For a new perspective on stories that matter to Australian business and politics, subscribe to our weekly newsletter.
After a steady year worsening relations between Beijing and Canberra, China has imposed a series of trade measures blocking Australian goods worth billions of dollars to its largest trading partner.
Restrictions on the transport of beef, barley, coal, lobster, wine and timber have taken many forms. Some measures are precise, such as anti-dumping and anti-subsidy duties on barley, allowing Australia move the matter to the World Trade Organization.
Others, from verbal notifications to bans on individual companies, are less clear. As for coal, for example, China has not even officially recognized the restrictions, blackening Canberra’s path to return to business as usual. Some goods were blocked for health and pest reasons. Meanwhile, China has repeatedly said that it is acting in accordance with international law and practice.
Here are the different ways China has curbed Australian imports:
Coal
China verbally told power plants and steel mills to suspend Australian coal imports, according to people familiar with the issue in October, instead of writing it down. This creates uncertainty about how long the shutdowns will last and how they could affect existing long-term contracts.
This is not the first time China has dumped Australian coal – it has targeted imports since January 2019. Restrictions have ranged from a direct ban on transport, subjecting loads to additional testing and customs clearance delays or an annual quota system that limits all purchases. including Down Under.
A December 13 China Global Times report, which has since been phased out, suggested that Beijing has formalized its shutdown by approving coal-restricted coal-fired utilities, with the exception of Australia.
Prime Minister Scott Morrison has said that if the report turns out to be correct, it will violated the free trade agreement that China and Australia signed in 2015. Chinese Foreign Ministry spokesman Wang Wenbin said the government is unaware of the situation when asked about the state media report .
Barley
China has imposed over 80% anti-dumping and anti-subsidy tariffs on the Australian barley for five years starting in May. The exporter supplies about 40% of grain purchases from China.
Australia said on Wednesday it would challenge China to the WTO over barley taxes. The dispute can last two to three years to be resolved, but the independent arbitrator should acknowledge that the tariffs “are not supported by facts and evidence,” according to Commerce Minister Simon Birmingham.
China regretted Australia’s decision and added that it would resolve the issue in accordance with WTO dispute settlement procedures.
Wine
Another visible goal of the Beijing actions was Australian wine. China will levy anti-dumping and anti-subsidy duties on beverages, which could bring the total to over 218%. Tariffs are expected to last between four and nine months.
Wine unloading?
Australia is the largest wine supplier in China
Source: General Administration of Customs of China
The Birmingham Minister of Commerce suggested the possibility of taking China to the WTO and on wine tariffs, noting that the statements made by Beijing had similar criteria to those made on barley. The Chinese Embassy in Canberra said that concerns about China’s accession to the free trade agreement were “totally unfounded ”and that the nation has fulfilled its obligations.
Beef
A number of reasons have been given for China’s borders on Australian beef from large meat companies. A Foreign Ministry spokesman said the restrictions would be enforced protects the health and safety of Chinese consumers amid reports of Covid-19 infections in meat factories worldwide, and has also criticized Australia’s search for coronavirus origins. However, he denied that the two issues were related.
Another reason given by China for suspending purchases from a manufacturer is the discovery drugs banned in beef products. The borders have expanded to other Australian companies, although China has offered no reason at all for his last stop. Australia accounts for up to 18% of beef imports from China.
Lobster
The Australian lobster has been cleared through customs delays due to increased import inspections for trace elements in minerals and metals, and most exporters have decided to suspend shipments to China until the process is clarified, according to an industry group.
Customs delays are particularly damaging, as live lobsters are usually thrown on ice and must be consumed within 72 hours of leaving Australia if they do not enter China’s tanks. The Chinese market accounted for more than 90% of Australian lobster exports worth $ 752 million ($ 573 million) in 2018-19.
Timber
China banned imports of logs from Queensland, Victoria, Tasmania and South Australia after finding pests during inspections. Imports of barley from Emerald Grain Australia have also been banned from customs clearance after China said weeds were found on recent arrivals.
Chinese customs have called for tougher quarantine controls on all Australian timber and barley, while Foreign Ministry spokesman Wang said China has repeatedly found biological hazards in Australian timber products and is a “serious danger ”for the domestic industry. China buys about a quarter of its overseas timber from Australia.
Others
There are other Australian goods in China’s crosshair as tensions rise. China told traders to do so stop buying products, including copper ore and concentrate, sugar and cotton, according to people familiar with the situation. Wheat was also marked as a possible target by Australian government forecaster Abares.
To date, iron ore and gas – two of Australia’s largest export winners – have been spared, as any border of imports could unduly affect China’s own economy.
– With the assistance of Jasmine Ng, Shuping Niu, Sybilla Gross and Dan Murtaugh