(Bloomberg) — China’s trade restrictions on Australian wine, lobsters and other commodities could be the next to ease amid a warming of diplomatic ties and expectations that Beijing will soon resume imports of Australian coal.
(Bloomberg) — China’s trade restrictions on Australian wine, lobsters and other commodities could be the next to ease amid a warming of diplomatic ties and expectations that Beijing will soon resume imports of Australian coal.
China has imposed a raft of trade measures since 2020, blocking billions of dollars of commodity exports from Australia, a top trading partner, with curbs on everything from beef, barley and coal to lobsters, wine and timber.
Those barriers appear to be easing as relations improve. Australian Foreign Minister Penny Wong visited Beijing last month to celebrate 50 years of bilateral diplomatic ties. Chinese officials are now discussing plans to allow four major importers to resume purchases of Australian coal as early as April 1, Bloomberg reported this week, citing people familiar with the matter.
Curbs on commodity imports from Australia will probably be lifted gradually and in an unofficial manner, said Hans Hendrischke, professor of Chinese Business and Management at the University of Sydney. There’s a great deal at stake as the China market accounts for about 40% of Australian exports.
There’s a degree of confidence that the restrictions will be lifted, “but we don’t know when,” Hendrischke said. “Nobody could tell you whether it will start with barley, wine producers or lobsters for Chinese New Year.”
Rock Lobsters
While China never officially acknowledged the curbs on lobsters, a recent social media post from customs stoked expectations that the crustacean would once again be welcome. In a report on the benefits of the Regional Comprehensive Economic Partnership, customs listed a range of Australian products that it said were attractive for consumers to purchase, including rock lobsters.
The wine industry will be very cautious before entering what was once its most lucrative export market, said Lee McLean, chief executive officer of Australian Grape & Wine. In the two years that China imposed tariffs of about 200% on Australian wine, producers sought alternative markets, including the US and UK. “Market diversification needs to continue,” said McLean. “We don’t want to get into a situation where we are too reliant on one market.”
A spokesperson for Seafood Industry Australia said the group welcomes the positive sentiment from Beijing and Canberra, but declined to comment on prospects for lobster exports to China.
Even if all the commodity curbs are lifted, trade flows will probably remain subdued, said Deborah Elms, executive director at the Asian Trade Centre in Singapore. “It’s not the government that trades, it’s individual firms. For companies, switching markets is not easy, fast or cost-free.”
–With assistance from Sybilla Gross.
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