usda foreign agricultural service gain report · short shelf life even in cold storages, cold chain...

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Voluntary Report - public distribution Date: 3/16/2007 GAIN Report Number: CH7017 CH7017 China, Peoples Republic of Stone Fruit Annual 2007 Approved by: Maurice House U.S. Embassy Prepared by: Jorge Sanchez, Wu Bugang and Frances Wei Report Highlights: Peach and nectarine production is forecast at 8.8 MMT in MY2007, up 5 percent from the previous year. Plum production is forecast to increase by 11 percent over the previous, largely due to an anticipated peak year in the production cycle. The Chinese government is developing a fruit traceability system that can help improve the quality and safety of domestically produced fruit destined for export and eventually their competitiveness in the world market. Cherry production is forecast at 145,000 MT in MY2007, up 21 percent from the previous year. Strong consumer demand has led to rapid increase in cherry imports. Includes PSD Changes: Yes Includes Trade Matrix: Yes Annual Report Beijing [CH1] [CH] USDA Foreign Agricultural Service GAIN Report Global Agriculture Information Network Template Version 2.09

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Page 1: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

Voluntary Report - public distribution

Date: 3/16/2007

GAIN Report Number: CH7017

CH7017

China, Peoples Republic of

Stone Fruit

Annual

2007 Approved by: Maurice House U.S. Embassy

Prepared by: Jorge Sanchez, Wu Bugang and Frances Wei Report Highlights: Peach and nectarine production is forecast at 8.8 MMT in MY2007, up 5 percent from the previous year. Plum production is forecast to increase by 11 percent over the previous, largely due to an anticipated peak year in the production cycle. The Chinese government is developing a fruit traceability system that can help improve the quality and safety of domestically produced fruit destined for export and eventually their competitiveness in the world market. Cherry production is forecast at 145,000 MT in MY2007, up 21 percent from the previous year. Strong consumer demand has led to rapid increase in cherry imports.

Includes PSD Changes: Yes Includes Trade Matrix: Yes

Annual Report Beijing [CH1]

[CH]

USDA Foreign Agricultural Service

GAIN ReportGlobal Agriculture Information Network

Template Version 2.09

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UNCLASSIFIED USDA Foreign Agricultural Service

Table of Contents Executive Summary .............................................................................................3 Production ..........................................................................................................4

Peach production grows steadily on stabilized acreage................................................ 4 Consumer demand for fresh and processed plums driving production increases............... 4 Growing processing industry accounts for increases for apricot production...................... 4 Favorable returns contributing to cherry production skyrocket ...................................... 4

Trade..................................................................................................................5 Exports growing slowly to neighboring countries due to short shelf life of stone fruit ........ 5 Cherry imports increasing fast due to strong consumer demand ................................... 5

Policy .................................................................................................................5 Registration system in place to improve exported fruit quality...................................... 5

Prices .................................................................................................................6 Consumption.......................................................................................................6

Consumption growth steady, cherry a new favorite .................................................... 6 Marketing ...........................................................................................................6

Cherry ............................................................................................................... 6 Competition: Domestic versus U.S. Cherries ......................................................... 8 Chile and New Zealand Cherries .......................................................................... 8

Plums................................................................................................................ 8 Peaches/Nectarines and Apricots............................................................................ 9

Tables............................................................................................................... 10 Import Tariff and VAT for Fresh Stone Fruit in 2007 .................................................. 10 2002-2005 China Peach Acreage and Production by Province..................................... 11 Production, Supply, and Demand (PSD) Tables ........................................................ 12

Fresh peaches and nectarines ........................................................................... 12 Trade Matrix ................................................................................................ 13 Export Price Table ........................................................................................ 14

Fresh plums and prunes ................................................................................... 15 Trade Matrix Tables....................................................................................... 16 Export Price Table ........................................................................................ 17

Fresh Apricots................................................................................................ 18 Trade Matrix Table ........................................................................................ 19 Export Price Table ........................................................................................ 20

Fresh cherries ................................................................................................ 21 Trade Matrix Tables....................................................................................... 22 Export Price table......................................................................................... 23

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UNCLASSIFIED USDA Foreign Agricultural Service

