February 15, 2011

 

China becomes largest market for US agricultural exports

 

China imported agricultural products worth US$17.5 billion from the US in 2010, accounting for 15.1% of the latter's total farm exports, making China the biggest export market for US agricultural products for the first time.

 

The major import from the US is soy, according to statistics released on Friday (Feb 11) by the USDA.

 

Li Guoxiang, a researcher with the Chinese Academy of Social Sciences (CASS), holds that increasing grain imports will help ease contradiction between major agricultural products and farmland, and increase the country's grain security.

 

In general, the advantages of rising grain imports outweigh the disadvantages, he said.

 

As the most populous country in the world, China should guarantee the planting of key agricultural products, such as rice, wheat and corn, to feed its people, while demand for cash crops such as soy can be met from the international market, he added.

 

The agricultural products on which China has high external dependence include soy, cotton, vegetable oil, and edible sugar, but it has little dependence on the international market for major grains such as rice, wheat, and corn.

 

If soy is excluded from the list of China's grain imports, the country's grain imports has not long exceeded 5% of its grain output.

 

Statistics from China's Ministry of Agriculture show that China's self-sufficiency in rice, wheat, and corn is relatively high. This indicates that China's dependence on the international grain market is moderate.

 

Purchasing agricultural products from the US is an important method of promoting trade balance between China and the US, against the background that both countries are striving to balance bilateral trade, an industrial economy researcher said.

 

Besides, he added that it is a rational practice for China to increase imports of staple agricultural products, as prices of agricultural products are expected to rise on the impact of recent sustained bad weather.

 

China's grain security outlook is undergoing significant changes. China is now making full use of both the domestic and overseas markets rather than focusing only on the balance of domestic supply and demand.

 

As the country imports more agricultural products, price rises of world agricultural products will have a greater impact on China, which may result in imported inflation, analysts warned.