Required Report - public distribution

**Date:** 11/30/2005

**GAIN Report Number:** CH5085

CH5085

**China, Peoples Republic of**

**Planting Seeds**

**Annual**

**2005**

**Approved by:**

![](media/image1.wmf)James Butterworth

U.S. Embassy Beijing, Office of Agriculture Affairs

**Prepared by:**

Casey Bean and Xinping Wu

**Report Highlights:**

China remains one of the largest seed producers and users in the world.
The long-term outlook remains positive. Serious challenges, however,
remain in the area of intellectual property infringement and counterfeit
seeds.

Includes PSD Changes: No

Includes Trade Matrix: Yes

Annual Report

Beijing \[CH1\]

\[CH\]

Table of Contents

[**Executive Summary 3**](#executive-summary)

[Production 3](#production)

[Agricultural Planted Area and Yields
4](#agricultural-planted-area-and-yields)

[Trade 5](#trade)

[Marketing Entry and Promotion 6](#marketing-entry-and-promotion)

[Policy Issues 6](#policy-issues)

[China's Seed Law Expected to have Amendments
6](#chinas-seed-law-expected-to-be-amended)

[Agricultural Commodity Import Regulations
7](#agricultural-commodity-import-regulations---chinas-animal-and-plant-quarantine-law-ch1051-its-implementation-regulations-ch3110-the-administrative-measures-ch2039-and-the-items-on-handling-review-and-approval-of-entry-animal-and-plant-quarantine-ch4020-establish-procedures-for-importers-wishing-to-purchase-propagating-material-including-seed.-essentially-importers-must-apply-for-a-quarantine-import-permit-qip-before-signing-any-contract.-only-with-a-qip-valid-for-six-months-it-is-permissible-to-sign-an-import-contract.)

[Planting Seed Phytosanitary and Licensing Restrictions
7](#planting-seed-phytosanitary-and-licensing-restrictions---corn-and-soybean-seeds-from-the-united-states-and-several-other-countries-are-still-prohibited-from-being-imported-into-china-because-of-quarantine-restrictions-on-stewarts-wilt-and-phytophthera-megasperma.-as-for-other-planting-seeds-both-the-requirements-for-main-crops-variety-approval-as-well-as-licensing-requirements-for-seed-production-and-marketing-place-arbitrary-restrictions-on-the-seed-trade.)

[Seed Tariffs and the Value Added Tax (VAT)
8](#seed-tariffs-and-the-value-added-tax-vat---china-has-tariff-rate-quotas-for-seed-wheat-rice-corn-and-a-few-other-non-grain-commodities.-in-quota-wheat-corn-and-rice-seed-are-subject-to-a-1-percent-tariff-while-all-other-planting-seeds-enter-tariff-free.-out-of-quota-tariffs-for-seed-corn-are-20-percent-while-out-of-quota-tariffs-for-wheat-and-rice-are-65-percent.)

[Plant Variety Protection (PVP) Background and Development
8](#plant-variety-protection-pvp-background-and-development---on-oct-20-2005-china-filed-its-endorsement-letter-to-fao-to-recognize-the-1997-amended-version-of-international-plant-protection-conversion-ippc-and-thus-becoming-the-141st-member-of-the-treaty.-the-official-liaison-office-is-affiliated-to-moa.-china-has-legally-recognized-the-1978-version-of-the-international-convention-for-the-protection-of-new-varieties-of-plants-upov-effective-from-october-1-1997-ch7023.-moa-and-sfa-are-responsible-for-reviewing-pvp-applications.-chinas-upov-membership-obligates-china-to-honor-sui-generis-the-breeders-rights-for-registered-and-approved-novel-distinct-uniform-and-stable-seeds.)

[Intellectual Property Rights (IPR) Issues for Planting Seed Enterprises
9](#intellectual-property-rights-ipr-issues-for-planting-seed-enterprises---despite-the-implementation-of-laws-and-regulations-ipr-infringement-and-counterfeit-cases-occurred-frequently.-moa-said-as-of-the-end-of-2004-cumulatively-ipr-infringement-and-counterfeit-cases-reached-299-and-564-respectively.)

[Biotechnology and Planting Seeds
9](#biotechnology-and-planting-seeds---transgenic-crops-and-seeds-need-to-be-approved-by-the-national-biosafety-committee-nbc-after-environmental-and-food-safety-evaluations-by-moa-and-government-affiliated-institutes.-chinas-investment-in-transgenic-seed-technology-is-more-than-any-other-country-besides-the-united-states.-china-has-commercialized-four-genetically-modified-plants-since-1997-including-cotton-tomatoes-sweet-peppers-and-petunias.-although-there-are-no-official-statistics-some-experts-reported-development-of-over-100-transgenic-crops-with-about-60-already-in-field-trials-including-rice-corn-wheat-soybeans-and-peanut-etc.-although-bt-cotton-has-been-widely-planted-china-has-yet-to-approve-any-major-food-crops-for-environmental-release.-moa-has-approved-one-soybean-seven-canolas-eight-corn-and-two-cotton-varieties-for-import-and-processing-but-none-for-planting.-moa-is-drafting-40-transgenic-crop-testing-and-safety-evaluation-standards-in-anticipation-of-increased-transgenic-crop-development.)

