Required Report - Public distribution

**Date:** 12/22/2008

**GAIN Report Number:** CH8078

CH8078

**China, Peoples Republic of**

**Agricultural Situation**

**Livestock and Products**

**2008**

**Approved by:**

![](media/image1.wmf)Michael Woolsey

AGBEIJING

**Prepared by:**

Zhang Jianping and Chanda Beckman

**Report Highlights:**

China's beef production in 2009 is expected to rise just two percent to
6.4 MMT, as increased input costs and comparatively low net returns
continue to constrain supply growth. Pork production in 2009 is forecast
to reach 46 MMT, up three percent over 2008, but still well below
pre-blue ear disease levels of 52 MMT in 2006.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Annual Report

Beijing \[CH1\]

\[CH\]

Table of Contents

[Cattle and Beef 3](#cattle-and-beef)

[Increasing Beef Production, but Pace Slow
3](#increasing-beef-production-but-pace-slow)

[National Beef Cattle Genetic Improvement Center Launched
3](#national-beef-cattle-genetic-improvement-center-launched)

[Chinese Official Elected OIE Commission Vice President for Asia-Pacific
Region
4](#chinese-official-elected-oie-commission-vice-president-for-asia-pacific-region)

[Domestic Bovine Semen Subsidy Challenges U.S. Bovine Genetics Exports
4](#domestic-bovine-semen-subsidy-challenges-u.s.-bovine-genetics-exports)

[High Beef Prices Impact Consumption
4](#high-beef-prices-impact-consumption)

[Increasing Beef Imports 5](#increasing-beef-imports)

[Decreasing Live Cattle and Beef Exports
5](#decreasing-live-cattle-and-beef-exports)

[Swine and Pork 5](#swine-and-pork)

[Pork Production Recovering Quickly
5](#pork-production-recovering-quickly)

[Impact of New Corporate Income Law on Swine Production
6](#impact-of-new-corporate-income-law-on-swine-production)

[Impact of Strategic Meat Reserves for Frozen Meat
6](#impact-of-strategic-meat-reserves-for-frozen-meat)

[Pork Consumption Recovering Quickly
6](#pork-consumption-recovering-quickly)

[Pork Imports to Decrease Due To Rising Domestic Production
7](#pork-imports-to-decrease-due-to-rising-domestic-production)

[Decreasing Live Swine and Pork Exports
8](#decreasing-live-swine-and-pork-exports)

[Statistics Tables 9](#statistics-tables)

[Cattle PS&D Table 9](#cattle-psd-table)

[Meat, Beef, and Veal PS&D Table 10](#meat-beef-and-veal-psd-table)

[Cattle and Beef Trade Matrices 11](#cattle-and-beef-trade-matrices)

[Swine PS&D Table 14](#swine-psd-table)

[Pork PS&D Table 15](#pork-psd-table)

[Swine and Pork Trade Matrices 16](#swine-and-pork-trade-matrices)

Executive Summary

China's total meat production in 2009 is forecast to increase nearly
four percent to 73.8 million metric tons (MMT). Beef production is
expected to be roughly unchanged as growth in beef cattle has slowed
significantly due to increased production costs, led by energy, feed,
and labor.

Pork production in 2009 is expected to rise by three percent to 46 MMT
compared to the previous year as China continues to recover from a
devastating outbreak of PRRS (blue-ear disease) in 2007. Continued
government support for swine production, including nation-wide and local
subsidies to sow producers, and reduced PRRS detections, will fuel
modest production gains. Post believes production could begin
approaching pre-PRRS levels by the end of 2009.

# Cattle and Beef

## Increasing Beef Production, but Pace Slow

FAS Beijing (Post) forecasts China's beef production in 2009 to increase
by nearly two percent to 6.4 MMT, up from the revised 2008 estimate of
6.3 MMT. Increased feed and other production costs have pushed many
backyard or smaller operators out of cattle rearing. Although China
reported a modestly higher grain harvest in 2008, grain prices are
expected to continue relatively high, as the minimum purchase price for
this year's grain crop was raised under China's grain security strategy.
Cattle producers also continue to be affected by outbreaks of Foot and
Mouth Disease (FMD).

The sluggish prospects for Chinese beef production is in contrast to
production of other livestock products, which enjoy substantial
government support. Beef cattle subsidies are not yet on the government
subsidy agenda, despite repeated calls from the beef cattle industry for
more support. Low subsidy levels can be partly explained by the fact
that beef only accounts for nine percent of China's total meat
production. The high-end beef market is also small in China, which is
mainly satisfied by imports. Therefore, beef is not as critical as pork
which accounts for over 60 percent of China's total meat production or
dairy products that have become more and more important source of
nutrition in China.

According to China's cattle industry, the bulk of profits lie in the
fattening and slaughter sectors as opposed to beef cow rearing for
reproduction, which is slow because it takes about one year for a cow to
produce one calf. Gross earning from one calf (not including labor and
grass material costs) is only about U.S. \$145 (1,000 RMB) on average.
Therefore, beef cow producers are not expected to expand new placements
by a large margin in 2009. If government subsidy or supports for beef
producers fail to materialize in the coming years, the beef cow
inventory could actually drop, reducing calf crop production after 2009.

Although China's new Law on Corporate Income Tax (effective January 1,
2008) exempts companies involve in cattle rearing from paying corporate
taxes, it has not yet attracted domestic and international investment in
the beef sector, unlike the swine sector where investment has grown
substantially after in the wake of the new law. As production costs
continue to increase and with little government support, profit for beef
production continues to shrink relative to poultry and swine.

## National Beef Cattle Genetic Improvement Center Launched

With investments totaling \$623,188 (4.3 million RMB), the National Beef
Cattle Genetic Improvement Center opened its doors in March 2008 at the
Northwest Agriculture and Forestry University in Yangling, Shaanxi
Province. This university is well known for its animal science program.
In response to an urgent need to improve beef cattle production
efficiency to curb high production costs, the university will focus on
building a platform to demonstrate industrialization of genetic
improvements for beef cattle production and feeding technologies through
information collection, analysis, and research on China's high-quality
beef cattle genetic resources. However, it could take several years to
commercialize research results.

