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The data released by China’s General Administration of Customs, for January to October 2023, reveals that the bilateral trade volume between China and Australia was US$281 billion, an increase of 10.6% (year-on year) with both imports and exports showing positive growth. Among them, China’s imports from Australia grew strongly by 15.3% year-on year, maintaining a monthly double-digit growth rate this year.
While traditional commodities such as coal and iron ore have been the drivers of this growth, other newly resumed trade products such as barley, timber and cotton are injecting new impetus into trade growth. Another product - Australian hay or oat grass - is resuming trade with China.
The coal trade is picking up rapidly and could set a new record this year. According to the latest industry data, Australian coal imports to China are about 29.55 million tons, with a monthly volume of about 6 million tons, according to data shared by the domestic industry research platform Today Think Tank. Other commodities from Australia include beef and barley, which have recently recovered after resuming trade and restoring market confidence. China is a major buyer of Australian barley. Barley is one of Australia's top three agricultural exports to China, with about 70% of Australia's barley production going to China.
In addition to traditional areas, the potential for bilateral cooperation in new areas such as clean energy, services, finance, and education is unprecedented, and the future looks promising.
According to information published on the official website of the Australian government, one-quarter of Australia’s exports go to China, showing that the trade relations have a direct impact on employment and the economy in Australia. According to the Australian Financial Review, China is Australia’s largest trading partner and Australia is China’s third-largest supplier of imports. Trade with China accounts for one-third of Australia’s total foreign trade. According to the data, iron ore is Australia's largest export commodity to China. China has become BHP’s largest single market. Since the beginning of this year, China has resumed importing Australian coal, with a monthly import value of about 1 billion Australian dollars (about 4.75 billion yuan). China also imported $860 million of oil from Australia in the first half of this year. In agricultural products, Australia exported $3.1 billion worth of wheat and other grains to China during the same period, up from $500 million two years ago.
In the case of barley, in August this year, China decided to formally remove anti-dumping and countervailing duties on Australian barley. In October this year, the two countries agreed that the same process would be used for Australian wine exports to China, showing Australia’s confidence of resolving current trade issues with China over lobster and beef.
Furthermore, one of the major trade highlights between China and Australia this year is that Australian lithium ore has surpassed liquefied natural gas to become the second largest export commodity to China. In the first half of this year, Australian lithium ore exports reached a record $11.7 billion, compared with just $470 million two years ago.
China and Australia have also actively explored cooperation in clean energy and green economy. Australia, although rich in mineral resources, has a large demand for clean energy and lacks the ability to refine, process, and manufacture, which is the strength of Chinese companies. Therefore, this means that on top of traditional cooperation, China and Australia are also facing a new opportunities for cooperation.
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