Rice industry sees exports to China coming soon, after red tape delay
WASHINGTON,
Nov. 11, 2015 - Despite some last-minute red tape requirements, a top official
with the U.S. rice industry said China could begin accepting shipments of U.S.
rice within a matter of months.
There
were wire service reports in early September that China was about to sign a
phytosanitary protocol that would lead to the approval of U.S. rice imports.
USDA’s Animal and Plant Health Inspection Service (APHIS) later told USA Rice those
reports were inaccurate and that the protocol was undergoing an interagency
regulatory review in China.
As
of Nov. 5, the agreement had yet to be concluded, according to Jim Guinn, USA
Rice vice president of international promotion.
“There
has been exchange of information between APHIS and the AQSIQ (China's
quarantine agency) relative to the protocol,” Guinn told Agri-Pulse. “There have been some additional edits made to the
document.”
Once
the protocols have been approved, Guinn says Chinese quarantine officials will
have to visit a number of U.S. rice export facilities.
“The
indication is they're not going to visit and approve each individual facility
but they would like to come and have a visual inspection of a sampling, at
least, of those who are interested in exporting to China,” he says. In
addition, the U.S. industry will provide a list to APHIS of facilities
interested in exporting, and the agency will visit each of them to certify that
they have the capacity to meet the phytosanitary protocol. Guinn believes under
a best-case scenario, it could be completed in two to three months.
China
is, by far, the world's largest producer and consumer of rice. USDA's World
Board estimates 2015 production at 145.5 million metric tons, or almost 31 percent
of the entire world crop. However, it's also the world's biggest rice importer
and the estimate of 4.7 million tonnes in 2015-16 would mark the fourth
consecutive year of record imports.
Its biggest suppliers have been Vietnam and Burma, along with Pakistan and Thailand. In a February report, USDA's Economic Research Service credited the surge to lower-priced imports compared to domestically grown rice. “As the world’s largest rice consumer, even small dietary shifts can have a large effect on the supplies needed to meet consumer demand, and China is increasingly turning to the world market to feed its appetite not only for staple commodities such as rice, but also fruits, vegetables, meat and other consumer-oriented products,” the report said.
Guinn says the U.S. has been in market-opening discussions with China since 2006. In 2011, Beijing determined the opening would require a phytosanitary protocol and a pest risk assessment, the latter of which was conducted that year. Although the market has never been open to U.S. rice, Guinn says for years there has been U.S. rice on upscale grocery shelves in major cities, although it's not clear how it's getting there. He would expect “a target audience at the top of the socioeconomic ladder” for U.S. rice, and adds, “We've had someone from the trade indicate that they thought that probably in the first year of gaining access, it could be 20,000-30,000 tonnes, and grow from there.”
As
for other potential growth markets for U.S. rice, Guinn cites nearby markets
like Mexico and Central America, but says U.S. producers “could be and are
currently facing additional competition in those markets.”
The
free trade agreement with Colombia has a tariff rate quota for U.S. rice that
rises 4 percent a year, and Venezuela has been a “wild card” with significant
quantities one year and little the next, but internal policies discourage
domestic production and the U.S. is positioned to gain share as imports
increase.
The
new Trans-Pacific Partnership agreement should provide some increase in sales
to Japan, but Guinn says there may be corresponding losses in other markets.
The U.S. has enjoyed duty free access to the Mexican rice market. Other TPP
members, including leading rice exporter Vietnam, will now also see tariffs
eliminated on rice imports.
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