China Open Rice Market to Exports from U.S.

The largest rice market in the world will soon open to farmers in the U.S.

Following negotiations that lasted years, China finally agreed to open its domestic rice market to U.S. rice exports marking the first time ever China has agreed to that, acknowledging the need it has for foreign shipments in order to meet the ever-growing demands of its huge middle class.

The market presents a great opportunity with incredible potential to grow, said Sonny Perdue the U.S. Agricultural Secretary in a prepared statement this week announcing the new agreement.

China is the largest producer as well as consumer of rice in the world, but has had to turn more towards imports the past few years to meet its domestic demand.

With close to 5 million tons of rice purchased from other countries in 2016, China was also the largest importer in the world.

American farmers for years have tried to gain access to the Chinese rice market, but several cultural, economic, bureaucratic and political obstacles always stood in their way.

The opening of the market could be a huge boon for a number of rice farmers in the U.S. who are struggling and have faced oversupply and sluggish prices for years.

Rice farmers in the U.S. produce on average 9 million tons annually, and consumers in China eat that same amount in only two weeks, according to a trade group in the industry known as USA Rice.

The market in China opening to U.S. farmers is contingent on the inspection then approval of facilities in the U.S. by Chinese quarantine and inspection officials.

If that all goes to plan, shipments from the U.S. to China, could begin later in 2017 or in the early part of 2018, said a member of USA Rice.

A big breakthrough took place early in 2016 when the two countries agreed on phytosanitary protocol, which sets the terms for sanitary conditions for milled rice from the U.S.

Officials in China are concerned over the possibility of some pests being in rice products entering China.

A member of USA Rice said the phytosanitary agreement was the most complex that the rice industry in the U.S. had entered into, but the potential overall size of the Chinese market makes it all worthwhile.