Albanese’s Re-election Reinvigorates China-Australia Trade Relations Amid US Tensions

Under the renewed leadership of Prime Minister Anthony Albanese, Australia is strengthening trade relations with China while balancing geopolitical pressures. This article examines key developments in agricultural exports, policy shifts, and the broader impact of US-China tariff dynamics.

China and Australia are cautiously advancing their bilateral relationship through renewed economic engagement, even as strategic frictions persist. In a significant development, apples grown on mainland Australia will be exported to China for the first time, highlighting Beijing’s gradual opening to more Australian agricultural products. This follows broader access granted for sheep and goat meat exports, and anticipates further market openings in other sectors, including blueberries.

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These steps come amid renewed global trade tensions triggered by US President Donald Trump’s sweeping tariff announcements in April 2025, which included a blanket 10 percent duty on Australian exports to the United States. Australia’s re-elected Labor government has positioned itself to respond pragmatically, prioritizing trade diversification and regional stability. As Treasurer Jim Chalmers warned, the US-China trade war casts a “dark shadow” over the global economy, placing renewed importance on resilient bilateral ties.

In this article, we examine the latest trade facilitation measures between China and Australia, assess the broader economic and geopolitical context, including implications of US tariff escalation. We also consider the outlook for strategic engagement between China and Australia in the second term of Australia’s Prime Minister Anthony Albanese’s government.

Recent trade developments between China and Australia

A series of breakthroughs in the agri-food sector signal a significant warming in China-Australia economic ties. After years of trade friction, several longstanding technical barriers are now being eased, enabling expanded market access for Australian producers and indicating a broader shift toward pragmatic normalization in bilateral trade.

Australian mainland apples gain market access after long impasse

In a milestone development, apples grown on mainland Australia will be exported to China for the first time, following a new bilateral agreement finalized in April 2025. Until now, only Tasmanian apples, which are produced in a fruit-fly-free environment, had been granted access under a 2010 protocol. Australian mainland growers, who account for roughly 90 percent of the country’s total apple production, had long been excluded due to China’s biosecurity concerns.

The breakthrough comes after years of negotiations between Australian and Chinese agricultural authorities. New cold treatment and registration protocols have now been agreed upon, paving the way for exports to begin with the 2026 harvest season. According to Apple and Pear Australia, this development opens access to a market already valued in the hundreds of millions of dollars annually and provides critical diversification for an industry previously dependent on Australia’s highly consolidated domestic retail market.

The Department of Agriculture, Fisheries and Forestry of Australia has confirmed that it will continue supporting growers in meeting China’s strict biosecurity and cold chain standards.

Expanded access for blueberries and high-value produce

Beyond apples, expectations are growing for expanded market access to additional Australian horticultural products, including blueberries. This follows broader signals from China that it is prepared to re-engage in structured trade liberalization with Australia in targeted agricultural sectors. The move also aligns with Beijing’s food security strategy, which prioritizes diversified and stable import channels for premium produce.

Major expansion in the sheep and goat meat trade

In parallel, April 2025 also saw the largest expansion in Australian sheep and goat meat exports to China in recent memory. Ten new abattoirs—seven in Victoria and one each in Tasmania, New South Wales, and South Australia—have received export approval from Chinese authorities. The new accreditations come in addition to renewed licenses for seven other facilities, significantly boosting Australian meat processing capacity for the Chinese market.

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Industry experts link the development not only to improving China-Australia relations but also to shifting global dynamics, particularly China’s desire to mitigate exposure to US tariffs amid ongoing trade tensions. China is already the largest importer of Australian mutton (accounting for 37 percent of total exports) and the second-largest buyer of lamb, with strong demand across all cuts and weight ranges.

According to the Australian Meat Industry Council, this new access provides crucial relief for producers facing rising input costs and trade bottlenecks elsewhere. The expanded approvals are expected to support Australian red meat exports for at least the next decade and could lay the groundwork for further liberalization in related sectors, such as beef and offal.

