China targets Australian cotton

SYDNEY/BEIJING: China has ordered mills to stop buying Australian cotton, an Australian Government source and two Chinabased traders said yesterday, the latest sign of worsening trade ties.

Relations soured after Australia accused China of meddling in domestic affairs, and worsened when Prime Minister Scott Morrison sought an independent inquiry over the origins of the coronavirus that emerged last year in the Chinese city of Wuhan.

China is the biggest buyer of Australian cotton, considered the highest quality of all import origins. The trade was worth about A$900 million ($NZ966 million) during the 201819 crop year.

The suspension of cotton purchases comes just days after Canberra scrambled to confirm reports of another suspension ordered by China, of coal imports from Australia.

If Chinese millers continue to buy from Australia they could be hit with a tariff of 40%, the source said.