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China Agricultural Newsletter - March 2018

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@iowaeda.com.

Laws, Regulations and Policies

China's commerce minister unveils roadmap to upgrade foreign trade

 China has formulated six major tasks and eight action plans to promote high-quality development of economics and trade in the coming five years, Commerce Minister Zhong Shan said Sunday.

MOA: China caps fertilizer, pesticide use and increases efficiency

 The opening session of the first meeting of the 13th National People's Congress was held at the Great Hall of the People on March 5th, 2018. After the meeting, the "ministers' passage" in the North Hall was opened. When answering reporters’ questions, Minister Han Changfu stated that food security is always the top priority of governance.

China targets U.S. agriculture in response to U.S. trade actions

 On March 23, 2018, the People’s Republic of China’s Ministry of Commerce (MOFCOM) announced a proposal to levy retaliatory tariffs impacting approximately $2.0 billion in U.S. food and agricultural exports to China in response to the recent U.S. 232 Trade Action on steel and aluminum.

China to improve quality certification for consumption

 BEIJING, March 13 (Xinhua) - China plans to unroll quality certification for high-end products and services amid efforts to push consumption upgrade, a senior official said Tuesday.

China plans near-term import boost

 China is expected to release a guideline to boost imports for the near term in its effort to achieve import-export balance in development, Economic Daily reported Wednesday, citing an official from the Ministry of Commerce.

China to start making foreign investment law

 China's national legislature will take steps to make a foreign investment law and do research on formulating a real estate tax law, according to a work report released Sunday.

Industry and Business

Chinese premier calls for enhanced agricultural competitiveness

 Chinese Premier Li Keqiang on Thursday called for efforts to improve crop structure and enhance competitiveness in the country's agricultural sector.

China's farm produce prices fall last week

 The price index for China's farm produce dropped in the week ending March 4 due to falling vegetable prices, the Ministry of Commerce said Tuesday.

Projections on China's key farm produce consumption from 2017 to 2018

 The projection of China's corn consumption from October 2017 to September 2018 has been revised up to 224 million tonnes on forecasts of higher industrial consumption, according to a report by the Ministry of Agriculture and Rural Affairs.

USDA: Global soybean imports are projected to grow 30% by 2027 with china leading the way

 World soybean trade is projected to rise rapidly during the next 10 years according to USDA’s Agricultural Projections to 2027, climbing 48 million tons (30 percent) to 205 million tons by 2027. 

USDA: China oilseeds and products annual

 China is the largest oilseed importer in the world with total oilseed imports at 98.42 million tons (MMT) in MY16/17. Chinese total soybean imports hit another record at 93.5 MMT, absorbing 62.6 percent of total world exports, and 61.2 percent of total U.S. soybean exports.

New added capacity of hogs more than 170 million head, and hog market price not optimistic in 2018

 In 2017, hog price was declining, but the investment momentum of enterprises didn’t abate. According to incomplete statistics by BOABC, about 126.7 billion yuan of investment focused on hog industry in the whole year, the total capacity of the newly added hog breeding projects will reach more than 170 million head.

USDA: Poultry and products semi-annual

 Post forecasts that broiler production will increase by 700,000 metric tons to 11.7 million metric tons (MMT) in 2018 due to returning consumer demand. Following China’s worst recorded outbreak of H7N9 avian influenza (AI) in the fall of 2016 continuing into the summer of 2017, consumer demand dropped significantly.

Chinese chicken import and export trade characteristics

 China has relatively weak competitiveness in chicken export, and is a net importer of chicken meat. In 2017, China exported 436,373 tons of chicken meat while importing 450,660 tons chicken meat, and the import volume was greater than the export volume.

Egg prices dropped sharply after the Spring Festival

 Affected by seasonal factors, egg prices generally fall sharply after the Spring Festival. On February 22, 2018, the farm gate price of eggs in main producing areas was 6.90 yuan/kg, down 19.47% from that before the Spring Festival.

Fertilizer capacity and output would continue to go down

 Along with the advancing of supply-side reform, the increasing of environmental pressure and the accelerating of eliminating backward capacity, the overall operating rate descended and output went down.

What changes would happen to supervisions on China fertilizer industry

 In the past, many departments were responsible for treatment of agricultural non-point source pollution, market access, production permit, quality check, commodity inspection of import and export, etc. After the official implementation of state institutional reform, the Ministry of Ecological Environment, the Ministry of Agriculture and Rural Affairs and the State Administration of Market Supervision would be reorganized, what changes would happen to supervisions on fertilizer industry?