[Turf Seeds and Nursery Seedlings 10](#turf-seeds-and-nursery-seedlings)

[Trade Tables 12](#trade-tables)

[Table 1 China's Imports from the World in Volume & Value
12](#table-1-chinas-imports-from-the-world-in-volume-value)

[Table 2 China\'s Imports from the U.S. in Volume & Value
13](#table-2-chinas-imports-from-the-u.s.-in-volume-value)

[Table 3 China's Grass Seed Imports and Major Countries of Origins
14](#table-3-chinas-grass-seed-imports-and-major-countries-of-origins)

[Table 4 China's Sunflower, Fruit/Melon Imports & Major Countries of
Origins
15](#table-4-chinas-sunflower-fruitmelon-imports-major-countries-of-origins)

[Table 5 China\'s Exports to the World in Volume & Value
16](#table-5-chinas-exports-to-the-world-in-volume-value)

[Table 6 China\'s Exports to the U.S. in Volume and Value
17](#table-6-chinas-exports-to-the-u.s.-in-volume-and-value)

[Table 7 China's Main Seed Exports & Major Destinations
18](#table-7-chinas-main-seed-exports-major-destinations)

# 

# Executive Summary

China remains one of the world's largest seed producers and users and is
self-sufficient in planting seeds for major crops including most grains,
oilseeds and cotton. Total annual demand for all planting seeds is
estimated at over 12.5 million metric tons (MMT), and commercial seed
production for 2004 was estimated at about 8.5 MMT.

China's seed market continues to be highly fragmented, with over nine
thousand registered "Seed Companies" nationwide. Better integration of
variety research and development, seed breeding and distribution
enterprises remains a goal for policy makers, industry associations, and
academic institutes. Post forecasts demand for vegetable and fruit seeds
to continue increasing along with the seed buyers' steady income growth,
offering more opportunities for international traders. The Chinese
government's policy objectives to increase grain production in MY04/05
dampened demand for grass seed and as a result imports of these products
declined. They are, however, expected to recover in the near future,
because China also has set a policy objective to restore the grassland
ecosystem in it's western provinces, which will require tremendous
quantities of specialized seeds if the government is to achieve its
objective. On the export side of the equation, exports of rice and
vegetable seeds are expected to continue growing because of China's
lower cost of production than many other competitor countries.

China's policies, laws, and regulations on the seed industry still place
restrictions on foreign investment and trade, in particular, for the
major crops such as corn and soybeans. Despite implementation of the
Seed Law and Plant New Variety Protection Law, foreign seed companies'
products still are experiencing serious problems with infringement on
their intellectual property rights (IPR), i.e., Chinese companies are
copying these companies' seed genetics and not paying royalties and/or
simply mislabeling seeds as Bt that are not.

# 

# Production

China remains one of the largest seed producers in the world. It is
self-sufficient in planting seeds for its main crops, including grain,
major oilseeds, and cotton. Official seed production statistics are not
available, but industry sources estimate annual seed use at 12.5 MMT and
the value of total seed sales value for 2004 was estimated at over
US\$2.5 billion. Additionally, an official media source reported that,
currently, total annual commercial seed production is estimated at 8.5
MMT, seed-processing capacity is estimated at 6.5 MMT with about 1.9 MMT
treated and storage capacity stands at 4.3 MMT. Seed self-sufficiency
rates for rice, corn, wheat and soybeans all are 100 percent, with
cottonseed at 85 percent and vegetable and fruit/melon at 95 percent.
China's low labor cost ensures its ability to produce hybrid seeds for
overseas markets cheaper than many other countries. In fact, the value
of China's seed exports for July 2004 to June 2005 marketing Year (MY)
surged by 22 percent over MY03/04, with vegetable and fruit/melon seed
leading the pack.

No significant change was reported in MY04/05 in seed production.
Regarding rice seed use, industry insiders reported that the split in
area planted to hybrid rice compared to conventional varieties was
approximately 50-50. Hybrid rice seed breeding is conducted mainly in
Hainan province. Hybrid corn dominates seed corn use, accounting for
over 75 percent of planted area. A sizable corn-breeding base is located
in Gansu province. It currently produces over 50 percent of China's seed
corn. The majority of wheat seed, however, is of conventional varieties,
most of which are produced in China's northern provinces. Several
soybean varieties of "high oil content" are being planted in China's
four Northeast provinces. The "double low" (low erucic acid and
glucosinolate content) rapeseed varieties account for over 70 percent of
the planted area. Cottonseed breeding is increasingly industrialized and
commercialized. Both industry insiders and farmers reported that the
traditional farmer-saved seeds are rarely used anymore. Planted area of
BT varieties increased to 3.3 million hectares (MHa) in MY04/05,
accounting for 65 percent of total cotton planted area. China's Ministry
of Agriculture (MOA) reported that domestic BT varieties market share
accounted for about 73 percent of the total in 2005, up from the 62
percent in 2004. Some Chinese sources claim that Chinese-produced BT
cotton is more adapted to the local environment and the seed is cheaper
than foreign seed. Vegetable and fruit/melon seeds are produced
throughout China, which better enables them to be bred and marketed to
suit local tastes and requirements.

Seed production and marketing continues to be highly fragmented. This is
mainly the result of a leftover effect of China's old planned economy,
which created a model of segregated research/development, breeding, and
marketing. MOA estimates there are over nine thousand registered
"Planting Seed Companies" in China. The listing of the 50 largest seed
producing enterprises by MOA in 2003 has seen little change in the past
two years. Industry sources reported none of these enterprises has
annual seed sales value exceeding US\$100 million in MY04/05. A MOA
official, however, said the market share of the "50 largest" increased
to 30 percent in MY04/05, from 15 percent in MY00/01, so there is some
consolidation within the industry, albeit at a rather slow pace. A few
of these companies have established comprehensive variety development,
seed breeding, and marketing systems. Many are not equipped with their
own research and development facilities. Some of these companies only
engage in selling seeds. Currently, the traditional seed breeding and
distribution model still prevails. Developers are mostly state or
provincial sponsored agricultural research institutes and universities,
while seed companies are responsible for breeding and marketing seeds to
farmers. It is worth noting that researchers and developers are
increasingly involved in seed breeding and marketing through established
breeding enterprises. Some new seed companies also have set up their own
research facilities, which enable them to develop their own new
varieties and retain the intellectual property rights. In most cases,
however, breeding enterprises may opt to purchase the new variety from a
developer. Better integration of variety research and development, seed
breeding and the distribution chain remains a goal for policy makers,
industry associations, and academic institutes. Although there has been
consolidation in the industry in recent years, it may take years before
several flagship enterprises replace the thousands of small players.

