China Threatens Tariffs on Australian Barley Imports as Aussies Push for Independent COVID-19 Investigation

Barley harvest in Grenfell, New South Wales, Australia, on Nov 12, 2007. Greg Wood/AFP via Getty Images

Australian trade minister Simon Birmingham said he’s “deeply concerned” after China’s Ministry of Commerce threatened to impose a tariff on Australian barley imports following claims of dumping.

In a May 10 statement, Birmingham said that the government would work with the Australian grains industry to mount the strongest possible case against China’s anti-dumping investigation.

“Our barley producers operate in a competitive global market without any trade-distorting subsidies and price their products in an entirely commercial way,” the minister said.

He continued to say that although he “respects China’s right” to start an investigation into anti-dumping, he rejects that there is substantial evidence, “let alone a conclusive case, to find dumping by or subsidy of Australian producers.”

“[W]e are quite clear and firm in our view that there is no justification to find that Australia’s farmers and barley producers are subsidized or are dumping their product in such ways,” he told reporters in Canberra.

Alannah MacTiernan, Western Australia’s minister for regional development, agriculture, and food, also denounced any grounds for China’s claims that “Australian barley is being dumped or subsidized in the Chinese market.”

The subsidies China is referring to are believed to be in relation to the government’s drought support measures and fuel rebates.

Western Australian (WA) farmers will take a “major blow” if this tariff goes through, she said.

The state relies heavily on barley exports to China—88 percent of Australia’s barley exports to China come from WA, valued at $805 million (US$526) in 2018-19.

“This is an important market for WA growers, with no ready alternatives. We know that WA malting barley is highly valued by brewers in China, who will no doubt be disappointed if this proposal proceeds,” MacTiernan said in a media statement.

“Seeding is just underway across the WA grain belt—the timing could not be worse for our growers, who have little to no time to reassess their options for the season.”

A joint statement from a group of five Australian grain industry organizations revealed that China’s proposed tariff may include a dumping margin of up to 73.6 percent and a subsidy margin of up to 6.9 percent for barley imported from Australia.

The Western Australian government said May 10 that it will be making direct contact with the Chinese Consul General on the matter and urged the Australian government to work closely with the Chinese Ministry of Commerce to find a fair outcome for the state’s growers.

Birmingham said the federal government reserves all rights to continue to defend the interests of Australian farmers.

China has given Australian barley exporters and the Australian government 10 days to respond.

Government sources told Australia’s national broadcaster the ABC that the Chinese Communist Party’s (CCP) threat of tariffs is likely in retaliation for Australia’s push for an independent investigation into the origins of the CCP virus, commonly known as the novel coronavirus.

The tariff threat came hours after health minister Greg Hunt confirmed Australia’s support for an EU motion to investigate the origins of the outbreak.

This is the second time in less than a month that CCP officials have publicly threatened trade relations with Australia, after an Australian minister voice support for a probe into the origins of the COVID-19 outbreak.

Australia's Foreign Minister Marise Payne speaks during a news conference at Australian Embassy in Bangkok, Thailand, on Jan. 10, 2019. Athit Perawongmetha/Reuters

Last month, foreign minister Marise Payne called for all members of the World Health Organization to support an independent review into the origins and spread of the CCP virus.

Following Payne’s remarks, China’s ambassador to Australia, Cheng Jingye, threatened that there would be economic losses to Australia’s tourism, produce, and higher education sectors.