Leslie Massey
Australia's main trade partners have varied over the years, with the country engaging in two-way trade with numerous nations. In 2022, Australia's major trading partners for exports were China, Japan, South Korea, and India. Meanwhile, its top import partners were China, the United States, South Korea, Japan, and Singapore. In terms of trade balance, China was Australia's biggest two-way trade partner in 2014, with exports valued at $98.2 billion and imports worth $54.3 billion, resulting in a $44 billion positive trade balance for Australia. Japan and the United States are also significant trade partners, with Japan being the second-largest export partner and the third-largest import partner, while the US is Australia's fourth-largest export partner and second-largest import partner.
| Characteristics | Values |
|---|---|
| Australia's biggest two-way trade partner | China |
| Australia's second-largest trade partner | Japan |
| Australia's third-largest trade partner | The US |
| Australia's other major trade partners | South Korea, Hong Kong, India, Singapore, United Arab Emirates |
| Australia's top trade partners in 2024 | China, United Kingdom, Bahrain, Hong Kong, United Arab Emirates, United States of America, Belgium |
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What You'll Learn
China: Australia's biggest two-way trade partner
Australia's economy is the 12th largest economy in the world by nominal gross domestic product (GDP). In 2015, its GDP was $1.62 trillion. Australia's biggest two-way trade partner is China. In 2014, exports to China were valued at $98.2 billion, and imports from China were worth $54.3 billion. This gives Australia a $44 billion positive trade balance with China. Approximately 34% of Australia’s total exports go to China, including iron ore ($46 billion), coal briquettes ($7.74 billion), gold ($6.34 billion), crude petroleum ($1.89 billion), and refined copper ($1.88 billion).
In 2024, trade between China and Australia was valued at US$31.9 billion (country-specific trade surplus). China was also Australia's biggest trading partner for imports in 2022.
Japan is Australia's second-largest trade partner. In 2014, the two countries shared a $70.2 billion trade value, with Australia exporting $50.2 billion worth of goods to Japan and importing $20 billion, resulting in a $30.3 billion positive trade balance. Japan is the second-largest export partner and the third-largest import partner for Australia. Approximately 18% of Australia's total exports go to Japan, and 7% of its imports originate there. Major exports to Japan include petroleum gas ($14.4 billion), coal briquettes ($10.7 billion), iron ore ($7.58 billion), copper ore ($1.41 billion), and crude petroleum ($925 million).
The United States is Australia's third-largest trading partner and fourth-largest export partner. In 2014, two-way trade between the two countries was valued at $60.4 billion, with Australia exporting $18.5 billion worth of goods and importing $41.9 billion, resulting in a $23.4 billion negative trade balance. The US is the second-largest import partner for Australia, with approximately 4.1% of its total exports going to the US and 11% of its imports originating there. Major exports to the US include frozen bovine meat ($1.53 billion), sheep and goat meat ($576 million), aircraft parts ($515 million), bovine meat ($502 million), and wine ($435 million). Australia's principal imports from the US include cars ($2 billion), medical instruments ($913 million), packaged medicines ($912 million), telephones ($545 million), and computers ($543 million).
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Japan: Australia's second-largest trade partner
Australia's second-largest trade partner is Japan. In 2014, the two countries shared a $70.2 billion trade value, with Australia exporting $50.2 billion worth of goods to Japan and importing $20 billion worth of goods. This gave Australia a $30.3 billion positive trade balance with Japan. Approximately 18% of Australia's total exports go to Japan, and 7% of its imports originate there. The largest percentage of exports to Japan includes petroleum gas, coal briquettes, iron ore, copper ore, and crude petroleum.
Japan and Australia signed a free trade agreement in 2014 after nearly a decade of negotiations. This agreement was the first of its kind between Japan and a major agricultural exporting country. The agreement has helped to strengthen the economic relationship between the two countries and promote trade and investment.
Australia's top trading partner is China, with approximately 34% of Australia's total exports going to China. Australia's exports to China are valued at $98.2 billion, while imports from China are worth $54.3 billion, resulting in a $44 billion positive trade balance. Other major trading partners of Australia include the United States, South Korea, Hong Kong, and the United Arab Emirates.
In recent years, Australia has also been increasing its trade with other countries such as the United Kingdom, Bahrain, and the United Arab Emirates. Australia's diverse trade relationships contribute to its position as the 12th largest economy in the world by nominal gross domestic product (GDP). The country's participation in global trade helps to drive economic growth and development.
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The US: Australia's third-largest trade partner
Australia and the United States have a strong history of working together to further economic prosperity through free and open trade. The two countries have worked together in establishing the G20 and collaborate in global and regional trade and economic fora, including the World Trade Organization (WTO) and the Asia-Pacific Economic Cooperation (APEC) forum.