Executive Summary Peach and nectarine production is forecast at 8.8 MMT in the MY2007, up 5 percent from the previous year. Plum production is forecast at nearly 2 MMT in MY2007, up 11 percent from the previous year, largely due to an anticipated peak year in the production cycle. Cherry production is forecast at 145,000 MT in MY2007, up 21 percent from the previous year, as a result of earlier plantings. Fruit consumption in China is growing at around 6 percent per year. Stone fruit is unlikely to keep this pace largely due to the short shelf life of this type of fruit. Most stone fruit is consumed during harvest season. Farmers near large cities are building more greenhouses in order to extend the supply season. Cherries are a new favorite in the Chinese fruit menu and consumption is increasing at an astonishing speed. China is exporting a limited but growing amount of stone fruit to neighbor countries. Given the short shelf life of stone fruit, cold chain transportation is less attractive to local traders. China exported a record 20,196 MT of fresh peaches and nectarines in 2006 following a bumper harvest. In 2007, fresh peaches and nectarines are forecast at 22,000 MT. Plum exports are expected to rebound to 7,500 MT in 2007 in anticipation of a much larger crop. Apricot exports are forecast at 4,500 MT, up nearly 40 percent over last year. Cherry imports are rapidly increasing due to strong consumer demand. U.S. cherries are popular in China because of their superb taste, appearance and quality reputation. Additionally, the inefficiencies of handling Chinese cherries shorten its shelf life, and significant transportation costs raise the retail price close to those of imported U.S. cherries. Although domestic cherries from Yantai and Dalian can be found during the season, consumers are willing to try higher quality imported cherry varieties as they are expecting to pay nearly the same price for domestic cherries.

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UNCLASSIFIED USDA Foreign Agricultural Service

Production Peach production grows steadily on stabilized acreage Peach and nectarine production is forecast at 8.8 million metric tons (MMT) in the 2007 marketing year (MY), up 5 percent from the previous year, if favorable weather conditions are present during the blossom season in April or May. MY2006 production was estimated at 8.38 MMT, up 10 percent from the previous year. The rapid growth in production is expected to slow down after the peach acreage has stabilized. Peach planted area is forecast at 6.97 million hectares in MY2007, up merely 1 percent from last year. Increased production costs and crop failure of other fruit have triggered fruit prices to escalate in recent years. Peach prices, however, are declining due to abundant supplies, as a result of increased tree placements coming to bear. As peaches cannot be stored for long periods of time (even in cold storage), prices drop dramatically during harvest season (see price table). Consequently, more stone fruit greenhouse production, including peaches, can be seen in producing areas close to large cities, although as a percentage of total production this type of production still limited. Consumer demand for fresh and processed plums driving production increases Plum production is forecast at nearly 2 MMT in MY2007, up 11 percent from the previous year, largely due to an anticipated peak year in the production cycle. Field visits and industry contacts indicate that plum acreage is also expanding at a faster pace. As a result, plum production figures for MY2006 were revised to 1.8 MMT, up from the previous estimate of 1.7 MMT. Likewise, plum production in MY2005 was also revised to 1.72 MMT from the earlier estimate of 1.68 MMT. The MY2007 plum acreage is forecast at 410,000 hectares, up nearly 4 percent from the previous year. The expansion of plum sown area is expected to slow down as market prices become less profitable. In the past few years, China introduced western varieties that are larger-sized, tastier and have a longer shelf life. High market prices have attracted farmers to dedicate larger portions of land to plum plantations. Another factor contributing to the increased production, especially in Fujian province, is the growing processing industry. Post has learned that a significant amount of these plums are processed into dried fruit and sold across the nation. Growing processing industry accounts for increases for apricot production Apricot production is forecast at 1.5 MMT in MY2007, up 10 percent from the previous year, due to rapid expansion of the apricot planted area in Xinjiang, Shandong and Hebei. The increase is mostly driven by the accelerated development of the apricot processing industry. The MY2006 production estimate was revised to 1.37 MMT in response to favorable market conditions and industry expectations. The planted area for apricots is forecast at 391,000 hectares, up 15 percent from the previous year. Nearly half of China’s fresh and processed apricots are harvested in Xinjiang Province. According to industry sources, local governments are encouraging farmers to plant drought-resistant crops in desert-type areas as a means to improve farmer incomes. Many large processing facilities (in apricot paste/nectar and dried apricot production) have been built in southern Xinjiang over the recent years. As a result, the planted area for apricot is expanding quickly with this trend likely to continue in the short term, and if demand for this product catches on, the trend may extend until the market stabilizes. Favorable returns contributing to cherry production skyrocket Cherry production is forecast at 145,000 MT in MY2007, up 21 percent from the previous year, as a result of the rapid expansion. This trend began in 2000 with plantings now bearing fruit. In MY2006, cherry production was estimated at 120,000 MT, up 30 percent

