China-Australia relations: iron ore miners to escape Beijing’s ‘punitive trade measures’ as small exporters scramble for new markets
- Smaller Australian exporters of products like lobster will struggle to quickly find alternative markets to China, but iron ore miners have little to be concerned about, analysts say
- Amid ongoing tensions with China, Australia is looking to diversify exports to growing markets like Vietnam, India and Indonesia, but analysts warn there will be no quick fix
Relations between China and Australia have become fraught over the past year after Canberra pushed for an international probe into the origin of the coronavirus without diplomatic consultations beforehand, and Beijing eventually responded with a number of trade blocks on wine, barley, cotton, copper, coal, sugar and lobsters. We look at the issues in this series.
Smaller export products victimised in a year-long conflict between China and Australia will struggle to find new markets in the short term, while economically codependent trade in commodities such as iron ore will be spared disruptions, analysts say.
As frayed relations pass the one-year mark, Australian exporters of goods including barley, wine and coal see new trading opportunities in countries such as Vietnam, Indonesia and Mexico, but these markets will not be able to absorb excess trade immediately, research firm IBISWorld said.
Using barley as an example, Matthew Reeves, a senior industry analyst at IBISWorld, said finding replacement export markets is not always a simple task.
“The Australian barley industry’s progress since China introduced the tariffs last year reveals the resilience of Australian exporters, who have pursued diversification strategies. However, shifts to new export markets can take months to achieve, and will do little to ease disruption in the short-term,” he said.
