EDITORIAL: China talks a glimmer of hope amid trade war beef
The pressure is on Anthony Albanese to secure some sort of exemption from American trade tariffs — or at least a step along the path to doing so — at his first face-to-face meeting with US President Donald Trump later this month.
Along with the rest of the world, Australia has been hit with a baseline 10 per cent on exports to the US, in addition to 50 per cent levies on steel and aluminium.
One of the industries most exposed is agriculture, particularly beef.
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By continuing you agree to our Terms and Privacy Policy.Last year, Australia sold $6 billion of beef to the Americans, mostly destined for the fast food market in the form of lean trimmings for hamburger patties.
Australia’s biosecurity rules, under which beef slaughtered in the US but born or raised in Canada or Mexico is banned for import, have attracted Mr Trump’s fury, with the President claiming the US “can’t sell a single hamburger” into our markets.
Australia is conducting a review of those rules and there are rumblings that the Government is considering making some tweaks which would allow Mr Albanese to put beef on the table in negotiations with Mr Trump.
Understandably, that’s raised concerns among some in the industry that Australia’s biosecurity advantage could be jeopardised.
Mr Albanese says that’s not the case.
“No, we will not change or compromise any of the issues regarding biosecurity, full stop, exclamation mark. It’s simply not worth it,” he told ABC Radio Melbourne on Friday morning.
“If things can be sorted out in a way that protects our biosecurity, of course, we don’t just say no, we don’t want imports in here for the sake of it. But our first priority is biosecurity and there’ll be no compromise on that.”
Australia does however, have a bargaining chip which could be far more attractive to Mr Trump: our plentiful rare earths.
The US is desperate to shore up its critical minerals supply given the majority of the world’s output is controlled by China, which could withhold export, if it felt it was in its interest to do so.
Australia’s political stability should make us an attractive partner in the critical minerals trade.
But Mr Trump is a uniquely fickle character to do business with. Entreaties to commonsense and logic have failed before.
About 5 per cent of Australia’s export goods are destined for markets in the US — a significant, though not world-ending figure.
The far greater impact of Mr Trump’s tariffs comes through reduced demand for Australian exports from other trading partners — namely, China.
That means that a breakthrough between the US and China has the potential to be more impactful than any direct exemptions Australia could extract from the Americans.
On that, there’s a glimmer of hope, with Mr Trump and Chinese President Xi Jinping agreeing to a new round of negotiations. Could Mr Trump be in the mood for trade war peace?
With his bromance with Telsa billionaire Elon Musk coming to a spectacular, though predictable, end this week, he could use all the friends he can get.
