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Agricultural Review

Troxler on a tractorFrom the tractor
by Agriculture Commissioner Steve Troxler

I wanted to update our readers on the N.C. Department of Agriculture and Consumer Service's latest trade efforts in China. Some of you may have heard that I led a trade delegation of cotton, peanut, soybean, tobacco and wheat producers and organizations to China in early March. It is the second trade mission I have headed up to China. The last one was in 2009.

In addition to meeting with potential buyers and others involved in agricultural trade, we also officially opened our first trade office in China in Beijing. I am extremely excited about this prospect and expect big returns on this investment for North Carolina agriculture.

I know some people would question why we need to focus so much attention on boosting overseas trade now especially in light of the current budget situation, but I believe we cannot afford to ignore such a large potential market for ag products. Beijing alone, China's capital city, has 22 million people. China's total population is more than 1.3 billion people compared to around 310 million in the United States.

The opening of a trade office in Beijing sends a signal about our commitment to trade with China. I think you can take the attitude that we'll wait, wait, wait for things to get better, or you take the attitude we're going to make things better. This office is a step toward making things better and continuing to grow agriculture and agribusiness in North Carolina. We know how important world trade is now, but it will be even more important in the future as worldwide demand ratchets up, and we want to have North Carolina positioned to take advantage of that demand.

When it comes to the Chinese market, I believe we have only started to scratch the surface of trade opportunities.

China is poised to become North Carolina's largest export market. In 2010, North Carolina's agricultural exports to China were $542 million, doubling from $271 million in 2008. Currently, Japan is our top export partner.

In 2009, total U.S. farm exports to China were a record $13.2 billion. That tells me two things – that North Carolina farm commodities make up just a small part of current farm exports and there is room to expand.

As part of our trip, we met with staff from the U.S. Embassy and from the Foreign Agricultural Service office who offered some additional points of optimism about the growth potential in China. Specifically, FAS staff pointed to 2009 being a record export year, but also added that growth in Chinese food demand is exceeding growth in domestic supply, Chinese farmland is down 10 percent since the late 1990s, the average farm size is one acre and Chinese food expenditures are expected to double by 2025 because of a rising middle class, rural to urban migration, strong growth in meat and dairy consumption and an improving distribution system.

U.S. agricultural exports are seen by Embassy and FAS staff as a promising area for helping China to bring down current trade imbalances with the United States.

The goals of our trade office is to establish relationships in China with members of the agricultural industry, trade organizations and the government's agricultural contacts, to get to know North Carolina companies working in China and to develop potential market contacts. I also see this office working with North Carolina producers, helping them navigate the business waters in China and helping provide contacts and translation assistance.

Our 30-person trade delegation included representatives from the N.C. Agribusiness Council Inc., Burley Stabilization Corp., Carolinas Cotton Cooperative, N.C. Cotton Producers Association, Golden Grove Candy, N.C. Small Grain Growers Association, N.C. Soybean Producers Association, N.C. State University, Tobacco Associates, Tobacco Growers Association of North Carolina, U.S. Tobacco Cooperative, Universal Leaf and White Hat Seed Farm.

I look forward to providing more updates from our trade mission in the future, particularly as our growers generate sales from this trip. I am optimistic that we will see sales from this effort, but I am even more optimistic that we are laying the foundation for increased trade in the future.

 

 

NCDA&CS Public Affairs Division, Brian Long, Director
Mailing Address:1001 Mail Service Center, Raleigh NC 27699-1001
Physical Address: 2 West Edenton Street, Raleigh NC 27601
Phone: (919) 707-3001; FAX: (919) 733-5047