Crop trade deficit recorded for 1st time By Zhao Huanxin (China Daily) Updated: 2004-08-20 00:26
China logged a staggering agriculture trade deficit in the first half of this
year, importing US$3.73 billion more than it exported, indicated the latest
statistics from the Ministry of Agriculture.
Ministry officials and academics, however, gave a lukewarm response to the
scenario, claiming the situation is a result of the country's ever-opening
market, and may not become a trend.
"It is still too early to conclude the agriculture trade deficit will run for
the whole or the coming years," Wang Zhanlu, a division director of the
ministry's Agriculture Trade Promotion Centre, told China Daily Thursday.
The agriculture trade is subject to an array of factors, including
supply-demand relations, prices, harvests and even climate, he said.
But the status quo probably means China may not be able to sustain a
long-standing agriculture trade surplus as it always did before it joined the
World Trade Organization (WTO) in 2001, said Han Yijun, a researcher with the
ministry's Research Centre for Rural Economy.
The country averaged an agriculture trade surplus of US$4.3 billion a year
between 1995 and 2003, according to the centre's data.
In the first half of 2004, the country exported US$10.62 billion of farm
produce, up by 10.7 per cent over the same period last year, according to a
statement from the ministry.
Imports, however, soared by 62.5 per cent year on year to hit a record
US$14.35 billion, producing a US$3.73 billion deficit, compared with a surplus
of US$760 million in the first half of last year, said the statement.
"The deficit is glaring but not surprising, given the country's commitments
following WTO entry, the implementation of tariff rate quotas and competition in
the global market," Han said, without specifying.
Compared with the first half of last year, China imported 1.8 times as much
as grain (rice, corn, wheat and barley), or 4.115 million tons, in the first
half of this year, partly in response to the straining supply-demand relations
in the domestic market, according to Han.
In particular, wheat trade made a U-turn during the period, Han said.
Back in the first half of last year, China was a net exporter of wheat. But
it imported 2.727 million tons of wheat by the end of this June, the latest
customs statistics indicated.
Wang of the Agriculture Trade Promotion Centre said grain imports constituted
just a marginal part of food consumption in China, and the country will by no
means rely on imports for food security.
Wheat imports, for example, have been used to replenish stocks rather than
for direct consumption, according to Han Jun, a senior researcher with the State
Council Development Research Centre - a leading government think-tank.
Cheng Guoqiang, another researcher with the State Council think-tank, also
said the agriculture trade deficit, largely a result of a drastic increase in
imports of grain, edible oil and cotton, is mostly within the rational range.
What Cheng reckoned as "unexpected" was the part of the deficit contributed
to by trade in animal products.
China's animal products have been long regarded as advantageous in terms of
export, Cheng said.
But between January and June, China exported US$1.37 billion worth of animal
products and imported US$2 billion, creating a deficit of US$630 million, the
customs statistics indicated.
With the bird flu epidemic that occurred earlier this year, the ever-growing
technical barriers imposed on Chinese agricultural products have set back and
upset Chinese exports, Cheng said improving hygiene and quality standards in
animal products will be key to trade expansion.
Major importers
China imported most agricultural products from North America in the
January-June period. Sales of agricultural products to China increased by 78.4
per cent year-on-year to hit US$5.65 billion.
The United States alone exported US$4.96 billion worth of farm produce to
China, a jump of 68.1 per cent compared with the same period in 2003, according
to customs statistics.
China's agricultural exports to the US were valued at US$1.12 billion, up by
26.9 per cent in the half year period.
