Agricultural firms step
up their efforts to export higher
value-added products instead of cheap
produce, report Yao Jing and Ding
Qingfen in Zhucheng,
Shandong
In the spacious
workshop of Zhucheng Waimao Co Ltd,
a poultry producing and processing
company in Shandong province, workers
wearing white overalls and masks were
cleaning, cutting and packaging chickens.
The rumble of machines meant voices
had to be raised when people
spoke.
All of the chickens
being processed were transported from
nearby feeding farms managed and owned
by the company. The modern production
line looks clean and
efficient.
This has changed a
lot compared with several years ago
when the company was more like
a farm and was buying chickens
from scattered peasant households who
could not guarantee the quality of
their chickens and other
animals.
"We have invested more
than 20 million yuan ($3.26 million) in
establishing an experimental plant to
push innovation and ensure the quality
and safety of our poultry products,"
said Wang Jinyou, general manager of
Zhucheng Waimao.
Wang's
38-year-old company is just one of
the numerous Chinese agricultural producers
that are struggling to move up
the value chain against the background
of the country's determination to
upgrade and transform its foreign
trade.
One of the most
important improvements for China's
agriculture exporters is from selling
cheap fresh products to processed
goods tagged with higher
prices.
Japan, which is known
for its strict regulations over
imported agriculture products, accounts for
70 percent of Zhucheng Waimao's total
food exports.
"All of our
products shipped to Japan have passed
quality tests since 2008," said
Wang.
Right now, Wang is
planning to develop new cooked
products based on different tastes and
cooking methods. In the meantime, he
will raise the price of existing
new products.
Large packages
will also be adjusted to offer
smaller ones, such as shrinking one
bag of fried chicken from 300 grams
to 160 grams, to meet local customers'
demands. In order to cater to
the elderly in Japan, Wang will
launch softer products that are more
easy to chew.
Wang is
also trying to switch to the
Chinese market. "The key factor for
expanding in the domestic market is
cultivating our brand names. Although
we were not previously paying
attention to the Chinese market, we
are now realizing it has great
potential," he said.
Today, the
China market accounts for 70 percent
of Wang's total sales in
quantity. However, as for its business
value, China is worth just 40
percent.
Another high-yielding Chinese
agricultural product, garlic, which totaled
$1.69 billion in exports in 2012, is
also taking off after production was
upgraded.
In Pizhou in East
China's Jiangsu province, the garlic
planting area is about 467 million
square meters. There are nearly 500,000
garlic farmers. Garlic exports from
there account for 10 percent of
China's total exports of the
root. In recent years, 36 companies
have begun to conduct garlic-processing
businesses, with five engaging in
extended processing.
Local government
and companies have invested 200 million
yuan in garlic innovation and brand
building. New products made using
better technology include garlic oil,
allicin, an organosulfur compound obtained
from garlic, and garlic
capsules.
"Ten tons of garlic
can produce one ton of allicin
with a purity of 10 percent. The
value of the garlic used will
surge nearly tenfold to 200,000 yuan,"
said Du Feilong, deputy director-general
at Pizhou Bureau of
Commerce.
Garlic cloves will
become the main exporting product
among extended processing
products.
"The export of garlic
cloves is 8,000 to 10,000 tons every
year, which accounts for 10 percent of
our total garlic output every year,"
said Du.
However, the overall
agricultural foreign trade has its
problems, with China's trade deficit
in the sector widening since 2004 as
it relies more on imports.
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