## 

## Chinese Official Elected OIE Commission Vice President for Asia-Pacific Region 

The World Organization for Animal Health (OIE) convened its 76^th^
session of the General Assembly in Paris, France at the end of May 2008.
At the meeting Zhang Zhongqiu, Deputy Director General of the Veterinary
Bureau at MOA was elected OIE Commission Vice President of the
Asia-Pacific Region. This is the first time a Chinese official has
served as an official of this organization. China has not yet lifted its
ban on imports of live cattle and beef products from the United States
due to BSE-related restrictions. Zhang's election to this new position
will hopefully foster a better understanding in China of OIE principles
for beef trade with countries where BSE has been detected.

## ­­­­­­­­­­­­­­­­­­­­­­Domestic Bovine Semen Subsidy Challenges U.S. Bovine Genetics Exports 

China banned U.S. live cattle exports to China on December 25, 2003 due
to BSE-related restrictions. It reopened its market for U.S. frozen
bovine semen in 2005. Since then, the United States has become the
largest foreign supplier to China's bovine genetics market. An emerging
market lies in China's dairy genetic improvement. The Chinese government
subsidizes artificial insemination for dairy cows and offers two straws
of high quality frozen Holstein bull semen per cow at a price of U.S.
\$2.20 (15 RMB). A new policy went into effect in late 2007 that
provides U.S. \$72.50 (500 RMB) for each high quality dairy cow heifer
produced from pure-bred breeding stocks with registered bloodlines.
These pure-bred breeding stocks are selected and cultivated at domestic
breeding centers approved and registered by the Ministry of Agriculture
(MOA). Many of China's existing pure-bred breeding cows and bulls that
are currently registered with MOA were imported from the United States
before the outbreaks of BSE in North America. However, the United States
cannot presently export breeding cows or bulls to China due to
BSE-related restrictions. Currently U.S. trade potential lies with
frozen semen exports to China. The U.S. Agricultural Trade Office in
Guangzhou has implemented an Emerging Market Program to use 2,500 straws
of U.S. frozen Holstein bull semen to train Chinese dairy cow raisers to
conduct artificial insemination among selected dairy cows in China. The
program is intended to demonstrate the high quality of U.S. genetic
materials to Chinese dairy cow producers. (For more details, please see
Post's annual dairy report CH8111.)

## High Beef Prices Impact Consumption 

![](media/image2.wmf){width="4.75in" height="1.875in"}

China's beef consumption in 2009 is forecast to increase by nearly two
percent to 6.3 MMT, up from the revised 2008 estimate of 6.2 MMT. Slower
disposable income growth due to global economic weakness and high
domestic beef prices are expected to hinder beef consumption growth in
the remainder of 2008 and in 2009.

From January to September 2008, China's average retail beef prices
increased by 49 percent to RMB28,250 (\$4,154) per ton, up from RMB
18,988 (\$2,792) per ton over the same period in 2007. These high prices
were mainly attributed to an eight percent decline in pork production in
2007 due to PRRS, which hampered supply, and increased demand for
substitute meats. The average unit price for imported beef from January
to October 2008 was over \$5,384 per ton, even higher than domestic
prices. Beef prices are expected to continue to exceed pork and poultry
prices in 2009 due to slow growth in production.

## Increasing Beef Imports

FAS Beijing forecasts China's beef imports in 2009 to increase by ten
percent to 11,000 MT, up from the revised estimate of 10,000 MT in 2008.
Whether or not China resumes imports of U.S. beef is a key question as
resumption in U.S. beef trade will likely result in significantly higher
import volumes. At the moment, Australia is the largest direct beef
supplier to China's import market while Uruguay recently surpassed New
Zealand to become the second largest supplier. Growth in Uruguayan beef
imports are mainly attributed to reduced New Zealand beef supplies due
to drought and significantly lower prices on Uruguayan beef. Brazil is
the largest supplier of re-exports to China via Hong Kong in 2008. Hong
Kong's beef re-exports to China decreased by 51 percent during
January-October 2008, partly because China temporarily reduced import
tariffs for meat products from June 1 to December 3, 2008, to curb high
meat prices. This encouraged direct shipments by reducing profitability
of transshipments.

Most imported high-end beef is targeted toward foreign tourists. While
the world economic crisis has not significantly affected China's
tourism, the number of foreign tourists traveling to China continues to
fall. It the sluggish tourist numbers continue into 2009, the beef
import pattern may shift toward more lower-priced offals consistent with
Chinese tastes and preferences.

## Decreasing Live Cattle and Beef Exports 

Post forecasts China's live cattle exports in 2009 to decrease by six
percent to 30,000 head, down from the revised 2008 estimate of 32,000
head, and beef exports to decline by 21 percent to 48,000 MT from
revised estimate of 61,000 MT. This reflects the slow increase in
China's cattle and beef production. Hong Kong and Macau are China's
dominant live cattle export markets, with Hong Kong accounting for 90
percent of the export market share. The appreciation of the RMB against
the Hong Kong Dollar[^1] has led to higher export prices, constraining
exports as a result.

# Swine and Pork 

## Pork Production Recovering Quickly

Post forecasts China's pork production in 2009 will rise three percent
to 46 MMT, continuing a recovery from the devastating PRRS disease
outbreak in 2007. Reduced PRRS detections, expected lower feed costs due
to a record grain harvest in 2008, and continued government subsidies
for sow production will help foster the modest gains. Pig crop
production in 2009 is forecast to increase by three percent based on a
one percent increase in the previous year. Post believes China's pork
production will begin approaching pre-PRRS levels by the end of 2009.

While Post expects continued production gains, feed costs will continue
to challenge Chinese pork producers. Feed accounts for 70 percent of the
total swine production costs in China. Producers prefer rations that
contain 60-70 percent corn. While corn and other feed costs have
gradually fallen in recent months, they remain more than 20 percent
higher than in the same period in 2007. Meanwhile, hog and pork prices
have decreased over 10 percent due to increased production. With lower
prices and continued high feed costs, some swine farmers, especially
backyard and small operators, fear losing money on their operations.
This fear could translate into dampened enthusiasm for increasing
production in 2009.