USDA: Consumer study on China's imported food products

 The overall market size of target imported food in Shanghai, Wuhan, Nanjing and Ningbo is approximately 10 billion USD, with the U.S. share being 2.3 billion USD. Imported fruit, dairy, wine & beer are top commodity groups in term of market size.

Potential of Brazilian agribusiness draws Chinese companies

 RIO DE JANEIRO - The construction of a new port in Sao Luis, capital of northeastern Brazil's Maranhao state, gives both local officials and Chinese companies something to cheer about.

China's ethanol demand remains strong

 The US ethanol industry has been able to offset a tariff-induced drop in exports to China, with experts saying that China's burgeoning demand will ensure it remains a desirable market.

Poland to promote more dairy products in China

 WARSAW, Mar 8 (Xinhua) - Poland has launched the "Dairy Treasures" campaign aimed at promoting Polish dairy products in China, said Polish Chamber of Milk.

U.S. wine exports to China rise 10 pct in 2017

 The value of U.S. wine exports to China, including the Chinese mainland, China's Hong Kong and Taiwan, rose by 10 percent last year, figures released Monday showed.

China's Longping High-Tech, ChemChina unit set up corn seed JV

 Chinese seed firm Yuan Longping High-Tech Agriculture on Tuesday said it is setting up a corn seed joint venture with China National Agrochemical Co Ltd, a unit of state-owned chemicals giant ChemChina.

Chinese firms to develop clean agriculture in Laos

 The Lao Ministry of Agriculture and Forestry, in cooperation with China's Hunan Jinye Zhongwang Technology Co., Ltd and Xuanye (Lao) Co., Ltd, will establish a model organic and bio-fertilizer processing factory for clean agriculture (CA) development in Laos, local daily Vientiane Times reported on Friday.

Syngenta seeds aggressively seeking acquisitions and collaboration

 The president of Syngenta Seeds says as industry mergers continue, the company is aggressively seeking acquisitions.

Alibaba to expand supermarket presence across China

 Alibaba said it has teamed up with 13 real estate developers to further expand its Hema supermarket model across the country in a bid to boost their presence in the new retail sector.

Statistics

Market Price of Major Agricultural Products in Circulation, March 11-20, 2018

 

Products

Units

Current Price

(CNY)

Price Change over Previous Period

(March 1-10, 2018, CNY)

± Rate (%)

Rice (Japonica Rice)

ton

4362.5

0.0

0.0

Wheat (Third-Class of National Standard)

ton

2557.4

-6.3

-0.2

Corn (Second-Class of Yellow Corn,)

ton

1905.8

27.5

1.5

Cotton (Ginned Cotton, Third-Class of White Cotton,)

ton

15482.1

 6.1

 

0.0

Live Pig (External Triple Crossbreed)

kg

10.6

-0.7

-6.2

Soybean

ton

3839.8

7.7

0.2

Soybean Meal (Crude Protein Content≥43%)

ton

3158.9

-62.0

-1.9

Peanut (Oil Peanut)

ton

6083.8

-130.5

-2.1

Urea (Small Granule)

ton

2019.4

-36.8

-1.8

Compound Fertilizer (Compound Fertilizer of Potassium Sulfate)

ton

2530.0

0.0

0.0

Pesticide (Glyphosate, 95% Technical Material)

ton

25312.5

0.0

0.0

Source: China National Bureau of Statistics

Major meat retail price March 2018

 Pork (Lean):

                                                                           RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)

Var. Percent

A.       03/11/18-
03/20/18

B.       03/01/18-
03/10/18

C.       02/11/18-
02/20/18

D.       03/11/17-
03/20/17

(A-B)/B

(A-C)/C

(A-D)/D

30.42

30.96

31.80

33.54

-1.74%

-4.34%

-9.30%

 

Chicken:       

                                                                          RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)

Var. Percent

E.        03/11/18-
03/20/18

F.        03/01/18-
03/10/18

G.       02/11/18-
02/20/18

H.       03/11/17-
03/20/17

(I-J)/J

(I-K)/K

(I-L)/L

20.64

20.82

21.02

19.22

-0.86%

-1.81%

7.39%

 

Egg:

                                                         RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)

Var. Percent

I.         03/11/18-
03/20/18

J.         03/01/18-
03/10/18

K.       02/11/18-
02/20/18

L.        03/11/17-
03/20/17

(E-F)/F

(E-G)/G

(E-H)/H

9.84

10.46

11.00

7.60

-5.93%

-10.55%

29.47%

 

Source: China Animal Agriculture Association 

 
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