China will impose anti-dumping and anti-subsidy duties on barley imports from Australia totalling 80.5 per cent starting on Tuesday, May 19, the commerce ministry says.

The move, the result of a probe that began in 2018, had been widely expected after the Australian grain industry said last week it had been warned Beijing was considering high tariffs.

The tariffs, which are expected to all but halt the $2 billion trade in barley between the two, come amid deteriorating relations between Canberra and Beijing, which have been exacerbated by a push by Australia for an investigation into the origins of the coronavirus outbreak.

The Ministry of Commerce said on Monday it had confirmed dumping by Australia and significant damage as a result of the dumping on its domestic industry.

It said duties of 73.6 per cent would be levied on all companies, including four named exporters, The Iluka Trust, Kalgan Nominees Pty. Ltd, JW & JI McDonald & Sons and Haycroft Enterprises.

It will also charge an anti-subsidy duty of 6.9 per cent, said the ministry.

China confirms tariff of over 80 per cent on Australian barley exports https://t.co/De6FstDynt

— South China Morning Post (@SCMPNews) May 18, 2020

Australia’s Trade Minister Simon Birmingham said China’s decision was deeply disappointing and that Australia has not subsidised or dumped barley to China.

“Australia is deeply disappointed with China’s decision to impose duties on Australian barley,” he said in an emailed statement on Monday.

Australia is by far China’s top supplier of barley, exporting about $1.5 billion to $2 billion worth of the grain a year.

China takes more than half of Australia’s barley exports.

The imposition of the tariff will fuel bilateral tensions between Australia and China.

The relationship soured in 2018 when Australia banned Huawei from its nascent 5G broadband network, while tensions were escalated by concerns within Canberra over China’s attempts to secure greater influence in the Pacific.

In recent weeks, China has been angered by Australia’s call for an independent inquiry into the origins of coronavirus.

“There aren’t many alternative markets. It could be sold to Saudi Arabia, but it will be heavily discounted to what Australian farmers could have received by selling to China,” an Australian government source told Reuters.

-AAP