China-Australia relations: WTO confirms appeal lodged against Beijing’s tariffs on Australian barley

Su-Lin Tan
·3-min read

Australia’s dispute with China over anti-dumping and anti-subsidy duties imposed on its barley exports is under way after the World Trade Organization (WTO) confirmed the complaint on Monday.

The complaint was officially listed on the WTO website and circulated to all 164 members of the global trade body. China imposed a total tariff of 80.5 per cent on Australia’s barley exports in May.

China did not determine export price on a reasonable basis when it improperly discarded the information provided by exporters and producers on the export price of barley

Australia’s WTO complaint

In its filing, Australia claimed China deviated from WTO rules 26 times during its anti-dumping investigation, including improperly using third-party country sales to justify Australia had dumped cheap barley.

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“China did not determine export price on a reasonable basis when it improperly discarded the information provided by exporters and producers on the export price of barley, and determined the export price by reference to third-party information,” the complaint said.

Australia also alleged China’s approach “appears to be” inconsistent with its obligations under WTO anti-dumping rules, including failing to fully examine the accuracy of the provided in the investigation.

During the course of the investigation, Australia also claimed China failed to verify the accuracy of the Chinese barley price and the statistics of various economic indicators relating to the state of China’s barley industry.

Australia filed its complaint a week ago seeking initial consultations with China and it will be able to request an adjudication by a WTO panel if the consultations are unsuccessful in reaching a resolution.

“China has always carried out trade remedies in a manner consistent with WTO rules. We regret that Australia has initiated a dispute, but we will seek to resolve the matter in accordance with the WTO dispute settlement procedures,” said commerce ministry spokesman Gao Feng when acknowledging the complaint last week.

After an 18-month investigation, China imposed a total tariff of 80.5 per cent on Australia’s barley exports in May, made up of an anti-dumping duty of 73.6 per cent and a countervailing or anti-subsidy levy of 6.9 per cent, rendering Australian barley exports uncompetitive in China.

The anti-dumping duties, along with suspensions of beef exports and Canberra’s push for an international inquiry into the origins of the coronavirus at the start of the pandemic without consulting Beijing, formed the start of the conflict between the trading partners that is now in its eighth month.

What has happened over the last eight months?

In imposing the barley anti-dumping duty, the Chinese commerce ministry said cheap Australian barley had substantially hurt the Chinese domestic market.

It is the first time either party has disputed an anti-dumping tariff at the WTO.

Since the two nations started trading as WTO members, Australia has imposed 87 anti-dumping and anti-subsidies measures on China, while China has initiated four, including the latest barley tariff.

Between 1995 and 2019, Australia was the sixth most prolific anti-dumping instigator among WTO members after India, the United States, the European Union, Argentina and Brazil.

Dumping is a situation in which the prices of exported goods are lower than the same goods sold in the domestic market of the exporter.

Trade lawyers have said in many anti-dumping measures against China and other countries, Australia had also imposed anti-dumping duties using third-party or proxy prices to substantiate its case.

This was seen in Indonesia’s recent win against Australia in February when the WTO determined Australia was inconsistent with its obligations as a member in the use of proxy prices over Indonesian prices to determine an anti-dumping case on Indonesian A4 paper exports.

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