With the free trade agreement between Australia and the United Arab Emirates underway, Daily Cargo News takes a deep dive into what the Australia-UAE Comprehensive Economic Partnership Agreement (CEPA) will mean for air freight both locally and further afield
THE DAWN of the third decade of the 21st Century saw a flurry of new trade between Australia and the United Arab Emirates (UAE).
Think Australian fine wines, meat and cheeses which feature in world-class antipasto and mouthwatering mains enjoyed by millions of tourists in luxury hotels.
From the glittering skylines of Abu Dhabi to the vast metropolis of Dubai, Australian goods are making their mark in the Middle East—and it is only getting bigger from here.
Industry insiders have praised Australia’s Comprehensive Economic Partnership Agreement (CEPA) with the UAE, led by trade minister Don Farrell, as a “well rounded, eyes open view” as the country cements its identity in global trade. The current value of goods traded between the two nations is $12.3 billion.
Australia’s latest free trade agreement is expected to provide better market access and more efficiency in moving Australian goods and services around the Middle East and North Africa.
International Forwarders and Customs Brokers Association of Australia (IFCBAA) chief executive Scott Carson said food and beverages are areas where Australian export goods can be expected to dominate.
“Where we see these opportunities developing for trade will be in fresh food products, vegetables, seafood, generally under the banner of perishables,” Mr Carson said.
“Products that need speed to consumer delivery internationally, so ones that have limited life in terms of usage for consumption, we see that expanding.”
Perishables (meats, seafood, fruits, vegetables and food products) were the leading export commodities for Emirates freight service, Emirates SkyCargo, across all Australian markets in 2024.
Beyond the import and export business, the raft of new initiatives that came into effect beginning 1 October this year saw 99% of tariffs eliminated.
“Being under the CEPA banner, they’re not just goods, there’s other initiatives for whole of trade, it includes labour, sustainability and environmental areas,” Mr Carson said.
One sector predicted to grow is pharmaceuticals where, similar to food, there is a speed to market requirement.
While the bulk of general pharmaceutical goods will continue to be handled by sea freight, Mr Carson believes concessions will also benefit the air sector.
“There are also other areas such as food, red meat, wine horticulture, we see that increasing for both the sea freight and air freight with these concessions,” he said.
“As is with the spirit of these types of agreements, it does make both nations more competitive in terms of the landed costs that has this duty concession.”
Leading the charge with transporting Australia’s lucrative exports into the Middle East is Emirates SkyCargo, which counted the launch of Emirates Courier Express in Australia among its milestones in 2025.
Emirates vice president cargo commercial, far east and Australasia, Abdulla Alkhallafi, said Australia was the first market post-launch to benefit from the service, which reduces time and cost factors.
“During discussions with global customers in Emirates Courier Express’ test phase, Australia was a common market they were looking for better delivery solutions to and from, given how challenging a region it can be to reach,” he said.
We stand ready to further foster this relationship, enhancing the connectivity between the UAE and Australia.
Abdulla Alkhallafi, Emirates
The UAE and Australia’s CEPA sets the stage for greater bilateral trade between the two countries, which historically share “very strong and prosperous relations”.
Trading between the two countries via Emirates SkyCargo aircraft dates back to 1995.
“By eliminating 99% of tariffs, we expect trade between the two nations to increase, which, in turn, requires more capacity to transport goods,” Mr Alkhallafi said.
Emirates SkyCargo has consistently carried more than 2350 tonnes each week with their tri-weekly freighter service along with 77 passenger flights.
Mr Alkhallafi said the airline will monitor the movement of goods between the two countries in terms of volume and hinted at the possibility of new aircrafts moving into 2026.
“As a facilitator for global trade, we stand ready to further foster this relationship, enhancing the connectivity between the UAE and Australia,” he said.
In 2023, the trade relationship was valued at about AU$9.94 billion. It makes the UAE Australia's 21st largest global trading partner.
Professor Tim Harcourt is chief economist at the Institute for Public Policy and Governance at the University of Technology Sydney and host of The Airport Economist.
He believes the Arab Nations will become increasingly involved in Australian trade in the coming years.
“I expect Qatar and Morocco to be the major players in the future as well as UAE and Saudi Arabia,” Professor Harcourt said, noting the importance of regional political stability.
