It’s offical: Australia sets course for China divorce

Precisely as forecast at MB, China’s trade war on Australia is really upon itself. Commodities are fungible and will always be shipped no matter what China does. It can preference its suppliers but cannot withdraw its demand from global markets so we will fill the supply gaps created by it shifting procurement elsewhere. New charts from the Lowy Institute:

Moreover, the divorce proceedings are now official. The one policy that the Morrison Government has right:

  • Australian exporters hit by sanctions have largely rebalanced their exports elsewhere.
  • This includes all affected commodities.
  • Wine is the laggard.
  • A new initiative is underway for “Team Australia” to win in ex-China Asia, launched by Trade Minister Dan Tehan.

As the spurned CCP whines like a bunny boiler in the corner:

  • The CCP Canberra Embassy summoned journalists to watch pro-Xinjiang video propaganda.
  • Uyghur community condemns charade.
  • Enjoy!

Or not:

This what you want for your kids?

This what you want for your kids?

Australia must divorce from China as fast as humanly possible.

David Llewellyn-Smith
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Comments

  1. pfh007.comMEMBER

    There will be no real divorce while we are still engaged in loads of iron ore rumpy pumpy with China.

    No possible way we can divert that much red dirt to other markets.

    Though we could send it via Bombay have them sprinkle it with curry powder, pretend it is Indian and send it on to China.

    Or send loads via Brazil with a steel band and pretend that it can do the cha cha.

    Or send loads via Africa and wrap it with labels marked Simandou – though no one will believe that any volume could come from there.

      • pfh007.comMEMBER

        Since when has China limited our exports of iron ore to China?

        There has been no pivot for iron ore because we are still sending as much as we can dig up to China.

        So I don’t see what the charts have to do with my comment that I don’t see how we can find alternative markets for 800 million tonnes of iron ore per year.

        Note: I am a big supporter of China forcing us to eat our own lobster.

        • Yeah I reckon if China stopped buying Aussie iron ore you’d get a two price commodity market based on origin of commodity.

          Iron ore from the rest of the world would get very expensive and Aussie iron ore would get cheaper.

          Costs in China would go up and iron ore costs would go down in the rest of the world – due to a surplus of of non-China acceptable (Aussie) iron ore.

          • Even StevenMEMBER

            I think you’ve set that out very clearly, North. Fully agree. I’m not sure how Pfh007 is coming to the view iron ore can’t be redirected.

            The question is: how big would be the price differential in the global market between Aussie iron ore and all others? My guess: not much. Some logistical disruption for sure, but commodity exporters will adapt.

            The only way China can REALLY hurt Australia is if they, themselves, stop buying iron ore full stop (from any source). Of course, they’d be badly hurting themselves to do that.

          • 100%. LTCM learned (the hard way) the difference between being in the market vs being the market.

        • NoodlesRomanovMEMBER

          Just looked it up – ABS says the iron ore is 36% of our exports. Might do us well to be forced to diversify or dare I say it – value add.

          • Value add….perhaps we should start a govt funded roof replacement program in Australia. Every house gets a new colorbond roof regardless if they need it. We could call it “Roof Rorts”.

      • The chart “Australian exports sanctioned by China and redirected” shows a drop in exports from Jan 2019 from around 100 Billion
        to 65 Billion. We are losing our (China sanctioned) export markets in both China and elsewhere according to the chart. Is that the Covid effect?

      • Andrew Veniamin

        According to pretty much any source I look at Australia’s exports to China peaked at 48% of our entire export revenue and in 2019 accounted for 40% of our total.

        For example the Coal that was redirected yes – but at less than 1/3 the value, same for Barley and almost everything else.

        The data above is laughable at absolute best. – who is Australia going to export 1,000 million tonnes of iron ore too when china leaves ?

        https://tradingeconomics.com/australia/exports-by-country

        Iron Ore is now accounting for almost $100 Billion (more) of our annual revenue – in October last year it was 36% of our ENTIRE EXPORT REVENUE – there is absolutely NO REPLACEMENT when China moves from Australia and thinking there is, is totally laughable.

        https://www.abs.gov.au/media-centre/media-releases/iron-ore-exports-hit-record-high-october

        • Even StevenMEMBER

          “The data above is laughable at absolute best. – who is Australia going to export 1,000 million tonnes of iron ore too when china leaves ?”

