Aussie timber trade nailed, China eyes wine, barley

Dominic Giannini and Paul Osborne | May 18, 2023

China will resume Australian timber imports as Beijing and Canberra now work towards stripping punitive tariffs from barley, wine and meat. 

The Chinese ambassador to Australia Xiao Qian confirmed China would resume imports on Thursday after notifying the Australian government the day before. 

The trade has been in limbo since late 2020.

“From today on the Australian timber is going back to China, to the market,” the ambassador told reporters in a rare press conference in Canberra on Thursday.

“There are also other issues on the table that allow me to say that the momentum is positive. Both sides agreed to sit down and talk about the differences.”

Trade Minister Don Farrell recently returned from a trip to Beijing where he held talks with his counterpart Wang Wentao and pushed for the full resumption of trade after China imposed tariffs against Australian products.

“Australian timber was one of the outstanding trade impediments discussed with my counterpart in Beijing last week,” he said.

“This is a great outcome for the Australian forestry sector. We look forward to the full resumption of trade for all affected products as soon as possible.”

The Australian Forest Products Association welcomed the move, saying it would help boost the sector.

“China has been and will continue to be an important market for Australian timber and wood fibre export products,” chief executive Joel Fitzgibbon said.

“When the ban came into effect more than two years ago it caused a great deal of upheaval and uncertainty for many timber exporters and the broader forest sector and this resolution is welcomed.”

China’s review of its tariffs on Australian barley is due in July but could be extended to August and was agreed to be expedited in exchange for Canberra halting its World Trade Organisation complaint against Beijing.

The ambassador said China was working through domestic processes and both sides hoped a resolution over barley could then be used as a template for wine. 

“It involves rather complicated procedures involving Chinese relevant departments and agencies,” he said. 

“That’s why we need at least three months to finish the review.”

But whether the barley and wine disputes will overlap remains murky with the second WTO complaint brought by Australia, this time on wine dumping, due in June.

Both parties will receive the report into the dispute three weeks before it is made public, as is what happened with the barley dispute before an agreement was struck to pause the case and stopped that report from being released.

A second detente would need to be struck over wine ahead of any barley restrictions being dropped if China wants to follow the same pathway. 

The ambassador also said his country was ready to set up a working group to discuss taking part in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

His country applied to join the pact in 2021, but little progress has occurred.

“We’re ready anytime to set up the working group … to talk about China’s entry,” he said.

He said China joining the pact would improve the prosperity of Australia and the region.

Talks are under way between the two countries on a convenient date for an official visit by Prime Minister Anthony Albanese, who on Monday expressed confidence about the improving relationship.