Despite global volatility, the air freight market in Asia-Pacific continues to gain momentum.
Market conditions have been “quite uncertain” this year, a trend Cathay Pacific’s regional head of cargo, Southwest Pacific, Nigel Chynoweth said should continue.
“Trade dynamics, weather events and supply variations all influence what’s being exported,” he said.
“We are a network cargo operator, so we must keep close to the market to understand any changes in market demand that we need to accommodate.
“For example, when certain fruits or vegetables are unavailable due to seasonal changes, we quickly pivot to other produce to meet demand.”
Statistics from American logistics and transportation company C.H. Robinson indicated air cargo capacity is up 3.3% globally, but delays in freighter deliveries forced airlines to keep older aircraft operating at higher levels.
Rates are expected to increase through the 2025 fourth quarter following typical holiday trends, but at a moderate pace compared with the same period in 2024 due to softer overall demand.
In Australia, the economic and social impact of air freight has been significant.
In a statement, Melbourne Airport said the demand for export growth had been a driver for planned major upgrades to facilities.
"We're investing billions of dollars in terminal and airfield infrastructure upgrades,” a spokesperson said.
Last year, Melbourne Airport moved $8.3 billion in international airfreight exports —nearly a quarter of Victoria's total export value.
Melbourne Airport spokesperson
Since the beginning of FY2025, airfreight operations through Melbourne Airport contributed around $980 million in direct gross value added to Victoria's economy.
These included more than 14,000 jobs in freight handling, logistics and airport operations.
"The majority of air cargo moves in the belly of passenger aircraft, so growing airline services and airport capability are essential to keep up with increasing export volumes,” the spokesperson said.
"Last year, Melbourne Airport moved $8.3 billion in international airfreight exports—nearly a quarter of Victoria's total export value and underscoring our role as an important international trade gateway.
Western Sydney International Airport is also due to begin cargo operations in the second half of 2026.
The new 24-hour cargo precinct is expected to increase Sydney’s air cargo capacity by about 33%.
In other parts of APAC, Asia Air cargo capacity has faced challenges due to rising charter demand, particularly for high-tech products.
The C.H. Robinson statement notes growing demand for dedicated freighters is limiting available space on passenger flights.
“Freighter flight operations are highly variable due to the shifts in demand and route realignments,” the statement said.
“Passenger flights, on the other hand, have returned to near pre-COVID levels, providing more stable capacity for cargo.
“As freighter operations shift away from India and China toward Taiwan and Southeast Asia, routes remain fluid and capacity unpredictable.”
Australia’s free trade agreement with the UAE has been welcomed by leading Hong Kong-based freight forwarder Cathay Cargo.
The Asian industry giant this year established its position as the third largest carrier by volume out of Australia.
Mr Chynoweth said while some FTAs created immediate opportunities to meet pent-up demand, others developed over a longer period as tariff barriers were reduced.
“The CEPA or any other type of Free Trade Agreement are excellent for trade as they focus government and business attention on growing bilateral exchange, benefiting all modes of transport, including air freight,” he said.
The Guangdong – Hong Kong – Macau Greater Bay Area (GBA) has been a big long-term focus for Cathay.
Over the next 10-20 years, the airline plans to invest heavily in the region, along with the Airport Authority of Hong Kong and the Hong Kong SAR government.
The vision for the GBA—made up of nine Chinese municipalities and two Special Administrative Regions (SARs) — is to transform into a global economic hub by 2035.
The long-term initiative, Framework Agreement on Deepening Guangdong-Hong Kong-Macau Cooperation in the Development of the Greater Bay Area, aims to redefine Hong Kong’s role as not just an Asian hub, but as the central aviation and logistics centre of the Greater Bay Area.
For Cathay Cargo, a key goal is to increase efficiency in line with broader airline operations in the region.
“We are enhancing efficiency by allowing forwarders using Cathay Cargo Terminal to fly goods into Hong Kong and then transport them from the airport to Dongguan by ship for onward distribution in the wider Greater Bay Area - all this without the hassle of applying for multiple shipments,” Mr Chynoweth said.
And the transportation of goods across the world has a big role to play in the upcoming decade.
In a statement from Cathay, the global demand for air freight remained robust post- pandemic, but customer expectations have also increased as they seek greater speed and visibility for their shipments.
