciting place for exporters wanting to enter the market. Some of the challenges will be market education, however social media and the rise of e-commerce retailing present new opportunities for product awareness. The industry may just be one of the driving forces of transformation and body positive messaging in the years to come.