## Impact of New Corporate Income Law on Swine Production

On December 11, 2007, the State Council announced the "Regulation on
Implementing the Law of the People's Republic of China on Corporate
Income Tax" effective January 1, 2008. The new regulation exempts
companies involved in animal and poultry rearing or primary simple
processing from paying the 25 percent tax on corporate income. This new
tax law has already attracted large domestic and foreign investment in
swine rearing. For example, the China National Cereals, Oils and
Foodstuffs Corp. (COFCO), the country\'s largest oils and food importer
and exporter, started a five-year pig raising project, investing U.S.
\$1.36 billion in Hubei Province, Central China. COFCO will build a
500,000 head reproducible sow breeding base, a 10 million live pig
raising demonstration project, and establish centers for pig breeding
technology research and swine disease prevention. In addition, a U.S.
investment bank is reported to have bought over 10 farms in Jiangxi and
Fujian provinces. Foreign companies are also investing through joint
ventures with domestic partners. The Tangrenshen Company in Hunan
Province recently undertook a new 10 million swine project, which will
be completed in the next few years. FAS/Beijing believes these
investments will show returns primarily after 2009 because it should
take at least two years to begin production. These developments will
translate into more concentrated swine rearing in the future, pushing
more backyard and small operators out of the swine business.

## Impact of Strategic Meat Reserves for Frozen Meat 

Most of China's strategic reserves are pork. Beef and mutton reserves
are small and designated for specific consumers. There is no reserve for
broiler meat, because broiler production cycles are short and producers
can easily recover from supply disruptions. Most strategic reserves in
China are held as live animals because of the high costs associated with
storage in cold warehouses. The Ministry of Commerce (MOFCOM) identifies
and approves swine farms for live reserves. The government provides
certain subsidies to guarantee an adequate swine supply when needed. If
there is no need four months into the future, farmers can sell their
swine and replace them with new animals. The disruption in production
caused by PRRS, and natural disasters like the May 2008 earthquake in
Sichuan Province and the ice storm in South China in early 2008, forced
the government to increase frozen meat reserves to guarantee an adequate
supply. MOFCOM requested provincial level reserves large enough to
supply China's more than 500 million urban residents for seven days.
Imported pork accounts for most of China's pork reserves. Smithfield, a
U.S. company, is the largest supplier to the central reserves. However,
China's imports in 2009 for central reserves are expected lower due to
improving domestic production.

## Pork Consumption Recovering Quickly

China's pork consumption in 2009 is forecast to continue recovering,
rising three percent to 46.2 MMT, up from the revised 2008 estimate of
44.9 MMT in 2008. As producers have improved control of PRRS, consumer
confidence has recovered quickly. Pork is still the most popular animal
protein accounting for over 60 percent of China's total meat
consumption. For much of 2008, sharply higher pork prices due to reduced
supplies provoked the Chinese government to take a number of steps to
reduce prices and assist consumers. These included providing subsidies
at RMB 30-60 (\$4.40-8.70) per person per month for the lowest-income
consumers to buy meat for six months in 2008. The government also capped
meat prices in February 2008 following the winter ice storm that swept
South and Central China and caused transportation and distribution
channel disruptions. China also temporarily reduced its frozen pork
import tariffs from 12 percent down to six percent from June 1 to
December 31, 2008 to boost imports to help reduce upward price pressure.
Domestic pork prices have since fallen significantly in response to
large imports and increased domestic production. Consumers have
increasingly switched back to pork consumption from poultry because of
lower pork prices. This trend is expected to continue into 2009.

# ![](media/image3.wmf){width="4.916666666666667in" height="2.2402777777777776in"}

## Pork Imports to Decrease Due To Rising Domestic Production

Post forecasts China's pork imports in 2009 to fall to 360,000 MT, down
significantly from the revised estimate of 480,000 MT in 2008. Increased
domestic production and slowed Chinese economic growth are expected to
constrain imports.

China is the sixth largest export market for U.S. pork. U.S. exports to
China from January to October 2008 increased eight times to 170,553 MT
valued at \$304.7 million through direct shipments accounting for 61
percent of the total value of China's imports. U.S. exports to China via
Hong Kong re-exports during the same period reached 30,844 MT valued at
HK\$361.9 million. A substantial portion of U.S. pork is used for
China's strategic reserves, a government subsidized program used to
stabilize the market and ensure steady supplies. In 2009, China's
increased domestic pork production and declining pork prices will reduce
the need for strategic reserve imports. If needed, the Government may
choose to increase live animal reserves when domestic swine are
available and price competitive. Imports will also be slowed by higher
meat import tariffs, which will return to 12 percent from six percent in
January 2009.

China's imports from the EU (led by France and Denmark) have increased
fast due to competitive prices. A significant factor is facilities in
the United States and Canada have to make often costly adjustments to
operations to meet China's zero tolerance for ractopamine residues,
while the EU does not since use of ractopamine is forbidden in the EU.
U.S. exporters are often warned or suspended by AQSIQ if ractopamine
residues are found. USDA/FAS and FDA are communicating with MOA to
encourage a science-based policy on ractopamine.

## Decreasing Live Swine and Pork Exports

China's live swine exports in 2009 are forecast to decrease by three
percent to 1.5 million head from the revised estimate of 1.54 million
head in 2008. Pork exports in 2009 are forecast to decrease seven
percent to 200,000 MT. The September 2008 contamination of Chinese milk
and animal feed with the industrial chemical melamine has reduced
overall foreign demand for related products due to food safety concerns.
Japan and Kyrgyzstan, China's second and third largest pork export
markets, reduced imports from China by 11 and 49 percent, respectively
after the melamine contamination crisis in September 2008, even though
China reduced its export prices. Hong Kong will remain China's dominant
export market in 2009

# Statistics Tables

## Cattle PS&D Table 

##  

  -------------- ------------- -------- ---------- ------------- -------- ---------- ------------- ----- ---------- -----------
  **Animal       **2007**                          **2008**                          **2009**                       
  Numbers,                                                                                                          
  Cattle China**                                                                                                    

                 **2007**                          **2008**                          **2009**                       

                 **Market Year                     **Market Year                     **Market Year                  
                 Begin: Jan                        Begin: Jan                        Begin: Jan                     
                 2007**                            2008**                            2009**                         

                 **Annual Data          **New      **Annual Data          **New      **Annual Data       **Jan**    
                 Displayed**            Post**     Displayed**            Post**     Displayed**                    

                                        **Data**                          **Data**                       **Data**   

  Total Cattle   139442        139442   104651     139721        139721   105948                         107095     (1000 HEAD)
  Beg. Stks                                                                                                         

