DFAT secretary Jan Adams held discussions in Canberra with China's Executive Vice Foreign Affairs Minister Ma Zhaoxu during his visit to Australia.
The meeting followed a pause in the federal government's World Trade Organisation case against Beijing for imposing hefty tariffs on barley.
The breathing space has led to optimism the tariffs could be removed entirely and extended to other items caught up in the dispute, such as Australian wine and rock lobster.
The two officials discussed trade between the countries along with human rights, strategic competition and Russia's invasion of Ukraine.
"Secretary Adams reiterated that it was in the shared interests of Australia and China to continue on the path of stabilising the bilateral relationship," according to a readout.
"The talks followed the agreement between foreign ministers at the Foreign and Strategic Dialogue in December 2022 to maintain high-level contact and commence or re-start dialogue in a range of areas."
Barley exports from Australia have effectively been blocked from entering China due to a more than 80 per cent tariff since 2020.
Beijing will conduct a review of the tariffs in the next three to four months after which the WTO case will resume if no agreement is reached.
National Farmers' Federation chief executive Tony Mahar said the trading breakthrough was reassuring and in both parties' long-term interest.
"We hope to see quick progress on removing trade barriers for rock lobster and wine," he said.
The four Australian export products at the centre of the dispute with Beijing are barley, wine, meat and crayfish.
Foreign Minister Penny Wong said the government was working as quickly as possible to remove the trade impediments.
"This is all about working to try and resolve this more quickly because of course Australian barley growers and communities that depend on barley would welcome a return of access to the Chinese market," she told Nine's Today show on Wednesday.
Senator Wong said wine exports were the next trade issue the government wanted to address.
Australian Grape and Wine board member Nikki Palun said the industry had built a lot of long-term relations in China before the tariffs and was cautiously optimistic about the resumption of trade.
"We're looking at the barley as a template, as a way forward for the Australian wine industry," she told ABC TV.
"We're very hopeful that a negotiated outcome rather than direct action with the WTO will bode well for the Australian wine industry."
But Senator Wong said Australian exporters would need to rely less on the Chinese market.
"We know we're not going to be able to continue to separate our economic and strategic relationship," she said.
"Australian producers, whether of barley or wine, are going to have to look to diversify markets."
Australia's trade ministers have also met in Townsville for an update on the Chinese relationship where federal Trade Minister Don Farrell outlined the government's trade diversification plan.
A spokesman for China's Foreign Ministry says China is willing to work with Australia "to return relations onto the right track".
China remains Australia's largest trading partner, with the relationship worth $300 billion last year.
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