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China Agricultural Newsletter - June 2014

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 to tighten regulations on food safety

 China drafted a new version of Food Safety Law, which pledges tough sanctions for offenders and promises stricter food safety supervision system.

Red line proposed for China's grain reserves

 Chinese policymaker Zhao Shuanglian has enough reform on his plate already, but still insists a red line be added to national grain reserves as a matter of urgency.

China removes price control over seed

 China's top economic planner on Friday ordered local government to free up seed, silkworm cocoon and industrial salt prices. The announcement on the National Development and Reform Commission (NDRC) website says prices of sodium carbonate and caustic soda, listed as industrial salt in China, will continue to be under government control.

Decades-old farm subsidy system to be phased out

 China is moving to replace decades-old agricultural subsidies with a more flexible pricing mechanism, as domestic harvests in the world's largest grain importer are expected to see their 11th consecutive year of growth.

China publishes lists of approved dairy importers

 The China Certification and Accreditation Administration (AQSIQ) has published two lists of the “first batch” of international manufacturers who are registered to import infant formula and other dairy products into the country.

 

PBOC to cut RRR to boost agricultural lending

 China's central bank announced Monday that it will cut the reserve requirement ratio (RRR) for banks with a certain proportion of lending to the agricultural sector and small firms, in a move to help boost liquidity and support those sectors.

Small firms get a break on VAT

 The Ministry of Finance announced on Wednesday that the value-added tax rate will be a flat 3 percent for many small businesses, effective July 1. The 4 percent and 6 percent rates were eliminated to make the system fairer, the ministry said.

Industry and Business Watch

China regulates company charges

 BEIJING, June 26 - China will strengthen the management of all kinds of charges and fees imposed on companies. China's cabinet the State Council said in a circular streamlining administration and delegation of power to the lower levels would stimulate companies, especially small ones.

China to develop high-standard farmland to ensure output

 China is to develop 800 million mu (53.3 million hectares) of drought and flood resistant farmland by 2020 in an effort to ensure output, agriculture minister Han Changfu has disclosed.

Flexible grain imports needed to bolster nation's food security

 China should consider flexible grain imports from international markets and take steps to ensure sustained growth in domestic output of staple grains, for long-term food security, government officials and foreign exporters said on Thursday.

China to shore up grain purchase, storage

 China will step up efforts to purchase and store grain and build more granaries as its grain output rises, according to an official statement on Wednesday.

Bumper harvest forecast for China wheat

 China’s Ministry of Agriculture has forecasted an output rise of summer wheat and its 11th consecutive bump harvest. 

China might restart imports of Russian grains after two-decade ban

 Russia’s Federal Service for Veterinary and Phytosanitary Surveillance Rosselkhoznadzor said yesterday that China might be interested in importing Russian wheat, rye and barley after a new two-decade ban, as two countries seek to form a closer political and economic bond.

China's soy imports continue to rise despite slip in May

 According to data from China Customs General Administration, China imported 5.97 million tonnes of soy in May, a drop of 530,000 tonnes, or 8%, compared to April, but an increase of 870,000 tonnes, or 17% on-year.

China's surging meat demand drives animal feed output rebound

 As China's demand for meat increases and fish farms expand output, animal feed output in the country is poised to recover from the first contraction in 20 years, according to the agricultural ministry.

USDA announces new requirements for US pork exports to China

 Updated requirements for US pork exports to China have been announced by the USDA’s Food Safety and Inspection Service (FSIS).

WH Group and Sigma Alimentos jointly acquire Spanish meat processor

 WH Group, formerly known as Shuanghui International, and Mexico's leading food producer Sigma Alimentos SA jointly acquired a 98.3% stake in Spain's meat processor Campofrio Food Group SA, China Daily reported.

Canada to increase access to China's beef market

 The Chinese government has agreed to move forward the necessary approvals to allow access for Canadian bone-in beef from animals under 30 months of age, following the announcement in 2010 that allowed access to boneless beef from animals under 30 months. 

Chile to export 4,000 dairy cattle to China by October 2015

 In an interview with China’s dairy publication Holstein Farmers Magazine, an official from Chile’s agricultural cooperative Cooprinsem said that Chile will ship 4,000 dairy cattle to China by October 2015.

China encourages baby formula mergers

 Chinese authorities on Friday released a work plan to encourage merging and corporate reorganization among domestic baby-formula producers to ensure the healthy development of the troubled dairy industry.