  Dairy Cows     13632         13632    11400      14700         14700    12189                          13000      (1000 HEAD)
  Beg. Stocks                                                                                                       

  Beef Cows Beg. 67500         67500    50585      68600         68600    51500                          52048      (1000 HEAD)
  Stocks                                                                                                            

  Production     59500         59500    45353      60500         60500    46800                          48500      (1000 HEAD)
  (Calf Crop)                                                                                                       

  Intra-EU       0             0        0          0             0        0                              0          (1000 HEAD)
  Imports                                                                                                           

  Other Imports  15            15       15         15            15       14                             13         (1000 HEAD)

  Total Imports  15            15       15         15            15       14                             13         (1000 HEAD)

  Total Supply   198957        198957   150019     200236        200236   152762                         155608     (1000 HEAD)

  Intra EU       0             0        0          0             0        0                              0          (1000 HEAD)
  Exports                                                                                                           

  Other Exports  51            51       51         49            49       32                             30         (1000 HEAD)

  Total Exports  51            51       51         49            49       32                             30         (1000 HEAD)

  Cow Slaughter  0             0        0          0             0        0                              0          (1000 HEAD)

  Calf Slaughter 0             0        0          0             0        0                              0          (1000 HEAD)

  Other          58760         58760    43595      60000         60000    44528                          45040      (1000 HEAD)
  Slaughter                                                                                                         

  Total          58760         58760    43595      60000         60000    44528                          45040      (1000 HEAD)
  Slaughter                                                                                                         

  Loss           425           425      425        1316          1316     1107                           1000       (1000 HEAD)

  Ending         139721        139721   105948     138871        138871   107095                         109538     (1000 HEAD)
  Inventories                                                                                                       

  Total          198957        198957   150019     200236        200236   152762                         155608     (1000 HEAD)
  Distribution                                                                                                      

  CY Imp. from   0             0        0          0             0        0                              0          (1000 HEAD)
  U.S.                                                                                                              

  CY. Exp. to    0             0        0          0             0        0                              0          (1000 HEAD)
  U.S.                                                                                                              

  Balance        0             0        0          0             0        0                              0          (1000 HEAD)

  Inventory      279           279      1297       -850          -850     1147                           2443       (1000 HEAD)
  Balance                                                                                                           

  Inventory      -1            -1       2          0             0        1                              1          (PERCENT)
  Change                                                                                                            

  Cow Change     3             3        1          0             3        3                              2          (PERCENT)

  Production     3             3        1          -2            2        3                              4          (PERCENT)
  Change                                                                                                            

  Production to  73            73       73         73            73       73                             75         (PERCENT)
  Cows                                                                                                              

  Trade Balance  36            36       36         34            34       18                             17         (1000 HEAD)

  Slaughter to   42            42       42         43            43       42                             42         (PERCENT)
  Inventory                                                                                                         

  TS=TD                                 0                                 0                              0          
  -------------- ------------- -------- ---------- ------------- -------- ---------- ------------- ----- ---------- -----------

(Not official PS&D table)

## Meat, Beef, and Veal PS&D Table

  -------------- ------------- ------- ---------- ------------- ------- ---------- ------------- ---- ---------- -----------
  **Meat, Beef   **2007**                         **2008**                         **2009**                      
  and Veal                                                                                                       
  China**                                                                                                        

                 **2007**                         **2008**                         **2009**                      

                 **Market Year                    **Market Year                    **Market Year                 
                 Begin: Jan                       Begin: Jan                       Begin: Jan                    
                 2007**                           2008**                           2009**                        

                 **Annual Data         **New      **Annual Data         **New      **Annual Data      **Jan**    
                 Displayed**           Post**     Displayed**           Post**     Displayed**                   

                                       **Data**                         **Data**                      **Data**   

  Slaughter      58760         58760   43595      60000         60000   44524                         45035      (1000 HEAD)
  (Reference)                                                                                                    

  Beginning      0             0       0          0             0       0                             0          (1000 MT
  Stocks                                                                                                         CWE)

  Production     7480          7480    6134       7730          7730    6260                          6360       (1000 MT
                                                                                                                 CWE)

  Intra-EU       0             0       0          0             0       0                             0          (1000 MT
  Imports                                                                                                        CWE)

  Other Imports  5             8       8          30            30      10                            11         (1000 MT
                                                                                                                 CWE)

  Total Imports  5             8       8          30            30      10                            11         (1000 MT
                                                                                                                 CWE)

  Total Supply   7485          7488    6142       7760          7760    6270                          6371       (1000 MT
                                                                                                                 CWE)

  Intra EU       0             0       0          0             0       0                             0          (1000 MT
  Exports                                                                                                        CWE)

  Other Exports  81            81      81         78            78      61                            48         (1000 MT
                                                                                                                 CWE)

  Total Exports  81            81      81         78            78      61                            48         (1000 MT
                                                                                                                 CWE)

  Human Dom.     7404          7407    6061       7682          7682    6209                          6323       (1000 MT
  Consumption                                                                                                    CWE)

  Other Use,     0             0       0          0             0       0                             0          (1000 MT
  Losses                                                                                                         CWE)

  Total Dom.     7404          7407    6061       7682          7682    6209                          6323       (1000 MT
  Consumption                                                                                                    CWE)

  Ending Stocks  0             0       0          0             0       0                             0          (1000 MT
                                                                                                                 CWE)

  Total          7485          7488    6142       7760          7760    6270                          6371       (1000 MT
  Distribution                                                                                                   CWE)

  CY Imp. from   0             0       0          0             0       0                             0          (1000 MT
  U.S.                                                                                                           CWE)

  CY. Exp. to    0             0       0          0             0       0                             0          (1000 MT
  U.S.                                                                                                           CWE)

  Balance        0             0       0          0             0       0                             0          (1000 MT
                                                                                                                 CWE)

  Inventory      0             0       0          0             0       0                             0          (1000 MT
  Balance                                                                                                        CWE)

  Weights        127           127     141        129           129     141                           141        (1000 MT
                                                                                                                 CWE)

  Production     6             6       0          -4            3       2                             2          (PERCENT)
  Change                                                                                                         

  Import Change  150           300     -11        400           275     25                            10         (PERCENT)

