D-Day looms on China trade ban threats

Wool, wine, barley and seafood industries have the most to lose if China enacts further bans like those that have already threatened to decimate the beef industry.

China has banned the importation of Australian beef and barley is next on the chopping block with D-Day looming this Tuesday when the industry will learn whether China intends to put an 80 per cent tariff on exports.

China is the industry's biggest international market, worth about $1.3 billion, according to Grain Growers chairman Brett Hosking, who said they were in a "holding pattern" while awaiting the determination.

Tensions between the two countries have risen due to Australia's push for an inquiry into COVID-19 and Chinese Ambassador Cheng Jingye has warned the review could lead to Chinese consumers boycotting Australian products.

The wine industry is particularly vulnerable to any China trade ban. Rob Dolan at his winery in Warrandyte, Victoria. Picture: Rob Leeson
The wine industry is particularly vulnerable to any China trade ban. Rob Dolan at his winery in Warrandyte, Victoria. Picture: Rob Leeson

The wool industry - which exported $3.6 billion internationally in 2016-17 - has already taken a hit amid the COVID-19 virus and Australian Wool Growers Association director Robert Ingram said any restrictions would "purely be malicious".

 

"China takes over 85 per cent of our clip and the Italian market has been decimated by the coronavirus," he said.

"If they slapped any restrictions on the wool trade, it would be catastrophic.

"I cannot see how they would justify any action they would take against wool."

The wine industry is also particularly vulnerable to any adverse reaction from China which imported $1.1 billion worth of Australian product in the last 12 months.

CEO of Australian Grape and Wine Tony Battaglene said China was a big part of the industry's recovery from COVID-19 as they had started reopening the economy.

He said any disruptions would have a "big impact", but didn't anticipate any bans or tariffs.

"Everyone is concerned when there's any tensions, we're not seeing any immediate threat though to the wine industry which is good," Mr Battaglene said.

"It's hard to see they would impose tariffs, it's hard to see a justification for them, so I don't even really think that's in the frame."

International education is worth $37.6 billion to the Australian economy. Picture: Hollie Adams/The Australian
International education is worth $37.6 billion to the Australian economy. Picture: Hollie Adams/The Australian

Seafood is big business in China with almost 94 per cent of Australia's rock lobster going to the country in 2019, representing $714 million of a $762 million export industry.

Seafood Industry Australia declined to comment on how any bans or tariffs would impact the industry.

The education industry has already received the threat of boycotts which Mr Cheng flagged as a possibility saying, "The parents of students would also think … whether this is the best place to send their kids".

According to the Australian Bureau of Statistics, international education is worth $37.6 billion to the Australian economy.

International Education Association of Australia CEO Phil Honeywood said strong "people-to-people links" had been established between the two countries due to a high number of Chinese students in Australia and he hoped in the absence of a ban "families would just vote with their feet".

 

"Clearly any industry that relies so heavily on the Chinese market would have concerns going forward," he added.

Director of the Australian Strategic and Policy Institute's Defence, Strategy and National Security program, Michael Shoebridge told News Corp while Mr Cheng had threatened product boycotts, it was more likely he was leveraging reduced consumer spending in China to pressure the Australian Government.

"Really a big driver in reduced sales is economic trouble inside China. So they can market it as we are punishing you when in fact their economy is in trouble," he said.

In response to Mr Cheng's warning students may not want to come to Australia, Mr Shoebridge said it was "deeply hypothetical".

Mr Shoebridge said Chinese students were unlikely to come to Australia for "some time" regardless, due to travel bans.

"He's (Mr Cheng) making a threat about something that's already happened, not by Chinese government decision but through the pandemic."

Originally published as D-Day looms on China trade ban threats



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