China flags introduction of tariffs on Australian barley

China could hit Australian farmers with tariffs on imported barley amid escalating political tensions between the two countries. Australian grain organisations, including Grain Trade Australia, said it was understood China’s Ministry of Commerce (MOFCOM)) was proposing to place new tariffs on all barley imported from Australia as a result of its ongoing anti-dumping and countervailing duties investigations. The yet to be finalised tariffs could include a dumping margin of up to 73.6 per cent and a subsidy margin of up to 6.9 per cent for all barley imported from Australia. Australian barley exporters and the Australian Government have been provided with 10 days to respond. It is understood MOFCOM would deliver its final determination on, or before May 19. The move to introduce tariffs on barley comes as political tensions between Australia and China intensify after Prime Minister Scott Morrison led calls for an investigation into the origins of coronavirus. WAFarmers grain section president Mic Fels said if the tariffs being mooted were applied, it could make Australian barley unaffordable in China. China is Australia’s largest barley export market and Australia is the largest supplier of barley to China. Barley is WA’s second largest broadacre crop in WA, after wheat, delivering about $1 billion in export grain and malt earnings a year. Mr Fels said grain growers would be looking closely at what the trade does this week and how prices were affected. “This anti-dumping action has been simmering for a long time and this is putting some numbers on it,” he said. “If it ends up playing out like this it would have a big effect on selling barley into China.” The probe by MOFCOM into Australian barley started a year ago after China alleged Australia was selling barley at lower prices than normal in the year to September 2018. Australian traders have vehemently denied the allegations. The grain industry organisations said in their statement barley exporters would continue to co-operate with the Chinese Government and work closely with the Australian Government. According to Grain Industry Association of WA, WA farmers will plant 1.86 million hectares of barley this year, up from 1.7 million hectares in 2019. Mr Fels said most farmers would have planted their barley for the 2020 season by now, but those who may not have finished may reduce their barley program in favour of other crops. The decision looms as Chinese demand for malt barley is weak because of lower beer consumption driven by COVID-19 restrictions, while feed barley demand has dropped amid fewer pigs after African Swine Fever wiped out herds.