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UNCLASSIFIED USDA Foreign Agricultural Service

compared to MY2005. The cherry sown area is forecast at 52,700 hectares in MY2007, up 12 percent from 47,100 hectares in MY2006. Driven by favorable returns since 2000, farmers in the coastal areas of Shandong and Liaoning provinces have been steadily building or alternating orchards for cherry production. These new plantings are gradually maturing and coming to their full production age. As land suited for this crop became scarce in these two provinces, cherry plantations expanded to other provinces such as Hebei, Shaanxi, Sichuan and Beijing. Although farm gate prices have considerably dropped from the highest levels to $1.54-$3.85 per kilo as a result of a quick expansion in production, farmers can still make a good profit from this crop. Cherry acreage is unlikely to expand as quickly as it did a few years ago because China has limited planting areas suitable for this delicate fruit. However, production is expected to increase at a high rate in the next few years as earlier plantings mature and increased popularity drive an increase in greenhouse cherry varieties. Trade Exports growing slowly to neighboring countries due to short shelf life of stone fruit China is exporting a limited amount of stone fruit to its Asian neighbors. Given stone fruit’s short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders. China exported a record 20,196 MT of fresh peaches and nectarines in 2006 following a bumper harvest with volume forecast at 22,000 MT in 2007. Russia, Vietnam and Hong Kong are expected to remain the top buyers of Chinese peaches. Plum exports are expected to rebound to 7,500 MT in 2007 in anticipation of a much larger crop. Russia remains the single buyer of Chinese apricots with volume increasing quickly. Chinese apricot exports are forecast at 4,500 MT, up nearly 40 percent over last year. China’s cherry exports are limited and unsteady due to small production, but the volume is forecast at 100 MT in 2007, twice as many as in 2006. Cherry imports increasing fast due to strong consumer demand China imports plums and cherries during the off-season, especially during the Chinese Lunar New Year usually in January or February. Although customs statistics indicate a decline in cherry imports, according to traders the volume is annually growing at a 20-percent rate. The majority of U.S. cherries are transshipped through grey channels between Hong Kong and Guangzhou and are not reflected in official customs numbers. U.S. cherries are popular in China because of their superb taste, appearance and quality reputation. Plum imports are declining due to large availability of domestically produced plums. U.S. plum supply season overlaps with that of domestic plums. However, different U.S. plum varieties are geographically favored according to regional taste and appearance preferences. Policy Registration system in place to improve exported fruit quality China’s General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) recently published the Administrative Measures on Inspection and Quarantine of Exported Fruit that took effect on February 1, 2007. According to the new regulation, packers should register their orchards and/or packinghouses even if the importing country has signed a protocol with China. Exporters who do not have their orchards/packinghouses registered should provide information about the orchards and packinghouses from which the fruit is sourced. Local quarantine departments may refuse to inspect the exporting fruit and provide a certificate if orchard/packinghouse information is lacking. The Chinese government is hoping that this fruit traceability system can help improve the quality and safety of domestically produced fruit destined for export and eventually their

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UNCLASSIFIED USDA Foreign Agricultural Service

competitiveness in the world market. The requirement may affect Chinese fruit exports in the near term, but is expected to facilitate exports in the long run. Prices

Mont h l y whol e s a l e market pr ices

0

5

10

15Ja

n-0

5

Feb

Marc

h

Apri

l

May

June

July

Aug

Sept

Oct

Nov

Dec

Jan-0

6

Feb

Marc

h

Apri

l

May

June

July

Aug

Sept

Oct

Nov

Dec

Year

$US

/kg

Peach Pl um Cher r y

Consumption Consumption growth steady, cherry a new favorite According to the China Fruit Marketing Association, per capita consumption of fruit in rural and urban areas reached 37.84 lbs. and 133.74 lbs (17.2 kilograms and 60.79 kilograms) in 2005, up 1 percent and 8 percent, respectively, over the previous year. In other words, total consumption of fruit in China increased by 6 percent in 2005. This rate of growth is expected to carry on in years to come as incomes continue to rise. Stone fruit consumption is unlikely to keep this pace largely due to its short shelf-life. Although more cold storage facilities have been built, they are used mainly for deciduous fruit like apples. Stone fruit, however, cannot be stored for a long period of time under the current technology. As a result, most stone fruit is consumed during the harvest season in the summer months. Farmers in provinces like Shandong and Liaoning have been increasing the number of green houses for stone fruit production in order to extend the supply season. The official percentage of greenhouse stone fruit production is not available, although it only accounts for a minor share. Another factor limiting stone fruit consumption is that Chinese consumers have traditionally believed that eating too many apricots and plums can cause health problems. This perception is now changing. Chinese consumers enjoy peaches because of their taste and symbol of longevity. Cherries are a new favorite in the Chinese fruit menu and consumption is increasing rapidly. Additionally, changing dietary habits have contributed to increased consumption of processed fruit, especially in the case of juice and juice drinks. In fact, an increasing portion of stone fruit, with the exception of cherries, is processed into canned fruit (peaches and apricots), juice and nectar (peaches and apricots), paste (apricots), and dried fruit (apricot and plums). Additionally, milk produced from apricot seeds is very popular in China. Marketing Cherry Currently, China only imports sweet cherries, (from northwest United States), due to local consumption habits and taste preferences. Increased disposable income, high profit margins, and well-established distribution channels, as well as Chinese consumers’ belief in

