Agricultural imports rising rapidly this year

China's imports of major agricultural products continued to increase rapidly in the first five months of the year, driven by price gaps between domestically produced products and imported products, according to the Ministry of Agriculture.

Wheat imports between January and May reached 2.2 million metric tons, an increase of 67.3 percent year-on-year, Wang Ping, deputy chief of the ministry's Department of Market and Economic Information, said at a news conference on July 17. Imports of soybeans increased by nearly 20 percent to 37 million tons, and imports of beef rose by 14 percent during the period, compared with the same period last year, Wang said.

China imported 1.68 million tons of wheat and associated products between January and April, an increase of 94 percent year-on-year, Wang said, citing figures from the General Administration of Customs.

Imports of some major agricultural products continued increasing quickly between 2011 and 2016, with grain imports increasing at an average annual rate of 32.2 percent, meat at an average annual rate of 24.9 percent, and dairy at 16.6 percent during the five-year period, according to the ministry.

"A rapid increase in imports has also had a great impact on China's domestic market for agricultural products," Wang said.

"Due to a sustained increase in imports, it is predicted that beef and mutton prices in the domestic market may fall slightly this year."

The prices of many agricultural products produced in China are higher than the international level due to higher production costs, according to the Ministry of Agriculture. An exception is corn, whose average wholesale price was 1.58 yuan (23 cents; 0.24 euros; ￡0.17) per kilogram in the first part of the year, similar to the international level, a decrease of 14.4 percent year-on-year, according to the ministry.

Dairy industry analyst Song Liang says the average cost of dairy products in China was at least 20 percent higher than in the European Union, largely due to higher production costs resulting from limited resources such as water and grazing land. This has caused a rapid increase in dairy imports, he says.

Due to causes such as increasing supply, prices of agricultural products in China in general have continued falling since the beginning of the year, with prices of fresh and perishable products, such as vegetables, pork, chicken and eggs, seeing the biggest decline, said Wang of the Agriculture Ministry.

For example, the price of eggs decreased to their lowest in the last 10 years in the first half of the year before rebounding recently, and the price of poultry also declined in the first half of the year, Wang said.

The major causes were increased production, as a result of higher poultry and egg prices two years ago and the falling prices of feed such as corn, and an increase in H7N9 bird flu cases during the first half of the year in China, he said.

The price of eggs started to rise in June due to reduced supply following sustained lower prices since late last year, Wang said.

Egg prices may continue to rise in the second half of the year, but at a slow rate due to adequate supply, he said.

The prices of some other major agricultural products, such as pork and vegetables, may also rebound in the second half of the year, Wang said.

wangxiaodong@chinadaily.com.cn

(China Daily Africa Weekly 07/21/2017 page25)