Canadian and to a lesser extend also French farmers benefit from the ongoing discussions between China and Australia on unfair trade practices. Canadian barley shipments to China increased by more than one third in May compared to the previous year. The Canadian Grain Commission reported that Canada exported 175,500 tons of barley to China, an increase of 38%. Also imports of European barley and especially barley of French origin will rise. Strategie Grains expects 6% more barley shipments for this season’s barley from the European Union.
China imposed in May tariffs totaling 80.5 percent on Australian barley, which were widely seen as retaliation for earlier Australian anti-dumping measures against China (inside.beer, 11.5.2020). Officially the China Chamber of International Commerce and the Ministry of Commerce (MOFCOM) argued that Australian exporters sold barley to Chinese importers at below the cost of production. As a proof, MOFCOM cited a much lower price for Australian barley exports to Egypt, ignoring the fact, that the quality of this barley destined for feed purposes was much lower.
China also claimed that the dumping caused damage to its domestic industry between 2014 and 2018, again ignoring the fact that Chinese barley production has been in decline for decades due to the uncompetitive small-scale-production in remote and poorer parts of China compared to the highly industrialized grain production on a much larger scale in Australia.
In 2019, Canada exported barley worth USD 532 million and was the fifth largest exporter of barley worldwide behind France (USD 1.5 billion), Russia (USD 762 million), Australia (USD 727 million) and Argentina (USD 720 million). However, concerning barley exports to China, Canada already ranked second behind Australia which will help now to increase its share further.
It is expected that Canadian acres allocated to barley in Canada will now rise to the highest in more than a decade. “Unfortunately, what’s happening to Australia will benefit Canada,” Errol Anderson, President of ProMarket Communications in Calgary was quoted by Bloomberg. “If China comes into the market, really those additional acres will be absorbed easily.”