  Export Change  -5            -5      -18        -24           -4      -25                           -21        (PERCENT)

  Trade Balance  76            73      73         48            48      51                            37.0       (1000 MT
                                                                                                                 CWE)

  Consumption    6             6       7          -4            4       2                             2          (PERCENT)
  Change                                                                                                         

  Population     0             0       0          0             0       0                             0          (HEAD)

  Per Capita     0             0       0          0             0       0                             0          (KG)
  Consumption                                                                                                    

  TS=TD                                0                                0                             0          
  -------------- ------------- ------- ---------- ------------- ------- ---------- ------------- ---- ---------- -----------

(Not official PS&D table)

## Cattle and Beef Trade Matrices

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Live Cattle                                                  
  Imports,                                                           
  2006-2008 (Number                                                  
  of Head)                                                           

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             15,072      14,744      14,744       11,735      -20.41

  Australia         12,265      11,344      11,344       9,084       -19.92

  New Zealand       2,802       3,400       3,400        2,651       -22.03

  United States     0           0           0            0           0.00

  Canada            0           0           0            0           0.00

  Other             5           0           0            0           0.00

  HS Code: 010210,                                                   
  010290                                                             

  Source: GTA China                                                  
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Beef and                                                     
  Veal Direct                                                        
  Imports,                                                           
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             1,388       3,924       2,747        3,320       20.86

  Uruguay           110         920         201          1,414       603.48

  Australia         1,034       2,195       1,816        1,790       -1.43

  New Zealand       234         457         381          91          -76.12

  Brazil            7           333         333          9           -97.30

  United States     0           0           0            2           0.00

  Canada            0           0           0            0           0.00

  Other             120         19          16           14          -12.50

  HS Code: 020110,                                                   
  020120, 020130,                                                    
  020210, 020220,                                                    
  020230, 021020                                                     
  160250                                                             

  Source: GTA China                                                  
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  Hong Kong                                                          
  Re-Exports of                                                      
  Beef and Veal to                                                   
  China, 2006-2008                                                   
  (Metric Tons)                                                      

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             114         1997        1959         951         -51.45

  Brazil            60          718         682          650         -4.69

  United States     0           435         435          151         -65.29

  New Zealand       0           38          38           47          23.68

  Canada            30          23          23           25          8.70

  Argentina         0           219         219          28          -87.21

  Other             24          272         562          50          -91.10

  HS Code: 020110,                                                   
  020120, 020130,                                                    
  020210, 020220,                                                    
  020230, 021020                                                     
  and 160250                                                         

  Source: WTA Hong                                                   
  Kong Census and                                                    
  Statistics                                                         
  Department                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Live Cattle                                                  
  Exports,                                                           
  2006-2008 (Number                                                  
  of Head)                                                           

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Destination       2006        2007        2007         2008        2008/07

  World             54,389      50,888      43,917       27,164      -38.15

  Hong Kong         45,957      42,275      36,175       23,992      -33.68

  Macau             5,898       5,517       4,776        2,474       -48.20

  Malaysia          0           1,813       1,813        0           -100.00

  Korea North       20          450         450          0           -100.00

  Mongolia          167         143         143          301         110.49

  Saudi Arabia      2,217       0           0            0           0.00

  Other             130         690         560          397         -29.11

  HS Code: 010210,                                                   
  010290                                                             

  Source: GTA from                                                   
  China Statistics                                                   
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Beef and                                                     
  Veal Exports,                                                      
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Destination       2006        2007        2007         2008        2008/07

  World             60,849      58,206      48,296       35,816      -25.84

  Hong Kong         15,051      15,815      12,508       12,165      -2.74

  Japan             10,439      8,365       6,396        4,227       -33.91

  Jordan            4,558       5,530       4,519        3,916       -13.34

  Korea South       14,080      10,296      9,076        3,584       -60.51

  Kuwait            3,668       3,825       3,290        2,704       -17.81

  Kyrgyzstan        312         1,925       1,564        1,963       25.51

  Malaysia          2,371       2,631       2,358        1,595       -32.36

  Lebanon           2,269       1,937       1,418        948         -33.15

  United Arab       169         761         627          637         0.00
  Emirates                                                           

  Libya             303         75          75           618         724.00

  Angola            64          675         536          569         6.16

  Israel            0           0           0            568         0.00

  Brunei            43          73          35           291         731.43

  Qatar             250         366         278          254         -8.63

  Macau             297         338         268          220         -17.91

  Korea North       1,602       913         903          164         -81.84

  Indonesia         1,502       1,188       1,132        15          -98.67

  Other             4,003       3,932       4,445        1,393       -68.66

  HS Code: 020110,                                                   
  020120, 020130,                                                    
  020210, 020220,                                                    
  020230, 021020                                                     
  and 160250                                                         

  Source: GTA from                                                   
  China Customs                                                      
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ---------------- ---------- ---------- ---------- ---------- ------------
  China Retail                                                 
  Beef Prices on                                               
  Average,                                                     
  2005-2008                                                    
  (RMB/KG)                                                     
  (\$1=RMB6.88)                                                

                                                               \% Change

                   2005       2006       2007       2008       2008/07

  January          17.11      18.55      19.64      29.11      48.22

  February         18.28      18.65      20.35      31.40      54.30

  March            17.72      18.37      20.14      31.42      56.01

  April            17.48      18.33      20.07      31.55      57.20

  May              17.48      18.31      20.28      31.73      56.46

  June             17.46      18.32      21.21      31.82      50.02

  July             17.40      18.27      22.02      31.92      44.96

  August           17.45      18.40      23.13      32.02      38.43

  September        17.65      18.57      23.69      32.39      36.72

  October          17.81      18.54      24.36                 

  November         17.98      18.86      25.27                 

  December         18.06      18.21      26.65                 

  Source: The                                                  
  Ministry of                                                  
  Agriculture                                                  
  ---------------- ---------- ---------- ---------- ---------- ------------

## Swine PS&D Table

  -------------- ------------- --------- ---------- ------------- --------- ---------- ------------- ---- ---------- -----------
  **Animal       **2007**                           **2008**                           **2009**                      
  Numbers, Swine                                                                                                     
  China**                                                                                                            

