site map
Contact us
Mail to us

China Agricultural Newsletter - February 2012

The China Agricultural Update is provided by the Iowa Economic Development Authoritys (IEDA) office in China, which is operated by Phoenix Consulting LLC. Ms. Wendy Zhang, IEDAs 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 IEDAs Beijing Office, please contact Kathy Hill at 515.725.3141 or

Laws, Regulations and Policies

Public opinions on grain law draft invited

The Legislative Affairs office of the State Council on Feb. 21 released a draft of a new grain law to solicit public opinions. The draft, jointly prepared by the National Development and Reform Commission and the State Administration of Grain, aims to ensure grain security by stabilizing grain output and intensifying control and supervision over the market.It includes stipulations concerning the market deployment of grain resources and the safeguarding of grain production, circulation and quality.

Draft grain law limits genetic engineering

The freedom of grain producers in China to genetically engineer produce will be limited under a draft law released on Feb. 21 by the Legislative Affairs office of the State Council.

Research, selling, importing and exporting of transgenic grain seeds should comply with state regulations. Any institution or individual must not apply transgenic technologies to principle grain cultivars without approval, according to the draft of a law referring to transgenics, the practice of inserting into an organism DNA that is not normally present.

Regulation of green food labels to be amended

The Ministry of Agriculture (MOA) has begun to solicit public views on a draft amendment to the current regulation of green food labels issued in 1993, according to the Ministry on Feb. 7. The move is aimed at strengthening regulation in this area and to better safeguard the producers, marketers and customers, according to the draft.

Rice purchase prices raised for 2012

China's top economic planning agency announced on Feb. 2 that it would raise the minimum purchase prices for rice in 2012 to encourage farmers to grow more grains.It is the fifth consecutive yearly price increase aimed to boost grain production and farmers' income.

The minimum purchase price for early indica rice will be increased to RMB120 yuan (US$19.01) per 50 kg, up RMB18 yuan from the 2011 price, the National Development and Reform Commission said in a statement on its website.

Agricultural investment vowed to enhance

A document publicized on Feb. 1 by the Central Committee of the Communist Party of China (CPC) and the State Council, or China's cabinet, said that the country will continue to expand its fiscal budget for agriculture in 2012 and direct more of the fixed-asset investment toward the sector.

Infrastructures to be improved for boosting grain production

China will step up efforts to construct water-conservation facilities and continue to increase funding for the projects to boost agricultural development, authorities said on Feb. 1. The country will quicken the pace of building water projects, treat rivers and lakes, strengthen reservoirs and prevent geological disasters to increase the areas that have access to irrigation.

More labor to be freed with farm machinery subsidies

Thegovernment said on Feb. 17 that it will continue to subsidize farmers machinery purchases this year to free up more rural labor and boost grain production nationwide.According to a joint statement by the Ministry of Agriculture (MOA) and the Ministry of Finance (MOF), the government has slated at least RMB13 billion yuan (US$2.1 billion) in subsidies for agricultural machinery purchases this year.

Anti-dumping measures on potato starch imports from EU reviewed

China has decided to launch a review of existing anti-dumping measures on potato starch imported from the EU and extend anti-dumping duties on potato starch imports from the EU for another year beginning on Feb. 6, according to the Ministry of Commerce (MOC).

Crackdown on counterfeit seeds, pesticides intensified

China will intensify a special crackdown on counterfeit seeds, pesticides, fertilizers and other agricultural materials, according to a statement issued at a working conference on Feb. 28. The campaign, carried out by nine government departments, including the Ministry of Public Security (MPS) and the Ministry of Agriculture, features "resolutely solving relevant cases, strictly punishing violations in order to safeguard the country's food safety and food security," the statement said.

Industry and Business Watch

Vice-Premier Hui urges agricultural technology

Chinese Vice-Premier Hui Liangyu on Feb. 2 called for accelerating innovation and promotion of agricultural science and technology. "It is vital to the overall economic and social development to obtain grain harvests and agricultural production and ensure major farm produce supplies this year," Hui said at a symposium with agricultural experts.

Farm produce prices fall on waning demand

Farm produce prices broke an eight-week trend of rising and fell on sliding demand as the Spring Festival holiday ended, the Ministry of Commerce said on Feb. 8.

Hog market overview

Looking at the size of the breakdown of the inventory for November 2011, breeding stock was around 49.05 million and total on farm inventory was around 476.25 million (as compared to October 2011, breeding stock was around 48.80 million and total on farm inventory was around 475.16 million and to September at 48.1 million and total on farm inventory was about 465.57 million), writes Ron Lane, Senior Consultant for Genesus in China.

Pork consumption continues to grow

China is keeping a close eye on pork imports while transiting from small-scale to large-scale pig production.China’s pork industry produces and consumes about half the world’s pig meat and it accounts for a large chunk of the country’s GDP.