          I think you misunderstand. China not buying Australian commodities means they have to source them elsewhere, which in turn now creates a shortfall in another country…. which Australia can then meet. This is what the charts above are demonstrating.

          Refer North’s comment above for a concise explanation.

    • If Bloomie is to be believed, the rise of scrap in China should provide headwinds for Australian red dirt exports soon enough:

      “It wouldn’t be surprising if China followed a similar trajectory, especially since the government is making it a priority. If it expands the proportion of scrap used in its steelmaking by 50% — a level that would bring it close to Japan’s — it would displace more than 100 million tons of iron ore demand (at current levels), and go a long way toward rebalancing its relationship with mining companies in Australia and elsewhere.”

      https://www.bloomberg.com/opinion/articles/2021-04-07/china-taiwan-conflict-could-come-sooner-rather-than-later

    • Divorce..Thank Dog for that..she has been a whining, sooky, demanding, gold digging [email protected] from the outset. Nevertheless damage done and like real life counterpart wives who go to courts, lie, issue AVO cos feelings hurt she’ll send country & individuals to soo I side (trigger warning:((

    • The logic of the article holds true for iron ore just as does for other commodities: If China was to buy iron ore from somewhere else, it does not affect total global demand for iron ore. If a non-Australia supplier diverts iron ore to China due to Chinese actions, that leaves a customer somewhere short of the same iron ore, who would then buy from Australian producers. We know this would happen, see the charts.

  2. Nearly fell out of my chair laughing. The guys accent in that video is so funny.

    ” Chinaaaaa is laaaaaand of happeeeeeeeeeeness. Probleeeeeeem of extreme poveeeeeeerty ” lol

    Well, its a kind of english I guess.

    ” China is known as the land of melons and fruit “. omg. I have such a dirty mind.

    So am I to understand that despite all the rhetoric and lies from the Boomers, they did there very best to sell us out to China. So rather then it being them who saved us, its soon to be the Economy ( a crash ) which ends up saving Australia… and not them? So the Boomers will be remembered for the arrogant a$$holes they are and in a few years, Australians will be thinking about that.

    So if we have nothing to thank the Boomers for, then I wonder how respected they’ll be in this future?

  3. chuckmuscleMEMBER

    Love those kinds of videos, hard to imagine anyone who has been alive for longer than 5 minutes wouldn’t laugh at how transparent they are. Every marketing team in a large corporate must use the same digital marketing company, given the ubiquity of flashy scenery, elevator music and smiling humans who’s life has obviously improved thanks to [insert product: drug, glysophate, financial service, toll road, gmo food, cluster munitions etc].

    Surely given the high percentage of people who question the wuflu vaccine for a variety of reasons including incentive structures as well as scientific, Scotty from marketing will get a video like this produced encouraging us all to trust big pharma and get jabbed, because like the CCP, big pharma have never done anything wrong, ever, and our lives WILL improve no doubt!

  4. TailorTrashMEMBER

    What a nice movie makes you feel all warm and fuzzy Note the emphasis on “all ethnic groups “
    ….that Han transmigration will fix thing for sure

  5. The “This what you want for your kids?” photo looks a little like the Chinese Embassy in Canberra. Has new electric wire been installed there lately?

  6. Start by forcing all Chinese consulates to close. Only the Canberra embassy should be allowed. State governments should not be doing business directly with China.

  7. El MerenderoMEMBER

    Aaaaaah but the experts…:

    https://www.scmp.com/economy/china-economy/article/3128651/china-australia-relations-trade-minister-dan-tehan-says?fbclid=IwAR2ZI9y_1zIZuTOr31ve3WnOArQ0IgpJlL3cfnrjxJtp6WvgYlExiNLNaXQ

    Su-lin Tan Carr Golley Laurenceson: what a combo of perfectly aligned opinions, just using a CCP-engraved moral compass.

    Then there is always this, to remove all doubts, as an appropriate use of taxpayer funds:

    https://www.npc.org.au/speaker/2021/828-jane-golley-wang-xining-michael-smith?fbclid=IwAR0zlR6OtnD0y_ip8VTZBDTYiUYm7pINn-DNbmABuFm5Wvhax2sEl1oyj74

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