Trade Tensions with China Escalate

The crayfish industry appears to be the latest victim of Australia’s deteriorating relationship with China after airfreighted lobsters were left to die at Chinese airports. On Tuesday, 20 tonnes of lobsters were stranded on planes at a Shanghai airport as Australian exporters faced issues with airport custom clearances. A rejection of the lobsters or a further delay of more than 48 hours, beyond which the expensive crustaceans are unlikely to survive, will prevent traders getting them into Chinese restaurants and shops before they are spoiled.

There are also media reports that barley, sugar, red wine, timber, coal, copper ore and copper concentrates from Australia were expected to be barred from this Friday 06 November, even if they had been paid for and had arrived. A ban on wheat is likely to follow, although a date for that has not yet been set. All this would potentially cause five to six billion-dollars damage to Australia’s economy.

This week Chinese importers received verbal directives to stop shipments of Australian wine, dealing a blow to a market worth more than a billion dollars last year. Earlier this year, China announced it was investigating claims Australia had sold wine below the cost of production and subsidised its farmers, prompting fears tariffs could be introduced.

Yesterday, timber appeared to be another commodity in dispute, with Chinese officials saying they had detected a pest in Queensland timber, prompting them to suspend imports.

Australia’s cotton industry is bracing for what could be a devastating blow as it becomes the next casualty in the escalating trade tensions. Mills in China are being told to stop buying Australian cotton as speculation grows that a tariff as high as 40% is about to be slapped on the product – a sanction that would make the trade with China unviable.

Colless Young is a licensed Customs Broker and International Freight Forwarder based in Brisbane. We offer professional advice on trade, transport and shipping through all Australian ports and airports. Our services cover every aspect of logistics, including exports and clearance of import cargo through customs and quarantine, warehousing and trucking.