Chinese Export tariffs on Australian Businesses

It is no hidden secret that there have been rising tensions between China and Australia regarding the Chinese Export tariffs imposed on Australian companies. China’s Ministry of Commerce confirmed it would impose “anti-dumping measures on some Australian wine imports from March 28 for (another) five years” which was a huge hit to the wine industry. The trade sanctions aimed at Australian exporters by China just keep on coming, what’s next?

China is Australia’s largest trading partner with two-way trade valued at $A214.6 billion in 2018. China remained Australia’s largest two-way trading partner, export market and import sources so you can imagine the affect these tariffs have had on Australia.

Here are a few statistics to highlight the severity of these tariffs: Australian grain growers were hit for six when China announced tariffs of 80 per cent on barley- brought trade to a halt. Last year, Australia sold almost $3 billion of red meat to China, making it the most valuable farm export, but now there are eight Australian abattoirs currently blocked from selling red meat to China. Regarding the wine industry, the tariffs could leave Australian winemakers to scramble to find new markets for $1.26 billion of wine. The cotton industry could face tariffs as high as 40 per cent, a sanction that could make the trade with China unviable. In 2019, nearly half of Australia’s timber exports went to China, a market worth $1.9 billion. Now China is refusing to accept timber from four Australian states. By early December, fourth quarter exports had fallen by 82 per cent and Australia’s largest coal port, Newcastle, had completely stopped sending coal to China altogether.

In May, China imposed tariffs of 80.5% on Australian barley exports, which were made up of a 73.6% anti-dumping duty and a 6.9% countervailing duty. From November 28, China announced it will impose tariffs on Australian wine imports ranging from 107% to 212%. In May, China imposed tariffs of 80.5% on Australian barley exports, which were made up of a 73.6% anti-dumping duty and a 6.9% countervailing duty. From November 28, China announced it will impose tariffs on Australian wine imports ranging from 107% to 212%.

When asked about the Chinese export tariffs, David Aherne, Director of Across the Ocean Shipping stated, “It is having a profound effect on our lobster exporters that operate out of WA. We have also seen many of our wine exporters cancel orders at the last minute due to buyers backing out of deals for containers given the latest tariffs implemented on Australia’s wines. We are finding that these tariffs are making it unviable for Australian exporters to be selling into the Chinese market”.

These tariffs have most definitely crippled certain Australian trade and pushed exporters to diversify and look to other markets for new free trade agreements. Many commercial freight operators with heavy focus on Chinese – Australian trade have also been severely impacted as a knock on effect.