Based on MOA's quality sample survey, the quality of seeds improved in
MY04/05. The survey results showed that met the quality standard were 88
percent for hybrid corn, and 95 percent for hybrid rice, as compared to
only 48 percent and 68 percent respectively in late 1990's.

As a result of China's policy restraints, foreign investment in the seed
sector remains low (CH7048). Except for vegetable seed production, only
a few joint ventures were set up for breeding BT cotton and hybrid corn.

Investment in development of new varieties remains inadequate but
diversified. Industry sources reported that there are about 400
government sponsored crop research institutes nationwide engaged in the
development of new crop varieties. These employ approximately 50,000
research personnel. Some industry sources said, however, that the
estimated that government's limited R&D spending -- only about US\$25
million annually \-- restricts breakthroughs in development of new
varieties. According to MOA, however, investment from the private sector
has been increasing in recent years. In 2004, for example, it accounted
for about 50 percent of the total investment in development of new
varieties. Although no official data exist, China's investment in
biotechnology is believed to be significant. One senior expert said
annual investment has been US\$100 million since 2000, and was estimated
to have increased to US\$500 million in 2005.

Instead of focusing solely on increasing yields, crop research and seed
production has taken high yield, better quality, and stress resistance
as combined priorities to raise crop production efficiency. Hybrid seed
production continues expanding as domestic growers demand trait-specific
seeds.

# 

# Agricultural Planted Area and Yields

Total sown area of all crops exceeds 150 million hectares. Grains and
oilseeds take the largest share, but the area planted to vegetable and
other horticultural products is increasing. Multiple cropping, although
declining, results in enormous year-round seed demand.

# 

Agricultural Planted Area and Yields

  ------------- ------ ------- ------ ------------ -------- ------------ -------- ---------- ------------ -----------
  Year/Crop     Rice   Wheat   Corn   \*Soybeans   Cotton   \*Rapeseed   Tubers   \*Peanut   Vegetables   Sunflower

  2000          30     26.7    23.1   9.3          4        7.5          10.5     4.9        15.2         

  2001          28.8   24.7    24.3   9.5          4.8      7.1          10.2     5          16.4         

  2002          28.2   23.9    24.6   9.6          4.2      8.5          9.9      5          17.4         

  2003          26.5   22      24     9.5          5.1      8            9.7      5.4        18           1.2

  2004          28.4   21.6    25.4   9.6          5.7      7.3          9.5      4.7        18.5         0.9

  \*2005        28.5   21.9    26     9.5          5.1      7.3          9.4      4.9        18.5         1

  Source: State                                                                                           
  Statistics                                                                                              
  Bureau.                                                                                                 
  \*Estimates                                                                                             
  by USDA and                                                                                             
  FAS/China.                                                                                              
  ------------- ------ ------- ------ ------------ -------- ------------ -------- ---------- ------------ -----------

Despite new hybrids and innovations in the planting seed sector, crop
yields remain stagnant. Some experts suggest that as more farmers do
casual work in cities, reduced labor input negates the benefit of
genetic improvement. If the government is to achieve its concurrent
goals of food self-reliance and rural development, then it must
encourage development and planting of new varieties that result in
higher yields while using fewer inputs.

Agricultural Crop Yields in Metric Ton per Hectare

  ------------- ------- ------- ------- ------------ -------- ------------ ----------
  Year/Crop     Rice    Wheat   Corn    Soybeans\*   Cotton   Rapeseed\*   Peanut\*

  2000          6.3     3.7     4.6                  1.1                   

  2001          6.2     3.8     4.7                  1.1                   

  2002          6.2     3.8     4.9     1.7          1.2      1.5          3

  2003          6.1     3.9     4.8     1.6          1        1.6          2.9

  2004          6.3     4.3     5.1     1.8          1.1      1.8          3

  \*2005        6.3     4.2     4.9     1.8          1.1      1.6          3

  Source: State                                                            
  Statistics                                                               
  Bureau.                                                                  
  \*Estimates                                                              
  by USDA and                                                              
  FAS/China.                                                               
  ------------- ------- ------- ------- ------------ -------- ------------ ----------

# Trade

*Imports* - China's seed imports for MY05/06 are not expected to change
significantly from MY04/05. Imports of vegetable seeds, however, are
forecast to grow, while grass seed imports are forecast to remain
stagnant in MY05/06. Total seed imports in MY04/05 were valued at
US\$80.3 million. This is US\$8.2 million less (9 percent) than in
MY03/04 when they were US\$88.5 million (See Trade Tables 1-4).
Vegetable seed and grass seed in value accounted for 47 percent and 36
percent of the total imports. The drop of imports for grass seeds and
fruit/melon seed resulted in a decline of total seed imports for
MY04/05, although vegetable seed imports grew by about 11 percent.
Industry sources explained that as the government's policy favored grain
production since 2004, and financial support for the "Grain for
Green[^1]" program both have caused demand for grass seed in China's
western provinces to decline, at least in the short term. In the longer
term, however, most industry insiders expect grass seed imports will
recover because the restoration of pastureland in western provinces
remains a long-term goal for policy makers, and landscaping in China's
burgeoning cities continues to grow. The value of forage seed imports
decreased by more than the increased imports of turf seed. Increased
imports of vegetable seeds reflected a more diversified demand for
varieties and quality by the consumers with increased disposable income.
It is also driven by strong growth of exports of vegetable products,
which increased by over 20 percent in the first three quarters of 2005.
Thus, many industry experts believe import of vegetable seeds will
continue growing in next few years. Additionally, the rapid growth of
China's dairy sector is driving demand for high quality forage seeds.

