China is buying more Australian wheat than ever even after diplomatic relations between the two countries frayed in recent years.
Australian shipments accounted for 63% of China’s wheat imports in the first 10 months of the year, compared with 28% over the whole of 2021 and just 15% the year before, according to Chinese customs data and Bloomberg calculations.
The booming trade stands out in the wake of deteriorating ties between the countries over issues including a clampdown on foreign investment and as Australia accused China of meddling in its domestic affairs. They took a nosedive in 2020 after Canberra called for a probe into the origins of Covid-19, infuriating Beijing. China responded with punitive trade penalties targeting Australian commodities from coal to barley, lobsters and wine.
There are signs tensions are thawing after Prime Minister Anthony Albanese and President Xi Jinping had the first face-to-face meeting between the countries’ leaders since 2019 last week. Even with some trade curbs in place, China is still Australia’s biggest export market, taking more than a third of total shipments.
In tonnage terms, China’s imports of Australian wheat more than doubled to 4.97 million tons in January through October from a year earlier. That’s the highest ever in data going back to 2004. Global wheat supplies have been constrained due to weather woes in major producing regions and as the war in Ukraine upended trade flows out of the Black Sea breadbasket region.