China said anti-dumping duties of 73.6 per cent would be levied on Australian exporters. It singled out four exporters which were named in a statement. They were The Iluka Trust, Kalgan Nominees Pty. Ltd, JW&JI Mcdonald & Sons and Haycroft Enterprises.
It would also impose an anti-subsidy duty of 6.9 per cent. Both duties would be effective from May 19. The tariffs are effective for five years.
The market was worth just under $600 million to Australian farmers in 2019 after coming off the multibillion-dollar highs of past years. Farmers have said the steep tariffs would effectively wipe out the trade with China and believe the move is politically motivated.
A united front of peak grains export and farming groups said the government should “pursue the WTO dispute settlement process to the fullest extent possible”. However, they don’t want the government to abandon efforts to resolve the dispute through talks with China while the WTO process plays out, which could take well over a year.
“These tariffs will disrupt and most likely halt exports by artificially increasing the price of Australian barley imported to China until the situation is resolved.” the coalition of grains export and farming groups said.
They estimate the trade dispute will cost the Australian grain industry and notably rural and regional economies at least $500 million a year.
“For a number of years China has been Australia’s largest barley export market and Australia is the largest supplier of barley to China. This imposed duty makes Australian barley less competitive into the Chinese market and has placed significant downward pressure on barley values offered to Australian growers,” they said.
China threatened the move last week when it gave Australia ten days to explain why it should not impose the tariffs.
Mr Birmingham said his Chinese counterpart, Commerce Minister Zhong Shan would not take his phone calls.
The Commerce Ministry said Australia could apply for a “review” of the decision under Chinese regulations.
The decision follows an 18-month Chinese investigation into claims by Beijing that Australia dumped barley into China where it is used to make beer and to feed livestock. China also last week banned imports of beef from four Australian abattoirs, citing inspection and quarantine concerns.
Both moves followed warnings from the Chinese embassy in Canberra that Australian exports could be hurt by Scott Morrison’s push for an independent investigation into the origins of the global pandemic.
While China has denied the move is due to diplomatic tensions, it has a history of punishing countries which impose it politically with economic sanctions, red tape or encouraging consumers to boycott products.
Australian exporters, including giant West Australian co-operative CBH, industry bodies and the Morrison government provided extensive submissions to China’s Ministry of Commerce (MOFCOM) as part of the investigations.
The submissions included information regarding every aspect of Australia’s barley industry, covering farm to consumer, data around export and domestic sales programs, company ownership and operational structures.
The coalition, made up of the Grains Industry Market Access Forum, Australian Grain Exporters Council, GrainGrowers, Grain Producers Australia and Grain Trade Australia, rejected the findings of what some industry leaders believe was a sham investigation.
“We do not believe the outcomes announced by China have been adequately substantiated,” they said.
“Consequently, we are deeply disappointed that China has chosen to apply tariffs against the Australian barley industry.”
“The duties will disrupt the Australian barley market, cause ongoing market uncertainty and have a significant impact on participants in the Australian barley industry, including growers and grain exporters. We are also concerned the disruption will have an adverse impact on Chinese customers and industries that rely on Australian supply.”
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The coalition said the Morrison government should engage with China in a “respectful and meaningful way” to resolve the issue while concurrently taking action with the WTO.”
“We very much hope a timely and amicable resolution can be agreed including the removal of duties to enable trade to be re-established, for the benefit of industries in both countries,” they said.