Grain Producers Australia chairperson Barry Large said while other countries had purchased Australian barley in the past two years, the possible return of the China market was good for growers and the industry.
“We welcome the government’s constructive dialogue creating this process and opportunity to recommence the barley trade,” Mr Large said.
“Barley is an important rotation crop for Australian growers and any optimism on the future is good.”
China imposed a tariff of 80.5 per cent on Australian barley in May, 2020, affecting a market valued at $916 million in the previous financial year.
Trade for other important Australian grains such as wheat were not impacted.
GPA southern director Andrew Weidemann said China’s decision to only impose high tariffs on barley was intended to help China’s own barley production.
“The original concept was to allow Chinese farmers to grow barley for a higher price,” Mr Weidemann said.
“Therefore the tariffs were imposed to make this possible.”
“But it has not worked and this is a key point.
“Chinese maltsters have now put pressure on the Chinese government to remove the tariffs so they can have access again to Australian barley.”
China and Australia reached an agreement last week which could see the timely removal of the import duties.
Trade Minister Don Farrell and Foreign Minister Penny Wong announced a two-step process across three months that will see China immediately initiate an expedited review of the duties imposed on barley.
Australia will temporarily suspend the WTO dispute initiated by the tariffs during the same period.
When the duties are removed the WTO case will be withdrawn, a deal that has been a continual option offered by the WTO.
“Reaching a resolution would be significantly quicker than if the WTO process continued,” Mr Large said.
“We welcome this new process and look forward to a positive outcome.”
Mr Weidemann said new export markets that have opened in the last two years will be affected owing to China paying the highest price for barley.
Barley exports to Saudi Arabia began in early 2021 in response to China’s tariffs but at a lower price.
Mr Weidemann said filling such a market would be a challenge.
“But barley is traditionally the easiest crop to grow,” Mr Weidemann said.
“And with a cracking start to the season, barley is probably a good option for farmers.”
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