China is vacuuming up Australian wheat despite simmering trade disputes still in place across other agricultural commodities, with new figures showing the Asian superpower has overtaken Indonesia as our biggest wheat customer. China accounted for 22.2 per cent of Australian wheat exports in the 2021-22 grain marketing year, which ended on September 30. In the months since, more than 2.4 million tonnes of wheat — of all specifications — has been exported to China for milling and feed use. Comparatively, nearby Indonesia accounted for 13.7 per cent in 2021-22 as growth in its buoyant flour mill industry slowed. The spike in wheat sales to China comes after a record Australian wheat harvest in 2021-22, with the nation’s record 36Mt wheat crop driven mainly by a 47 per cent jump in WA’s total wheat crop yield. An 8 per cent increase in the area sown to wheat in WA combined with favourable timing of rainfall and mild spring conditions resulted in record-high crop yields and 13 million tonnes of wheat produced. Despite the interest in Australian wheat, Beijing and Canberra are still at odds over bans and restrictions on the trade in other farm products — including crippling tariffs on barley and wine. Promising meetings between Chinese and Australian diplomats in recent months are yet to see any of the $20 billion worth of trade sanctions on agricultural products lifted, but farmers still have hope. China was the biggest market for barley until Beijing moved to shut down the trade in 2020 with tariffs of up to 80.5 per cent for five years. The dispute is before the World Trade Organisation, with a dispute resolution panel expected to make a determination on the appeal in the first quarter of this year. The barley dispute stems from China’s claims that Australian farmers are propped up by government handouts and accusations that exporters dumped Australian barley on to the Chinese market. Australia rejects the claims, and farmers have thumbed their noses at the tariffs since their introduction, planting three of the four biggest barley crops on record in the past few years. The latest US Department of Agriculture Grain and Feed Report for Australia noted China barley tariff had “limited impact on farmers’ sentiment” towards barley in crop rotations. “If not for high canola prices in recent years, there may have been a bigger planted area of barley in recent years,” the report said. Australia wrapped up its third-biggest barley export year on record in 2021-22, with the 8Mt exported just behind the 9.2Mt in 2016-17 and the 8.3Mt exported in 2020-21. Since China’s barley tariffs were introduced, Australia has diversified barley export destinations, with Saudi Arabia, Japan and Vietnam now the biggest importers — accounting for more than 60 per cent collectively. Other markets were Kuwait, Jordan, the Philippines, Mexico, United Arab Emirates, Qatar and Peru. Grain industry sources said China was buying Australian wheat of all specifications for milling and feed and that Australian imports had “substantially ramped up the volume of imports” after drought in Canada in recent years. Rural Bank’s February insights report, released on February 14, said Australia’s relatively low protein wheat crop and competitive pricing suited China’s demands. WA will have plenty of wheat and barley to export in coming months, with the Grains Industry Association of WA predicting the State’s production will tip 26.4Mt, up on last year’s record 24.3Mt. Wheat futures in Chicago traded near the highest level in more than two months this week, based on concerns that Russia would intensify its war in Ukraine, posing a threat to planting, harvesting and exporting grain in the Black Sea.