Foreign Minister Stephen Smith said China's Vice Foreign Minister He Yafei had cancelled a trip to a regional forum this month in a diplomatic snub, adding that Australia "very much regrets" the move.

"The Chinese officials made it clear that they were most unhappy with her visit," Smith told parliament.

"They made it clear that the visit by vice-minister He to the Pacific Islands Forum dialogue would not take place and that China would be represented by an ambassador."

China vehemently opposed the visit by Kadeer, whom it accuses of inciting last month's rioting in the Xinjiang region which left at least 197 dead.

The cancelled visit further tests relations between the key trading partners which were hit last month by China's detention of an Australian mining executive on spying allegations, later downgraded to industrial espionage.

China was instead represented at the Pacific Islands Forum in Cairns by special envoy Wang Yongqiu. Smith said Vice-Minister He had been due to meet senior Australian officials on the forum's sidelines.

"Australia very much regrets that China has decided to effect that response," he said.

"If China does take further action as a result of allowing Rebiya Kadeer to come to Australia, we will of course regret that."

Chinese foreign ministry officials in Beijing declined to comment when contacted by AFP.

Relations with China have plummeted over the past two months despite Mandarin-speaking Prime Minister Kevin Rudd's pledges to bolster ties with the Asian giant and key trading partner.

Just weeks before Hu's arrest in Shanghai, his company Rio Tinto walked away from a 19.5 billion US dollar cash injection, triggering an irate response in state media.

During her visit, Kadeer accused China of the "psychological torture" of her children after they denounced her on state TV, and warned that detained mining executive Stern Hu could be facing a show trial and lengthy jail term.

She also attended the screening of a documentary about her life, which China tried to have withdrawn from the Melbourne International Film Festival.

Opposition leader Malcolm Turnbull accused the government of a "ham-fisted" approach to China, saying relations were at their lowest point in years.

"Our relations with China are at ... the lowest ebb they have been for many, many years," Turnbull said. "(Rudd) has been making an absolutely ham-fisted effort with our diplomatic relations."

"He has mishandled relations... he obviously has no leverage with China left at all," Turnbull added.

Resource-rich Australia has profited from China's lightning growth over the past decade with two-way trade worth 58 billion dollars (48 billion US) last year, official figures show.

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