Australia tensions ‘opening for other farm suppliers’

Escalating tensions between China and Australia, which have caused declines of Australian agricultural exports to China in recent months, could offer opportunities for other producers to participate in the Chinese market.

Meanwhile, China can take the opportunity to diversify its import sources, industry insiders told the Global Times on Monday.

After China imposed anti-subsidy tariffs on Australian barley in May, making Australian barley less competitive in the Chinese market, opportunities arose for other barley suppliers to fill the gap, Li Guoxiang, a research fellow in the agricultural sector at the Chinese Academy of Social Sciences, told the Global Times on Monday.

Media reports have said that Argentina is jockeying to get more of its malt barley into Chinese beer-making industry. Argentina is expected to export 120,000 tons of barley to China this year, Reuters reported, citing Agustin Baque, the foreign trade chief. “For the next season, if the Chinese maintain import taxes on Australian barley, I think it could double to 240,000 tons, maybe more, if barley farms in France and Canada have bad weather,” Baque said.

As the most populated country in the world, China has huge demand for barley, and Australia has been the top supplier. According to Chinese customs, Australia, Canada and France are major barley suppliers to China. Together they account for 95 percent of all imported barley in China, with Australia alone taking a share of more than 50 percent.

According to China's National Bureau of Statistics, barley imports from Australia increased to 6.48 million tons in 2017 from 3.87 million tons in 2014 – a 67-percent increase.

However, along with the increasing market share, the price of Australian barley declined to $198 per ton in 2017 from $288 in 2014, resulting in a sharp decrease of barley production in China.