Australia in Talks With Brazil for Agricultural Trade Agreements

Australia and Brazil have launched negotiations for new agricultural trade agreements allowing the import of Australian barley and wheat, the Brazilian Agriculture Ministry said in a statement on Friday.

The meeting was held between the Australian ambassador to Brazil, Sophie Davis, and Brazilian Agriculture Minister Carlos Favaro on Wednesday, according to the ministry.

The two countries aim to initiate arrangements that will allow Brazilian pork export and Australian barley and wheat imports. They also discussed research cooperation in sustainable agriculture.

However, the ministry stated that Brazil and Australia must first articulate a reduction in bilateral trade tariffs at the World Trade Organization (WTO) before implementing such trade agreements.

Abitrigo, a Brazilian trade group representing flour millers, said in a separate statement that it also met Australian government representatives to share information on the Brazilian wheat market.

The trade group said it was in favor of diversifying sources of wheat imports, adding this would be beneficial to Brazilian flour millers.

Brazil is a net wheat importer and the world’s fourth-biggest pork exporter, being home to some of the world’s largest meatpackers. The country’s total pork export reached 1.13 million tons in 2021.

Brazil’s main supplier of imported wheat is Argentina, though its own internal production is growing as it seeks to become self-sufficient in the staple.

Australia-China Trade Dispute

Australia’s major agricultural products are wheat and barley. Australia’s wheat production is estimated to have reached 37 million metric tons in the 2022-2023 year, while its barley production is estimated to hit 13.5 metric tons, according to the U.S. Agriculture Department.

In October 2021, Australia elevated its dispute with China at the WTO over Beijing’s punitive tariffs on Australian barley exports.

The Chinese Communist Party imposed 80 percent anti-dumping tariff on Australian barley imports in May 2020 after the former Australian government called for an independent investigation into the origins of COVID-19.

Exports of beef, cotton, wine, lobsters, and grapes were all hit with restrictions of varying degrees.

On Feb. 6, Australian Trade Minister Don Farrell discussed with Chinese Commerce Minister Wang Wentao the removal of China’s trade restrictions on key commodities of Australia, their first trade talks in three years.

Farrell said trade and investment had always been part of the “bedrock” of the relationship between the two countries as China continued to be Australia’s largest trading partner and an important source of investment.

The minister also said the Australian government was determined to cooperate with China while standing firm on the country’s national interest.

While there were disagreements between the two sides on many issues, the Australian government believed the differences should be resolved via dialogues.

Wang also hoped that Australia could handle the above issue “appropriately” and provide a “fair, open, and equal” business environment for Chinese companies.

The meeting between Farrell and Wang is Australia’s latest attempt to resume the normal trade relation with China after Foreign Minister Penny Wong’s trip to Beijing in December 2022.

Alfred Bui and Reuters contributed to this report.