Imports from the United States during MY04/05 stands at US\$29.3
million, down by US\$3.8 million over MY03/04. Most of this decrease can
attributed to decreased grass seed imports. Imports of sunflower and
vegetable seeds, however, grew during the period.

*Exports* - Seed exports are forecast to continue growing in MY05/06 due
mainly to China's low cost structure for seed breeding operations. Total
seed exports for MY04/05 rose rapidly to US\$60.5 million, up by 22
percent over MY03/04. Vegetable, rice, and fruit/melon seed export value
continued to rank the three largest categories, accounting for 47
percent, 21 percent and 10 percent, respectively. Hybrid rice seed
exports, mainly to Viet Nam and Bangladesh, continued to grow, up by 2.5
percent over MY03/04. This is likely to continue into the foreseeable
future due to China's technical advantages and the adaptability of
China's hybrid rice to the climate in these countries. Vegetable seed
exports increased to US\$28.8 million in MY04/05, which is 16 percent
more than MY03/04. The United States, Korea, and the Netherlands in that
order continued to be the three largest export destinations of China's
vegetable seed in terms of value in the past three years. Korea,
however, ranked first in volume. Vegetable seed exports to the United
States in value reached US\$8.7 million, up by 18 percent from MY03/04.
Strong exports reflect China's price advantage in seed breeding with
either imported (for re-export) or domestic new varieties. According to
MOA, contracted seed breeding by foreign seed trader is increasing along
with the improved implementation of the Regulations on the Protection of
New Plant Varieties.

# 

# Marketing Entry and Promotion

China's onerous investment, import, and marketing laws and regulations
for the planting seed sector remain in place. Its policy on foreign
investment in the seed sector (CH2012 and CH7048) still prevents any
investment by foreign enterprises in the transgenic planting seed
sector, while investment for "main crop" varieties is limited to a
minority share. Many foreign seed companies, however, have established
representative offices in China. They normally work with a few
importers, but establish vast networks and relationships with seed
wholesalers and vendors in regions or markets with the best potential.
In general, farmers purchase seeds from local seed stations. Seed
vendors usually promote the seeds that have the highest profit margin,
therefore, it is important to bear in mind that price matters when
selling seeds to the small-scale household farmers.

Demonstration is the best way to show farmers the advantages of newly
developed varieties. This is commonly done by domestic seed enterprises.
Local officials/experts and farmers are usually invited and briefed,
especially at harvest time. It is also effective to provide free seeds
to farmers for trial planting. Trade shows are another way to expose
farmers to new varieties. For example, the third annual national
planting seed trade fair was held in Zhengzhou, Henan in October 2005.
Over ten thousand people representing 3000 seed-related entities
participated. Many regional (one or several provinces) or specialized
(such as vegetable or oilseeds seed fairs) are held regularly. More
information for the fair is available at: [http://www](http://www/).
aweb.com.cn. or http://www.agri.gov.cn.

# Policy Issues

## China's Seed Law Expected To Be Amended

## 

In August 2004 China published changed Articles 17 and 33 in its Seed
Law. See GAIN reports CH4063 and CH0031 for details. The Seed Law
Implementation Measures (CH1052) and the Interim Articles from Crop Seed
(Seedling) Import and Export (CH4060) are not affected. Nevertheless,
MOA said many problems surfaced along with the rapid development of the
seed sector. A nationwide survey by MOA is under way, in which it has
requested all relevant agencies to submit suggestions regarding the
amendment to the Law. Post will report on any new developments regarding
this amendment when they occur.

Enforcement of the Seed Law and relevant rules and regulations still
faces serious challenges. MOA said that, as of the end of 2004,
cumulatively IPR infringement and counterfeit cases reached 299 and 564,
respectively. MOA recognized the seriousness of the problem so, on March
05, 2005, MOA and the State Administration of Industry and Commerce
(SAIC) issued a Circular that was intend to bring some order to China's
free-wheeling seed market. It contained a detailed work plan with the
following measures: 1) support of large seed enterprises through
combining seed subsidies for approved varieties of rice, wheat, corn,
and soybeans; 2) pushing forward the separation of seed enterprises from
agricultural administrative agencies; and, 3) strengthening the review
and approval process for new varieties.

*Labeling* - On October 10, 2005, China issued its "General Directive
for Labeling of Agricultural Seeds" and was notified to WTO. Post sent
an unofficial English translation to the relevant U.S. agencies and
industry associations. After a cursory review, several large seed
traders' said that the said standard was a combination of the existing
rules and regulations. However, further analysis is needed to fully
assess its impact on the seed trade.

## Agricultural Commodity Import Regulations - China's Animal and Plant Quarantine Law (CH1051), its Implementation Regulations (CH3110), the Administrative Measures (CH2039), and the "items on Handling Review and Approval of Entry Animal and Plant Quarantine" (CH4020) establish procedures for importers wishing to purchase propagating material, including seed. Essentially, importers must apply for a Quarantine Import Permit (QIP) before signing any contract. Only with a QIP (valid for six months), it is permissible to sign an import contract.

## Planting Seed Phytosanitary and Licensing Restrictions - Corn and soybean seeds from the United States and several other countries are still prohibited from being imported into China because of quarantine restrictions on "Stewart's Wilt" and "Phytophthera Megasperma". As for other planting seeds, both the requirements for "main crops" variety approval, as well as licensing requirements for seed production and marketing, place arbitrary restrictions on the seed trade. 

