• Australia wants to stabilize and diversify its relationship with China, but that does not mean that trade flows should simmer, said Australia's Trade Minister Don Farrell.
• "We want to stabilize our relationship with China... we also want to diversify our relationship. That doesn't mean trading any less with China," he said.

Australia wants to diversify its trading relationship with China, but that doesn't mean trade flows will slow down, Australian Trade Minister Don Farrell told CNBC.

"We want to stabilize our relationship with China... we also want to diversify our relationship," Farrell told CNBC's Martin Soong on the weekend in Osaka, Japan where G7 trade ministers met.

"That doesn't mean trading any less with China. But it does mean trading more with the countries with whom we have free trade agreements," he added, citing those in the European Union bloc.

Currently, Australia has agreements with more than 20 countries, and is hoping to negotiate for more.

Canberra is also in dialogue with its largest trading partner China to drop tariffs on Australian wine imports that were introduced in March 2021. At the height of diplomatic tensions in 2020 and 2021, China slapped import tariffs on several Australian exports — ranging from wine and red meat to lobsters and timber.

In August, Beijing finally lifted tariffs on Australian barley imports, which previously totaled about 1.5 billion Australian dollars ($988.1 million).

In a note of optimism, Farrell said he expects Australian Prime Minister Anthony Albanese to have a "successful trip" in his upcoming visit to China.

Albanese is set to visit China on Nov. 4 to Nov. 7, and is due to meet Chinese President Xi Jinping. It will be the first visit to China by an Australian prime minister since 2016.

Asked about Australia's trading ties with Taiwan, Farrell said both parties share a "very good trading relationship," and that Taiwan will continue to be "one of [Australia's] biggest customers under the Albanese government."

"Our trade will be going up with Taiwan, not backwards," he said, highlighting that Australia is increasing wine sales into Taiwan, which was Australia's fifth largest merchandise export market from 2021 to 2022.

Farrell also emphasized that Australia is keen on an agreement with the EU even though negotiations for a free trade agreement between both parties collapsed.

"Australia wants an agreement with the European Union, but not at any price," Farrell said, pointing out that access to European agricultural markets for Australian goods have been one of the sticking points.