June 28, 2013
China has experienced a net import of wheat, corn and rice as shown by the data from the Ministry of Agriculture (MoA).
It imported about 13.17 million tonnes of grains in 2012, of which about 3.42 million tonnes were wheat, 5.15 million were corn and 2.09 million tonnes were rice. And in the first four months of this year, it imported one million tonnes of paddy and rice, up 83.6% from a year ago.
An industry observer pointed out that the nation had been the biggest paddy importer in the world and the annual import volume stood at four to five million tonnes currently. Actually, absolute import of rice of the nation was not large, but rice firms in some southern segmented markets were stilly badly affected.
A researcher at the MoA said that overseas rice price was much lower than that in the domestic market. In addition, the tariff rate was very low. Under such an environment, the nation saw the import of wheat, corn and rice increase sharply and this directly caused inventory of grain firms in the market to continue rising.
A top executive with a Hunan-based rice firm disclosed in an interview not long ago that the price of rice imported from Vietnam, Pakistan and Burma was RMB3.44/kilogramme (US$0.56), but that of rice produced locally reached RMB3.6 to RMB3.8 (US$0.58-0.62) per kilogramme.
The MoA researcher reiterated that actually, the price of cotton overseas was also much lower than that in the domestic market. Cotton price in the market hit RMB19,000/tonne (US$3,084) currently, RMB4,000 (US$649) to RMB5,000 (US$812) more than that of imported one. The price spread once hit RMB6,000/tonne (US$974) last year.
The industry observer stressed that this had a close tie with too low rate of related tariffs. Available information showed that the average rate of tariffs on agricultural products globally was 62% currently, with the maximum even exceeding 1,000%. However, the figure stood at only 15.2% in the Chinese mainland, accounting for less than one fourth of the global one. There would be no doubt that the nation would experience a net import of more major grains in the near future provided that it did not take moves as soon as possible.