Industry sources indicate importers of certain seeds have been asked to
submit an annual import plan to MOA and China's State Forestry
Administration (SFA). The statutory basis for this requirement, however,
is unclear. Government offices reportedly use the information when
deciding how to award VAT-free import approvals.

Exporters of U.S. planting seeds should contact the USDA Foreign
Agriculture Service Planting Seeds Division
([www.fas.usda.gov/cots/seeds.html]{.underline}), APHIS officers
([www.aphis.usda.gov/is/tst/RegionThree.html](http://www.aphis.usda.gov/is/tst/RegionThree.html)),
and the American Seed Trade Association
([www.amseed.com/](http://www.amseed.com/)) and the Oregon Seed Council
([forages.oregonstate.edu/organizations/seed/osc]{.underline}/) to
understand more about the issues facing planting seed exports to China.
Exporters should be aware, however, that FINAL IMPORT APPROVAL OF ANY
PRODUCT IS SUBJECT TO THE IMPORTING COUNTRY'S RULES AND REGULATIONS AS
INTERPRETED BY BORDER OFFICIALS AT THE TIME OF PRODUCT ENTRY. Therefore,
it is particularly valuable to make certain importers are familiar not
only with published rules but also the customary practices.

# 

## Seed Tariffs and the Value Added Tax (VAT) - China has tariff-rate quotas for seed wheat, rice, corn, and a few other non-grain commodities[^2]. In-quota wheat, corn, and rice seed are subject to a 1 percent tariff, while all other planting seeds enter tariff-free. Out-of-quota tariffs for seed corn are 20 percent, while out-of-quota tariffs for wheat and rice are 65 percent. 

The VAT-free policy on seed imports is likely to remain in place from
2006 to 2010 as part of China's "11^th^ Five-Year Plan." The current VAT
exemption procedure, however, lacks transparency and efficiency. Details
of the VAT-free policy are said to be in the pipeline, but whether it is
to be clarified before the beginning of 2006 remains unclear.

Industry sources report that, in the current VAT-free regime, within
each year of the plan, usually during April or May, government offices
send circulars or other internal notices to customs officials confirming
what products and companies have been granted VAT-free status. Under the
VAT collection system, companies pay the 13 percent VAT as a deposit for
imports during the first few months of the year. If a company is granted
VAT-free status, then the deposit is returned. If not, the deposit is
kept and future shipments for the year must pay the 13 percent VAT.

This confusing system leads to an instable market because some importers
and the companies they represent try to book seeds for shipment near the
end of the year while they retain VAT-free status. Likewise, market
confusion reigns when companies do not receive their expected VAT-free
status, which increases costs for importers and the distributors they
represent. These increased costs often erase traders' profits, which
causes order cancellations, shipment redirection, and even default.

## Plant Variety Protection (PVP) Background and Development - On Oct 20, 2005, China filed its endorsement letter to FAO to recognize the 1997 amended version of International Plant Protection Conversion (IPPC), and thus becoming the 141st member of the treaty. The official liaison office is affiliated to MOA. China has legally recognized the 1978 version of the International Convention for the Protection of New Varieties of Plants (UPOV) effective from October 1, 1997 (CH7023). MOA and SFA are responsible for reviewing PVP applications. China's UPOV membership obligates China to honor, sui generis, the breeders' rights for registered and approved novel, distinct, uniform and stable seeds. 

## 

  ------------------------------------------------------ ----------------------------------------
  Ministry of Agriculture PVP Office                     State Forestry Administration's PVP
                                                         Office

  No. 11 Nongzhanguannanli                               No. 18 Hepingli Dong Jie

  Chaoyang District                                      Chaoyang District

  Beijing, China 100026                                  Beijing, China 100714

  Tel: 86-10 64193029                                    Tel: 86-10 84239104

  Fax: 86-10 64194661                                    Fax: 86-10 64213084

  Web: [www.cnpvp.cn](http://www.cnpvp.cn/)              Web:
                                                         [www.cnpvp.net](http://www.cnpvp.net/)

  Web2:                                                  
  [www.stee.agri.gov.cn](http://www.stee.agri.gov.cn/)   
  ------------------------------------------------------ ----------------------------------------

MOA reports from the time it began accepting applications in 1999
through October 31, 2005, the PVP office received 2679 applications for
new PVP. At present, 621 applications have been completely reviewed and
approved. The greatest number of applications and approvals are for
major field crops including corn, rice, soybeans, wheat, and rapeseed.
According to MOA, over 90 percent of all applications are of corn, rice
and wheat, and about 60 percent filed by research institutes and
universities and colleges. Additionally, MOA indicates six out of the
one hundred foreign applications it received for new PVP were completely
reviewed and approved. Foreign applications increased sharply in 2005,
with 86 new applications out of the total of 100. As of November 2005,
SFA also received about 400 applications, including 90 by foreign
enterprises. A total of 100 applications completed the review and
approval process with 22 for foreign variety owners. At present, there
are 14 MOA DUS testing institutes and 21 SFA testing agencies around the
country. To ensure scientific and authoritative determination of plant
variety rights, China formulated guidelines for testing 57 new varieties
of plants, including corn, rice, poplar and peony, of which 18 have been
promulgated and implemented as national or industrial standards.

## Intellectual Property Rights (IPR) Issues for Planting Seed Enterprises - Despite the implementation of Laws and Regulations, IPR infringement and counterfeit cases occurred frequently. MOA said as of the end of 2004, cumulatively IPR infringement and counterfeit cases reached 299 and 564, respectively. 

Several planting seed companies reported problems with IPR infringement
in China, yet many companies experiencing problems had not registered
their trademarks or copyrights in China. Without such registration, the
company has little legal recourse if products are counterfeited or its
IPR otherwise infringed. Registration, however, does not guarantee a
company's IPR will not be infringed upon. Several companies that have
registered their product's brand name, trade name, and logo still
experience infringement and even if they receive favorable court
rulings, it is very difficult to receive compensation from the offending
party.

