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Trade

Australia to ask WTO to intervene over Chinese tariffs on barley

Move likely to further stoke bilateral tensions between Canberra and Beijing

A field of barley near Moree, New South Wales, in October.   © Reuters

SYDNEY (Reuters) -- Australia will launch a formal appeal to the World Trade Organization (WTO) later on Wednesday seeking a review of China's decision to impose hefty tariffs on imports of Australian barley, Minister for Trade Simon Birmingham said.

Acknowledging the appeal take years to be resolved, Birmingham told reporters Australia would also request formal consultations with China regarding dumping and other duties on Australian barley amid an increasingly bitter trade and diplomatic row between the two countries.

As relations soured this year after Canberra proposed an independent investigation into the origins of the coronavirus pandemic, first reported in central China last year, Beijing in May imposed five years of anti-dumping and anti-subsidy duties totalling 80.5% on Australian barley - effectively stopping a billion-dollar trade in its tracks.

Australia denies the allegations it subsidises local barley production and Birmingham said it will seek formal intervention from the WTO.

"Australia has an incredibly strong case to mount in relation to defending the integrity and proprietary of our grain growers and barley producers," Birmingham said.

The Chinese government embassy in Australian didn't immediately respond to email requesting comment.

The WTO appeal threatens to further stoke bilateral tensions that have already seen China impose tariffs on a range of Australian commodities, with diplomatic communication limited.

But Australia's conservative government is under growing pressure from grain growers now forced to seek alternative markets - which often don't pay as much as China - for their products for the next five years while Beijing's tariffs are enforced.

About 70% of Australian exports of the grain typically go to China, Australian data show.

The effective block on sales to China also comes as Australian barley production is expected to hit nearly 12 million tonnes this crop year, after rain revived some of the biggest growing regions following years of drought.

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