The Ministry of Commerce of China (“MOFCOM“) initiated an antidumping and countervailing duty administrative review of Barley from Australia, effective on 14 April 2023. For all Australian barley exporters, this is an opportunity to revoke the existing antidumping and countervailing duties and resume exportation to China.
Background
Since 19 May 2020, Australian barley has been subject to 73.6% antidumping and 6.9% countervailing duties in China, following the original antidumping and countervailing duty investigations launched by China against Australia in 2018.
This administrative review is different from a typical review in that it was requested by the Chinese alcohol industry, which is a downstream buyer of the Australian barley, and the request is to revoke the antidumping and countervailing duties due to the insufficient supply of imported barley to meet domestic needs.
In the initiation notice dated 14 April 2023, MOFCOM has allowed all interested parties to submit comments and supporting documents relating to the continuation of the existing duties within 20 days of the initiation. The final result of the review will be published within one year of initiation on 15 April 2024.
An administrative review requested by the Chinese industry in an aim to revoke the existing antidumping and countervailing duties is uncommon in practice. Nevertheless, this aligns with the overall trend of the easing of trade tension between China and Australia, which began in 2018 and culminated in China imposing trade remedies measures on various Australian products and implementing effective import bans on certain Australian mineral products.
Next steps
Considering the current geopolitical dynamics and economic relationship between China and Australia, it is very likely that the duties will be revoked, which will apply to all Australia exporters.
That said, the decision will not be rendered automatically, and the interested parties, including the Australia exporters, should actively participate in the process. It is strongly advised for Australian barley exporters to submit their comments within the requisite timeline, which may cover crucial factors, such as:
- the decline in barley export volume to China since the imposition of the trade remedies measures,
- the ability of Australia barley to meet the demands of Chinese downstream industries, including the alcohol industry, and
- how the revocation of the antidumping and countervailing duties can boost exports to China and benefit its industries.
In case of a more typical administrative review, in which foreign exporters request reassessment of the antidumping or countervailing duty rates, MOFCOM normally issues questionnaires to the exporters to collect more detailed information, including without limitation, the sales and costing data regarding the product under investigation. It is unclear whether exporters involved in this administrative review will also undergo these procedures, given the one year timeframe (which is likely to be shortened) within which MOFCOM will render its final determination.
Thus, it is advisable for Australian exporters to closely monitor the case’s progress and collaborate with MOFCOM in any further inquiries after filing their initial comments.
The China trade team of Baker McKenzie Fenxun has almost 20 years of experience in assisting Chinese and multinational clients in handling trade remedies cases. Most recently, we assisted multiple Australia exporters in responding to the antidumping and countervailing investigations against Australia wines initiated by MOFCOM, as well as one of the largest US agricultural exporters in responding to the Chinese-initiated antidumping investigation involving US sorghum and barley. We are best placed to assist Australian companies with the aforementioned actions.