Broader implications

These developments, while sector-specific, serve as bellwethers of a more strategic recalibration in China-Australia relations. The easing of trade restrictions in sensitive areas such as horticulture and meat suggests a re-emergence of mutual economic interest, even as high-level political differences remain unresolved. Amid global uncertainty and increasingly complex trade alignments, both sides appear motivated to restore commercial stability and reassert the primacy of economic cooperation.

A recalibrated trade strategy in response to the US

Australia’s recent trade normalization with China is unfolding against the backdrop of a broader reassessment of the country’s external economic posture, particularly in response to renewed volatility in US trade policy. The Albanese administration has made it increasingly clear that it seeks to insulate Australia from the collateral damage of great power competition, especially as tensions between the US and China escalate.

Navigating the “dark shadow” of US-China frictions

PM Albanese has repeatedly emphasized the importance of building a sovereign economic strategy capable of withstanding external shocks. This includes shielding Australian industries from the “dark shadow” cast by the US-China trade war—a phrase used to characterize the uncertainty created by unpredictable US tariff measures and retaliatory policies.

The concern is not hypothetical. While Australia is technically a close security ally of the United States, its exports, particularly in agriculture and resources, are not exempt from being swept up in tariff actions.

Strategic diversification and political rebalancing

These developments seem to have already fed into a broader policy recalibration in Australia. There is a growing public and parliamentary consensus on the need to avoid excessive alignment with US trade postures, which can shift dramatically depending on the political cycle. In this context, the recent trade breakthroughs with China are not merely about regaining lost market access—they are part of a deliberate effort to re-diversify Australia’s trade portfolio and reassert an independent economic diplomacy.

This strategic rebalancing is further reinforced by the active role of industry stakeholders, who have increasingly lobbied for pragmatic engagement with China, recognizing it as a commercially indispensable market, particularly for agriculture and critical minerals. The government’s responsiveness to these pressures suggests a more nuanced, multipolar approach to trade—one that seeks to navigate between geopolitical loyalty and economic rationality.

China’s response to Australian PM Albanese’s re-election

China’s response to PM Albanese’s re-election in May 2025 was notably swift and positive, signaling Beijing’s intent to continue stabilizing bilateral relations. Chinese Premier Li Qiang extended formal congratulations, reflecting a diplomatic warmth absent in previous election cycles.

This gesture aligns with a broader pattern of engagement observed during Albanese’s first term. In November 2022, Albanese met with Chinese President Xi Jinping at the G20 summit in Bali, marking the end of a prolonged diplomatic freeze between the two nations.  Subsequent high-level dialogues, including Foreign Minister Penny Wong’s visit to Beijing in December 2022, further underscored mutual efforts to mend ties.

Outlook: China-Australia relations under Albanese’s second term

Following a decisive electoral victory in May 2025, Prime Minister Anthony Albanese has secured a robust mandate to steer Australia’s foreign policy amidst escalating global uncertainties, particularly the intensifying US-China trade tensions.

Albanese’s administration is expected to pursue a strategy of measured yet persistent cooperation with China, especially in trade. While breakthroughs on strategic issues may be limited, the emphasis will likely be on maintaining stability and fostering economic ties. Key sectors to watch include wine, barley, education, and potential re-engagement in the tech sector.

Trade is poised to become the cornerstone of a pragmatic China-Australia partnership. Beijing has shown a strategic interest in building regional economic stability amid global uncertainty, as evidenced by the resumption of Australian exports such as coal, timber, barley, beef, and hay.

Australia, on its part, is diversifying its trade policy while maintaining security ties with the US. The Albanese government’s Future Made in Australia initiative, announced in April 2024, aims to bolster domestic manufacturing in sustainable energy, with a commitment of US$22.7 billion over a decade.

This balanced approach reflects a recalibrated trade strategy in response to the US-China trade war. The Albanese administration is prioritizing protection from the “dark shadow” cast by these tensions, especially in light of concerns over Trump’s tariffs. Public and political sentiment is shifting away from overdependence on US policies, advocating for a more autonomous and diversified economic strategy.

All in all, under Albanese’s renewed leadership, Australia appears well-positioned to navigate the complex geopolitical landscape by strengthening trade relations with China, diversifying its economic partnerships, and maintaining strategic alliances, thereby ensuring national resilience and economic stability.

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