June 3, 2018 / 7:34 AM / 10 months ago

Australian citrus growers fret China trade tension may harm exports

SYDNEY, June 3 (Reuters) - Australia’s citrus industry on Sunday called for the government to rebuild the country’s fraying relationship with China, fearing trade tension may harm its booming export market.

Relations between the two nations have been severely tested amid moves by Australia to limit foreign influence, spurring legislation banning foreign political donations. Australia has also tightened regulations on foreign investment that has led to the rejection of Chinese company-led bids for sensitive assets.

Nathan Hancock, Citrus Australia’s chief executive, told Reuters that farmers had carefully built the market only to see politicians threaten it with poor diplomacy.

“Only a few years ago we signed a free trade agreement with China and now we find ourselves in the situation where China is threatening to stop trade with us, and teach us a lesson through trade,” he said by telephone on Sunday.

“I think it’s time we took this seriously. Ministers in Australia should be going to China and starting to rebuild our relationship, and this might go so far as the Prime Minister himself.”

Growers have enjoyed the best prices in years as good weather, a bumper harvest and exceptional quality fueled some 263,600 tonnes of exports in 2017, up 20 percent from a year earlier and worth A$432 million ($330 million). Of that 39 percent was shipped to China and Hong Kong, according to Citrus Australia.

Two-way trade between the nations has grown since Australia and China signed a trade pact in 2015, increasing to A$170 billion ($128 billion) last year.

Relations between the two countries soured further recently after Australia’s Treasury Wine Estates Ltd, the world’s biggest listed winemaker, said it faced delays getting some products through Chinese customs.

China also rejected a request for a senior bilateral meeting during a recent visit by Australia’s trade minister, a high-ranking diplomat said last week.

$1 = 1.3217 Australian dollars Reporting by Alison Bevege; Editing by Edwina Gibbs

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