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Friday, May 22, 2009

Expanding Our Horizons in Beijing

Friday, May 22 brought new knowledge of international trade and marketing. The first full day in Beijing began at the U.S. Grains Council Office. This office is located in the China World Tower. Cary Sifferath, Director of USGC-China Office, started the morning with an overview of corn production and USGC programs such as DDGS promotion, trade servicing, and trade policy. An interesting fact that Mr. Sifferath shared was that an estimated ninety percent of corn harvested in China is done by hand. He also mentioned that no GMO corn is produced in China. We also learned that U.S. DDGS, a corn byproduct, is imported and used in livestock feeds. A main focus of the USGC is to increase demand for DDGS by building the Chinese swine and dairy industry by encouraging commercial growth and providing training to producers. In addition, Mr. Sifferath explained that the Chinese government has discontinued the growth of the Chinese ethanol industry due to the increasing population and need for corn in the food supply.

Phillip Laney, China Country Director for American Soybean Association (ASA), provided the team with some valuable insight about the Chinese soybean market and U.S. soybean trade. It was interesting to learn that China is the number one importer of U.S. soybeans. All imported U.S. soybeans are used for livestock production. This solid Chinese market has already imported 680,509 million bushels of U.S. soybeans since September 1, 2008. Mr. Laney also talked about how ASA is working to increase the demand for U.S. soybeans by working closely with the aquaculture industry. The aquaculture industry is rapidly growing in China and by working with aquaculture producers, ASA is hoping to further increase the demand for U.S. soybeans.

Finally, a representative from U.S. Wheat Associates-China Office provided information about the wheat industry in China. Currently, imports of U.S. wheat in China are basically non-existent due to the increased price of U.S. wheat and sufficient production of Chinese wheat. An interesting fact that we learned was that popular U.S. fast food chains are rapidly increasing in China. From 2005 to 2008, Papa John’s Pizza restaurant had a 594 percent growth in China.
After this educational morning, we ventured to Louis Dreyfus Commodities Company for a tour of a soybean crushing facility. Mr. Alex Dong, General Manager, gave us an overview of the company and its history. He also shared valuable information about the China commodities market. The Louis Dreyfus plant began production of soybean oil and meal in 2007. Currently the plant imports about 500,000 tons of U.S. soybeans per year. Mr. Dong also gave us a tour of the plant and explained how soybean meal and soybean oil is produced at the plant.

To finish off the day, the team ate at a traditional Chinese restaurant. Each day our chopstick skills improve a bit, but we still have a long way to go. After dinner everyone had the chance to have a little taste of home with Coldstone Creamery ice cream.

Londa Johnson - Senior, University of Wisconsin-River Falls
Heather McLean - Graduate Student, University of Florida


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