According to industry watchers, express cargo is expected to lead the growth in the air cargo market worldwide.
Freight forwarders have acted to expand capacity and improve services to meet the evolving needs of businesses, particularly those that relied on urgent deliveries to operate and thrive.
“We’re already seeing increased trade activity between Australia and India, with a growing volume of shipments that didn’t exist two or three years ago,” Mr Chynoweth said.
Among the standout commodities since the FTA with India came into effect was the humble avocado. “They’ve become surprisingly popular exports to India,” he said.
On the passenger side, travellers can now check in for Cathay Pacific flights from bus and ferry terminals within the wider GBA, with the Shenzhen Shekou Cruise Home Port even having a dedicated Cathay lounge—a sign of how the region’s transport systems are becoming more integrated.
“Hong Kong has evolved from a manufacturing base into a key logistics hub connecting the region. The GBA encompasses around 87 million people compared to Hong Kong’s 7 million, offering huge future potential,” Mr Chynoweth said.
Cathay Cargo has increased dedicated freighters into Australia. Image: Cathay Cargo
As a network carrier, he said Cathay Cargo was well-positioned to assist shippers to take advantage of new or expanded market access.
A major focus for the business in the past five years has been digitalising services.
“This has been hugely beneficial for both Cathay Cargo and our agents and shippers, creating a seamless booking experience and delivers real-time updates on progress,” Mr Chynoweth said.
Year-round flights have doubled in both Perth and Brisbane.
Cathay has also brought back seasonal flight into Cairns for summer, and have started seasonal flights to Adelaide, which began last month and will continue until the end of March 2026.
Alongside the passenger network, two freighters per week – one on Mondays (Sydney–Melbourne–Hong Kong) and another on Tuesdays (Sydney–Melbourne–Brisbane–Hong Kong).
Mr Chynoweth said the variety of increased services allowed for all types of cargo from machinery, turbines and helicopters, to smaller parcels departing on midnight flights out of Brisbane, Sydney, Melbourne and Perth.
From air to land, truck networks have helped Cathay Cargo compete with rival carriers.
“We’ve always faced strong competition from sea freight operators, particularly those who have optimised transit times for perishable goods,” he said.
“To remain competitive, we continue to evolve our offering – particularly in cool chain logistics.”
The airline works with six to eight specialist cool chain partners to offer a wide range of container options suited to different types of cargo.
The focus has been on pharmaceuticals and temperature-sensitive foods, the growth which Cathay Cargo has described as “rather explosive”.
Mr Carson said it is important for Australia to review free trade agreements with European nations, with reference to the recently expanded agreement with the UK.
“They’re all positive initiatives as we look to centre our own identity in trade, not just in the Asia-Pacific or Oceania, but more widely through the Middle East,” he said.
The UAE deal is viewed by economists as a natural move due to “most Australian exporters” having already established a base in the country.
"Our first trade deal in the Middle East provides Australian businesses with a competitive advantage in this fast-growing region,” he said recently.
“As an important global logistics centre and hub, the UAE will serve as a gateway for Australia's exports to the broader region and beyond."
The Australian government’s national freight data showed imports and exports were forecasted to increase in the next five years.
Trade minister Don Farrell said "Australia's free trade agreement with the UAE delivers for Australian businesses, consumers and our economy”.
"The removal of tariffs on key Australian exports to the UAE, from red meat and dairy to alumina, steel and cosmetics, opens more opportunities for Australian businesses and creates more high-paying local jobs for Australian workers,” he said.
Australia’s Trade Ministry said Australian exporters are expected to save approximately AU$135 million in the first year, with annual savings projected to reach $160 million once the agreement is fully implemented.
“The market in Australia looks positive, and the future looks brighter still with the CEPA in effect,” Mr Alkhallafi said.
“We expect that to increase with more demand for Australian perishables such as meat, fruits and vegetables to and through Dubai.”
One sector the CEPA agreement is primed to support is agriculture, with tariffs eliminated on dairy, pulses and horticulture.
Australia’s primary produce made up the largest business unit, by tonnage, globally, for export to the UAE.
“As the fastest mode of transportation over long distances, air freight will remain the backbone for shipping perishable products,” Mr Alkhallafi said.