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UNCLASSIFIED USDA Foreign Agricultural Service

cherries’ nutritional value have all contributed to the rapid growth in consumption of U.S. sweet cherries in China. Per Capita Annual Disposable Income of Urban Households 2005

Disposable Income No. Province RMB USD

Region

National Average 10,493.03 $1,346 1. Shanghai (Municipality) 18,645.03 $2,391 East 2. Beijing (Municipality) 17,652.95 $2,264 North 3. Zhejiang 16,293.77 $2,089 East 4. Guangdong 14,769.94 $1,894 South 5. Tianjing (Municipality) 12,638.55 $1,621 North 6. Fujian 12,321.31 $1,580 South 7. Jiangsu 12,318.57 $1,580 East

Source: China Statistical Yearbook 2006 Note: 1$ = 7.8 RMB

The three Chinese ports are authorized to import U.S. cherries directly include; Guangzhou, Shanghai, and Dalian. Dalian is located in the northern part of China and sources the Beijing market; the only market for U.S. cherries in northern China. According to industry sources, Dalian’s imports in 2006 were nearly zero due to the extended season of locally produced cherries (to the end of July). The season normally ends in June. Beijing’s geographical proximity to the main domestic cherry production areas in Yantai and Dalian make U.S. cherries competitive in price, compared to locally produced cherries. In 2005, the most developed and affluent areas in the east and south of China, accounted for as much as 70 percent of the total national GDP. Similarly, these are also the largest markets for U.S. cherries. In 2006, Wenzhou, a city in Zhejiang province with a population of seven million consumed 1/3 of U.S. cherries imported through the port of Guangzhou. Even as an undeveloped market for the relatively expensive U.S. cherries (when compared to local fruits), Wenzhou traders already receive container loads of U.S. cherries on a daily basis during shipping season, while traders elsewhere in China place orders only on a case-by-case basis. U.S. cherry consumption in Hangzhou, the capital of Zhejiang province, ranked 3rd in average per capita disposable income nationwide following Shanghai and Beijing, surpassed Shanghai in cherry consumption making it the second most important market for U.S. cherries in East China. Two years ago, Shanghai began importing U.S. cherries directly. Due to their high cost (around $84 per 20 lb.case), only a few Shanghai fruit traders ventured in this test market. With progressively more opportunities for U.S. cherries in the Shanghai market, traders will likely increase their direct imports. Guangzhou maintains the dominant position in China for wholesale and distribution of imported fruit. Around 70-80 percent of all imported fruit enters China through the part of Guangzhou. Direct shipments of U.S. cherries to Guangzhou and Shanghai ports reached 34,229 cases in 2006, skyrocketing from 5,337 cases in 2005, a 641-percent jump. Moreover in 2006, 115,000 cases and 28,000 cases of U.S. cherries were re-exported from Hong Kong and Taiwan, respectively, to Guangzhou wholesale markets. Most imported U.S. cherries reach consumers through retail outlets. In 2006, cities like Guangzhou, Wenzhou, and Hangzhou, sourced by the Guangzhou fruit market, enjoyed a

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UNCLASSIFIED USDA Foreign Agricultural Service

reasonable retail price ranging from $12-14/kg, while Shanghai consumers will pay a premium of $20-40/kg for U.S. cherries as a result of much smaller import volume through the Shanghai port. Air shipments of cherries at the beginning of the season are typically much more expensive than mid-late season arrivals by ocean freight. In 2006, unusually hot weather endured in the northwest region of the United States that adversely impacted the quality and price of U.S. sweet cherries. Reduced output raised the export price to higher levels. The cost of importing a case of U.S. sweet cherries to Shanghai peaked at $83 and brought the wholesale price to around $100 per case. However, despite the high cost, exports to China totaled more than 300,000 cases, including re-exports from Taiwan and Hong Kong. During the same period, Taiwan and Japan’s imports dropped by about 30 percent. With the continued marketing support by a variety of cooperator groups and Agricultural Trade Office (ATO), China’s consumption of U.S. sweet cherries will undoubtedly increase in the years to come. Competition: Domestic versus U.S. Cherries Different seasonality and availability in the market from early July to mid August leave U.S. sweet cherries with no competitors in China. The season for Chinese cherries is from the end of April through the end of June, slightly before U.S. sweet cherries enter the market. However, the inefficiencies of handling Chinese cherries shorten its shelf life, and significant transportation costs raise the retail price close to those of imported U.S. cherries. In the production areas of Yantai and Dalian, cherries are picked from the tree earlier in the morning. Without any cleaning, they are then packed and shipped to the airport for immediate air transportation. Although domestic cherries from Yantai and Dalian can be found during the season, consumers are willing to try the imported product as they are expecting to pay nearly the same price for domestic cherries. California cherries will be available in China in mid-May 2007. Before direct imports were allowed to mainland China ports, some traders in south China had handled such products through gray channels and had negative experiences. Because the thinned-skin delicate California variety was too fragile for handling, storage, or transportation; traders suffered sibstantial financial losses. However, industry representatives in China are optimistic about the promising future market. Traders in Shanghai and Guangzhou have shown great interest in importing California cherries directly; the most effective way to make these available to consumers when they are still fresh. It is difficult to predict the exact import volume due to its short (availability only one month from mid-May through mid-June) and limited output. Chile and New Zealand Cherries According to the World Trade Atlas, in 2005 China imported 244 tons of cherries from New Zealand and none from Chile. Chile and New Zealand cherries are available in the market at the end of the calendar year, taking the greatest advantage of the highest sales season: the Spring Festival (Chinese Lunar New Year). A major fruit importer in northern China, (who also has a presence in the Guangzhou fruit market), imported 50 containers of Chilean cherries at the end of 2006. Another major importer based in Guangzhou imported 47 containers, both in time for the Spring Festival sales in February. Plums Increased wealth calls for greater quality and variety by Chinese consumers. Booming consumption of imported fruit also benefits greatly from improved infrastructure, cold-chain storage facilities, and transportation. Although plums are currently a small niche market, Chinese consumers are willing to pay premium prices for high quality imported fruit. According to the World Trade Atlas, China is the 6th largest export market for U.S. plums in 2006.

