November 21, 2003

China Meat Sector Not Affected By Market Liberalization Under WTO's Commitments
 

China's meat sector is likely to see minimal negative impact from a full liberalization of the market as part of China's commitments under the World Trade Organization, an official from Shineway Group, one of China's largest meat processors, gave the market viewpoint.

"The meat industry will survive full-fledged foreign competition because abattoirs and small scale butchers worldwide still must rely on a great deal of manual labor to process meat, and China's low wages vis-a-vis major meat exporting countries remain highly competitive," said Shineway marketing manager Ma Baomin.

The implementation of China's WTO commitment, including drastic reductions in agricultural import tariffs, is scheduled for completion by 2005.

Apart from the labor-intensive nature of the domestic meat industry, Ma predicts a windfall for countries like the US for certain sectors of China's meat sector.

"Chinese eat more than just the beef, pork, mutton from slaughtered animals... we also consume many of the innards," he said.

Ma predicts a promising future for US edible animal parts in China given the attractiveness of the market versus the US where demand is virtually zero.

Ma said that the US, Australia, Argentina and other major meat-exporting countries will continue to do well in the restaurant and hotel sectors because these establishments often attract customers based on the origin of their offerings, and meats from these countries are still seen as being of higher quality than domestic varieties.

Ma said Shineway is the largest player in China's meat processing market estimated at 60 million tons per year.