Seed sold in counterfeit packages identical to legitimate brand names is
the most frequent problem for seed companies. Other IPR crimes include
theft of seed/germplasm from production fields or facilities that is
then bred and marketed by other companies. Seed companies also report
demands for restitution for "inferior quality" seed sold by
counterfeiters. Local courts also can award damages to growers, even
when poor crop management or weather borne problems, not seed quality,
is the root of the problem.

GAIN report CH2049 provides information on how to access UNOFFICIAL
English translations of China's Copyright Law, Trademark Law, and Patent
Law along with the Implementation Regulations or Enforcement Measures
for each of the aforesaid.

## Biotechnology and Planting Seeds - Transgenic crops and seeds need to be approved by the National Biosafety Committee (NBC) after environmental and food safety evaluations by MOA and government affiliated institutes. China's investment in transgenic seed technology is more than any other country besides the United States. China has commercialized four genetically modified plants since 1997, including cotton, tomatoes, sweet peppers and petunias. Although there are no official statistics, some experts reported development of over 100 transgenic crops with about 60 already in field trials, including rice, corn, wheat, soybeans and peanut etc. Although Bt cotton has been widely planted, China has yet to approve any major food crops for environmental release. MOA has approved one soybean, seven canolas, eight corn, and two cotton varieties for import and processing, but none for planting. MOA is drafting 40 transgenic crop testing and safety evaluation standards, in anticipation of increased transgenic crop development. 

If granted MOA safety approvals, transgenic seeds must undergo
examination for distinctness, uniformity, and stability (DUS) by PVP
examiners. China's PVP office drafted new DUS testing guidelines for
corn and rice, thereby lending speculation that if corn and rice
transgenic events receive safety approval, the process for PVP testing
for those seeds can move forward quickly and transparently.

The approval process so far has proved cumbersome and lacking in
transparency. China's biotechnology regulations require foreign
introduced transgenic events to first receive approval abroad and then
undergo subsequent evaluation in China. This asynchronous process
creates difficulties not only for commercial shipments containing
transgenic commodities, but also for adoption of future transgenic seeds
in countries that export to China.

Many scientists and economists recognize the benefits to consumers and
farmers of commercializing release of transgenic planting seeds.
Analysts point out that not only will state-sponsored research
institutes benefit from licensing technology to seed companies, but also
farmers would benefit from lowering both direct and indirect costs,
increasing yields, and lower pesticide applications. Official studies
highlighted not only economic benefits, but also environmental benefits,
including elimination of hundreds of accidental pesticide poisonings.

# 

# Turf Seeds and Nursery Seedlings

Despite a drop of total grass seed imports for MY04/05, China's demand
for turf seeds and nursery seedlings remains strong as efforts to
beautify urban areas have intensified, and planting of grass and nursery
products in parks, zoos, and on roadsides has expanded. The long-term
outlook for urban beautification/green space design includes planting
more trees, shrubs, and grasses, not only in the biggest metropolitan
areas like Beijing, Shanghai, Guangzhou, and Dalian, but also in smaller
cities. News accounts cite the government's goal for 70 percent of
China's 662 municipalities to increase their urban forestry coverage
rate from the present 30.2 percent in 2004 to 45 percent by the year
2050.

Urban Green Space

  ------------------------------------------- ------ ------ ------ ------- -------
  Urban Green Space                           1995   2000   2002   2003    2004

  Total Areas of Parks & Green Areas in       67.8   86.5   86.5   121.2   132.2
  Cities (10,000 Ha)                                                       

  Public Green Areas per 10,000 people in Ha  2.5    3.1    3.7    4.4     4.6

  Area of Parks and Zoos (10,000 Ha)          7.3    8.2    8.2    11.3    13.4

  Number of Parks and Zoos (unit)             3619   4455   4455   5832    6427

  Source: NSB 2005 Yearbook Table 11-10                                    
  ------------------------------------------- ------ ------ ------ ------- -------

The future of urban beautification and the nursery sector remains bright
as Chinese cities clamor to host international events, e.g., the Beijing
Olympics, the 2010 World Expo in Shanghai, and other events that will
draw tourists and businesses from around the world. Additionally, many
cities are spending more money on city landscaping including more lawns.
Constraints to expanding domestic floriculture and sod farms include
inadequate water supply, rising water costs, and competition with food
crops (less marginal land planted with grass and nursery products).
Nursery vendors remain optimistic, however, with a growing interest in
importing grass seed, shrubs, and tree seedlings.

Nationwide Horticultural Planting Area (Ha)

  ------------------------------ ------------ --------------- ------------
                                 2002         2003            2004

  Cut Flowers, Vines, and        18,834       28,842          35,138
  Potpourri                                                   

  Potted Plants                  39,122       46,626          78,529

  Ornamental Trees               163,766      233,111         356,011

  Food and Medicinal Flowers     28,468       51,325          84,382

  Industrial Flowers             34,870       28,314          39,648

  Grass Sod                      34,107       26,083          23,757

  Flower Seed                    4,381        2,463           4,149

  Young Plants/Seedlings         8,221        9,415           10,705

  Flower Bulbs                   2,685        3,936           3,685

  Source: Ministry of                                         
  Agriculture Statistical                                     
  Abstract                                                    
  ------------------------------ ------------ --------------- ------------

# Trade Tables

## Table 1 China's Imports from the World in Volume & Value

  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------
                              **Volume                                  **Value                     
                              (KG)**                                    (US\$)**                    

