By Elishya Perera
SYDNEY, Australia (CWBN)_ As heavy rain boosted production, Australia upgraded its forecast for agricultural exports for the season ending June 2021, despite mounting trade tensions with China which has severely impacted the demand for several commodities this year.
Earlier today (Dec 07), the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) announced that agricultural exports for the aforementioned period will total A$49.24 billion ($36.59 billion), which is a 1% increase from its previous estimate of A$48.8 billion in September.
According to ABARES executive director Steve Hatfield-Dodds, recent heavy rains which ended a three-year drought across the country’s east coast boosted agricultural production in several states. “We’re expecting a near all-time high winter crop, the best ever in New South Wales, and a more favourable outlook for summer cropping than we have seen in recent years,” he said.
This upgrade was announced amidst mounting trade tensions between Australia and its largest trading partner, China, this year.
Australian Prime Minister Scott Morrison previously called for an investigation into the origin of the COVID-19 pandemic, which provoked Beijing, and China slapped Canberra with economic sanctions in retaliation.
Barley and wine exports from Australia are among the list of commodities which are severely impacted by these sanctions. In May 2020, Beijing imposed a combined 80.5 per cent tariff on Australian barley, and less than two weeks ago, tariffs up to 212 percent were imposed on Australian wine as well.
While, ABARES did not give forecasts for exports to China, the Bureau acknowledged that the recent tariffs imposed by China would dim the outlook for the country’s barley and wine industries.
“There are a number of risks present for the rest of 2021 that remain a watch point, including wine trade with China,” Hatfield-Dodds said.
It is also reported that wheat exporters from Canberra are shying away from striking deals with Chinese buyers following the recent trade tensions, which has in turn left these buyers scrambling to source low-gluten wheat for the Beijing’s booming fancy bakery market.
