SPOTLIGHT: AUSTRALIA
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STAND-OFF LINGERS Australia’s trade spat with China has continued to affect bulk trades during the course of the year – not least with the price of some essential commodities that China has been obliged to purchase in the open market at higher prices than would be available through a trade deal
W
hile the trade standoff between Australia and China has been continuing in recent months, Australian wheat is still heading towards China despite the latter’s anti-dumping duties on Australian wine and barley. Although there were recent reports of Australian coal being landed in China, few analysts are expecting an early ending to the dispute. China has also cut back on purchases of Australian coal and beef as the dispute has been running, but wheat purchases are continuing. Wheat supplies have been under pressure as northern hemisphere suppliers have been affected by weather conditions. Australia, meanwhile, has been experiencing good conditions for the harvest. “It is all about availability of goodquality wheat supplies at the right price when it comes to food security for China, or any other country,” Phin Ziebell, an agribusiness economist at National Australia Bank in Melbourne told Reuters. “Chinese buyers have cancelled some cargoes of French wheat on quality issues and they are turning to Australia in a big way,” one Singapore-based trader at an international food-supply company was quoted as saying. “We are, indeed, expecting a bumper Australian wheat harvest and China will definitely import as Aussie wheat seems like the only better choice globally,” a Beijing-based trader with an
international trading house told Reuters, adding that French wheat this year is “basically doomed” due to quality issues. Dry bulk trades have obviously continued to be affected by tensions between Australia and China, partly due to Australian moves to acquire nuclear submarine tonnage. China has been banning imports of Australian coal since the last quarter of 2020 and has had to increase coal imports from Russia and other suppliers such as the US and Canada, with all the implications for dry bulk fleets and ton-miles. The Chinese ban on Australian coal has been costing Chinese steel mills substantial amounts as it has needed to pay a premium to secure coal from other suppliers; it is estimated to consume about two million tonnes of coal every day in its mills. The ban on Australian coal has caused distortions in the coal market because of the premium China has to pay against coal costs elsewhere in the world.
eyre peninsular
As T-Ports has been expanding its facilities in South Australia’s Eyre Peninsular, the company has announced plans to provide grain growers on upper Eyre Peninsula with an alternative delivery option at a T-Ports bunker site at Kimba. T-Ports has announced that it will build a new facility at the Eyre Premium Hay premises east of Kimba. The facility is
set to be completed in time for this year’s harvest, while capacity at the company’s Lock site will also be expanded. Chief Executive Officer Kieran Carvill says the expansion projects highlights T-Ports’ commitment to working in partnership with growers and are part of the company’s plan to continue increasing grain throughput and give South Australian growers choice. The model has been followed with port developments that give grain growers a stake in the port end of the equation. “Growers at both Kimba and Lock have been strong supporters of our grain supply chain, as have many others across the Eyre Peninsular. Given current harvest predictions, we’re now able to offer an alternative storage option for this part of the catchment zone,” he says. “While upper EP growers have had the opportunity to deliver direct to our port at Lucky Bay since it opened in 2019, the Kimba site will give them a delivery option much closer to home so they can move tonnes from the paddock more efficiently and cost-effectively at the peak of the harvest. “We will continue to monitor other opportunities to support our grower customers right across the catchment area in the future as we know they recognise and support the benefits of competition in the EP grain supply chain.” The T-Ports facility at Kimba will
BULK TERMINALS
international | AUTUMN 2021