  **HS       Planting Seeds   **MY02/03**   **MY03/04**   **MY04/05**   **MY02/03**   **MY03/04**   **MY04/05**
  Code**                                                                                            

             **Total**        27,258,695    30,603,915    24,161,111    74,519,073    88,540,125    80,275,615

  10019010   Wheat            24            37            1             2             448           1

  10020010   Rye              6                                         3             0             0

  10030010   Barley           0             12                          0             115           0

  10040010   Oats             3,000                       49            2,650         0             438

  100510     Corn             30,134        39,455        76,267        289,250       313,941       594,049

  10061010   Rice                                                       0             0             0

  10061011   Rice,long grain  0                                         0             0             0

  10061019   Rice, other      138           217           685           8,233         1,348         21,570

  10070010   Sorghum          282,364       103,152       115           420,552       150,738       194

  10089010   Other cereals    40,000        18            0             43,700        385           0

  12010010   Soybeans         133           883           40            74            11,386        376

  12021010   Peanuts          750           2,000         0             452           802           0

  12051010   Rape/Colza,low   0             4             0             0             41            0
             erucic acid                                                                            

  12059010   Rape/Colza,nes   97            219           3             21            30            6

  12060010   Sunflower        544,873       470,345       910,664       2,543,357     2,602,519     5,042,782

  12072010   Cotton           24,115        12,125        1,906         17,968        14,611        10,655

  12091000   Other sugar beet 7,973         115,405       389           75,958        481,536       14,010

  120921     Alfalfa          5,557,828     2,568,822     766,770       10,001,890    5,239,649     1,477,675

  120922     Clover           1,229,566     1,836,999     1,269,134     2,323,065     4,436,459     3,739,220

  120923     Fescue           4,475,025     6,898,855     5,621,940     5,031,586     7,718,600     6,421,425

  120924     Kentucky         2,226,070     2,601,294     1,739,080     5,686,591     6,959,801     4,749,913

  120925     Rye grass        2,794,922     4,253,106     2,784,158     2,893,313     4,365,468     2,828,405

  120930     Herbaceous       196,346       419,201       225,380       4,162,642     4,975,058     4,405,003

  120926     Timothy          2,794,922     4,253,106     2,784,158     2,893,313     4,365,468     2,828,405

  12092910   Sugar beet       259,675       115,848       420,361       1,121,009     699,998       2,359,938

  12092990   Other Forage     1,967,983     1,317,203     872,579       4,934,322     3,707,130     2,811,350

  120999     Fruit, Melon and N/A           N/A           944,774       5,339,117     8,079,538     4,776,372
             Other                                                                                  

  120991     Vegetable        4,822,751     5,595,609     5,742,658     26,730,005    34,415,056    38,193,828

  Source:                                                                                           
  China                                                                                             
  Customs                                                                                           
  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------

## Table 2 China\'s Imports from the U.S. in Volume & Value 

  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------
                              **Volume                                  **Value                     
                              (KG)**                                    (US\$)**                    

  **HS       **Planting       **MY02/03**   **MY04/05**   **MY04/05**   **MY02/03**   **MY04/04**   **MY04/05**
  Code**     Seeds/MY**                                                                             

             **Total**        11,710,936    16,975,170    13,866,261    26,778,189    33,088,265    29,320,494

  10019010   Wheat            0             3             0             0             58            0

  10020010   Rye              0             0             0             0             0             0

  10030010   Barley           0             12                          0             115           0

  10040010   Oats             0             0             0             0             0             0

  100510     Corn             0             0             4             0             0             6,096

  10061010   Rice             0             0             0             0             0             0

  10061011   Rice, long grain 0             0             0             0             0             0

  10061019   Rice, other      0             0             0             0             0             0

  10070010   Soghum           0             0             0             0             0             0

  10089010   Other cereals    0             0             0             0             0             0

  12010010   Soybean          0             0             0             0             0             0

  12021010   Peanut           0             0             0             0             0             0

  12051010   Rape/Colza,low   0             0             0             0             0             0
             erucic acid                                                                            

  12059010   Rape/Colza, nes  0             0             0             0             0             0

  12060010   Sunflower        205,327       372,353       618,820       1,134,642     1,922,193     3,578,363

  12072010   Cotton           670           955           1,881         1,381         7,902         10,449

  12091000   Other sugar beet 606           22            0             12,937        545           41

  120921     Alfalfa          514,411       56,353        62,504        1,444,735     207,803       202,961

  120922     Clover           3,510         22,948        10,000        29,071        49,612        32,000

  120923     Fescue           3,883,592     6,325,012     5,424,585     4,417,835     7,127,308     6,202,667

  120924     Kentukey         1,757,070     2,030,153     1,615,980     4,733,699     5,809,135     4,492,683

  120925     Rye grass        2,077,182     3,544,715     2,518,558     2,059,646     3,299,009     2,397,515

  120930     Herbaceous       13,893        18,057        46,924        2,714,567     2,639,490     2,399,636

  120926     Timothy          2,077,182     3,544,715     2,518,558     2,059,646     3,299,009     2,397,515

  12092910   Sugar beet       0             0             0             0             0             0

  12092990   Other forage     1,025,753     862,058       568,107       3,162,558     2,860,258     2,327,836

  120999     Fruit, Melon &   N/A           N/A           138,731       1,284,192     1,964,330     874,885
             Other                                                                                  

  120991     Vegetable        151,740       197,814       341,609       3,723,280     3,901,498     4,397,847
  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------

## Table 3 China's Grass Seed Imports and Major Countries of Origins

  ----------------- ---------------- ----------------- ------------------
  **Timothy Imports                                    
  Volume (in KG)                                       
  and Major                                            
  Origins**                                            

