Trade relations between China and Australia have been strained for some time. As a result, Chinese imports of Australian fruit have struggled since December last year. For many Australian fruit varieties the Chinese import volume is much smaller than in previous years. Mr. Li, spokesperson for a trade company in Guangzhou, commented on the impact of this situation for Australian suppliers and Chinese importers.
Mr. Li first introduced changes in the import volume of his company, "take grapes for example, we normally import around 60 shipping containers per year from Australia, but this year we have only imported 20 containers. The strained trade relations have an impact on both sides, but we do not allow this situation to affect our cooperation with suppliers. Australia has always been an important production area where we purchase our import fruit. We have close relations with suppliers there. We hope to continue trading without interruptions to further support each other."
"China is one of the largest export markets for Australia. Now that the trade relations are strained and the price of shipping is higher than usual, many suppliers have to adjust their export activities. Australian suppliers try to shift their focus from China to Southeast Asia and Europe. However, these markets can not compete with China in terms of import price and the volume these markets can absorb. Australian exporters did not make as much profit as in previous years," said Mr. Li. "The Australian fruit association has taken some measures to improve this situation, such as support for large fruit traders in opening up new markets."
This is the peak period of the orange season. Traders everywhere proceed with caution. Some suppliers have temporarily halted export to China. They focus their attention on South Korea and Japan instead. Although the Chinese market price of imported Australian oranges is slightly higher than last year, the difference is minimal. "Some importers tried to sell a small volume of import oranges for high prices in the beginning of the season. But this plan did not work out," said Mr. Li. "First, the rarer a product, the higher the price, but if the price rises too much, then consumers will lose their interest. Second, there is a wide variety of products in the Chinese fruit market. There are high-quality oranges from South Africa and Peru as well. Their supply volumes are growing larger, which means that Chinese consumers have plenty of high-quality oranges to choose from."
"Of course, all orange varieties from different origins have their own unique characteristics, but Australia is in an advantageous position. First, Australian suppliers have permission to export a wide variety of oranges to the Chinese market, and they can do so earlier than most other suppliers. They certainly have a loyal customer base, and their market share is big. Second, the level of plantation and processing is very high in Australia. The product quality is excellent. That is why the market price of Australian fruit is usually higher than the price of fruits from other production areas," explained Mr. Li. "But in the end, the import fruit market is growing more diverse, and the competitive advantage of Australian fruit is not as strong as before."