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UNCLASSIFIED USDA Foreign Agricultural Service

China Imports of US Plums (2004/5)

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2004 2005 2006Year

Val

ue (

$)

0

200

400

600

800

1,000

1,200

1,400

1,600

Vol

ume

(MT

)

Value Volumn

Source: USDA BICO Report

Guangzhou remains the hub for fruit imports from the United States, including plums. Shanghai and Dalian are also open for direct shipment. Most U.S. plums arrive in China through Guangzhou, and are then shipped to major cities like Shanghai and Beijing where disposable incomes facilitate the sale of high-end imported products. Imported U.S. plums are found at high-end retail outlets, restaurants, and four and five star hotels. Retail prices range from $2.56-3.46/1.1 lb. (RMB 20–27/0.5 kg) during the shipping season (from July through September). Four different colored plums (red, yellow, black and green) are available on the market. On-site promotions at retail outlets have proved to be an

effective way to increase product awareness among most Chinese consumers. Sales have doubled and sometimes tripled during these promotion periods. According to industry sources, taste preferences for different plum varieties also vary geographically. Generally, northern China prefers sweet plums while southern China prefers a tart taste. Competition for U.S. plums mainly comes from local plums that share the same season. China began planting U.S. plum varieties in northern China several years back. The overall quality of locally produced plums has improved dramatically in recent years. Australian plums are available from December through January, making them a festival/holiday gift item for the flourishing Chinese Spring Festival market. Chilean plums become available between September and December, after the U.S. plum season ends and before the Australian plum season begins. Peaches/Nectarines and Apricots U.S. peaches/nectarines have not been granted access to China. In 2005, China imported a total of 141 tons (valued at $ 280,680) of plums; all from New Zealand. In 2004, China imported a total of 137 tons of plums of which 4 tons were from New Zealand and the remaining 133 tons (valued at $272,588) from Thailand. China currently does not offer market access to fresh apricot imports.

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UNCLASSIFIED USDA Foreign Agricultural Service

Tables Import Tariff and VAT for Fresh Stone Fruit in 2007 HS Code Description Tariff VAT 08091000 Apricots, fresh 25% 13% 08092000 Cherries, fresh 10% 13% 08093000 Peaches/nectarines, fresh 10% 13% 08094000 Plums and sloes, fresh 10% 13% Source: China Customs

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UNCLASSIFIED USDA Foreign Agricultural Service

2002-2005 China Peach Acreage and Production by Province China Peach Production (1000 Ha and MT) by Province 2002-2005

