CHINA

1

• CHINA
• MARKET BRIEFING

FEBRUARY 2008
U.S. Wheat Associates CHINA
2
China Population 1.3 billion
3
China Economy Fastest Growing Major
Economy (2007 growth 11.5 - 11.9)
(Billion US)
lt 2005 2006 actual growth 10 - 10.9 gt
Source China National Statistics Bureau Exchange
rate _at_7.6 (2007), growth rate 2008-2010 _at_8.5,
2011-2020 _at_7
4
High Per Capita GDP Growth
(Unit US)
Source China National Statistics Bureau Exchange
rate _at_7.6 (2007), growth rate 2008-2010 _at_8.5,
2011-2020 _at_7
5
China Wheat area PRC 23.5 MHa / USA 23.4 MHa
6
China - 15 MAJOR PORTS

• Yantiai
• Qingdao

7
China Wheat Situation
8
Chinese vs. Rest of the World Ending Stocks
China accounted for 49 of world stocks in
1999/2000, down to 29
9
Chinas Soybean Supply / Demand
10
Chinas Rice Supply / Demand
11
Chinas Corn Supply / Demand
12
China Wheat Area and Production
4.6
107
23.0
13
China Wheat Production - Major Producer
Provinces
(Unit MMT)
Source China National Grain Oil Information
Center (CNGOIC) Estimate
14
China Wheat Yield - By Major Province
(Unit MT/Ha)
Source China National Grain Oil Information
Center (CNGOIC) Estimate
15
China Daily Grain Market Price
Source China National Grain Oils Information
Center Exchange rate _at_8.0 since Sep 2004, _at_7.86
since Nov 2006, _at_7.55 since Jul 2007 _at_7.5 since
Aug 2007, _at_7.15 since Jan 2008
16
U.S. FOB PNW Prices
17
SRW and Soft White Prices
18
Ocean Freight Rates for Grains
19
China Wheat Imports - Calendar Year by Country
(Unit MMT)
Source China Customs Statistics
20
China Flour Imports - Calendar Year by Country
(Unit TMT)
Source China Customs Statistics
21
Chinas US ImportsPurchases and actual imports
Containerized and bulk vessel shipments
376
152
SW/WW-178 NS/DNS-188 SRW 66
HRW 0.5 SW/WW-5.8 NS/DNS-3.3 SRW 57.3
HRW 0.3 SW/WW-10.5 NS/DNS-0.7 SRW 0
725
516
(July June)
22
China Wheat Exports - Calendar Year by Country
(Unit MMT)
Source China Customs Statistics
23
China Wheat Exports - Crop Year by Country
(Unit MMT)
Source China Customs Statistics Crop Year from
June to next May
24
China Flour Exports - Calendar Year by Country
(Unit 10 TMT)
Source China Customs Statistics
25
China Flour Exports - Marketing Year by
Country
(Unit 10 TMT)
Source China Customs Statistics Marketing Year
from July to next June
26
Chinas flour consumption estimates 70
MMT
27
Market Quality Segments
28
QSR Expansion (Quick Service Retail)Western-Style
Fast Food
Source China Food Industry Association and
internet
29
HRW HWW Use China( HWW - 12.5 or higher
protein )

• Western Pan Bread
• (only pan loaf tested in OVA)
• Sweet Breads
• European Hearth Breads
• Dumpling (Jiao Zi) Wrappers
• Premium Grade Chilled and Fresh Noodles

30
Policies Affecting Wheat

• Domestic intl price differential
• TRQ
• Value added tax - VAT
• Milling wheat and flour exports
• VAT, TRQ
• Flour exports to other Asian markets
• Animal plant quarantine rules
• Dockage and non-wheat seeds
• TCK and KB fungus
• Insects
• MRLs for pesticides
• Food labeling requirements

31
US Wheat Activities

• Trade servicing and information
• Weekly price report
• Crop and harvest progress reports
• Supply demand reports
• Industry Government relations
• Publications
• Chinese or dual language
• Sino America Baking School
• Instructor training (USA, Europe, Asia)
• Baking technical servicing
• Milling technical servicing
• Wheat procurement training
• Overseas Varietal Analysis
• Asian products collaborative

32
Questions / Answers