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Australian $1.6b timber exports to China in doubt

Australia’s $1.6 billion timber export business with China could come to an abrupt halt Friday after unconfirmed instructions from Chinese customs authorities. Also under threat is Australian wine, copper, barley, coal, sugar, and lobster. Source: Timberbiz

The notice, distributed by a customs clearance agent on Tuesday, has not been confirmed by the Chinese government.

Australia exported logs worth $614 million and woodchips worth $980 million in the 2018-19 financial year.

Queensland timber logs have already been banned after tree-destroying bark beetles were allegedly found in a shipment along with barley from Emerald Grain Australia. The claims have been denied by Australian exporters.

China’s Foreign Ministry said it had asked Australia to investigate the presence of live pests in timber, such as longicorn and buprestid beetles, which had been found in imports since January.

The trade dispute follows Australia’s push for an inquiry into the origins of the coronavirus in April but has continued to intensify after Beijing imposed new national security laws on Hong Kong and advanced its territorial claims on the South China Sea.

The Chinese Foreign Ministry has denied it is ratcheting up economic pressure to win diplomatic concessions.

The Morrison government is yet to confirm the existence of the sweeping edict against Australian goods but was working closely with the named industries and continued to seek clarification from Chinese officials.

Australian trade officials yesterday were examining the authenticity of the instructions relayed in the customs notice, as concerns grow it may be self-fulfilling and encourage importers to diversify away from Australian products.

Two commodity traders said they could not verify the “banned” list, which appeared to be from a city-level authority because it contained the word “bureau” and not “ministry”, which would have indicated it was a China-wide directive.

A spokesman for the Australian Forest Products Association said the association was aware that Chinese customs authorities have advised the Australian Department of Agriculture that the export of logs from Queensland to China have been suspended on the basis of detections of live quarantine pests in log consignments.

“AFPA is working with the Department of Agriculture, Water and Environment to obtain more details from Chinese officials about these incidents and to address any quarantine issues identified.”

Timber Queensland referred questions to AFPA.

But there is a consistent message from China that Friday is D-day for imports in China to be cleared by customs.

Neither Trade Minister Simon Birmingham nor Agriculture David Littleproud have had official-level contact with their counterparts in China since the beginning of the coronavirus outbreak.

Senator Birmingham has urged Australian companies dependent on China to broaden their markets to account for “unpredictable administrative decisions that have been made at the Chinese end”.

He has threatened to take China to the World Trade Organisation over the infringements.