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At the beginning of the year, Australia overtook Russia to become China’s primary coal provider, coinciding with the ongoing improvement in bilateral relations between Beijing and Canberra.
In January and February, Chinese customs data revealed a remarkable 3,188 percent surge in imports, amounting to US$1.34 billion, compared to nil shipments in January 2023.
Australian coal shipments constituted 24 percent of China’s total coal imports during the initial two months of the year, a substantial increase from the previous year’s 0.9 percent.
During the same timeframe, Russia’s share decreased significantly from nearly half to 22 percent, with shipments from the northern neighbor dropping by 41 percent to US$1.25 billion.
In 2020, relations between China and Australia soured when Canberra demanded an inquiry into the origins of the ka hui coronavirus. However, since then, ties have gradually improved, as exemplified by Australian Prime Minister Anthony Albanese’s visit to China in November.
I kona mua makaikai. to Australia in seven years, Minister of Foreign Affairs Wang Yi highlighted the importance of deepening cooperation between the two countries across all sectors, despite ongoing differences regarding strategic and security issues.
Additionally, exports of Australian coal, cotton, and barley, which were previously subject to official or unofficial bans, have gradually resumed since last year.
In 2019, Australia held the top spot as China’s primary coal provider, making up nearly 60 percent of its imports. However, by 2022, Australia’s share had plummeted to just 1.5 percent, while Russia surged ahead to claim the leading position with a 40 percent share.
However, Beijing lifted restrictions and reinstated coal imports in February of the preceding year, resulting in a swift surge in the share of Australian shipments to 18 percent.
Australian coal imports are tariff-free within the Regional Comprehensive Economic Partnership due to the membership of both China and Australia in the Asia-Pacific trade agreement.
In the initial two months of 2024, China’s exports of lithium batteries to Australia surged by 90 percent, reaching 1.76 million units, and exceeding a value of US$95.8 million compared to the previous year.
China has experienced a rise in wine imports from Australia, with the percentage climbing to 0.6 in the initial two months of the year, yet significantly lower than the 37 percent recorded in 2019.
In March 2021, Beijing enforced tariffs reaching up to 218 percent on Australian wine; however, there are anticipations for their removal due to the ameliorating relations.
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