A lift on China’s crippling tariffs on Australian barley could pump about $150 million into the nation’s economy — but would result in less wheat being exported to the Asian superpower. It’s been three years since China imposed trade-ending tariffs on Australian barley at the height of diplomatic trade tensions in 2020, when it argued Australian barley was being “dumped” cheaply on the Chinese market. Farmers’ hopes were lifted after both governments this month agreed on a “pathway” to resolve the trade dispute. China is undertaking an “expedited” review of its tariffs on Australian markets and in return, the Australian Government agreed to temporarily suspend its challenge against the tariffs through the World Trade Organisation dispute process. WA Agriculture Minister Jackie Jarvis said while the Federal Government was responsible for negotiations with China, farmers and the State Government would welcome a removal of tariffs on Australian commodities including barley and wine. “Tariffs are a contentious issue... we would love to have easier market access,” she said. Speaking in Perth this month, Grains Research Development Corporation chair John Woods said industry was hopeful. “If we can remove the (barley) tariffs, that is potentially an uplift of $150 million in the barley market,” he said. “That is very powerful. “One thing we have learned is diversity is key in regards to markets... we look forward to China purchasing many of our Australian products again... barley of which would be one. “We are very excited there might be a thawing of relations and we hope that might happen.” Barley prices dropped about $40 a tonne overnight when the tariffs were announced, but later regained about $15/t. At a net loss of about $25/t, reinstating barley trade to China would be worth about an additional $25/t to farmers. Prior to the tariffs, between 4 million tonnes and 6Mt of Australian barley was exported to China each year. Episode 3 grains analyst Andrew Whitelaw said his “back of cigarette packet estimate” was higher, with the three years of tariffs worth between $860m and $1.3 billion due to the China tariffs. Some farmers have argued the tariffs were purely political, with China ramping up its wheat purchases from Australia during the past two years to last year overtake Indonesia as Australia’s biggest wheat customer. It is understood much of the Australian wheat imported by China is being used to feed livestock, and the country would happily pivot to buying barley for this same purpose — reducing wheat imports. China accounted for 22.2 per cent of Australian wheat exports in the 2021-22 grain marketing year, which ended on September 30. The country continues to hoover up Australian wheat, accounting for 26 per cent of all exports between October and February. Australian farmers produced 14.1Mt of barley last year, marking a third year in a row of high production, and exported 8Mt. The latest USDA Grain and Feed Australia report revealed barley exports would dip to 5Mt this year, based on a drop in production. However, while exports were expected to be down, there could be a “shift in destinations” if China returned to the market. In the three marketing years preceding the tariffs, the value of the trade averaged $US909m ($1.37 billion) a year. Since then, Saudi Arabia has emerged as Australia’s major barley export destination but is less dominant than China was. Other significant barley export destinations now include Vietnam, Kuwait, Jordan and the Philippines.