                 **2007**                           **2008**                           **2009**                      

                 **Market Year                      **Market Year                      **Market Year                 
                 Begin: Jan                         Begin: Jan                         Begin: Jan                    
                 2007**                             2008**                             2009**                        

                 **Annual Data           **New      **Annual Data           **New      **Annual Data      **Jan**    
                 Displayed**             Post**     Displayed**             Post**     Displayed**                   

                                         **Data**                           **Data**                      **Data**   

  Total          494407        494407    418504     487801        464801    439895                        446662     (1000 HEAD)
  Beginning                                                                                                          
  Stocks                                                                                                             

  Sow Beginning  44000         46500     44206      44099         46000     43989                         44900      (1000 HEAD)
  Stocks                                                                                                             

  Production     589333        630000    592080     604158        640000    600000                        615000     (1000 HEAD)
  (Pig Crop)                                                                                                         

  Intra-EU       0             0         0          0             0         0                             0          (1000 HEAD)
  Imports                                                                                                            

  Other Imports  3             3         3          4             4         9                             7          (1000 HEAD)

  Total Imports  3             3         3          4             4         9                             7          (1000 HEAD)

  Total Supply   1083743       1124410   1010587    1091963       1104805   1039904                       1061669    (1000 HEAD)

  Intra EU       0             0         0          0             0         0                             0          (1000 HEAD)
  Exports                                                                                                            

  Other Exports  1609          1609      1609       1550          1550      1540                          1500       (1000 HEAD)

  Total Exports  1609          1609      1609       1550          1550      1540                          1500       (1000 HEAD)

  Sow Slaughter  0             0         0          0             0         0                             0          (1000 HEAD)

  Other          589333        652000    565083     588158        644645    586750                        604500     (1000 HEAD)
  Slaughter                                                                                                          

  Total          589333        652000    565083     588158        644645    586750                        604500     (1000 HEAD)
  Slaughter                                                                                                          

  Loss           5000          6000      4000       2500          5000      4952                          2500       (1000 HEAD)

  Ending         487801        464801    439895     499755        453610    446662                        453169     (1000 HEAD)
  Inventories                                                                                                        

  Total          1083743       1124410   1010587    1091963       1104805   1039904                       1061669    (1000 HEAD)
  Distribution                                                                                                       

  CY Imp. from   0             0         0          1             2         7                             5          (1000 HEAD)
  U.S.                                                                                                               

  CY. Exp. to    0             0         0          0             0         0                             0          (1000 HEAD)
  U.S.                                                                                                               

  Balance        0             0         0          0             0         0                             0          (1000 HEAD)

  Inventory      -6606         -29606    21391      11954         -11191    6767                          6507       (1000 HEAD)
  Balance                                                                                                            

  Inventory      -2            -2        -3         -1            -6        5                             2          (PERCENT)
  Change                                                                                                             

  Sow Change     -91           -5        -6         902           -1        0                             2          (PERCENT)

  Production     -8            -7        -2         3             2         1                             3          (PERCENT)
  Change                                                                                                             

  Production to  13.4          14.0      13.4       14.0          14.0      13.6                          13.7       (PERCENT)
  Sows                                                                                                               

  Trade Balance  1606          1606      1606       1546          1546      1531                          1493       (1000 HEAD)

  Slaughter to   119           132       135        121           139       133                           135        (PERCENT)
  Inventory                                                                                                          

  TS=TD                                  0                                  0                             0          
  -------------- ------------- --------- ---------- ------------- --------- ---------- ------------- ---- ---------- -----------

(Not official PS&D table)

## Pork PS&D Table

  -------------- ------------- -------- ---------- ------------- -------- ---------- ------------- ---- ---------- -----------
  **Meat, Swine  **2007**                          **2008**                          **2009**                      
  China**                                                                                                          

                 **2007**                          **2008**                          **2009**                      

                 **Market Year                     **Market Year                     **Market Year                 
                 Begin: Jan                        Begin: Jan                        Begin: Jan                    
                 2007**                            2008**                            2009**                        

                 **Annual Data          **New      **Annual Data          **New      **Annual Data      **Jan**    
                 Displayed**            Post**     Displayed**            Post**     Displayed**                   

                                        **Data**                          **Data**                      **Data**   

  Slaughter      589333        652000   565083     588158        644645   586750                        604500     (1000 HEAD)
  (Reference)                                                                                                      

  Beginning      0             0        0          0             0        0                             0          (1000 MT
  Stocks                                                                                                           CWE)

  Production     44200         41609    42878      44700         42026    44593                         46000      (1000 MT
                                                                                                                   CWE)

  Intra-EU       0             0        0          0             0        0                             0          (1000 MT
  Imports                                                                                                          CWE)

  Other Imports  198           186      198        210           200      480                           360        (1000 MT
                                                                                                                   CWE)

  Total Imports  198           186      198        210           200      480                           360        (1000 MT
                                                                                                                   CWE)

  Total Supply   44398         41795    43076      44910         42226    45073                         46360      (1000 MT
                                                                                                                   CWE)

  Intra EU       0             0        0          0             0        0                             0          (1000 MT
  Exports                                                                                                          CWE)

  Other Exports  350           350      350        330           330      215                           200        (1000 MT
                                                                                                                   CWE)

  Total Exports  350           350      350        330           330      215                           200        (1000 MT
                                                                                                                   CWE)

  Human Dom.     44048         41445    42726      44580         41896    44858                         46160      (1000 MT
  Consumption                                                                                                      CWE)

  Other Use,     0             0        0          0             0        0                             0          (1000 MT
  Losses                                                                                                           CWE)

  Total Dom.     44048         41445    42726      44580         41896    44858                         46160      (1000 MT
  Consumption                                                                                                      CWE)

  Ending Stocks  0             0        0          0             0        0                             0          (1000 MT
                                                                                                                   CWE)

  Total          44398         41795    43076      44910         42226    45073                         46360      (1000 MT
  Distribution                                                                                                     CWE)

  CY Imp. from   88            88       91         94            94       205                           160        (1000 MT
  U.S.                                                                                                             CWE)

  CY. Exp. to    0             0        0          0             0        0                             0          (1000 MT
  U.S.                                                                                                             CWE)

  Balance        0             0        0          0             0        0                             0          (1000 MT
                                                                                                                   CWE)

  Inventory      0             0        0          0             0        0                             0          (1000 MT
  Balance                                                                                                          CWE)