2002 2003 2004 2005 Province 1000 ha MT 1000 ha MT 1000 ha MT 1000 ha MT

Shandong 108.9 1,210,344 125.9 1,576,537 125.3 1,828,331 126.6 2,011,740 Hebei 89.4 1,009,618 98.5 1,133,773 101.6 1,223,842 99.0 1,248,910 Henan 38.7 362,694 47.4 424,846 55.4 536,342 60.2 601,029 Hubei 38.4 354,276 38.3 404,180 44.7 428,076 43.5 468,766 Liaoning 18.3 185,209 19.3 229,149 19.0 311,140 20.1 346,978 Sichuan 24.7 238,376 28.7 269,816 31.9 310,240 34.2 319,039 Jiangsu 29.6 314,003 29.8 317,105 32.6 326,451 32.8 318,699 Beijing 17.6 244,870 17.4 264,585 16.8 296,409 17.4 306,210 Zhejiang 21.0 189,596 21.7 210,067 23.8 259,595 24.6 285,842 Shaanxi 17.6 143,583 19.1 153,007 22.0 216,680 25.4 280,971 Anhui 12.9 129,150 15.2 167,674 20.4 188,630 20.6 212,186 Fujian 25.8 178,057 26.3 195,809 26.3 190,248 25.7 199,653 Shanxi 6.2 66,379 8.7 102,927 9.9 129,935 9.9 132,355 Guangxi 8.6 53,354 10.8 72,172 13.2 93,589 15.5 122,080 Yunnan 17.0 86,388 16.9 95,803 18.0 104,939 18.2 113,385 Shanghai 7.1 74,063 8.9 101,543 10.0 95,277 7.6 102,818 Gansu 10.4 69,069 11.5 75,254 13.7 74,933 14.2 102,261 Hunan 18.1 67,267 17.3 74,305 20.9 83,591 21.6 94,888 Guangdong N/A 59,021 N/A 61,173 6.6 67,258 7.6 86,860 Guizhou 7.8 51,317 11.2 54,254 12.4 58,865 15.7 65,468 Xinjiang 8.4 27,945 8.9 31,939 10.8 49,390 10.6 56,877 Chongqing 5.6 41,290 8.0 46,295 9.3 48,719 10.0 55,554 Tianjin 4.3 44,850 4.3 49,071 4.4 49,006 4.0 48,997 Jiangxi 9.0 26,505 9.0 26,994 9.6 28,386 10.7 37,392 Ningxia 1.5 2,028 3.7 8,241 3.7 8,312 1.0 2,913 Tibet 0.1 619 0.1 850 0.1 1,259 0.2 1,412 Jilin 0.1 197 0.3 391 0.5 1,121 0.2 612 Qinghai N/A 368 N/A 340 N/A 421 N/A 412 National total

547.1 5,230,436 607.2 6,148,100 662.9 7,010,985 677.1 7,624,207

Source: China Agricultural Statistical Report

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UNCLASSIFIED USDA Foreign Agricultural Service

Production, Supply, and Demand (PSD) Tables Fresh peaches and nectarines

PSD Table Country China, Peoples Republic of

Commodity Fresh Peaches & Nectarines (HA)(1000 TREES)(MT) 2005 Revised 2006 Estimate 2007 Forecast

USDA Official

Post Estimate

Post Estimate

New USDA Official

Post Estimate

Post Estimate

New USDA Official

Post Estimate

Post Estimate

New Market Year Begin 01/2006 01/2006 01/2007 01/2007 01/2008 01/2008

Area Planted 696000 6767 677100 715000 715000 690600 0 0 6975000Area Harvested 0 0 0 0 0 0 0 0 0Bearing Trees 0 0 0 0 0 0 0 0 0Non-Bearing Trees 0 0 0 0 0 0 0 0 0Total Trees 0 0 0 0 0 0 0 0 0Commercial Production 7500000 0 7609207 8200000 8200000 8385000 0 0 8805000Non-Comm. Production 15000 0 15000 15000 15000 15000 0 0 15000Production 7515000 0 7624207 8215000 8215000 8400000 0 0 8820000Imports 141 0 141 120 120 0 0 0 0Total Supply 7515141 0 7624348 8215120 8215120 8400000 0 0 8820000Fresh Dom. Consumption 6523091 0 6617698 7076620 7076620 7193804 0 0 7448000Exports, Fresh 17050 0 17050 18500 18500 20196 0 0 22000For Processing 975000 0 989600 1120000 1120000 1186000 0 0 1350000Withdrawal From Market 0 0 0 0 0 0 0 0 0Total Distribution 7515141 0 7624348 8215120 8215120 8400000 0 0 8820000

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UNCLASSIFIED USDA Foreign Agricultural Service

Trade Matrix

Export Trade Matrix Country China, Peoples Republic of Commodity Fresh Peaches & Nectarines Time Period Units: MT Exports for: 2005 2006 U.S. 0 U.S. 0 Others Others Russia 8355 Russia 8658 Hong Kong 5313 Vietnam 6634 Vietnam 2691 Hong Kong 3970 Singapore 261 Singapore 412 Macau 165 Malaysia 209 Malaysia 116 Macau 203 Thailand 57 Saudi Arabia 41 Saudi Arabia 41 Kazakhstan 34 Indonesia 25 Indonesia 30 UAE 15 Thailand 2 Total for Others 17039 20193 Others not Listed 11 3 Grand Total 17050 20196

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UNCLASSIFIED USDA Foreign Agricultural Service

Export Price Table

Prices Table Country China, Peoples Republic of

Commodity Fresh Peaches & Nectarines Prices in $US per uom MT

Year 2005 2006 % Change

Jan 130 130 0% Feb 180 290 61% Mar 950 150 -84% Apr 410 270 -34% May 360 240 -33% Jun 340 260 -24% Jul 310 300 -3% Aug 360 300 -17% Sep 270 300 11% Oct 220 320 45% Nov 150 150 0% Dec 130 130 0%

