expected to shrink crop yields and the amount of available farmland, which will in turn
reduce the country‘s domestic food supply (Reuters, August 22, 2007).
The Chinese government has encouraged investment in the rural economy and theagricultural sector is growing at approximately 3% per year. The government growth target for the agricultural sector is just over 5% annually. However, due to environmental challenges, such as thedesertification of arable land and drought, growth has been slower than expected.
China boasts the world‘s second largest economy. Agriculture accounts for nearly 11% of that economy and
employs more than 40% of the labour force. China is a major exporter and importer of agri-food
products, as well as the world‘s largest exporter of seafood products, making it a market with many
opportunities for Canadian agri-business.
China is a net importer of agri-food and seafood products. In 2008, its agri-food and seafood trade
deficit was over US $18 billion. China‘s agri
-food and seafood imports have been growing over the pastfive years at an average of 21% a year (Global Trade Atlas, 2009).
China‘s key agri
-food and seafood imports in 2008 were soybeans, cotton, refined palm oil, crudesoybean oil, and wool. Key suppliers in 2008 were the United States, Brazil, Argentina, Malaysia andAustralia.
Major processed food imports in China include: palm oil, soybean oil, fish meal, beef hides and frozenfish. Malaysia, the United States and Argentina are the largest suppliers of processed food to China,
accounting for approximately 41% of China‘s processed food imports (Global Trade Atlas 2009).
There is great growth potential for high-quality Canadian food products among discerning Chinese
consumers. China is an increasingly important trading partner of Canada and is Canada‘s fourth largest
export market for general merchandise products. In 2008, these exports totalled $10.5 billion and accountedfor over 2% of overall exports, up from $4.8 billion in 2003.China is also an important export market for Canadian agri-food and fish and seafood. In 2008, exports toChina of agri-
food products exceeded $1.5 billion, up from $400 million in 2003. China was Canada‘s fourth
largest export market for agri-
food products, accounting for almost 4% of Canada‘s total agri
Canada‘s exports of fish and seafood to China are also important but have shown less rapid growth than
exports of agri-food products. In 2008, Canada exported $258 million in fish and seafood products to China,
up from $255 million in 2003. This accounted for 7% of Canada‘s total fish and seafood exports, makingChina Canada‘s third largest export market for fish and seafood products.
Canada‘s top agri
-food and seafood exports to China were canola seeds, canola oil, snow crabs,soybeans, and peas.
Canada registered an agri-food trade surplus of CAD $0.9 billion with China.
Canada‘s top agri
-food and seafood imports from China include: apple juice, frozen fish meat, frozenshrimp, mushrooms and sole fillets (Statistics Canada 2009).
Processed food imports continued a five year growth trend and reached US $25 billion.
Canada supplied approximately three percent of China‘s processed food imports.
GLOBAL TRADE POSITION
CANADA’S TRADE RELATIONSHIP WITH CHINA