China has agreed to allow imports of rice from the U.S. for the first time, United States Secretary of Agriculture Sonny Perdue announced on Thursday.
“The agreement with China has been in the works for more than a decade and I’m pleased to see it finally come to fruition, especially knowing how greatly it will benefit our growers and industry,” Perdue said in a statement announcing that the long-delayed phytosanitary protocol to permit the import of U.S.-milled rice into China had been signed.
The announcement could be a big deal for rice farmers in Colusa County and the Sacramento Valley.
China is the world’s largest producer of rice. Since 2013, it has also been the world’s largest importer. The United States Department of Agriculture (USDA) expects China to import 4.8 million metric tons of milled rice in 2017/18, making it the world’s largest import market, according to USA Rice.
California is the second largest rice producing state, with more than 95 percent of the state’s approximately 550,000 acres of rice being grown in the Sacramento Valley. California ships about two million tons overseas to customers on average each year.
“The potential is there for market growth. It’s not a bad thing, for sure,” said Colusa County Agricultural Commissioner Greg Hinton. The biggest boon to the area’s growers and millers could be an increase in prices, which have been down in recent years.
“I know that it’s going to be good for the market and for the industry. Prices have been really depressed lately. They’ve come up a little bit recently, but it’s been a tough last couple of years for the rice growers,” said Colusa County Supervisor Denise Carter, who is also a rice grower. “China represents a huge market, and we produce a quality product. I think that’s where, for California rice, in particular, this is going to be a big deal.”
The target market for US rice, and particularly California-grown rice, is China’s emerging middle class, Hinton said.
“Everything I’ve heard about it is what the U.S. is betting on is that the middle class in China will be looking for a better quality product (than what is grown in China domestically),” Hinton said. “We already have that. If they’re looking for better quality rice, it could really be a boost to us. It’s a gamble, but it’s a good one, and I’m glad that market opened up.”
While the potential is there for rice prices to rebound against the backdrop of the newly-opened market in China, it’s by no means a guarantee. It certainly won’t happen immediately.
Before any U.S. growers can export any rice to China, the new rice protocol between the two countries will need to be implemented. According to USA Rice, it is the most complex rice phytosanitary agreement the U.S. has ever entered into. The USDA said that exports to China can start after Chinese officials complete an audit of U.S. rice facilities.
“I think there is excitement to it, but rice farmers – until they can get that product over there – aren’t going to get excited about anything. I think everyone is on the fence, just waiting to see what this does to the market,” Hinton said. ■
Photo by Cheri Azevedo.