China's UHT milk imports to surge

 China’s demand growth for UHT milk has been surpassing other dairy categories such as infant formulas and other powers, with UHT imports more than quadrupling over the last three years to 184,000 tonnes in 2013. 

Dakang raises fund for acquisition of two NZ dairy farms

 Hunan Dakang Pasture Farming Co., Ltd (Dakang) announced on June 17 that the company plans to raise RMB2.51 billion (US$402.93 million) through private placement for the acquisition of two New Zealand dairy farms.

Heilongjiang pilots grain banks

 Northeast China's Heilongjiang province has launched a pilot project allowing farmers to deposit their grain in bank, according to people.com.cn.

New Hope Group partners Asiasea to enter seafood business

 New Hope Group, a leading supplier of meat, egg and dairy products in China, has signed a strategic cooperation framework agreement with Asiasea (Dalian) Seafood Co., Ltd. (Asiasea), making the group’s entrance into seafood business.

Coca Cola starts building new China plant

 HARBIN, June 26 - Construction of a new Coca Cola plant started on Thursday in Harbin, northeast China's Heilongjiang Province, as part of the beverage giant's plan to invest four billion U.S. dollars in China.

Nestle opens R&D center in Dongguan

 Swiss company Nestle formally opened a new research and development center in Dongguan of Guangdong province on Tuesday, with an aim to further increase its presence in the Chinese mainland.

China set to be net investor

 China's outward investment is very likely to exceed foreign direct investment inflows this year, making the country a net investor, according to officials at a United Nations body.

Bright Food sees bright M&A options

 Bright Food Group Co, the Chinese owner of British cereal maker Weetabix Ltd, said it is seeking acquisitions and has the ability to pay as much as 10 billion yuan ($1.6 billion) for a target.

Chinese company to build noodle factory in Australia

 SYDNEY, June 6 (Xinhua) - Australia's safe food reputation has attracted a Chinese company to build a flour mill near Perth to make noodles for children, the West Australian newspaper reported Friday.

Statistics

Average food prices in 50 cities June 11-20, 2014

 

Item

Specification/Unit

Current price

(RMB)

Percentage changes

as compared to last period

(%, June 1-10, 2014)

Rice

Japonica rice / kg

5.96

0.0

Flour

Strong flour / kg

5.61

0.0

Flour

Standard wheat / kg

4.51

-0.2

Soy products

Bean curd / kg

4.49

0.0

Peanut oil

5 Lin barrel bulk / litre

26.83

-0.2

Soyabean oil

5 Lin barrel bulk / litre

10.79

0.2

Rape seed oil

Grade 1 in bulk / kg

13.80

0.3

Pork

Rump / kg

23.72

-0.7

Pork

Belly meat / kg

23.75

-0.4

Beef

Leg / kg

66.17

0.0

Mutton

Leg / kg

65.67

-0.1

Chicken

Frozen fresh chicken / kg

19.75

-0.4

Chicken

Breast / kg

21.06

-0.1

Ducks

Frozen fresh duck / kg

17.53

0.5

Eggs

Fresh eggs in bulk / kg

10.75

-1.9

Source: China National Bureau of Statistics

Major meat retail price May 2014

 

Pork (Lean):
                                                                           RMB1.00 yuan/kg
Average Sales Price (Street markets & Supermarkets)
Var. Percent
A.       05/11/14-
05/20/14
B.       05/01/14-
05/10/14
C.       04/11/14-
04/20/14
D.       05/11/13-
05/20/13
(A-B)/B
(A-C)/C
(A-D)/D
27.32
26.14
26.72
28.26
4.51%
2.25%
-3.33%
 
Egg:
                                                         RMB1.00 yuan/kg
Average Sales Price (Street markets & Supermarkets)
Var. Percent
E.        05/11/14-
05/20/14
F.        05/01/14-
05/10/14
G.       04/11/14-
04/20/14
H.       05/11/13-
05//20/13
(E-F)/F
(E-G)/G
(E-H)/H
11.12
10.44
9.78
9.42
6.51%
13.70%
18.05%
 
Chicken:       
                                                                          RMB1.00 yuan/kg
Average Sales Price (Street markets & Supermarkets)
Var. Percent
I.         05/11/14-
05/20/14
J.         05/01/14-
05/10/14
K.       04/11/14-
04/20/14
L.        05/11/13-
05/20/13
(I-J)/J
(I-K)/K
(I-L)/L
18.82
18.44
18.14
17.76
2.06%
3.75%
5.97%
Source: China Animal Agriculture Association
 
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