The latest trade data from November 2021 seems to again tell a relatively upbeat story about the ability of Australian exporters to redirect to other markets. The above graph covers all nine exports impacted by China’s confirmed trade restrictions: barley, beef, cotton, timber products, coal, copper ores and concentrates, sugar products, crustaceans, and wine. As they have for effectively all of 2021, the value of exports of coal, copper ores and concentrates, and barely to China were still flatlining at zero as of November 2021. Meanwhile, there wasn’t a significant uptick in the overall value of the other targeted exports to China, which remained down on their levels prior to the introduction of trade restrictions.
But the total value of the nine targeted exports to the rest of the world was hovering around A$10 billion a month as of October-November 2021. That is by a wide margin a record high since May 2020 when China introduced the first in an expanding barrage of politically punitive trade restrictions. Although the monthly value of these exports to China in November 2021 was approximately 9% of its value in May 2020, the value of these same nine exports to the rest of the world in November 2021 was approximately 267% of its value in May 2020. Given the persistently high coal prices and the disproportionate overall value of coal exports in this basket of nine exports, it’s worthwhile considering the monthly value excluding coal. But even taking coal out of the equation, the value of the other eight Australian exports to the rest of the world in November 2021 was approximately 186% of its value in May 2020.
The above data points to ongoing successful export redirection to alternative markets in the wake of China’s trade restrictions. But the simple monthly value of impacted exports is far from the full story. As well as elevated coal prices, these values are being driven by a range of fortuitous circumstances for Australian exporters. These include factors such as global food prices rising to their highest level since June 2011, high global prices for specific impacted agricultural exports like barley and cotton, and generally favourable growing conditions in Australia. For example, the volume of the 2020-21 Australian barley season was the second highest on record behind 2016-17. So, although the monthly value of targeted Australian exports has surged despite China’s trade restrictions, these industries may yet face much tougher times if Beijing’s ongoing economic coercion is combined with less favourable weather and market conditions.
Monthly values of select Australian exports targeted by China’s trade restriction are provided below.