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China Agricultural Newsletter - September 2013

The China Agricultural Update is provided by the Iowa Economic Development Authority's (IEDA) office in China, which is operated by Phoenix Consulting LLC. Ms. Wendy Zhang, IEDA's trade specialist in the China office, can provide customized market research information for your company. For more information on how to utilize the services offered by IEDA's Beijing Office, please contact Mr. Joseph Rude at joseph.rude@iowa.gov.

Laws, Regulations and Policies

China urges higher food safety standards

Chinese food safety authorities have been urged to better supervise food safety standards,in the latest move to improve efforts in this area.

China raises procurement price for rice

China has lifted the minimum state procurement prices for semilate and late rice to protect farmers'interests, the top economic planner said Saturday.

China halts chilled beef imports from Australia

Buoyed by concerns over food safety, China has banned imports of chilled Australian beef, but the measure is being viewed by producers as a non-tariff barrier designed to protect local industry.

China approves egg futures trading

BEIJING, Sept. 28 (Xinhua) -- China Securities Regulatory Commission (CSRC), the country's top securities regulator, announced that it has endorsed the Dalian Commodity Exchange (DCE) to carry out egg futures trading.

China approves rapeseed imports from Russia

In a move to help meet robust domestic demand for the oilseed, China has allowed crushers to import rapeseed from Russia through a border city.

Subsidies for domestic milk brands

Some domestic up-market dairy brands are set to receive a government subsidy to promote merging and acquisition within the industry, a senior official of the Ministry of Industry and Information Technology said on Tuesday

China probes rotten fruit juice

China's food watchdog said it had ordered investigations into four beverage groups whose juice products were reportedly made from rotten fruit.

Chinese service sectors opened to foreign investors

BEIJING, Sept. 27 (Xinhua) - China's cabinet on Friday approved a detailed plan allowing foreign companies to invest in more service sectors in the Shanghai Free Trade Zone (FTZ).
 

China unveils reform details in Shanghai FTZ

BEIJING, Sept. 27 (Xinhua) - China on Friday unveiled the blueprint for its pilot free trade zone (FTZ) in Shanghai with a detailed list of reform tasks, easing restrictions on the yuan, investment and trade to spearhead the nation's future reforms.

Industry and Business Watch

Farm produce prices continue to rise

The prices of farm produce in 36 major Chinese cities continued to climb last week, according to official data on Wednesday.

China's wheat prices soar on tight supplies

Due to dwindling high-quality supplies and growing expectations that state purchase prices will rise before the planting season begins next month, Chinese wheat prices have hit record peaks.

China's wheat imports to rise to 7.5 million tonnes in 2013-14

After bad weather damaged domestic crops, China is likely to purchase a total of 7.5 million tonnes of wheat from overseas markets in 2013-14.

China's soy demand for animal feed grows

About 80% of China's annual demand for soy is crushed into meal to produce oil and feed for farmed animals and fish, and only about 20% is directly used for food such as traditional tofu, soy milk, or the seasoning soy sauce.

Brazil remains top soy exporter to China

According to figures from China's customs department, Brazil is still the biggest exporter soy to the country, with US producers falling behind.

China's 2013 corn output may reach 215 million tonnes

China National Grain and Oils Information Center's forecast revealed that China's corn output this year is likely to rise 4.6% to a record 215 million tons.

China may import 20-30 million tonnes of corn annually

In order to cover growing supply shortages, China could import 20 million to 30 million tonnes of corn a year, as much as four times of current levels.

Livestock may surpass crop farming in China by 2015

According to the latest research by Chinese Academy of Engineering, livestock, including aquaculture, is expected to take over crop farming as the main segment of China's agriculture by 2015.

Shuanghui wraps up Smithfield deal, China's largest US takeover

BEIJING, Sept. 26 (Xinhuanet) - Calling it a "great transaction" for shareholders, United States farmers and agriculture, Smithfield Foods Inc Chief Executive Officer Larry Pope announced that shareholders had approved the pork giant's acquisition by Shuanghui International Holdings Ltd, the biggest Chinese takeover ever of a US company.

Cargill inaugurates integrated poultry operation in Anhui

Cargill inaugurated its fully-integrated poultry operation in Lai’an, Anhui on September 23. At a total investment of US$250 million, the facility covers a complete poultry supply chain, including chicken breeding, farming, feed production, hatching, slaughtering and processing.

Australia's beef exports to China soar

A July report from Meat and Livestock Australia (MLA) identified that a record 92,279 tonnes of Australian beef and veal had been exported to China in 2013 – worth more than US$350 million, and a whopping increase from 7,736 tonnes a year earlier.

2nd International Poultry Forum China boasts over 200 poultry professionals in attendance

The 2nd International Poultry Forum China in Beijing was held September 6-7 with more than 200 in attendance from China's leading poultry companies. The two-day educational and networking forum featured industry experts from around the world presenting on two themes: "A New Round of Risk and Crises in the Poultry Industry" and "Adoption of Measures Suiting Local Conditions in Pursuit of a 'Circular Economy.'"

China feed producer Yongye International to be taken private

Chinese plant and animal feed maker Yongye International Inc. is being taken private by a group that includes its CEO in a deal worth approximately US$339.2 million, according to reports.

China feed mills importing US sorghum as corn replacement

China's private feed mills are increasingly turning to sorghum from the U.S. after using up their annual import allocations for preferred animal feed grain corn, according to reports.

