It’s boom time in the Top End, but there’s more to the region than mineral resources and red dust. Find out why the Northern Territory is export territory.
“The Northern Territory is a net exporter: its exports exceed imports, which is not necessarily the case in other parts of Australia,” says David Knapton, Austrade’s manager for the Northern Territory. The reason? Energy and mineral resources such as liquefied natural gas, uranium, aluminium, iron ore and gold have contributed to the region’s success.
Although resources revenue gives the NT a healthy position in the global market, the divide between big business and SMEs has grown, causing a few labour problems, says Knapton. “If you’re in the small business sector, you’re struggling because you can only offer so much money, whereas if you’re a mining company and getting good demand for your product, you force the price of labour up.”
Knapton believes the consequences of the bigger companies taking the export limelight means smaller businesses are discouraged from exporting, concentrating instead on the flourishing domestic market. “Small companies are saying: ‘I can make a lot of money here now, whereas if I export it takes longer and there’s a lot of effort, it’s harder, it costs more,’ so they tend to put export on the backburner,” he explains.
“I’d encourage businesses to take a longer term approach; the smart companies are looking for opportunities both ways. Even though things are going well, companies still need to be strategic about their long term planning.”
Robert Tormey, director of export development business Auslink, says there’s more to it; he maintains there’s a lack of export training: “I won a tender to review the Trade Support Scheme. One of the things that came out of it was the Territory government now recognises the need for training as they haven’t got any strategic plans focusing on it.”
Currently, support for export is reactionary rather than proactive, Tormey believes. “The focus on international trade has slipped and we want them to pick it up and run with it with a bit more focus. There’s so much untapped potential here, given all the infrastructure.”
The NT’s robust infrastructure is one area that has certainly contributed to successful exporting in recent years. With the Adelaide–Darwin rail link and a direct shipping route north to Asia, Darwin is well placed to become a logistics hub. “The live cattle industry has done very well in the Northern Territory. We’ve had cattle shipped out of Darwin from Queensland because of the development of the Port of Darwin,” says Tormey. “It’s our infrastructure that has started to stimulate live cattle and bulk minerals.”
Knapton agrees. “Location, location, location is very important here; there’s a very strong focus on markets to the north. About 75 percent of NT’s exports go into Asia,” he says. “The NT government has put effort into building up the infrastructure of the Port of Darwin, including building mineral loaders. They have been looking at ways to attract more shipping companies to come here as part of the Australasia Trade Route strategy.”
However, lack of airfreight capacity means that high-value, low-volume and/or time-sensitive commodities are harder to export. “It’s primarily budget airlines flying narrow-bodied planes and they’re not interested in freight,” explains Knapton. “There is a definite need for airfreight capacity and the NT government is looking at ways to do that but haven’t been successful so far.”
This won’t affect the emerging mining services industry, however, which counts education and training as exports. “The service sector has a lot of potential, particularly for large resource-based infrastructure projects going on throughout South East Asia. Training in the use of heavy equipment, training in various forms of mechanical equipment, and so forth,” says Tormey. “And also the repair of equipment is a growth area. We have a very strong resource-based economy and we have considerable skills in maintaining equipment for remote areas, given the distances in getting equipment serviced.”
Tourism is another iconic NT export, with the bulk of the territory’s 400,000 visitors coming in the dry season. Tormey sees tourism as diminished in recent times. “We used to lead Australia in terms of promoting the outback; we used to win numerous Australian Tourism Awards, but we haven’t won one for quite a while. Other states are doing a better job,” he observes. “That’s an area we could develop further for the export market.”
Corporate tourism is about to take off, however, with the Darwin Convention Centre, which opened earlier this year. The centre is one part of the Darwin Waterfront development, which is designed to make the city a destination for high-spending tourists, in addition to the backpackers they already attract. “They already have 23 conferences booked and that’s good dollars in terms of likely spend,” says Knapton. He also notes that eco-tourism will become more prominent.
Arts and crafts, particularly by indigenous artists, is another notable industry of the NT. This tends to help regional areas of the territory, especially with the assistance of buying tours arranged by Austrade and the NT Government. “We take them to where the art is produced,” says Knapton. “These art centres would never be able to get to these buyers, so we take the buyers to them.”
There’s a lot happening outside the resources sector, so while resources dominate the export leaderboard, Tormey hopes they won’t overshadow other exports: “With the resource boom, people take their eye off of trade opportunities. There are a number of emerging products, but they need to be promoted better.”
The NT Government’s Trade Support Scheme provides financial assistance to NT-based organisations for international marketing activities, including attending trade shows, promotional activities and website development. If you’re eligible, the scheme will reimburse you for up to 50 percent of the costs associated with those activities.
For more details, visit www.nt.gov.au/dcm/tradesupport
Capital city: Darwin
Export revenue: $2,644 million
Top three exports: Oil and gas, metal ores, ‘other’ manufacturing.
—Source: Australian Bureau of Statistics
Cycad collector Joe Perner travelled around the world collecting and trading seeds of these rare Jurassic plants. When the hobby became too big for the house, it became a business instead—Cycad International. “It was either give up the hobby or do it properly,” says Karen Perner, director of the company.
In 1994, the Perners bought five acres in Katherine to set up a nursery. Through their website, sales came from cycad societies around the world. Although significant international orders came from private collectors, the Perners saw an opportunity to sell to commercial organisations such as landscapers. Perner credits Austrade and the NT Government’s Trade Support Scheme for helping them enter new markets: “There are lots of avenues to help people get into exporting and if we hadn’t taken advantage of those, our learning curve would have been a lot more expensive.”
The Perners have since doubled the size of their nursery to meet demand. “If people came in with a big order, we weren’t necessarily in a position to meet the demand so we bought more land and invested heavily in a huge nursery development,” says Perner. “We’re looking to seriously market into the Middle East and Singapore now we have the products and facilities to bring clients over and show them a well set out nursery environment, which then becomes its own selling tool.”
Significant markets for Cycad International include Brunei, Qatar, Spain, and a number of Asian countries.
The hardest part about exporting cycads is going through the bureaucracy, says Perner. Because cycads are endangered, the company had to attain CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) accreditation to trade. They must also have an export licence, and each shipment must meet quarantine criteria. But, she says, bureaucracy also helps with shipments: “It makes a good selling proposition for our product because we’ve met all the criteria already.”
Part of the property is now also a tourist attraction, a scenic garden with a café. Perner says the plants thrive in the humid weather and enjoy the wet season, making the NT an ideal place to have the nursery. “Joe’s known throughout the cycad world so we have people come and look at the plants,” she notes. “It’s a good conservation collection and the world looks upon it quite favourably because there are lots of different rare and endangered plants in one safe location.”