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Australian exports of Chinese milk powder hit a new high, the year is likely to be increased tariffs

Source: xkb.com.au
[Economic News]     13 Nov 2020
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Australian exports of Chinese milk powder hit a new high, the year is likely to be increased tariffs

Australia's dairy exports to China have now risen to over A $1 billion a year. (ABC Photo)

Australian dairy exporters have sold milk powder to China at a record high this year, but tariffs on these products may double according to the China-Australia Free Trade Agreement (ChAFTA) rules.

government new data show that Australia sold a record number of all-fat milk powder to China this year, which is enough to trigger the safeguard mechanism stipulated in the Sino-Australian Free Trade Agreement. For the rest of 2020, China will be able to impose a 10% tariff on Australia's related exports.

On Wednesday night, the Australian Federal Ministry of Agriculture, Water and Environment just learned that China will suspend imports of all Vizhou logs indefinitely from now on. Before that, pest beetles were reported to have been found in 12 batches of wood exported to China in Virginia (bark beetle).

Trade in barley between two Australian grain exporters and China has been suspended overnight. Five meat processing companies in Queensland and Xinzhou have also been suspended from exporting beef to China due to quarantine and labeling problems. Australian wine producers are still waiting for more information about customs clearance of exports in China.

Australia's dairy exports to China have now risen to over A $1 billion a year. So far, the industry has not been affected by the escalation of trade tensions between Australia and China.

According to bilateral trade regulations, the Australian Federal Ministry of Agriculture, Water and Environment expects a change in the trading environment for whole milk powder.

According to the Sino-Australian Free Trade Agreement, tariff preferences can be withdrawn once the agricultural agreement, especially the safeguard clause (SSG), is triggered. If so, it would be the first time since the signing in 2015 that Australian milk powder has triggered the clause.

Australia's health ministry speaker said triggering the safeguard clause showed strong demand for Australian milk powder, which is often used in food production. Therefore, once the tariff quota is reached, the tariff on milk powder exported by Australia to China will be raised from 5% to 10% for the rest of 2020. "

The total tariff quota for Australian milk powder in 2020 is 22,335 tons. By the end of September, its exports to China had reached 19726 tons. According to exports in 2019, the Australian Health Department expects to reach a tariff quota of 22,335 tons by the end of October or early November.

Although Australia's export of milk powder to China reached a tariff quota in late December 2019, it did not trigger a special safeguard clause in the agricultural agreement. Last year, Australian whole milk powder sales to China reached about A $156 million.

Australia's red meat exports to China in July triggered a special safeguard clause in the agricultural agreement. This also shows that the product's export sales to China reached a record.


China's suspension of imports of logs from Victoria

When Chinese Ministry of Foreign Affairs speaker Wang Wenbin presided over yesterday's routine journalist meeting, a question was asked :" Victoria Australia said that China had found pests in Australian timber and therefore banned imports of Australian timber. Australia's guess is that it is no coincidence that the relationship of australia has deteriorated and china has restricted imports from australia. How do you comment on this? "

"Chinese authorities have suspended imports of Queensland logs from Australia since October 31,2020 because of the interception of quarantine pests in Australian logs. But recently, the Chinese customs also intercepted quarantine pests from logs from Victoria, Australia. Once these pests are introduced, they will cause serious problems to the production and ecological security of agriculture and forestry in China threat. In order to prevent the risk of plant epidemic from the source, according to the relevant Chinese law regulations and international standards, General Administration of Customs decided to suspend the import of Victoria logs from November 11,2020. "

"General Administration of Customs has made circulate a notice, to the Australian authorities to improve the quarantine management system of imported logs ," Wang said. Above measures taken by the General Administration of Customs are normal biosafety prevention, scientific and reasonable, in line with the relevant law and regulations of China, and in line with international practice. "

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