  Weights        75            64       76         76            65       76                            76         (1000 MT
                                                                                                                   CWE)

  Production     -9            -9       -8         1             1        4                             3          (PERCENT)
  Change                                                                                                           

  Import Change  120           107      120        6             8        142                           0          (PERCENT)

  Export Change  -36           -36      -36        -6            -6       -39                           -7         (PERCENT)

  Trade Balance  152           164      152        120           130      -265                          -160       (1000 MT
                                                                                                                   CWE)

  Consumption    -9            -9       -7         1             1        5                             3          (PERCENT)
  Change                                                                                                           

  TS=TD                                 0                                 0                             0          
  -------------- ------------- -------- ---------- ------------- -------- ---------- ------------- ---- ---------- -----------

(Not official PS&D table)

## Swine and Pork Trade Matrices

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Swine                                                        
  Imports,                                                           
  2006-2008 (Number                                                  
  of Head)                                                           

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             2,489       2,506       2,506        8,381       234.44

  United States     1,038       194         194          6,478       3239.18

  Canada            503         1,780       1,780        1,777       -0.17

  Denmark           662         0           0            126         0.00

  United Kingdom    266         262         0            0           0.00

  France            0           270         0            0           0.00

  Other             20          0           532          0           -100.00

  HS Code: 010310,                                                   
  010391, 010392                                                     

  Source: GTA China                                                  
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Pork                                                         
  Imports by                                                         
  Reporting                                                          
  Countries Export                                                   
  Statistics,                                                        
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             52,308      98,274      77,533       260,924     236.53

  United States     31,866      67,870      51,900       107,517     107.16

  France            2021        3767        2,753        67,756      2361.17

  Denmark           629         4,319       3,899        65,613      1582.82

  Canada            15,870      17,576      16,409       15,204      -7.34

  United Kingdom    668         960         99           1,942       1861.62

  Taiwan            11          205         57           505         785.96

  Belgium           668         960         477          0           -100.00

  Ireland           2           758         223          0           -100.00

  Other             573         1,859       1,716        2,387       39.10

  HS Code: 020311,                                                   
  020312, 020319,                                                    
  020321, 020322,                                                    
  020329, 021011                                                     
  021012,                                                            

  021019, 160241,                                                    
  160242 and 160249                                                  
  ,                                                                  

  Source: GTA                                                        
  Reporting                                                          
  Countries\'s                                                       
  Export Statistics                                                  

  Note: Hong Kong                                                    
  Re-exports to                                                      
  China is in a                                                      
  separate table.                                                    
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  Hong Kong                                                          
  Re-Exports of                                                      
  Pork to China,                                                     
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  The World         17,127      53,696      45,398       151,702     234.16

  United States     362         1,956       1,502        30,844      1953.53

  Germany, Fed Rep  4,851       8,991       7,696        24,345      216.33

  Spain             3,581       11,243      9,492        21,648      128.07

  Canada            1,637       641         541          15,567      2777.45

  Netherlands       690         4,809       3,862        11,938      209.11

  Italy             100         3,545       2,904        7,810       168.94

  Brazil            719         6,209       5,330        7,487       40.47

  Poland            497         2,478       2,094        6,700       219.96

  Denmark           2,537       3,132       2,657        4,916       85.02

  United Kingdom    151         791         371          3,519       848.52

  Belguim           1,045       2,639       2,380        3,503       47.18

  France            627         2,900       2,760        3,491       26.49

  Ireland           225         803         729          2,754       277.78

  Hungary           0           736         644          2,131       230.90

  Other             105         2,823       2,436        5,049       107.27

  HS Code: 020311,                                                   
  020312, 020319,                                                    
  020321, 020322,                                                    
  020329, 021011                                                     
  021012,                                                            

  021019, 160241,                                                    
  160242 and 160249                                                  
  ,                                                                  

  Source: WTA from                                                   
  Hong Kong Census                                                   
  and Statistics                                                     
  Department                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Pork                                                         
  Imports by                                                         
  Reporting                                                          
  Countries Export                                                   
  Statistics,                                                        
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Origin            2006        2007        2007         2008        2008/07

  World             52,308      98,274      77,533       260,924     236.53

  United States     31,866      67,870      51,900       107,517     107.16

  France            2021        3767        2,753        67,756      2361.17

  Denmark           629         4,319       3,899        65,613      1582.82

  Canada            15,870      17,576      16,409       15,204      -7.34

  United Kingdom    668         960         99           1,942       1861.62

  Taiwan            11          205         57           505         785.96

  Belgium           668         960         477          0           -100.00

  Ireland           2           758         223          0           -100.00

  Other             573         1,859       1,716        2,387       39.10

  HS Code: 020311,                                                   
  020312, 020319,                                                    
  020321, 020322,                                                    
  020329, 021011                                                     
  021012,                                                            

  021019, 160241,                                                    
  160242 and 160249                                                  
  ,                                                                  

  Source: GTA                                                        
  Reporting                                                          
  Countries\'s                                                       
  Export Statistics                                                  

  Note: Hong Kong                                                    
  Re-exports to                                                      
  China is in a                                                      
  separate table.                                                    
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Swine                                                        
  Exports,                                                           
  2006-2008 (Number                                                  
  of Head)                                                           

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Destination       2006        2007        2007         2008        2008/07

  World             1,722,540   1,609,008   1,341,048    1,284,337   -4.23

  Hong Kong         1,602,222   1,491,689   1,243,105    1,205,293   -3.04

  Macau             117,382     116,712     97,336       78,901      -18.94

  Korea North       2,294       347         374          0           -100.00

  Other             642         260         233          143         -38.63

  HS Code: 010310,                                                   
  010391, 010392                                                     

  Source: GTA from                                                   
  China Customs                                                      
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ----------------- ----------- ----------- ------------ ----------- ---------
  China Pork                                                         
  Exports,                                                           
  2006-2008 (Metric                                                  
  Tons)                                                              

                    Jan-Dec     Jan-Dec     Jan - Oct                Jan - Oct

                    Quantity    Quantity    Quantity                 \% Change
                                            Comparison               

