Slow build for timber trade take-off with China

·3-min read

Expectations of a quick resumption of the $600 million timber trade deal with China have been tempered as Australia works towards getting bans lifted on other lucrative sectors.

Agriculture Minister Murray Watt says it may take a few months before the timber industry starts getting the benefit of restrictions being lifted.

"We would expect in the next couple of months to see some real change and those imports starting to happen," Senator Watt said on Friday.

"There's a couple of other little quarantine things that have got to be resolved, but clearly this is really positive news for Australia's timber industry that a really important export destination has reopened."

China's ambassador to Australia Xiao Qian this week confirmed bans on Australian timber imports worth $600 million had been lifted.

Australian Forest Products Association chief executive Joel Fitzgibbon said China would continue to be an important market for the nation's timber and wood fibre exports.

The timber ban was part of the $20 billion in coercive trade sanctions imposed by Beijing in 2020 at the height of a diplomatic rift between the two countries and included barley and wine exports.

Senator Watt said the timber industry had since found other markets, but they weren't big enough to fill the Chinese gap.

"Very often China is prepared to pay a premium for Australian products, including timber, so it would be fair to say we've lost in the hundreds of millions of dollars as a result," he said.

Australia hopes China will next lift trade sanctions on barley imports in a fresh sign of improving trade relations.

Prime Minister Anthony Albanese is working towards a date to visit Beijing after trips by his foreign affairs and trade ministers. 

Mr Albanese said while the removal of impediments in the timber industry was a welcome sign, he wanted to see improvements in the barley and wine sectors as well.

"It's important that any of the impediments to trade between China and Australia be lifted," he said.

"It's important that China show the world that does believe in trade according to international norms."

Opposition foreign spokesman Simon Birmingham said Beijing should be fully honouring the Australia-China free trade agreement. 

"There's little for us to be grateful for in terms of China crab walking back to the terms of that agreement," he said.

"There's been a bit of a change in terms of China easing back on the so-called wolf warrior diplomacy with many different parts of the world."

Mr Qian raised concerns about Chinese confidence in Australian markets and business investments, saying bans on Chinese products and applications like TikTok or security cameras eroded trust.

The ambassador said both nations needed to be able to work together with absolute confidence.

"There are also concerns from the Chinese side related to Chinese investment in Australia," he said.

But he added "Chinese people are having more and more favourable attitudes towards Australia and equally towards Australia the products".

Treasurer Jim Chalmers said Australia was working to make foreign investment laws as robust as possible.

"It's a non-discriminatory foreign investment policy," he said. 

"We want a strong, productive wealth-creating relationship with China, it's such a big and important market to us and to our country and to our prospects."