China’s Rising Profile in the Global Market
for Fruits
and Vegetables
Sophia
Wu Huang; Fred Gale
China’s emergence as a fruit
and vegetable exporter presents a new source of
competition for U.S. producers. China’s fruit
and vegetable exports have increased most rapidly
in three categories: apples, apple juice, and fresh
vegetables. Since 2003, China’s apple exports
have surpassed those of the United States and have
made inroads into major U.S. export markets in Asia.
China is now the world’s leading exporter
of apple juice, and U.S. apple juice producers face
both import competition and loss of export markets.
China’s exports of processed fruits and vegetables
do not yet pose a serious challenge to the United
States, because the two countries do not export
the same types of products. However, China’s
rising exports of fresh vegetables have begun to
compete with U.S. exports to Asian markets, and
in some cases U.S. market shares have slipped.
However, such rapid export growth
on the part of China may not be a long-term phenomenon.
Growing domestic demand for fruits and vegetables
is likely to reduce the supply available for export.
As Chinese household incomes rise, fruit and vegetable
consumption will rise, as will the variety demanded.
Several important U.S. horticultural products are
already popular among high-income Chinese households.
Moreover, as the growth in the Chinese economy deepens,
income gains will be spread more widely over the
Chinese population. In the coming years more households
will likely emulate the consumption patterns of
the top-earning households, and Chinese consumption
of fruits and vegetables could rise sharply.
Chinese apples and apple juice erode U.S.
market share
China, the world’s largest
apple producer, has boosted its exports of apples
and apple juice. In 1992, apple juice exports were
negligible, and apple exports were less than 50,000
tons. Exports of both products began growing rapidly
during the late 1990s. By 2004, fresh apple exports
reached more than 750,000 tons and apple juice exports
reached nearly 500,000 tons. China is now the world’s
leading exporter of apple juice and, in 2004, had
a 56-percent share of the U.S. import market.
While Chinese fresh apples are
not allowed into the United States because of phytosanitary
issues, China’s apple exports are eroding
U.S. market share in Southeast Asian markets, which
purchase nearly 60 percent of China’s apple
exports. In 1999, China surpassed the United States
as the leading supplier of apples to Southeast Asia,
and its share in volume grew to nearly 70 percent
in 2004. The U.S. share of the Southeast Asian apple
market fell from 50 percent in 1997 to 13 percent
in 2004.
And China’s fresh vegetable exports
take over Asian markets
China’s fresh vegetable exports
include a wide variety of products grown in coastal
regions, often under contract for Japanese or other
Asian companies. Many vegetable products exported
by China are different from those exported by the
United States. But as China’s fresh vegetable
exports have diversified, they present more competition
to U.S. exporters. Exports of onions, carrots, cauliflower,
and broccoli grew from just a few thousand tons
in 1992 to a combined total of over 1 million tons
in 2004, making China the largest supplier in some
Asian markets. Other prominent vegetable exports
include garlic and mushrooms.
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China’s vegetable exports
compete with U.S. products primarily in Japan and,
to a much lesser degree, South Korea. China surpassed
the United States as the leading fresh vegetable
exporter to Japan in 1996. It is the dominant supplier
to Japan of imported garlic, peas, leeks, radishes,
and mushrooms. China’s share of Japan’s
imports of carrots, onions, and broccoli also grew
rapidly over the past decade, and these are displacing
U.S. products.
China emerges as a market
for U.S. exports of fruits and vegetables
Driven by demand from the growing
population of upper income consumers in urban centers,
China expanded its global import value of fruits
and vegetables (including fresh fruit, fresh vegetables,
processed fruits and vegetables, fruit and vegetable
juices, pulses, and tree nuts) more than ninefold
since the early 1990s to reach $910.2 million in
2002-04. China’s imports of U.S. fruits and
vegetables increased almost without interruption
from $15.7 million in 1992-94 to $137.7 million
in 2002-04, despite existing trade barriers. While
China’s fruit and vegetable imports still
remain small, China now ranks among the top 15 largest
importers of U.S. fruits and vegetables.
Among all categories of these
imports, fresh fruits and processed fruits and vegetables
grew the fastest—to the benefit of U.S. exporters.
The U.S. share of China’s fresh fruit import
market grew from less than 4 percent to nearly 15
percent, in part because of China’s growing
upper income class and relaxation of trade barriers.
Grapes, oranges, and apples accounted for the bulk
of shipments. China’s imports of U.S. processed
fruits and vegetables also increased substantially,
reflecting rapid Westernization in the Chinese diet.
Processed potatoes (mainly french fries) and sweet
corn accounted for 83 percent of China’s imports
of U.S. processed fruits and vegetables in 2002-04.
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This
article is drawn from . . . |
China’s
Rising Fruit and Vegetable Exports Challenge
U.S. Industries, by Sophia Huang
and Fred Gale, FTS-320-01, USDA, Economic
Research Service, February 2006.
Global
Trade Patterns in Fruits and Vegetables,
edited by Sophia Wu Haung, WRS-04-06, USDA,
Economic Research Service, June 2004.
China
Increases Exports of Fresh and Frozen Vegetable
to Japan, by Sophia Huang, VGS292-01,
USDA, Economic Research Service, August 2002. |
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