Cropping

China threatens to impose tariffs on Australian barley

By Country News

China's threat to slap major tariffs on Australian barley could cost grain exporters hundreds of millions of dollars and hurt barley producers.

The threat is the latest escalation in an increasingly bitter diplomatic row over Australia's calls for a global inquiry into the origins of coronavirus.

China has publicly threatened to impose economic sanctions on Australia in retaliation to the investigation.

Prime Minister Scott Morrison said China had not linked barley tariffs to the COVID-19 inquiry or anything else.

He said it would be "extremely disappointing" if tariffs were used as an act of retribution.

“There's no reason for me to think, based on the way that they're approaching it, that I could draw that conclusion,” Mr Morrison said.

“Barley is Australia's second most valuable agricultural export to China, with the trade worth $1.5 billion.

“China is due to conclude an 18-month anti-dumping investigation into Australian barley by Tuesday, May 19.”

Federal Agriculture Minister David Littleproud said it was clear that Australia had not dumped barley into China.

“We expect to be able to demonstrate that to Chinese officials and have been trying to do that for some 18 months and will continue to work with them,” Mr Littleproud said.

“Australia is prepared to take China to the World Trade Organisation to fight against the tariffs.

“That's what the umpire is there for and that's what we would test if we feel aggrieved that our position hasn't been properly accepted or understood.”

NSW Farmers grains committee chair Matthew Madden said the tariffs would be a substantial blow to Australian barley producers.

“Barley is considered one of Australia’s main exports to China, and our barley industry has a long standing and positive relationship with China,” Mr Madden said.

“While it is China’s prerogative to impose a tariff against us, it is not justifiable.

“We understand that a final determination will be provided on or before May 19.”

Labor's agriculture spokesman Joel Fitzgibbon said the government needed to get the matter under control.

“We are getting a taste now of what it is like when we mismanage our relationship with our largest trading partner,” Mr Fitzgibbon said.

“This issue of barley goes back 18 months, it predates COVID-19.”