China suspends export permits for Australian beef and sheepmeat abattoirs in 2020.

Context

In May 2020 four Australian abattoirs had their export permits to China suspended, with Beijing claiming that they had failed to comply with required health standards, including labelling and compliance with COVID-19 regulations. After the suspension of a further license for one additional abattoir in August 2020, a  spokesperson for the Chinese foreign ministry, Zhao Lijian, claimed that this was unrelated to broader bilateral political relations between Beijing and Canberra. A sixth Australian abattoir lost its license in December 2020. Ultimately, ten Australian beef and sheepmeat abattoirs were reported to have lost their export permits to China in the period 2020-22.

These incidents are typically considered part of the broader deterioration of bilateral ties between Australia and China in 2020, with commentators pointing out that the initial suspension of four abattoir licenses came the month after the Australian government’s calls for an enquiry into the origins of COVID-19. Australian government sources told media that bilateral political tensions were the likely cause of the permit suspensions.

Impact

According to reporting, the specific firms targeted included: JBS’ Beef City and Dinmore abattoirs, the Kilcoy Pastoral Company, the Northern Cooperative Meat Company, JBS Brooklyn, Minerva’s Australian Lamb Co, Teys Naracoorte, and John Dee. Australia’s red meat exports to China were valued at around AU$3 billion in 2019, but this dropped by around 30% in 2020.

Responses 

(i) Australian Industry 

Chief executive of the Australian Meat Industry Council, Patrick Hutchinson, told press that “[Australian] beef supply roughly has been reduced now by a third … the suspended companies made up a hell of a lot of that, so it is hard to quantify, but certainly it’s in the many hundreds of millions of dollars that we’ve gone backwards”.

Fiona Simson, the president of Australia’s National Farmers’ Federation, called on the governments of Australia and China to engage in diplomacy, telling press that “We recognise in relationships as significant as that between Australia and China, from time to time, issues do arise. . . When they do it is important that both parties work together in a respectful manner to, as soon as possible, resolve the challenge, to an end that is satisfactory to both.” The founder of one Australian beef producer, Sam McNiven, told press that “[s]ome politicians in Australia say too much, they need to stop this rhetoric with China, especially criticism and speculation regarding the origin of the COVID 19 virus.”

(ii) Australian Government 

In response to the Australian meat industry’s calls for diplomatic engagement, then Commonwealth trade minister Dan Tehan said that the government was attempting to engage in dialogue with China, explaining “[w]e’ve called on the Chinese authorities to follow the proper processes and procedures that most countries follow, especially when it comes to COVID outbreaks in meat establishments”. Additionally, the minister pointed towards a diversification strategy, noting “[t]hat’s why the UK Free Trade Agreement was so important and the increased access that we got for our meat into the UK market was so important,” and that “[t]hat’s why we continue to keep working on a European Union Free Trade Agreement while I’ve been in weekly negotiations with my Indian counterpart on an Indian Free Trade Agreement.” 

(iii) Chinese Industry Responses 

Chinese state media reporting in 2024 noted Beijing’s attempts to diversify the sources of its beef imports, citing Chinese observers as saying that “the move will help reduce market fluctuations due to over-reliance on any single market, while providing more opportunities for other countries through high-level opening-up.” The same report also cited “international grain trade uncertainties amid rising geopolitical tensions and trade protectionism” as factors behind the move towards diversification.   

(iv) Third Party Responses 

Data shows that exports from Brazil, Argentina and elsewhere to China increased substantially during the period.

Status

Three firms regained their export permits in 2023. The chief executive of one of these firms, Brad Teys, told press that this development “gives some sense of optimism that Australia’s remaining suspended plants may follow. It’s heading in the right direction,” and thanked “(Australian) agriculture minister Murray Watt and the federal government for their efforts in restoring market access”. In May 2024, five further Australian abattoirs regained their export permits. A statement from Australian foreign minister Penny Wong welcoming this development called it “welcome news for our producers [that] affirms the calm and consistent approach taken by the Albanese Labor government”. One leading Australian politician (and former trade minister), Dan Tehan, told press that the development meant that “China has realised this (Weaponised Trade) is hurting them and not us”. The case has been largely resolved in the context of improving bilateral ties under the Albanese administration (2022-). Additionally, reports have suggested that a decline in the availability of US beef exports to China may have prompted Beijing to reconsider its position on the Australian abattoir license suspensions.

