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Foreign Food Exporters to Chinese: Take Big Bite
"have you eaten yet?" It's a common greeting in China. It highlights how important eating is to Chinese, and that's why overseas and domestic companies are scrambling to fill the Chinese stomach.

Last year, food sales in Shanghai rose 7.9 percent over 2000 to 75.7 billion yuan (US$9.1 billion), representing 41 percent of the city's total retail sales. The figure is forecast to rise 7 to 8 percent in 2002.

"Food has become the major cash cow for local retailers, accounting for 48 percent of sales at supermarkets, 74 percent at hypermarkets and 89 percent at convenience stores," said Hong Guankang, vice director of Shanghai Chain Store Association.

China's recent entry into the World Trade Organization means foreign companies will flood into the domestic food market, intensifying competition, industry officials said.

"As part of its WTO commitments, China will lower its tariffs on U.S. priority products like beef and poultry to 14 percent from 31 percent," LaVerne E. Brabant, U.S. consul for agricultural affairs, said yesterday at the 2002 Shanghai Food Market Summit. "The tariff on frozen beef, in particular, will drop by 33 percentage points to 12 percent."

"Although the United States exported only 6 percent of its agricultural products to the Chinese mainland and Hong Kong in 2000, we see good market potential here," Brabant said. "About 2 million Chinese can afford to buy U.S. products on a regular basis. We have offices in cities with strong economic growth like Shanghai and Guangzhou, and will expand to others like Dalian and Chengdu."

On average, Chinese consumers spend only US$1 annually on American products, which have huge room to grow owing to the rising brand awareness and demand for convenience food, he said.

Deng Huada, a commercial officer of the Canadian Consulate General, meanwhile, said Canada is poised to introduce more food products to the Chinese market.

Canada exported fruits and vegetables worth C$758 million (US$478 million) to China in 2000, while importing Chinese products worth C$394 million.

Meanwhile, a monthly economic magazine, Business Information of Shanghai, yesterday released its lists of top 10 brands in a dozen cate-gories, including candy, wine, cigarettes and ice cream.

Domestic brands were ranked No. 1 in several drinking products categories, such as wine, beer and mineral water. Foreign brands led in categories such as chocolates, biscuits and milk power.

(Shanghai Daily February 01, 2002)

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