November 23 2006, 11:39

Is China able to become a net importer of produce commodities?

China is the largest grower of produce commodities in the world. It constantly threatens other large producers in the world by rates and scales of production development. At the same time, the trend of production development in comparison with the trend of consumption growth make us think about how long China is able to dominate on world produce market.

At the present moment one half of all vegetables and 17% of fruits in the world are produced in China. The farmers are actively transferring from the production of small-profit grain and oil crops to fruit and vegetable growing which provide a much greater profit per hectare. Cheap and excessive labor resources predetermine practically no mechanical facilities applied for the produce growing. It means minimum investments and low production cost.

The most recent data of the State Statistic Committee of China prove that the total volume of the retail trade of consumer goods has increased 14.3% in October 2006 comparing to the same period of time past year. The growth rates have turned out to be 1.5% higher than at the same month a year ago. One can constantly come across such figures. If we consider the growth rates for fruit and vegetable production in the whole, they are in average 8-10% per year (and even lower for fruits). So, at the present moment the consumption is growing faster than the supply. Moreover, the most part of the consumption growth is formed by the increased demand for food commodities in the countries with relatively low income per capita.

What is likely to happen with world produce business if China becomes a net importer of vegetables and fruits? Is it possible? If it is possible, when does it happen? These and other questions will be covered by Mr. Robert Lee, the International Consultant, the Director of the Agricultural Marketing Project in his presentation dedicated to the trends of world produce market development. He will make a report in the framework of the third international conference "Fruits and Vegetables of Ukraine 2006. Open Market". We remind that there are only 2 days left to register for participation in the conference!