References & Further Information

Cadell, C. 2020. “China says beef imports suspension unrelated to China-Australian relations.” Reuters. August 28. Available at: https://www.reuters.com/article/world/ china-says-beef-imports-suspension-unrelated-to-china-australian-relations-idUSB9N2BD05J/

Condon, J. “Three red meat plants re-gain China market access.” Beef Central. December 12. Available at: https://www.beefcentral.com/news/three-red-meat-plants-re-gain-china-market-access/

Global Times. 2024. “China diversifies sources of beef imports.” Global Times. June 11. Available at: https://www.globaltimes.cn/page/202406/1313920.shtml

General Administration of Customs of the People’s Republic of China. 2017. ‘List of meat products imported from certain countries that passed the assessment and evaluation’ [符合评估审查要求的国家或地区输华肉类产品名单] March 9. Available at: https://www.shuzih.com/pub/161506e01b82dfa9daa0a33eef734459/cb5c0fb577e24666b2a5ab65222eb323.doc

Hughes, M. and L. Mayers. 2022. “Meat industry calls for dialogue with China as trade war continues for second year.” ABC News. February 1. Available at: https://www. abc.net.au/news/rural/2022-02-01/meat-industry-calls-for-end-to-trade-war-with-china/100795230

Hurst, D. 2020. “Australia-China trade tensions raise fears over future of agricultural exports.” The Guardian. May 13. Available at: https://www.theguardian.com/world/ 2020/may/13/australia-china-trade-tensions-raise-fears-over-future-of-agricultural-exports

Ministry of Foreign Affairs of the People’s Republic of China. 2020. ‘China suspended to accept import declarations of meat products from four Australian enterprises’ [外交部：中方暂停接受4家澳企业肉类产品进口申报] May 12. Available at: http://world.people.com.cn/n1/2020/0512/c1002-31706381.html.

Ministry of Commerce of the People’s Republic of China. 2015. ‘Protocol on Quarantine Requirements of Cattle Imported from Australia’ [关于自澳输入屠宰用牛的检疫和卫生要求议定书]. July 24. Available at: http://melbourne.mofcom.gov.cn/article/ztdy/201507/20150701058746.shtml.  

Nason, J.  2022. “China deep dive: On beef’s bumpy road, is there a way back?” Beef Central. April 22. Available at https://www.beefcentral.com/news/china-deep-dive-on-beefs-bumpy-road-is-there-a-way-back/

Needham, K. and C. Packham. 2020. “China halts beef imports from four Australian firms as COVID-19 spat sours trade.” Reuters. May 12. Available at: https://www.reuters. com/article/world/china-halts-beef-imports-from-four-australian-firms-as-covid-19-spat-sours-trade-idUSKBN22O0FA/

Packham, C. 2020. “Australia lowers forecast for beef exports to China as trade ties sour.” Reuters. June 16. Available at: https://www.reuters.com/article/business/ australia-lowers-forecast-for-beef-exports-to-china-as-trade-ties-sour-idUSKBN23M1YS/

Patton, D. and H. Gu. 2020. “China suspends beef imports from sixth Australian beef supplier.” Reuters. December 7. Available at: https://www.reuters.com/article/ business/china-suspends-beef-imports-from-sixth-australian-beef-supplier-idUSKBN28H134/

Reuters. 2024. “China lifts ban on five Australian beef exporters.” CNN. May 29. Available at: https://edition.cnn.com/2024/05/29/business/china-lifts-ban-australia-beef-exporters-intl-hnk/index.html

Sullivan, K. 2020. “China’s ban on Australian beef costing hundreds of millions and putting people out of work.” ABC News. Available at: https://www.abc.net.au/news/ 2020-12-09/china-bans-cost-meat-industry-hundreds-of-millions/12961538

Sullivan, K. 2024. “Australian beef exports to China can resume after trade war suspension, minister says.” ABC News. May 30. Available at: https://www.abc.net.au/ news/2024-05-30/australian-beef-back-to-china-after-trade-war-suspensions/103911316