The volatility of pork industry

Growth of China's domestic pig meat industry is being held back by rising costs, disease outbreaks, animal waste disposal challenges and food safety concerns as well as more competitively priced imports, according to a new report from the USDA Economic Research Service. Senior editor, Jackie Linden, highlights the main points of the report.

China to drive global dairy demand

In 2012, China will be a key driver of global dairy demand with imports of whole milk powder (WMP) forecast to grow by seven percent. This rise in demand is reported by Dairy Australia in their February update. Ongoing urbanization and continuing concerns about the quality and safety of domestic food production support consumer demand.

VC, PE firms show appetite for food industry

As the Chinese become richer and pay more attention to the quality of food, venturecapital and privateequity companies have started to invest in the country's agricultural sector and cultivate food products' brands.

Brasil Foods initiates Chinese joint venture

Brasil Foods has signed a joint venture agreement with Hong Kong-listed food and vehicles distributor Dah Chong Hong Holdings Ltd. to expand distribution of chilled poultry, pork and beef products in China.

Reduced ethanol growth means increased distillers grain imports

China's five-year plan to reduce its domestic production of grain-based ethanol will result in tighter supplies of dried distillers grain for animal feed and an increased demand for imports of the by-product through 2016, according to the U.S. Grains Council.

Starbucks signs deal to set up JV in Yunnan Province

U.S. coffee chain Starbucks on Feb. 6 officially signed a deal with a local coffee-growing and -processing firm to set up a joint venture in southwest Yunnan province. Starbucks will partner with Ai Ni Group in the joint venture, but the U.S. company will be mainly in charge of the joint venture's operations, the two companies said at the deal signing ceremony in Kunming, capital of Yunnan.

DuPont to establish molecular breeding technology hub in China

DuPont has signed a multi-year lease agreement with Beijing International Flower Port to build a state-of-the-art Technology Hub for its Pioneer seed business in Beijing, China. The new facility is slated to open later this year and will employ nearly 50 researchers.

Wal-Mart increases stake in Yihaodian

Wal-Mart Stores Inc. plans to increase its investment in Yihaodian, a fast-growing e-commerce website in China, increasing Wal-Mart's share from 20 percent to approximately 51 percent. Analysts said the move will allow Wal-Mart to continue to reach younger customers, who increasingly prefer to shop online.

China to deepen agricultural cooperation with US

The agricultural ministries of China and the United States will further enhance agricultural exchanges and cooperation, deepening mutual understanding and trust, so as to achieve mutually beneficial development in the future, said Minister of Agriculture Han Changfu on Feb. 12.Han made the remarks in an interview with Xinhua prior to Chinese VicePresident Xi Jinping's visit to the United States.

U.S.-China High Level Agricultural Symposium held in Iowa

Chinese Vice President Xi Jinping attended the U.S.-China Agricultural Symposium in the state of Iowa during his visit to the U.S. on Feb. 16.In his speech, Vice President Xi extended his warm congratulations to the opening of the U.S.-China Agricultural Symposium and sincere welcome to all participants from both countries.

Vice Minister of Agriculture sees need for biotech

It is crucial for developing countries to strengthen national food security, increase farmers' income, and eradicate poverty. Application of biotechnology in agriculture can accelerate the selective breeding of new varieties that are high yieldingand resistant to pests and diseases. Dr. Li Jiayang, China’s Vice Minister of Agriculture and President of Chinese Academy of Agricultural Sciences (CAAS) shared these thoughts in a meeting in Beijing with Dr. Clive James, chair and founder of the International Service for the Acquisition of Agri-Biotech Applications (ISAAA) and Dr. Randy Hautea, ISAAA Global Coordinator on February 9, 2012.


Average food prices in 50 cities February 11-20, 2012

Current price (RMB)
Percentage changes as compared to last period
(%, January 11-20, 2012)
Japonica rice / kg
Strong flour / kg
Standard wheat / kg
Soy products
Bean curd / kg
Peanut oil
5 Lin barrel bulk / litre
Soyabean oil
5 Lin barrel bulk / litre
Rape seed oil
Grade 1 in bulk / kg
Rump / kg
Belly meat / kg
Leg / kg
Leg / kg
Frozen fresh chicken / kg
Breast / kg
Frozen fresh duck / kg
Fresh eggs in bulk / kg
Source: China National Bureau of Statistics

Major meat retail price February 2012


Pork (Lean):
                                                   RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)
Var. Percent
A.     2/11/12-2/20/12
B.     2/01/12-2/10/12
C.    2/11/11-2/20/11

                                                   RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)
Var. Percent
D.    2/11/12-2/20/12
E.     2/01/12-2/10/12
F.     2/11/11-2/20/11

                                                                    RMB1.00 yuan/kg

Average Sales Price (Street markets & Supermarkets)
Var. Percent
G.    2/11/12-2/20/12
H.    2/01/12-2/10/12
I.      2/11/11-2/20/11

Source: China Animal Agriculture Association