Exchange Rate 7.8/1 Local Currency/US $ Date of Quote 2/27/2007 MM/DD/YYYY

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UNCLASSIFIED USDA Foreign Agricultural Service

Fresh plums and prunes

PSD Table Country China, Peoples Republic of Commodity Fresh Plums & Prunes (HA)(1000 TREES)(MT)

2005 Revised 2006 Estimate 2007 Forecast USDA

Official Post

Estimate Post

Estimate New

USDA Official

Post Estimate

Post Estimate

New

USDA Official

Post Estimate

Post Estimat

e New

Market Year Begin 01/2006 01/2006 01/2007 01/2007 01/2008 01/2008 Area Planted 355000 355000 365000 360000 360000 395000 0 0 410000 Area Harvested 0 0 0 0 0 0 0 0 0 Bearing Trees 0 0 0 0 0 0 0 0 0 Non-Bearing Trees 0 0 0 0 0 0 0 0 0 Total Trees 0 0 0 0 0 0 0 0 0 Commercial Production

1680000 1680000 1720000 1710000 1710000 1800000 0 0 1998000

Non-Comm. Production

8800 8800 8800 8000 8000 8000 0 0 8000

Production 1688800 1688800 1728800 1718000 1718000 1808000 0 0 2006000

Imports 8551 8551 8551 7000 7000 2493 0 0 2000 Total Supply 1697351 1697351 1737351 1725000 1725000 1810493 0 0 200800

0 Fresh Dom. Consumption

1064000 1064000 1064000 1091000 1091000 1041000 0 0 1123000

Exports, Fresh 7451 7451 7451 8560 8560 6195 0 0 7500 For Processing 625900 625900 665900 625440 625440 763298 0 0 877500 Withdrawal From Market

0 0 0 0 0 0 0 0 0

Total Distribution 1697351 1697351 1737351 1725000 1725000 1810493 0 0 2008000

Page 16: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 16 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Trade Matrix Tables

Import Trade Matrix Country China, Peoples Republic of Commodity Fresh Plums & Prunes

Time Period Units: MT Imports for: 2005 2006 U.S. 0 U.S. 1946 Others Others New Zealand 8551 New Zealand 547

Total for Others 8551 547 Others not Listed 0 0 Grand Total 8551 2493

Export Trade Matrix Country China, Peoples Republic of Commodity Fresh Plums & Prunes

Time Period Units: MT Exports for: 2005 2006 U.S. 0 U.S. 0 Others Others Vietnam 3526 Vietnam 2421 Russia 1837 Russia 2230 Hong Kong 1792 Hong Kong 1079 Pakistan 88 Malaysia 200 Malaysia 73 Macau 141 Macau 64 UAE 43 Singapore 61 Singapore 41 Italy 3 Italy 15 Spain 2 France 14 Japan 2 Thailand 6 Total for Others 7448 6190 Others not Listed 3 4 Grand Total 7451 6194

Page 17: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 17 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Export Price Table

Prices Table Country China, Peoples Republic of

Commodity Fresh Plums & Prunes Prices in $US per uom MT

Year 2005 2006 % Change

Jan 130 140 8% Feb 120 300 150% Mar 180 210 17% Apr 350 410 17% May 410 850 107% Jun 280 240 -14% Jul 230 280 22%

Aug 270 270 0% Sep 300 390 30% Oct 180 520 189% Nov 170 230 35% Dec 150 140 -7%

Exchange Rate 7.8/1 Local Currency/US $ Date of Quote 2/27/2007 MM/DD/YYYY

Page 18: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 18 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Fresh Apricots

PSD Table

Country China, Peoples Republic of Commodity Fresh Apricots (HA)(1000 TREES)(MT) 2005 Revised 2006 Estimate 2007 Forecast

USDA Official

Post Estimate

Post Estimate

New USDA Official

Post Estimate

Post Estimate

New USDA Official

Post Estimate

Post Estimate

New Market Year Begin 01/2006 01/2006 01/2007 01/2007 01/2008 01/2008 Area Planted 282000 3434 296000 315000 315000 340000 0 0 391000Area Harvested 0 0 0 0 0 0 0 0 0Bearing Trees 0 0 0 0 0 0 0 0 0Non-Bearing Trees 0 0 0 0 0 0 0 0 0Total Trees 0 0 0 0 0 0 0 0 0Commercial Production 1120000 0 1220000 1250000 1250000 1366400 0 0 1500000Non-Comm. Production 17800 0 17800 16000 16000 16000 0 0 15000Production 1137800 0 1237800 1266000 1266000 1382400 0 0 1515000Imports 0 0 0 0 0 0 0 0 0Total Supply 1137800 0 1237800 1266000 1266000 1382400 0 0 1515000Fresh Dom. Consumption 547488 0 616388 568000 568000 635000 0 0 651000Exports, Fresh 1412 0 1412 2000 2000 3249 0 0 4500For Processing 588900 0 620000 696000 696000 744151 0 0 859500Withdrawal From Market 0 0 0 0 0 0 0 0 0Total Distribution 1137800 0 1237800 1266000 1266000 1382400 0 0 1515000

