Agribusiness & Food

China begins Australian sugar probe

It’s bad news for the Australian sugar export industry as the Chinese Ministry of Commerce (‘MOFCOM’) has begun an investigation into sugar imports into China.

Australia is one of four countries, the others being Brazil, Thailand and Korea, that are being targeted.

Lloyd’s List Australia understands that a petition was made members of the local Chinese sugar industry to the ministry arguing that rapid import growth of 663.15% in sugars between 2011 to 2016 caused a variety of problems for the local industry.

MOFCOM’s announcement 46 of 2016 reads: “the petitioner also claims that, the rapid import growth in quantity of the applying product for the investigation causes impact to China domestic industry, for the production and operation indicators, such as operating rate, sales quantity, market share, sales revenue, pre-tax income of Chinese domestic industry deteriorates, while China domestic industry suffers serious injury, and there is a causal link between the rapid import growth in quantity of applying product for the investigation and the serious injury of Chinese domestic industry.”

Consequently, MOFCOM has determined that the triggers for a “safeguard investigation” have been met.

An investigation got underway as of September 12 and public hearings are due as to whether or not additional tariffs / duties / quotas should be imposed on Australian sugar imports to China.

A final decision is due in nine months. Targeted Australian companies include:

  • Queensland Sugar Ltd
  • Sugar Australia Pty Limited
  • Bundaberg Sugar Ltd.
  • NSW Sugar Milling Co-operative Ltd
  • Heck Group
  • Isis Central Sugar Mill Co. Ltd
  • Mackay Sugar Limited
  • Tully Sugar Limited
  • MSF Sugar Pty Ltd

Lloyd’s List Australia understands that, owing to the organisational structure of the Australian sugar industries, the above lists comprises of companies that form a very large percentage of this country’s sugar export trade.

Interested parties can find out more information at http://www.mofcom.gov.cn/ which is written in Modern Standard Chinese. Official English language versions are available at mofcom.gov.cn although these clearly have considerably less detail than the Chinese versions. Google also offers a machine-translation service although the accuracy of these are questionable.

Interested parties may wish to contact lawyer Frank Hang, who is a partner with the Beijing law firm of Global Law Office www.glo.com.cn

This article originally appeared in ABHR affiliate Lloyd’s List Australia.

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