World meat industry news

All news / China steps up warnings, buys US barley, Russian beef

  • 22 May 2020, 08:31

China says it will buy more American barley and Russian beef as part of previously agreed trade deals in a blow for Australian exports facing restrictions due to political tensions between Beijing and Canberra.

Barley imports from the United States to China would be effective from this week, according to a notice on the China Customs website.

Australia's barley exports to China are under threat.  James Davies

The deal was part of China's agreement to buy an additional $US200 billion ($310 billion) in additional American goods and services under a trade deal.

China is preparing to slap steep tariffs on Australian barley imports after an 18-month anti-dumping investigation. China also this week suspended beef exports from four Australian abattoirs.

"US barley products have similar quality levels to Australian barley which is replaceable. It is a shame that Australia is losing its competitive advantage in beef and barley," said Lin Guofa, an analyst with consulting firm Bric Agriculture Group.

"The suspension of the four abattoirs is designed to send a strong signal to deter Chinese traders to import beef from Australia. Most buyers will be fearful now about continuing their business with Australia."

Commodities traders and state media played up the barley announcement, saying it highlighted China was less dependent on Australian agricultural imports than it used to be.

China has indirectly threatened to punish Australia economically after the Morrison government called for an independent inquiry into the origins of coronavirus pandemic.

One trader quoted a Chinese idiom “Kill the chicken to scare the monkey” which means making an example out of someone to threaten others. "With barley and beef, China is now using Australia as an example (to threaten other countries)," he said.

China on Thursday defended its anti-dumping investigation into Australian barley. Farmers expect China to impose tariffs of up to 80 per cent on the commodity.

"China will make an objective, fair and just decision on sanctions based on the investigation result and we will fully consider all of the opinions of relevant parties," a Commerce Ministry spokesperson said.

China's state media have also been talking up a previously agreed deal to import Russian beef this week. Reports said 10,000 tonnes of Russian beef would enter the Chinese market in 2020 with the first batch of 200 tonnes arriving in early April.

Another report said Russia shipped an export of 21.4 tonnes of beef to China on May 3. China in February also lifted a 19-year import ban of US beef.

"There are varied choices for Chinese consumers nowadays. Australia needs to focus on enhancing its own competitiveness and winning Chinese consumers' preference and trust," the hawkish Global Times said in an article on Friday.


China's boycott may extend beyond beef, barley as Beijing goes to war

However, traders said there was still huge consumer demand for Australian products in China and no signs so far of a consumer boycott.

There are also doubts about the US-China trade deal which could threaten American agricultural imports into China. US President Donald Trump this week suggested trade with China could cease altogether.

Mr Trump said in an interview with Fox Business Network broadcast on Thursday that he had no interest in speaking to China's President, Xi Jinping, and hinted he was open to severing ties with the world's second-largest economy completely.