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Home  »  Ag Sectors

China will remain driver in world agricultural trade, poll finds

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By JOHN O'CONNELL



Capital Press



Most of the farms Mike Thornton saw during a recent speaking engagement in China were small and non-mechanized.



"The potential for growth in their agricultural output is tremendous," said Thornton, superintendent of the University of Idaho's Parma Research and Extension Center.



But he also observed an abundance of familiar fast-food chains and crowds dressed in American T-shirts -- evidence, he said, that China's vast population has a taste for U.S. culture and presents untapped potential for U.S. agricultural producers.



For better or worse, China's influence on agriculture will be the key issue facing the industry in 2013, according to more than 350 executives from leading North American food, beverage and agribusiness companies polled by Rabobank. The agricultural bank found 40 percent of respondents believe China, despite recent signs of a slowing economy, will remain the "primary driver of global economic growth for the next 50 years."



"Our North American clients in the food, beverage and agriculture sectors see opportunities to play a role in the Chinese market, not only as exporters but also as investors in the country's domestic growth by bringing technology, know-how and capital to support development of a more modern, safe food system in China," Rabobank official Bill Cordingley said in a press release.



John Toaspern, vice president of international marketing with the U.S. Potato Board, believes China's ability to grow its agricultural output is limited by a lack of water and arable land. He said China currently produces only enough frozen potato products to meet 40 percent of demand. For the marketing year ending in June 2012, the U.S. exported to China $8.35 million in dehydrated spuds, up 18 percent from the prior year, and $100 million in frozen potatoes, up 63 percent.



"For the most part, we mainly see (China) as an opportunity," Toaspern said. "While they certainly will increase and improve production and quality, we foresee for a long time to come it will be a good market for U.S. potatoes."



Toaspern said opening China to fresh U.S. spuds has long been a USPB priority.



Though China produces a quarter of the world's potatoes, Thornton said most of them are small, yellow-skinned varieties, unfit for fry production. Thornton fielded several questions in China about techniques for raising Shepody, one of the few varieties adapted to the climate and suited for making fries.



Thornton believes China is in the best position to compete with U.S. exports of labor intensive and perishable products such as tree fruits and vegetables, especially to Pacific Rim nations. He learned the Chinese Academy of Agricultural Sciences has been conducting extensive research in breeding broccoli, cauliflower, cabbage and melons. Thornton was also struck by the vast expanses of corn acres he saw in China to support a growing beef market.



Even as China's production rises, Thornton believes the U.S. will always have a niche in the country due to its reputation for quality, and China's growing middle class.






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