Northeast China Initiates Soybean Revitalization Plan

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Last updated at: (Beijing Time) Friday, April 12, 2002

Northeast China Initiates Soybean Revitalization Plan

Since Premier Zhu Rongji disclosed at a press conference that soybean imports from the United States last year equalled China's annual soybean harvest, this important legume has been a major focus of concern in the country. Recently a plan was initiated in one of China's granaries, Heilongjiang Province to strengthen the country's soybean industry.

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A soybean action plan was recently initiated in one of China's granaries, Heilongjiang Province, according to the Beijing-based China Radio International.

Since Premier Zhu Rongji disclosed at a press conference that soybean imports from the United States last year equalled China's annual soybean harvest, this important legume has been a major focus of concern in the country. The action plan is designed to strengthen the country's soybean industry.

According to the soybean action plan, northeast China's Heilongjiang province will build a soybean quality improvement station, a seed growing farm, and a production base of 660 thousand hectares in three to five years' time.

The action plan is designed to cope with the severe challenge that is facing China's soybean industry.

A national survey shows that, of the prices of staples such as rice, wheat, and corn, soybean was the only one that saw a price decline last year. Moreover, there is an oversupply of soybeans in China's major soybean growing areas.

Why is this?

The answer is quite simple. The cost of soybean in the United States is about half of the price of that grown in northeast China.

Moreover, American soybean is also better in terms of quality. When pressed to extract oil, American soybean produces 20% oil, compared with only 17% for domestic soybean.

What's the way out, then?

The fact that China is a WTO member excludes the possibility of building trade barriers. In fact, the low 3% duty on soybean imports that China imposed this year has given easy access for foreign soybeans.

So the only solution is to enhance the quality of domestic soybeans and to produce them in an industrialized efficient way, said the State-owned radio station.

Under the action plan, over 100 million yuan, or 12 million US dollars, has been channeled to build soybean breeding and processing centres and to upgrade the machines used for soybean growing and harvesting.

Can Chinese Soybean Survive the Fierce Competition?

With a relative low cost and therefore lower price, genetically modified or GM soybeans account for a major part of the soybeans imported to China, where traditional Non-GM soybeans dominate the country's output.

The Jiusan Oil Group in northeast China's Heilongjiang Province, by first sticking a Non-GM label on its products, is trying to seize the advantage in market competition.

This is based on the understanding that natually-produced soybeans are the safest, Tian Renli, general manager from the Jiusan Oil Group was quoted as saying.

Some developed societies like Japan and EU countries are scrupulous about the import of GM food. And now China is demanding that the GM content is shown on the label of food products. This will give consumers the right whether or not to buy GM or Non-GM food.

But people are still not confident about GM food, Tian told the radio, so the promotion of Non-GM soybeans will increase the competitiveness of domestic soybeans.

However, a researcher from the Chinese Academy of Sciences, Zhu Zhen said this is not the best choice in the long run, reported the radio station.

He has doubts about using non GM food as a barrier to protect domestic farm products.

Firmly believing in the safety and potential of marketing GM food, Zhu Zhen said that largely promoting Non-GM soybean is only a temporary method in international trade.

Only through reducing costs and improving quality can Chinese soybeans survive in the future.

The major problem of Chinese soybean production lies in the seed cultivation, Zhu told the radio. There is not a specific objective in the cultivating process, such as on oil content which has made our product less competitive.

The transportation from the farm to the market needs to be simplified to cut cost of the product, Zhu said to the radio.

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