BEIJINGSYDNEY Aug 4 Reuters China39;s Ministry of Commerce said on Friday it would drop antidumping and antisubsidy tariffs on Australian barley imports that had been in place for three years affecting billions of dollars of trade, as the two nations repair strained ties.

China and Australia agreed in April to resolve their dispute over barley imports, with Canberra to suspend a case at the World Trade Organization WTO over Beijing39;s antidumping and countervailing duties on barley, while China promised to speed up a review into the tariffs.

The tariffs will be dropped starting on Saturday, China39;s Ministry of Commerce said, citing a changing situation in China39;s barley market without providing further details.

The barley decision puts a spotlight on the few remaining Australian products restricted by China, including wine, which also faces tariffs, as well as unofficial restrictions on lobster and meat exports from certain abattoirs.

This outcome demonstrates the importance of the WTO dispute mechanism in defending the interests of Australia39;s worldclass producers and farmers, three Australian ministers said in a joint statement. We have been clear that we expect a similar process to be followed to remove the duties on Australian wine.

Rabobank senior grains analyst Dennis Voznesenski said the decision would be positive for Australian barley prices and farmers with malt quality barley were especially likely to attract a premium over recent prices.

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