Prime Minister Scott Morrison has slapped down a Coalition backbencher who used the word "Chinaman", following a backlash from the Chinese-Australian community.

Key points: LNP senator Barry O'Sullivan used the phrase "Chinaman" on Tuesday

LNP senator Barry O'Sullivan used the phrase "Chinaman" on Tuesday The comment prompted widespread backlash and prompted a statement from the Prime Minister on Chinese social media

The comment prompted widespread backlash and prompted a statement from the Prime Minister on Chinese social media Agriculture Minister David Littleproud has been accused of using another slur in his criticism of the comment

Nationals Senator Barry O'Sullivan made the comment on Tuesday as he chaired a committee dealing with plans to put a new biosecurity levy in place.

During questioning about how the levy would apply, Senator O'Sullivan was exploring other options for the creation of a biosecurity risk.

"Here's my question, there's a bigger chance of us having a biosecurity breach by us having a bloody old Chinaman who brings in his favourite sausage down the front of his undies."

Senator O'Sullivan went on to say there were millions of people who came across Australia's borders who posed a biosecurity risk "every day", and argued individual passengers who arrived in Australia by air should be subject to the levy.

Today Mr Morrison posted on the Chinese social media platform WeChat, praising Chinese-Australians for their "profound influence" and calling on Australians to "unite as one to defend our hard-won, harmonious and free society".

"The remarks made by Senator Barry O'Sullivan do not represent my views, nor do they represent the views of the Liberal and National Party's coalition government," he said.

"For more than 200 years, Chinese immigrants have worked hard to contribute new ideas, helped shape Australia's identity and made outstanding contributions to the prosperity of Australian society."

Opposition Leader Bill Shorten called on Senator O'Sullivan to say sorry for the comment.

"Senator Barry O'Sullivan should immediately apologise to the Chinese community in Australia for his comments in this week's Senate estimates," Mr Shorten himself wrote on WeChat.

"At the same time, Scott Morrison should demonstrate some leadership and ask him to apologise.

"There is no place in our society for these offensive remarks about the Australian Chinese community."

Mr Littleproud says "those that manage the river should live on the river". ( ABC News: Matt Roberts )

Littleproud's comments throw more fuel on the fire

Cabinet Minister David Littleproud said Senator O'Sullivan's choice of words was "disappointing" and "not acceptable", adding that if Senator O'Sullivan "feels fit to rectify it then he should".

"Obviously that's disappointing. I don't know the context in which he made that statement," Mr Littleproud said.

He went on to say Senator O'Sullivan was retiring in July and it was up to him to uphold his "legacy".

"Backbenchers from time to time go off reservation," he added.

That sparked a fresh round of criticism from Labor frontbencher Brendan O'Connor.

"It's highly offensive of the senator to make such a comment, and it hasn't been helped by the Minister also making an offensive comment," he said.

"That really just shows how out of touch this government is, that they're willing to slur a particular ethnicity and then defend that slur by making another slur towards another ethnicity."

"Off reservation" is a phrase from the 19th century used in reference to Native American people, although some Australians may not be aware of its origins.

Other MPs including Labor's Andrew Leigh, Luke Gosling and even foreign affairs spokeswoman Penny Wong have used the expression in the past.

'Insensitive', 'offensive' and 'culturally derogatory'

Earlier this week New South Wales Labor politician and Chinese-Australian Ernest Wong said Senator O'Sullivan's "Chinaman" comment was racist.

He described the remarks as "insensitive", "offensive", "culturally derogatory" and lacking "any level of intelligence".

"There's no place in our community for racially inflammatory remarks, least of all from a senator who has the great privilege, responsibility and salary of sitting in our parliament to represent the interests and prosperity of all Australians."

The Chinese Community Council of Australia also condemned Senator O'Sullivan's remarks and called for an apology.

"The use of such an offensive term from the White Australia age is an insult not only to 1.2 million Australians of Chinese heritage, but indeed to all Australians who share the common Australian values of respect and equality."

"Recently prime ministers of Australia and opposition leaders have repeatedly affirmed the vital contributions made by Australians of Chinese descent to all facets of Australian society and the fact that they are an integral part in the fabric of Australian society — the most successful multicultural society in the world."