Australian wool exports to China enjoy zero tariffs on 10,000 tons

On June 17, my country and Australia officially signed a free trade agreement. According to the agreement, the two parties will achieve the goal of “comprehensive, high-quality and balanced interests” in more than a dozen fields such as goods, services, and investment. It is the free trade agreement with the highest overall level of trade and investment liberalization that my country has signed with other countries so far. one. As an important imported raw material for my country’s wool textile industry, Australian wool is also included in China’s tariff exemption category for important Australian products.
According to the latest news from the relevant agencies of the Australian Embassy in China, according to the China-Australia Free Trade Agreement, in addition to the existing WTO quota, Australia will receive a country-specific quota of 30,000 tons of wool (washed weight, approximately 43,000 tons of raw wool). The tariff within the quota is zero. At the same time, the number of national quotas will increase by 5% per year based on this base. By 2024, Australian wool with tariff-free access to the Chinese market will reach nearly 45,000 tons (washed weight, approximately 64,300 tons of raw wool). This is also the best treatment provided by China in all free trade agreement trade so far.
According to the China-Australia Free Trade Agreement, in the field of goods, products from both sides accounting for 85.4% of the export trade volume will immediately achieve zero tariffs when the agreement takes effect. After the tax reduction transition period, the proportion of Australia’s tax items and trade volume that will eventually achieve zero tariffs will reach 100%; the proportion of China’s tax items and trade volume that will achieve zero tariffs will reach 96.8% and 97% respectively. This greatly exceeds the 90% tax reduction level in general free trade agreements.
According to statistics from the General Administration of Customs of my country, in 2014, my country imported a total of 332,400 tons of wool, with an import value of US$2.427 billion. Among them, imports from Australia account for about 60% of global imports. China is the largest buyer of Australian wool in the world, and Australian wool exports to China account for 71% of its total export market share. As one of the results of the China-Australia Free Trade Agreement, what impact and changes will the 30,000-ton Australian wool national quota have on the market price and demand for imported wool raw materials in China?
According to the analysis of authoritative sources in the Nanjing wool market, according to my country’s commitment to join the WTO, my country currently has an annual wool import quota of 287,000 tons. The tariff rate within this quota is 1%. China has actually provided a nearly tax-free policy for imported wool. market access. After China and New Zealand signed a free trade agreement in 2008, they have provided an annual national quota of 25,000 tons of New Zealand wool since 2009. With an annual increase of 5%, the national quota in 2015 reached 33,502 tons. After the signing of the China-Australia Free Trade Agreement, the newly added 30,000 tons of Australian wool national quotas operate in a manner similar to that of New Zealand wool. However, the characteristics of Australian wool products and the market demand positioning of New Zealand wool products are different, so it will not bring much change to the current domestic imported wool pattern. For those domestic wool spinning companies that demand high-quality and high-grade Australian wool, wool fiber is a high-value textile raw material with a high unit price. Therefore, the country-specific quotas for Australian wool will further help companies reduce import costs. After experiencing a downward trend in the past 3 to 4 years, my country’s wool market has bottomed out since the second half of last year. Especially in the recent period, the market for double-sided woolen products used for woven women’s clothing has been very hot, which has boosted the wool market. pick up. If the market improves further, it will continue to drive corporate demand for upstream high-quality raw materials.
Compared with Australian wool imports, there is no more good news about Australian cotton in the results of the China-Australia Free Trade Agreement. Although textile companies with import needs for high-quality cotton generally recognize Australian cotton’s fiber length, consistency, strength, whiteness, and the absence of trifilament and other indicators, my country’s current tariff quota of 894,000 tons of cotton imports has been fully After the distribution is completed, companies still have no better solution to their demand for high-grade imported cotton.