China halts Australian hay imports amid escalating trade row

Some 28 Australian hay exporters to China have failed to get their expired permits renewed since the end of February, ABC News reported, threatening the nation’s A$160 million (US$121 million) hay export market to China.

According to the Global Times, citing its industry sources, China consumes about a million tons of hay a year, with 300,000 tons coming from Australia, which is its sole source of hay imports. The rest is provided by Chinese domestic producers.

The report said that Beijing is looking at other options for this feed material, including increasing domestic production and looking at new sources of imports. China is also seeking to cut corn and soymeal content in animal feed by using alternative grains, as a deficit of corn supplies has triggered huge price hikes. 

Economic tensions between China and Australia have escalated in recent years, after Australia began cracking down on Chinese investment in the country. Relations deteriorated further after Australia banned Chinese telecoms Huawei and ZTE from its 5G rollout. Tensions were raised again last year, when Australia called for an international inquiry into the origins of the coronavirus outbreak, prompting accusations from Beijing that Australian lawmakers were acting on orders from Washington.

In response, China has imposed trade tariffs on a variety of Australian goods, including coal, barley, wine, beef, and lobster.

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