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Agricultural trade sees slow growth
( 2003-08-31 09:48) (China Business Weekly)

Affected by the severe acute respiratory syndrome (SARS) outbreak, China's agricultural product exports grew slowly in the year's first half while farm product imports remained robust.

As a result, China's agricultural trade surplus dwindled from US$3 billion in the same period of last year to US$770 million in the first half, a decrease of 74 per cent.

In the first half, China exported US$9.6 billion worth of farm products, up 19 per cent year-on-year, but its agricultural import volumes rocketed to US$8.8 billion, up 74 per cent.

Farm product exports in the first half accounted for 5.04 per cent of China's total exports, which declined 0.63 percentage points compared with last year.

The influence of SARS on China's agricultural exports was mainly felt in April and May. Exports in those two months decreased 6 per cent and 7 per cent from March's volumes.

In June, farm product exports grew 5.7 per cent.

SARS mainly affected Chinese exports of live poultry, corn, vegetables, fruit and other special produce.

It also affected aquatic products to some extent.

Geographically, SARS seriously affected farm product exports from Beijing, the Inner Mongolia Autonomous Region and Fujian, Guangdong, Shandong, Jilin and Anhui provinces.

SARS also threatened small and medium-sized farm product processing enterprises in China, while its effect on big agricultural enterprises was minimal.

In June, China's exports of poultry, vegetables and fruit were still affected by SARS, and the impacts could continue into the third quarter, depending on when importing countries abandon their bans of such imports from China.

The animal husbandry industry - especially China's poultry exports - was hit most seriously by SARS in the first half. Export growth of China's animal husbandry products rose slightly, 0.4 per cent, in the first half, but, in May and June, the exports declined 13.3 per cent and 10 per cent over April.

SARS also had a significant impact on China's fruit and vegetable exports in April and May.

In the first half, China's vegetable exports grew 13.8 per cent, year-on-year, to US$1.36 billion. However, export volumes between April and June decreased 6.5 per cent, 7.6 per cent and 4.2 per cent, respectively, over March.

Vegetable exports in Beijing in the three months decreased 82 per cent, 83 per cent, and 55 per cent, respectively, compared with the same periods of last year.

In the first half, SARS periodically affected corn exports, but its influence on other produce was minimal.

During the period, China's corn exports rose 92.1 per cent, year-on-year, but in April and May, corn exports decreased 65 per cent and 75 per cent compared with the volumes in March.

In June, corn exports rose 14 per cent over March, indicating a recovery from SARS.

Major factors blocking the growth of corn exports include slower transportation due to SARS and foreign importers' fears about doing business with China during the SARS outbreak.

Such concerns did not affect other grain products.

In the first six months, China's grain exports grew 87.1 per cent, to 8.98 million tons, among which, 1.14 million tons of rice and 723,000 tons of wheat were exported, up 74.7 per cent and 79.67 per cent, respectively.

Some fish exports were slightly affected by SARS, but, on the whole, aquatic products were not seriously affected by the outbreak.

In the first half of the year, aquatic products valued at US$2.36 billion were exported, up 16 per cent year-on-year. Between March and June, there was continued export growth, which indicated SARS had less impact on fruit, vegetables and poultry exports.

Yet, between May and June, processed fish products were affected. Exports of processed fish products decreased 14 per cent and 23 per cent, respectively, compared with March, and exports of fish decreased 42 per cent and 50 per cent, respectively, compared with March.

But because exports of the two products account for a small percentage of aquatic products, they did not influence exports of the whole industry.

Between April and June, SARS periodically affected agricultural exports from Beijing, Inner Mongolia and Fujian, Guangdong, Shandong, Jilin and Anhui provinces.

Exports from Guangdong and Zhejiang provinces, major agricultural exporters, increased 1.8 per cent and 12 per cent, respectively, in the first half while Fujian's exports fell 1.1 per cent.

Shandong's export growth remained robust during the year's first half, despite SARS.

While farm export growth slowed in the first half, agricultural imports increased dramatically, due to lower agricultural tariffs that resulted from China's membership in the World Trade Organization.

Between January and May, China's cotton imports increased by 30 times, compared with the same period last year, to reach 375,000 tons.

China's soybean imports increased 211.6 per cent, year-on-year, to 10.15 million tons in the first half of this year.

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