  Destination       2006        2007        2007         2008        2008/07

  World             418,788     269,099     231,688      137,873     -40.49

  Hong Kong         129,965     107,431     90,783       69,848      -23.06

  Japan             79,133      74,430      62,232       34,894      -43.93

  Kyrgyzstan        15,522      10,172      8,161        6,822       -16.41

  Malaysia          11,258      7,934       7,059        5,644       -20.05

  Macau             6,242       5,170       4,453        3,722       -16.42

  Vietnam           29,322      9,623       7,518        1,980       -73.66

  Korea North       75,364      21,166      19,980       2,114       -89.42

  Singapore         12,748      6,456       6,351        3,373       -46.89

  Philippines       13,571      9,525       8,751        2,792       -68.10

  Indonesia         3,032       1,291       1,291        1,591       23.24

  Lebanon           678         693         606          588         -2.97

  Papua New Guinea  737         477         375          585         56.00

  Korea South       8,006       433         382          425         11.26

  Angola            2,341       359         155          78          -49.68

  Albania           6,242       5,170       0            0           0.00

  Kazakhstan        5,420       2,280       2,282        0           -100.00

  Russia            6,984       822         0            0           0.00

  Moldova           2,041       294         0            0           0.00

  Georgia           2,195       78          78           609         680.77

  Ukraine           630         0           0            0           0.00

  Other             7,357       5,295       11,231       2,808       -75.00

  HS Code: 020311,                                                   
  020312, 020319,                                                    
  020321, 020322,                                                    
  020329, 021011                                                     
  021012, 021019,                                                    

  160241, 160242                                                     
  and 160249                                                         

  Source: GTA from                                                   
  China Customs                                                      
  Statistics                                                         
  ----------------- ----------- ----------- ------------ ----------- ---------

  ---------------- ---------- ---------- ---------- ---------- ------------
  China Retail                                                 
  Pork Prices On                                               
  Average,                                                     
  2005-2008                                                    
  (RMB/KG)                                                     
  (\$1=RMB6.88)                                                

                                                               \% Change

  MONTH            2005       2006       2007       2008       2008/07

  January          14.14      12.43      14.91      25.53      71.23

  February         14.33      12.18      14.97      26.08      74.22

  March            13.95      11.65      14.50      25.56      76.28

  April            13.58      11.13      14.39      25.68      78.46

  May              13.27      10.71      15.86      24.71      55.80

  June             13.15      10.58      17.74      24.10      35.85

  July             13.07      11.06      20.77      23.58      13.53

  August           12.94      12.01      22.95      23.18      1.00

  September        13.00      12.82      22.10      22.59      2.22

  October          12.34      12.99      21.15                 

  November         11.87      13.35      22.35                 

  December         11.95      14.40      24.05                 

  Source: The                                                  
  Ministry of                                                  
  Agriculture                                                  
  ---------------- ---------- ---------- ---------- ---------- ------------

  ---------------- ---------- ---------- ---------- ---------- ------------
  China Retail Hog                                             
  Prices On                                                    
  Average                                                      
  2005-2008                                                    
  (RMB/KG)                                                     
  (\$1=RMB6.88)                                                

                                                               \% Change

  MONTH            2005       2006       2007       2008       2008/07

  January          8.80       7.40       9.55       16.50      72.77

  February         8.84       7.11       9.20       16.70      81.52

  March            8.69       6.68       8.91       16.83      88.89

  April            8.36       6.21       9.02       16.87      87.03

  May              8.05       5.96       10.20      15.77      54.61

  June             8.01       6.08       11.37      15.35      35.00

  July             7.94       6.47       13.12      14.82      12.96

  August           7.80       7.17       14.27      14.47      1.40

  September        7.75       7.84       13.60      13.86      1.91

  October          6.98       7.93       13.21                 

  November         6.75       8.33       14.13                 

  December         6.95       9.18       15.46                 

  Source: The                                                  
  Ministry of                                                  
  Agriculture                                                  
  ---------------- ---------- ---------- ---------- ---------- ------------

  ---------------- ---------- ---------- ---------- ---------- ------------
  China Retail                                                 
  Piglet Prices On                                             
  Average                                                      
  2005-2008                                                    
  (RMB/KG)                                                     
  (\$1=RMB6.88)                                                

                                                               \% Change

  MONTH            2005       2006       2007       2008       2008/07

  January          13.43      9.24       12.12      29.66      144.72

  February         13.56      9.48       12.26      30.62      149.76

  March            14.64      8.85       12.68      35.29      178.31

  April            14.51      7.82       13.31      38.23      187.23

  May              14.02      6.98       15.09      36.11      139.30

  June             13.74      6.84       17.17      34.55      101.22

  July             13.35      7.05       20.11      33.01      64.15

  August           12.74      8.31       24.09      30.94      28.44

  September        12.09      9.60       23.70      28.55      20.46

  October          10.02      9.85       22.62                 

  November         8.83       10.25      23.84                 

  December         8.68       11.44      26.21                 

  Source: The                                                  
  Ministry of                                                  
  Agriculture                                                  
  ---------------- ---------- ---------- ---------- ---------- ------------

  ---------------- ---------- ---------- ---------- ---------- ------------
  China Retail                                                 
  Industry Feed                                                
  Prices for                                                   
  Fattening Swine                                              
  On Average                                                   
  2005-2008                                                    

  (RMB/KG) (\$1 =                                              
  RMB 6.88)                                                    

                                                               \% Change

  MONTH            2005       2006       2007       2008       2008/07

  January          1.96       1.84       1.98       2.51       26.77

  February         1.93       1.83       1.98       2.55       28.79

  March            1.91       1.83       2.03       2.55       25.62

  April            1.90       1.82       2.01       2.60       29.35

  May              1.90       1.84       2.05       2.60       26.83

  June             1.88       1.86       2.07       2.65       28.02

  July             1.88       1.87       2.11       2.73       29.38

  August           1.88       1.92       2.17       2.73       25.81

  September        1.86       1.88       2.24       2.71       20.98

  October          1.87       1.90       2.23                  

  November         1.85       1.90       2.33                  

  December         1.83       1.96       2.42                  

  Source: The                                                  
  Ministry of                                                  
  Agriculture                                                  
  ---------------- ---------- ---------- ---------- ---------- ------------

[^1]: The RMB has appreciated 21 percent since 2005 when China
    discontinued its binding exchange rate against the U.S. Dollar and
    began using a package exchange rate.