China lifts ban on Australian lobsters

Beijing has banned or retaliated with almost $15 billion worth of Australian exports, from wine to timber, during years of sour ties with Canberra.

The $500,000-a-year lobster trade is the last major Australian export to remain under sanctions, and its removal has been the subject of months of Australian diplomatic efforts.

Australian Prime Minister Anthony Albanese finally declared victory after a meeting with Chinese Premier Li Qiang in Laos, saying Beijing had agreed to “a timetable for resuming full lobster trade by the end of this year”.

China introduced a de facto ban on live lobster in 2020, while denying that the move – and a raft of other punitive tariffs – were linked to the worst crisis in relations in decades.

Beijing has been angered by Australia’s crackdown on foreign influence operations in China, a decision to block tech giant Huawei from running Australia’s 5G network and a call for an investigation into the origins of the Covid-19 pandemic.

Thursday’s reversal comes as Beijing watched trade wars with Europe and the United States deepen.

Brussels and Washington have imposed punitive tariffs on China’s exports of electric vehicles, semiconductors, solar panels and a range of other goods.

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Thursday’s announcement is a notable political victory for Albanese, who is seeking re-election in early 2025. Many lobster producers come from Western Australia, a key battleground state.

The centre-left leader has spent most of his two years in office trying to insulate the vital trade relationship with China, Australia’s biggest trading partner, from geopolitical winds.

Australia is part of a loose alliance led by the US that has aggressively rejected China’s bid for primacy in the Pacific region.

Kyri Toumazos, of the Northern Territory Lobster Fishermen’s Association of South Australia, told AFP he was “relieved” the ban would be lifted.

“For us, that Chinese market has really been our core market for a long time, so we can start to re-engage with that. The demand is there and will continue to be there,” he said.

An estimated 97.7% of Australia’s lobster exports were sold to China, more than 1,600 tonnes a year, before the ban.

Some Australian producers have since found new markets in the United States, Europe, Asia and the Middle East.

Many more have circumvented the sanctions by creating a “grey market” of exports to China via Hong Kong, Hanoi and other Asian cities.

The volume of exports to Hong Kong alone increased by more than 6,100% after the ban, according to researchers at the University of Technology Sydney.

The suddenness of China’s ban and the realization of an over-reliance on China have left many Australian manufacturers wary.

But the size of China’s market can make the returns irresistible.

Andrew Lawrie of Sky Seafoods in South Australia once sold 95% of his lobster to China.

When the ban came, he shifted his focus to the domestic market, but efforts to replace China were in vain: “You can’t because of the volume,” he told AFP.

Lawrie said reentering the Chinese market was “definitely risky” but the volume of sales and high prices in China made it worth it.

The sanctions are expected to be lifted in time for Chinese New Year, when delicacies such as lobster are in high demand.