policy issues

Market Access in China Stymied by Regulatory Barriers, Trade Spats

China is both the second largest economy and importer in the world. Since its accession into the World Trade Organization in 2001, the country’s gross domestic product has grown from being ranked sixth globally to now representing roughly 15 percent of the world’s GDP. With this economic boom, China is experiencing more liberalization, rising living standards, a growing middle class and changing consumption patterns. Yet, opportunities for U.S. industries to access this burgeoning marketplace continue to be stifled by regulatory barriers and trade disputes.

Now more than ever, the Chinese people are incorporating meat and dairy products into their diets. In its attempts to be self-sustaining, the country has begun not only growing more animals, but also producing more meat, poultry and dairy products. To keep pace with the growing food demands of a growing population, the Chinese feed industry has been scaling up at an average rate of more than 10 percent over the past 20 years, now becoming the world’s largest with a total output of 187.9 million metric tons of feed in 2018. However, the Chinese feed industry continues to be plagued by on-farm, outdated production technology and techniques, environmental pollution, low-quality inputs, poor machinery and low management expertise in small-scale operations, which have led to feed safety problems.

With a total output of 187.9 million metric tons, China's feed industry is one of the world's largest.

The U.S. feed industry, by comparison, has long been recognized as a leader in the development and deployment of products to increase feed production and feed conversion ratios and reduce production costs, in accordance with stringent food safety regulations. With so much to offer in terms of technology and expertise, it is no wonder that China has become one of the largest single export markets for U.S. feed and feed ingredients, valued at over $394 million in 2018 (excluding alfalfa and hay products). Yet, many regulatory hurdles remain that are reducing the U.S. animal food industry’s access into this burgeoning marketplace.

Feed Exports to China

The American Feed Industry Association continues to work with the U.S. government to advocate for U.S. feed, feed ingredients, pet food and animal food manufacturing technologies to have greater access into the Chinese market by urging China to modify some of its outdated and unnecessary regulatory policies. Ongoing trade disputes between the United States and China, however, challenge the relationship between the two countries, and U.S. animal food manufacturers are at risk of losing their place in this vital marketplace in the future.

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