Yili to invest in milk supplier

Dairy producer Yili Industrial Group has confirmed plans to invest $50 million in dairy firm China Huishan Dairy Holdings Co to secure its milk supply amid government urging industry consolidation.

China's Bright Food in talks to buy Israeli food group Tnuva

SHANGHAI, Sept 3 (Reuters) - China's Bright Food (Group) Co Ltd is in talks on the possible acquisition of Tnuva, Israel's biggest food manufacturer and distributor, in a deal one newspaper said could be worth around $1.6 billion.

Fonterra to have 30 farms in China by 2020

New Zealand dairy giant Fonterra is expected to have 30 farms in China with an annual production capacity of 1 billion liters of milk by 2020, a company executive said on Monday.

KKR returns to China's dairy industry with JV

KKR & Co LP is leading a joint venture that plans to invest $140 million in two large dairy farms in China, said a person with direct knowledge of the matter, as the private equity firm returns to the fast-growing sector.

Ukraine eyes increasing grain exports to China

Ukraine on Tuesday expressed the hope to increase grain exports to China, as Beijing issued a green light to the import of wheat, soybeans and barley from Ukraine.

China, Tajikistan eye free trade zone in agriculture

China and Tajikistan are discussing the possibility of establishing a free trade zone in bordering counties to expand trade in agricultural products, a high-ranking Tajik leader told China Daily on Wednesday.

Xinjiang to build cotton trading center

Cotton processors in northwest China's Xinjiang Uygur autonomous region are planning to build a cotton trading center in the country's largest cotton planting area.

Experts appeal for labelling GM food

A war of words by two online celebrities has aroused a new round of debate on the safety of genetically modified (GM) food, with some experts appealing for the consumers' right to be informed when buying GM products.

Cotton and papaya only GM products for commercial use

There are only two kinds of genetically modified agricultural products permitted for commercial production in China - cotton and papaya, a news report said.

China plans to purchase large swath of Ukrainian farmland

China's Xinjiang Production and Construction Corps (XPCC) and Ukrainian agricultural firm KSG Agro have reached an agreement, in which Ukraine will provide 100,000 hectares of farmland to China.

Ningbo Tech-Bank to acquire AgFeed's operations in China

Ningbo Tech-Bank Co., Ltd plans to acquire AgFeed industries, Inc., which is currently under Chapter 11bankrupcy protection, at US$52.88 million and will take over its operations in China.

China among top-3 global investors

China became the world's third-largest investor for the first time last year when its outbound investments rose 17.6 percent to US$87.8 billion while other global investors cut their investment by 17 percent, according to a document released by the Ministry of Commerce yesterday.

China's Wanda has $5 billion a year for foreign acquisitions

(Reuters) - Chinese property developer Dalian Wanda Group says it can afford to spend as much as $5 billion every year to buy foreign firms or assets, underscoring the rising clout of the firm as it expands abroad.

Statistics

Average food prices in 50 cities September 11-20, 2013

Item

Specification/Unit

Current price

(RMB)

Percentage changes

as compared to last period

(%, September 1-10, 2013)

Rice

Japonica rice / kg

5.75

0.4

Flour

Strong flour / kg

5.31

0.2

Flour

Standard wheat / kg

4.46

0.2

Soy products

Bean curd / kg

4.31

-0.7

Peanut oil

5 Lin barrel bulk / litre

28.04

-0.7

Soyabean oil

5 Lin barrel bulk / litre

11.22

0.2

Rape seed oil

Grade 1 in bulk / kg

13.51

0.1

Pork

Rump / kg

26.87

0.3

Pork

Belly meat / kg

26.55

0.1

Beef

Leg / kg

64.26

0.6

Mutton

Leg / kg

63.50

0.1

Chicken

Frozen fresh chicken / kg

18.62

0.4

Chicken

Breast / kg

20.45

-0.2

Ducks

Frozen fresh duck / kg

16.51

0.3

Eggs

Fresh eggs in bulk / kg

11.06

1.2

Source: China National Bureau of Statistics

Major meat retail price September 2013

Pork (Lean): 

                                                                      RMB1.00 yuan/kg 

Average Sales Price (Street markets & Supermarkets)

Var. Percent

A. 09/11/13-
09/20/13

B. 09/01/13-
09/10/13

C. 08/11/13-
08/20/13

D. 09/11/12-
09/20/12

(A-B)/B

(A-C)/C

(A-D)/D

30.80

30.64

30.02

29.60

0.52%

2.60%

4.05%

 

Egg:

                                                                      RMB1.00 yuan/kg 

Average Sales Price (Street markets & Supermarkets)

Var. Percent

E. 0911/13-
09/20/13

F. 09/01/13-
09/10/13

G. 08/11/13-
08/20/13

H. 09/11/12-
09/20/12

(E-F)/F

(E-G)/G

(E-H)/H

10.96

10.64

9.90

10.86

3.01%

10.7%

0.92%

 

Chicken:        

                                                                              RMB1.00 yuan/kg 

Average Sales Price (Street markets & Supermarkets)

Var. Percent

I. 09/11/13-
09/20/13

J. 09/01/13-
09/10/13

K. 08/11/13-
08/20/13

L. 09/11/12-
09/20/12

(I-J)/J

(I-K)/K

(I-L)/L

18.44

18.06

17.96

18.14

2.10%

2.67%

1.65%

 

Source: China Animal Agriculture Association 

 
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