As of this weekend, Beijing’s Ministry of Commerce (MOC) will slap tariffs ranging from 100 to 200 percent on Australian wine imports as part of an ongoing “anti-dumping” investigation into the industry.
The MOC announced on Friday, saying “preliminary rulings” found there has been “substantial” dumping of wine from Australia into the Chinese market.
“There is a direct relationship between dumping practices and actual damage, and it has been decided to implement temporary anti-dumping measures on the above products from Nov. 28, 2020 (this Saturday),” the announcement on the MOC website stated.
“The margin rate for each company is 107.1 to 212.1 percent,” it continued.
Agriculture Minister David Littleproud told the ABC, “We’re trying to get an appreciation of the reasoning behind the determination in introducing these tariffs.”
“That’s why we’re moving quickly to work with the industry and my officials and DFAT officials in Beijing to get an understanding so we can put our case around this decision … that we feel is quite outrageous and, to be honest, disproportionate to any reason that anyone has put to us subsequently.”
The MOC announced the initial investigation in August, alleging that Australian winemakers were deliberately selling wine cheaply into the country at below-the-market prices (even below production cost), and effectively “dumping” the product into China to drown out local winemakers. The investigation was supposed to conclude next year.
Prime Minister Scott Morrison immediately dismissed the allegations after it was announced telling reporters, “We totally don’t accept any suggestion that there has been any dumping of Australian wine in China whatsoever.”
“There is no basis against the claims made against the Australian wine industry or subsidies or things of that nature,” he said.
Morrison also made the point that Australian wines had the second-highest average price in China in the first half of 2020, following New Zealand wines.
Australian wine brands, such as Penfolds, are highly regarded by Chinese consumers and tourists. Penfolds is so popular it has had to contend with a copycat brand called Benfords.
Salvatore Babones, associate professor at the University of Sydney, was blunt in his assessment of Beijing’s latest move.
“These new punitive tariffs show that there is really no point in signing trade deals with China, like the 2015 China-Australia Free Trade Agreement and the just-concluded Regional Comprehensive Economic Partnership,” he told The Epoch Times.
China accounts for 37 percent of Australia’s wine exports and is its largest market.
Australian ministers have noted difficulties getting in contact with their Chinese counterparts to discuss the matters and have considered going through the World Trade Organisation for a resolution.
The latest move from Beijing rounds off an ongoing series of measures being taken against Australian exports to the country including beef, barley, wine, coal, cotton, lobster, and timber industries.
The trade strikes began soon after Foreign Minister Marise Payne called for an investigation into the origins of COVID-19, which sparked a sharp rebuke from Canberra-based Chinese Ambassador Cheng Jingye.