Australian barley export prices have jumped 8 per cent since early August to average $255 per tonne on the back of China’s decision to remove trade-ending tariffs after three years. The rise — revealed in the USDA’s recent grain markets and trade report — was a stark contrast to the 3 to 4 per cent decline in barley export prices for French and Argentinian barley, which fell to average $235/t as China turned its attention to Australia. While China’s Ministry of Commerce said the tariff removal was due to changes in the “market situation in China”, the USDA report suggested China was facing a “year of thinner global exportable supplies” and its bids for Australian barley were pushing prices up. China predominantly imports barley for feed with a smaller portion for malting, and was Australia’s biggest barley market — worth $1 billion per year — before it implemented crippling tariffs mid-2020 amid trade tensions. The country imports between 7.5 and 8.5Mt of barley each year. While the tariff removal is not expected to immediately restore trade volumes to the high levels in 2016-17, when a record 6.3Mt was exported to China from Australia, the competition in the market has had a flow on effect for farmers. Prices paid to farmers $15 per tonne when the tariffs were lifted, and have risen a further $35-40 since. “Supplies are more limited than in 2016-17, and Australia exported to other markets over the past few years of reduced trade with China,” the USDA report revealed. “As a result, Saudi Arabia, Thailand, and other major importers will now compete with China for limited Australia barley supplies in the coming year.” WA’s first barley shipment to China in nearly three years set sail from the Kwinana Grain Terminal earlier this month, with 55,000t of Maximus malt barley arriving at the Port of Fangcheng in South China on September 17. At the time, CBH chief executive Ben Macnamara said it was an historic moment for WA’s $9b grains industry and the reinstating of the trade would provide farmers with more options when selling their grain. The Chinese Government lifted the tariffs on August 4, with Australia’s biggest grain exporter CBH and Eastern States trader Emerald Grain regaining access five days later on August 9. Reinstating the trade is expected to be worth between $860 million and $1.3b to the nation’s grains industry. Trade Minister Don Farrell told media this month there was still more work to do on dropping barriers against Australian wine, lobster and beef exports to China. Global barley production is expected to sit at nearly 142Mt, down 6.5 per cent year-on-year and the lowest since 2018-19.