China issues highlighted at 39th World Ag Expo
China issues highlighted at 39th World Ag Expo
TULARE, CA -- A total of 140 seminars on nearly every conceivable agriculture-related topic, from cooking demonstrations to dealing with an increasingly hostile business environment, were presented during the three days of the World Ag Expo held here Feb. 14-16 at the International Agri-Center. Among them was a series of international trade seminars that included three separate 90-minute-long sessions that addressed China.
Speakers discussed marketing opportunities and pitfalls in China, assessments of China's potential as a fierce competitor in the international market and in the U.S. market, and growing concerns over intellectual property rights infringement in China.
The speaker at one of the China seminars was Susan Day of the California Table Grape Commission, who discussed trends in China's agricultural trade and its potential impact on U.S. agriculture.
After years of working to gain direct access to the Chinese market for California table grapes (which had long been trans-shipped into China by way of Hong Kong), the commission finally succeeded in opening the Chinese market nine years ago, Ms. Day said. Since then, "we have been working hard to improve that access," but except for a slight decrease in tariffs, which were part of the original negotiations, those improvements have not materialized, she said.
Initially, the grapes were allowed to arrive at six of China's ports. The California table grape industry has worked hard to try to get a seventh port opened, but to no avail.
California grape exports to China have been increasing, reaching 55,000 tons during the 2005 season, Ms. Day said. At the same time, China's own table grape production has increased dramatically in the last three years. Although China currently grows very few seedless varieties, which are the main grape varieties grown in California, China has become a "massive" producer of the Red Globe -- a seeded variety grown in California primarily for export -- and has become a major factor for that variety in export markets that California once dominated.
China's biggest markets for Red Globes are Russia, Pakistan and Vietnam, which are minor markets for California, followed by Hong Kong and Malaysia, which have been major markets for California.
Most of China's grapes are grown in the northwestern part of the country, where there are some large farming operations, and around the major cities, where the farms are much smaller, Ms. Day said.
China's growing middle class, with an average annual household income of $9,000 (U.S.) per person, is expected to double to 100 million people (about 7 percent of the population) by 2010, Ms. Day noted. That will potentially expand the market for California grapes, which currently have an advantage because of superior quality, she said. The market is "used to high-quality California grapes," and currently only a small quantity of the grapes produced in China can match that quality, due in part to a lack of infrastructure and good post-harvest practices. But those things are changing and "can change fast," she said.
Grapes are not the only commodity in which China has been expanding rapidly. Since 1980, China's total fruit production has expanded tenfold, Ms. Day said.
There is "still a lot of opportunity" for U.S. fruit exports into China, she said, but there are also precautions that must be taken. Among the major concerns is counterfeiting. Grapes grown in China are sometimes mislabeled as being grown in the United States or in California or even with a label similar to that of a U.S. producer. Also there are "not the same legal recourses" as in the United States, so exporters must be careful to protect themselves, she said.
Another seminar speaker who addressed trade issues with China was Ken Gilliland of Irvine, CA-based Western Growers Association, who noted that China is now the largest fruit- and vegetable-producing nation in the world.
Among the international delegates to the World Ag Expo was Marcus Keller, an investment manager with the Australian government's Invest Australia agency, who touted the advantages of U.S. agribusinesses making investments in Australian farming operations. Contra-seasonal production, close proximity to Asian markets and the availability of relatively inexpensive land across a variety of soil types and climates are among the benefits, he said.
A 15-member delegation from Iraq was also present at the expo. Raad Ommar, chief executive officer of the Iraqi- America Chamber of Commerce & Industry in Baghdad, told The Produce News that the delegates were primarily looking to establish business relationships with U.S. companies that could supply them with basic needs and services, such as seeds and irrigation technology.
Now in its 39th year, the World Ag Expo is billed as the largest exposition of its kind in the world. More than 1,500 exhibitors occupy over 2.5 million square feet of exhibit space, and the show draws some 160,000 visitors each year. Parking alone occupies 120 acres. Exhibitors and attendees alike come to the show from all parts of the world. Volunteer translators are available for more than 35 languages.
Tulare County, where the International Agri-Center is located, and neighboring Fresno County are the two largest agricultural counties in the United States in terms of crop value.