By Lewis Jackson, Siyi Liu and Melanie Burton

SYDNEY (Reuters) – Australia exported roughly $40 million worth of ore and concentrate to China early this year, Australian customs data shows, a sign of industry hope that trade in the red metal will resume as diplomatic relations improve.

Australian trade data shows exports worth A$60.5 million ($41.04 million) of copper ore and concentrate to China in January, though the cargoes have not appeared in Chinese customs data. It was the first month of exports since December 2020, Australian data showed.

China is gradually easing a raft of unofficial restrictions and tariffs on Australian imports including coal, copper ore and concentrate and barley that were imposed in 2020 at the height of a diplomatic spat over trade, security and the origins of COVID-19.

Trade Minister Don Farrell said last week he would travel to Beijing “very soon” for trade talks with his counterpart after a virtual meeting in February. An unofficial ban on Australian coal imports was lifted in January.

“Any step towards resolving the trade impediments is welcome,” Farrell said on Wednesday in response to a Reuters request for comment on this story.

Copper ore and concentrate imports are likely to resume if the talks go well, according to an official surnamed Wang at a Chinese copper smelter, who said smelters want extra supply from Australia. He declined to provide a full name due to the sensitivity of the issue.

In the weeks after China lifted the unofficial coal ban, traders initially sent small shipments to test whether customs would clear coal cargoes.

Australian copper accounted for just 5% of Chinese imports in 2019 but is an important source of supply in what is expected to become a tight global market.

The world’s top refined metal producer, China has lifted copper production to a record high this year, propelling demand for the raw material imports it heavily relies on.

Chinese customs did not immediately respond to a faxed request for comment.

Graphic: Copper comeback? Australian copper returns to China – https://www.reuters.com/graphics/AUSTRALIA-CHINA/TRADE-COPPER/klvygljqnvg/chart.png

Chinese customs data showed just 10kg (22.05 lb) of copper ore and concentrate were imported from Australia in the first quarter of this year, a neglible volume that is roughly in line with what was recorded a year earlier.

Should restrictions end, the trade should return to former levels in time, according to Nick Pickens, global mining research director at Wood Mackenzie.

China imported just over one million tonnes of copper ore and concentrate from Australia in 2019, according to customs data, worth about $1.67 billion at the time.

Australia’s centre-left Labor government notched another win last month in its push to remove all trade blocks when both countries agreed to resolve within three months a World Trade Organization dispute over Chinese barley tariffs.

Australian trade data showed A$78,000 worth of barley exports to China in January, the first since November 2020.

($1 = 1.4743 Australian dollars)