U.S. Wants China as Agricultural Partner


by Chris Clayton, DTN Ag Policy Editor

DES MOINES (DTN) — As an old Chinese saying goes, “Food is essential to the people.”

Chinese Vice President Xi Jinping stressed that point in comments Thursday at the opening of unique a U.S.-China Agricultural Summit. The daylong summit included signing a five-year “strategic cooperative agreement” between the U.S. and China specifically to promote areas in agriculture that could further deepen the relationship between the world’s two largest agriculture producers.

“I believe these discussions will further deepen U.S. and Chinese agricultural cooperation,” Xi said, speaking through a translator. “It will make our agricultural sectors better developed and more prosperous, and our farmers better off.”

The summit drew a great deal of enthusiasm among U.S. officials, particularly given Xi’s ties to Iowa and the expectation that Xi will eventually become president of China.

Actual language of the strategic agreement was not immediately available. Members of the press were asked to leave the event after leaders made their opening comments.

The summit highlighted food security, food safety, sustainability and obviously agricultural trade. Xi noted agriculture is a basic industry needed to ensure survival and development of society. Food security is a key component to economic security in today’s world.

Xi stressed China has worked aggressively to lower trade barriers in agriculture. Chinese agricultural trade over the past decade also has been growing at an annual rate of about 20{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f}. In 2011, Chinese agricultural trade reached $30 billion.

“In the past 10 years, China honored its commitment on accession to the WTO and brought down its tariff level on agricultural products to one-fourth of the world’s average,” Xi said.

U.S. exports to China reached more than $23 billion in 2011, Xi said. Vilsack and U.S. officials used a lower number of $20 billion in U.S. exports to China, which is now the top market for U.S. agricultural products.

While touting the development of Chinese and U.S. agriculture, Xi reiterated that the world’s most populated nation remains a “developing country,” a term under the WTO that allows more latitude on trade expectations than a “developed country.”

“China is a developing country with a population of 1.34 billion people,” Xi said. “So in this sense, China is the largest developing country in the world. China attaches great importance to food security and gives top priority to developing rural areas, agriculture and ensuring a sufficient food supply for 1.3 billion people.”

Xi said that in feeding its population, China has made an important contribution to all of mankind. He added the country has 21{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} of the world’s population, but only 9{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} of the globe’s arable land.

In discussing the country’s grain and oilseed situation, Xi said China continues to import high volumes of soybeans, but has a stable supply of corn, wheat and rice. “We have achieved a balance between their demand and supply,” Xi said. “We have sufficient grain reserves and market supply.”

In recent years, China has worked to build reserves of grain and edible oil with a mix of variety and management of the reserves. “This has effectively stabilized prices in the country and international markets with important contributions to ensuring the world’s food security.”

Xi noted China also has placed more emphasis on biotechnology, creating a hybrid rice that China has shared with other developing countries and helped those countries with United Nations development goals.

Xi also highlighted that while producing more food, “In today’s world, agriculture faces more constraints from population resources and environment.”

In public comments, leaders from Iowa, the Obama administration and China avoided discussing any of the ag-trade disputes frequently highlighted between the two countries, such as U.S. concerns about the safety of Chinese imports, or the continuing ban on U.S. beef.

Agriculture Secretary Tom Vilsack, a former Iowa governor, said the summit offered a chance to strengthen the relationship between the two countries that in many ways developed through agriculture.

“We are the world’s two largest agricultural producers and strong collaborators in agricultural research and education. Our great trade relationship benefits the citizens of both of our nations,” Vilsack said.

Vilsack said the U.S. and China “have responsibility and opportunity to work together to address the causes of global hunger that affect more than 925 million people.”

The world’s growing population reflects even greater challenges, Vilsack said. Global food production has to increase 70{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} by 2050.

“The expertise, technical know-how, research and combined will of our two nations can go a long way to filling empty stomachs and improve incomes and economies around the world.”

The talks are also a chance to promote more bi-lateral ag trade, as demonstrated by $4.3 billion in soybean contracts signed on Wednesday between U.S. and Chinese soybean-industry leaders.

“Finally, this symposium will help Chinese and American businesses to develop relationships that are integral to opening doors for new opportunities,” Vilsack said. “Those relationships will assure that when difficulties arise, as they sometimes do, we will continue to dialogue until solutions are found.”

In working toward global economic recovery, agriculture faces destabilizing factors. Maintaining agricultural cooperation and development are important factors in recovering from financial crises and promoting sustainable growth of the world’s economy, Xi said.

“Raising Chinese and U.S. agricultural cooperation to a higher level will help us to achieve stable development of our domestic economies and help the world’s economy to achieve a faster recovery,” he said.

Xi said the U.S. and China must work together to increase cooperation in science and technology to raise production levels while protecting the environment and promoting sustainable agricultural development. Further, the countries must increase trade with “a fair and equitable market environment.” Also, the countries must work together on “agricultural hot spot issues” to exchange information that helps global food safety and security.


Shortly after the opening comments from officials, Phil Seng, president and CEO of the U.S. Meat Export Federation, said in an interview that talks over opening the Chinese market to U.S. beef have been slow, or almost non-existent. There have been no talks since last November, he said.

“Hopefully, with the words from the top here obviously of cooperation and spirit of mutual benefit, and I think if you can look at what has been done with soybeans as far as the major purchase and also the relationship with agriculture, I hope that’s a nice predicate to kind of base ourselves as we go forward,” Seng said. “It looks like a new beginning, and if it is a new beginning, obviously there are issues as far as beef access, when it comes to biotechnology and the utilization of biotechnology.”

Seng added the Chinese lamb market also remains closed to the U.S. Issues also remain with pork exports. Seng said some of that has to do with the bureaucracy as China has 13 different ministries involved in food safety, and the ministries often don’t do well talking amongst themselves.

“China consumes half the world’s pork,” Seng said. “It’s a very opportune market for us and we finished the year very strong with exports to China. We would like our exports to China to be a little less undulating — you know, more predictable.”

Still, Seng said he thinks there are benefits simply by having a large delegation headed by the vice president going to Iowa farms and seeing agricultural production.


© Copyright 2012 DTN/The Progressive Farmer, A Telvent Brand. All rights reserved.

Posted with DTN Permission by Haylie Shipp


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