The Australia-United States Free Trade Agreement (AUSFTA) came into force on 1 January 2005, and since then, two-way trade has grown from US$32 billion to US$77 billion. Over 97% of Australia's non-agricultural exports to the United States (excluding textiles and clothing) are now duty-free, and three-quarters of agricultural tariff lines have been eliminated. Under AUSFTA, Australian companies also have access to the US federal government procurement market, valued at US$637 billion, and the government procurement markets of 31 US states.
The United States is Australia's largest economic partner, with two-way trade valued at US$77 billion and an investment relationship worth US$1.6 trillion. Approximately a quarter of Australia's inward foreign investment comes from the United States, totalling US$740 billion (AUD$1.09 trillion). The US runs a large trade surplus with Australia, with Australian exports to the US valued at US$18.5 billion and imports from the US valued at US$41.9 billion in 2014.
The largest American exports to Australia include financial services, travel services, telecoms/computer/information services, royalties, and trucks. Notable Australian investors in the US include Woodside, Westfield, Brambles, Atlassian, Worley, Visy, Bluestone Lane, Rio Tinto, and Tritium. Australian companies employ approximately 150,000 people in the US, including around 19,000 in both California and Texas.
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South Korea: Positive trade balance with Australia
Australia's top trading partners include China, the United States, Japan, and South Korea. South Korea is the third-largest export market for Australia. The two countries have a positive trade balance, with a strong focus on manufacturing and exports.
South Korea's economy grew 1.8% year-on-year in the first quarter of 2021, surpassing its pre-pandemic size. This growth was driven by exports, which surged by more than 80% year-over-year in the first ten days of May 2021. The increase in exports from South Korea has boosted demand for Australian commodities such as iron ore, metallurgical coal, and LNG. Outside of commodities, Australian exports of agriculture, manufacturing, and other goods to South Korea have been slightly lower in recent years, reflecting South Korea's slower domestic demand recovery.
South Korea's long-term focus on boosting "green" and "digital" investments is positive for Australian exports. The South Korean government's goal to increase renewable energy generation from 7% to 30-35% by 2040 provides opportunities for Australian energy and resource exports. Rare earths and lithium, cobalt, nickel, and graphite supplies are among the emerging sectors that will benefit from South Korea's position as a global leader in lithium battery manufacturing.
The positive trade balance between Australia and South Korea is a result of complementary economic strengths and a focus on mutually beneficial trade relationships. Australia's strong commodity exports align with South Korea's demand for natural resources, while South Korea's advanced manufacturing sector provides opportunities for Australian suppliers of raw materials and components. The two countries' economic partnership is expected to continue to strengthen, with potential for further growth in two-way trade.
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India: One of Australia's major export partners
India is one of Australia's major export partners. The two countries have a long history of cooperation, including shared military experiences dating back to World War I. In recent years, their defence relationship has strengthened through initiatives such as joint naval exercises, personnel exchanges, and training collaborations.
The Australia-India Council (AIC), established in 1992, has played a crucial role in fostering mutual awareness and understanding between the two nations. The AIC has facilitated exchanges in various fields, including security and strategic issues through initiatives like the Australia-India Strategic Lecture.
Bilateral trade between India and Australia has been steadily growing. In FY24, bilateral trade stood at US$24.1 billion, with India's exports to Australia reaching US$7.94 billion. India's major exports to Australia include petroleum products, engineering goods, pharmaceuticals, textiles, and gems and jewellery. During the India-Australia Joint Ministerial Commission meeting in March 2023, both countries set a target of increasing bilateral trade to US$100 billion in the next five years by exploring new areas of cooperation.
The Economic Cooperation and Trade Agreement (ECTA), also known as the India-Australia Economic Cooperation and Trade Agreement (Ind-Aus ECTA), has been instrumental in enhancing trade ties and fostering mutual growth. This partnership has created new opportunities for businesses and contributed to employment in both countries. Since its inception, bilateral merchandise trade has surged, reaching US$16.3 billion by November 2024.
India and Australia have a strong and growing economic relationship, with India recognised as a significant export partner and import source for Australia. The two countries continue to work together to deepen their trade and investment links, with a focus on mutual benefit and growth.
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Frequently asked questions
Australia's main trade partners vary depending on whether you are looking at export or import data. In 2022, Australia's top trade partners for exports were China, Japan, South Korea, and India. That same year, its top trade partners for imports were China, the United States, South Korea, Japan, and Singapore.
Australia's biggest two-way trade partner is China. In 2014, Australia's exports to China were valued at $98.2 billion, and its imports from China were worth $54.3 billion.
Japan is Australia's second-largest trade partner. In 2014, the two countries shared a $70.2 billion trade value.
