Australian ag exports into China grow in value despite political tensions
China is a key export market for Australia, with agricultural exports lifting in value last year. But this could bring some risk for Australia.
AUSTRALIAN agricultural exports into China lifted in value last year, with beef and sheepmeat boosting export values.
But with about one in three of Australia’s export dollars coming from a market that has recently announced a number of anti-dumping investigations, Australia could be placed in a risky position when dealing with China.
A Rabobank report, released today, showed food and agricultural products exported from Australia to China lifted 8 per cent in value during 2019-20.
The greatest value gains were Australian beef and sheep meat exports, off the back of the ongoing African swine fever outbreak.
The report showed wine, grains, oilseeds, fruit and dairy exports also lifted in value last season.
While Australia’s shipments of agricultural produce lifted in 2019-20, the total value of Australian agricultural exports stagnated last season, with shipments down by about 2 per cent.
China’s share of Australian agricultural exports lifted by about 32 per cent in 2019-20, up from 29 per cent the year prior, according to the report.
Rabobank head of food and agribusiness research Tim Hunt said by effectively extracting “one in three of our export dollars from one market” placed Australia in a potentially risky situation.
“We haven’t been this exposed to one market since the 1950s, when we were still joined at the hip to the UK,” Mr Hunt said.
“And that was a very different political relationship.”
It comes as China recently announced an anti-dumping investigation into Australian wine imports, prompting a trading halt.
Mr Hunt said trade between Australia and China was starting to suffer.
“China has often found reasons to reduce purchase of agri products from countries when tensions arise. And its most senior diplomat in Australia warned over two years ago that if political relations continue to deteriorate, trade could suffer,” Mr Hunt said.
“Australia has five food and agricultural exports to China that can be worth over a billion dollars in any given year.
“In 2020, China has so far impeded or threatened to impede three of these – via the removal of accreditation to supply some beef product lines from certain abattoirs, the imposition of an anti-dumping duty of barley, and now a threat to impose anti-dumping duties on wine also.”
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