Page 19: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 19 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Trade Matrix Table

Export Trade Matrix Country China, Peoples Republic of Commodity Fresh Apricots

Time Period Units: MT Exports for: 2005 2006 U.S. 0 U.S. Others Others Russia 1411 Russia 3249 Hong Kong 1

Total for Others 1412 3249 Others not Listed 0 0 Grand Total 1412 3249

Page 20: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 20 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Export Price Table

Prices Table Country China, Peoples Republic of

Commodity Fresh Apricots Prices in $US per uom MT

Year 2005 2006 % Change

Jan 130 N/A #VALUE! Feb N/A N/A #VALUE! Mar N/A N/A #VALUE! Apr 360 350 -3% May 360 470 31% Jun 340 570 68% Jul 430 490 14% Aug 450 440 -2% Sep 250 600 140% Oct N/A 300 #VALUE! Nov N/A N/A #VALUE! Dec N/A N/A #VALUE!

Exchange Rate 7.8/1 Local Currency/US $ Date of Quote 2/27/2007 MM/DD/YYYY

Page 21: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 21 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Fresh cherries

PSD Table

Country China, Peoples Republic of Commodity Fresh Cherries,(Sweet&Sour) (HA)(1000 TREES)(MT)

2005 Revised 2006 Estimate 2007 Forecast USDA

Official Post

Estimate Post

Estimate New

USDA Official

Post Estimate

Post Estimate

New

USDA Official

Post Estimate

Post Estimate

New

Market Year Begin 01/2006 10/2006 01/2007 01/2007 01/2008 01/2008 Area Planted 40500 40500 41000 44500 44500 47100 0 0 52700 Area Harvested 0 0 0 0 0 0 0 0 0 Bearing Trees 0 0 0 0 0 0 0 0 0 Non-Bearing Trees 0 0 0 0 0 0 0 0 0 Total Trees 0 0 0 0 0 0 0 0 0 Commercial Production

89600 89600 92000 116500 116500 120000 0 0 145000

Non-Comm. Production

0 0 0 0 0 0 0 0 0

Production 89600 89600 92000 116500 116500 120000 0 0 145000 Imports 286 286 286 200 200 189 0 0 150 Total Supply 89886 89886 92286 116700 116700 120189 0 0 145150 Fresh Dom. Consumption

89525 89525 91925 116280 116280 119823 0 0 144650

Exports, Fresh 61 61 61 100 100 46 0 0 100 For Processing 300 300 300 320 320 320 0 0 400 Withdrawal From Market

0 0 0 0 0 0 0 0 0

Total Distribution 89886 89886 92286 116700 116700 120189 0 0 145150

Page 22: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 22 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Trade Matrix Tables

Import Trade Matrix Country China, Peoples Republic of Commodity Fresh Cherries,(Sweet&Sour) Time Period Units: Imports for: 2005 2006 U.S. 42 U.S. 151 Others Others New Zealand 244 Chile 37

Thailand 1

Total for Others 244 38 Others not Listed 0 0 Grand Total 286 189

Export Trade Matrix Country China, Peoples Republic of Commodity Fresh Cherries,(Sweet&Sour) Time Period Units: MT Exports for: 2005 2006 U.S. 0 U.S. 0 Others Others Singapore 27 Singapore 17 Thailand 12 Hong Kong 13 Malaysia 11 Indonesia 13 Indonesia 5 Malaysia 2 Indonesia 4 Netherlands 2

Total for Others 61 45 Others not Listed 0 0 Grand Total 61 45

Page 23: USDA Foreign Agricultural Service GAIN Report · short shelf life even in cold storages, cold chain transportation makes shipping stone fruit even less attractive to Chinese traders

GAIN Report - CH7017 Page 23 of 23

UNCLASSIFIED USDA Foreign Agricultural Service

Export Price table

Prices Table Country China, Peoples Republic of

Commodity Fresh Cherries,(Sweet&Sour) Prices in $US per uom MT

Year 2005 2006 % Change

Jan 120 390 225% Feb 180 290 61% Mar 950 150 -84% Apr N/A N/A #VALUE! May 3140 13333 325% Jun 3480 4490 29% Jul 1540 3350 118%

Aug N/A 130 #VALUE! Sep N/A N/A #VALUE! Oct N/A N/A #VALUE! Nov N/A 130 #VALUE! Dec N/A N/A #VALUE!

Exchange Rate 7.8/1 Local Currency/US $ Date of Quote 2/27/2007 MM/DD/YYYY