Pest Control Deal Opens Way to China for US Rice Exports
US rice exports are near to being cleared to enter the world’s biggest market for rice. The US Department of Agriculture has confirmed that the US and China have agreed on a phytosanitary protocol to mitigate pests such as insects – long a sticking point for the Chinese – as USA Rice reports.
“The challenge now is to move from agreement to shipments,” says Betsy Ward, CEO of USA Rice, advocates for the US rice industry, including millers, merchants and growers.
According to USA Rice, the USDA’s Animal and Plant Health Inspection Service (APHIS) laid out the next steps to actual shipments: separate inspections of US exporters’ mills and storage facilities by APHIS and its Chinese counterpart, China’s release of a list of ports eligible to receive US rice, and the Chinese government’s decree authorizing imports. If all goes well, China could permit imported rice from the US by early spring.
The US is a major exporter of rice. According to the USDA, global markets account for nearly half the annual sales volume of US-produced rice.
US rice production was down 13% in 2015, the USDA estimates, but a comparison of 2015 trade data through November with the same 11 months in 2014 shows export volume up 17% for a 3.34% gain in value. Here are the value and volume trends in US rice exports month by month in 2015 and over the years 2007 through 2014:
Perennial top markets for US rice are Japan, Haiti and Canada. But there was a change-up in the top five between 2014 and last year, with Colombia and Jordan displacing Iraq and Saudi Arabia in the rankings:
Our multi-year trend data on top markets shows sharp peaks and valleys in exports to Iraq, reflecting the easing and tightening of trade sanctions.
Meanwhile, Colombia’s imports of US rice have surged. That’s largely the result of the free trade agreement between the two countries. But severe drought is also forcing Colombia to boost rice imports.
How will opening the Chinese market to US rice shake things up?
When Los Angeles Times reporter David Pierson looked into the possibility, he calculated that rice consumption in China is so high the country could eat through America’s annual production in 17 days. But, he found, US rice producers weren’t interested in meeting mass demand but in selling packaged rice to China to fill a high-end niche. That was back in 2014, when producers hoped for a resolution of the phytosanitary issue as soon as “next year” and expected exports to China would be on a par with exports to Canada.
Now, with the strong dollar making US exports pricier and the Chinese economy faltering, the near-term potential for US rice exports to China is harder to gauge. As the Prairie Star reports, the USDA has been cutting its forecasts for such agricultural export staples as cotton, soybeans and pork in the face of Chinese headwinds.
- Our Top 25 US Agricultural Imports and Exports reports rank commodities by value of trade each month, update the year’s cumulative data, and provide comparisons with last year’s data. Click here to download the latest ranking report.
Date posted: January 29, 2016