Labor and a former senior defence official say Australia should consider co-ordinating efforts with like-minded allies to conduct freedom of navigation patrols contesting Chinese territorial claims in the South China Sea after Foreign Minister Julie Bishop ruled out doing unilateral exercises in her strongest language yet.

Ms Bishop and Defence Minister Marise Payne overnight wrapped up their annual diplomatic and defence talks with US counterparts in San Francisco, with China's increasingly assertive behaviour one of the key topics of discussion.