  Country           **MY 02/03**     **MY03/04**       **MY04/05**

  **United States** 2,077,182        3,544,715         2,518,558

  Denmark           362,525          349,900           158,000

  Netherlands       99,650           40,000            60,000

  New Zealand       43,975           236,350           47,600

  Canada            65,242           2,041             0

  Australia         145,000          80,050            0

  **Total**         2,794,922        4,253,106         2,784,158

                                                       

  **Fescue Seeds                                       
  Imports Volume                                       
  (in KG) and Major                                    
  Origins**                                            

  Country           **MY 02/03**     **MY03/04**       **MY04/05**

  **United States** 3,883,592        6,325,012         5,424,585

  Canada            186,027          180,935           138,525

  Denmark           403,000          352,729           58,830

  **Total**         4,475,025        6,898,855         5,621,940

                                                       

  **Kentucky Seeds                                     
  Import Volume (in                                    
  KG) and Major                                        
  Origins**                                            

  Country           **MY 02/03**     **MY03/04**       **MY04/05**

  **United States** 1,757,070        2,030,153         1,615,980

  Denmark           406,300          454,925           123,100

  Japan             0                0                 0

  **Total**         2,226,070        2,601,294         1,739,080

                                                       

  **Rye Grass                                          
  Imports Volume                                       
  (in KG) and Major                                    
  Origins**                                            

  Country           **MY 02/03**     **MY03/04**       **MY04/05**

  **United States** 2,077,182        3,544,715         2,518,558

  Denmark           362,525          349,900           158,000

  Netherlands       99,650           40,000            60,000

  New Zealand       43,975           236,350           47,600

  Canada            65,242           2,041             0

  Australia         145,000          80,050            0

  **Total**         2,794,922        4,253,106         2,784,158

                                                       

  **Herbaceous                                         
  Imports Volume                                       
  (in KG) and Major                                    
  Origins**                                            

  Country           **MY 02/03**     **MY03/04**       **MY04/05**

  New Zealand       0                33,780            120,287

  **United States** 13,893           18,057            46,924

  Australia         11,428           0                 21,508

  United Kingdom    77               289,285           18,166

  Korea, South      0                1                 8,475

  Taiwan            71,864           69,139            4,951

  **Total**         196,346          419,201           225,380
  ----------------- ---------------- ----------------- ------------------

Source: China Customs

## Table 4 China's Sunflower, Fruit/Melon Imports & Major Countries of Origins

  -------------------- ----------------- ---------------- ----------------
  **Sunflower Planting                                    
  Seed Imports Volume                                     
  (in KG) and Major                                       
  Origins**                                               

  Country              **MY 02/03**      **MY03/04**      **MY04/05**

  **United States**    205,327           372,353          618,820

  Australia            114,250           66,480           184,893

  Israel               9,253             29,100           41,740

  India                19,600            210              40,018

  France               6,094             569              20,690

  **Total**            544,873           470,345          910,664

                                                          

  **Fruit, Melon and                                      
  Other Import Volume                                     
  (in KG) and Major                                       
  Origins**                                               

  Country              **MY 02/03**      **MY03/04**      **MY04/05**

  Taiwan               N/A               N/A              420,322

  Thailand             N/A               N/A              205,368

  **United States**    N/A               N/A              138,731

  Indonesia            N/A               N/A              107,156

  Australia            N/A               N/A              54,154

  **Total**            N/A               N/A              944,774
  -------------------- ----------------- ---------------- ----------------

Source: China Customs

## Table 5 China\'s Exports to the World in Volume & Value 

  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------
                              **Volume                                  **Value                     
                              (KG)**                                    (US\$)**                    

  **HS       **Planting       **MY02/03**   **MY03/04**   **MY04/05**   **MY02/03**   **MY03/04**   **MY04/05**
  Code**     Seeds/MY**                                                                             

             **Total**        20,717,780    23,137,977    26,456,360    46,276,513    49,463,463    60,503,914

  10019010   Wheat            0             3,100         300,001       0             3,160         60,001

  10020010   Rye              1,200         0             304,400       708           0             136,205

  10030010   Barley           7,000         25,513        244,500       3,033         6,042         61,050

  10040010   Oats             2,000         31,900        45,500        1,380         18,316        16,586

  100510     Corn Seed        61,317        372,820       347,614       85,847        282,954       313,756

  10061010   Rice Seed        0             0             0             0             0             0

  10061011   Rice Long Grain  3,226,256     2,668,755     10,867,943    2,939,399     2,295,999     9,381,635

  10061019   Rice Other       10,098,121    9,928,154     2,107,649     12,109,062    10,001,820    3,238,256

  10070010   Sorghum          238,800       31,480        9,257         127,689       47,020        15,872

  10089010   Other Cereals    4,800         40,424        9,173         3,006         11,625        16,524

  12010010   Soybeans         61,877        100,805       151,858       16,728        59,688        138,546

  12021010   Peanuts          46,080        50,100        90,600        23,380        32,483        56,170

  12051010   Rape/Colza, low  0             0             0             0             0             0
             erucic acid                                                                            

  12059010   Rape/Colza,nes   1,440         212,945       22,125        1,365         60,028        13,593

  12060010   Sunflower        18,216        105,117       81,345        36,880        104,482       244,307
             Planting                                                                               

  12072010   Cotton Planting  400,726       288,096       171,268       1,000,330     709,966       427,666

  12092910   Other Sugar Beet 8,350                                     38,560        0             0

  120921     Alfalfa          292,303       110,093       2,936,865     223,038       143,542       3,821,498

  120922     Clover           5,890         0             3,350         3,915         0             8,620

  120923     Fescue                         840           20,000        0             1,415         30,400

  120925     Rye Grass        0             7,255         18,070        0             6,646         44,422

  120930     Herbaceous       269,434       287,824       618,713       4,404,683     3,183,770     4,744,890

  120930     Timothy          0             7,255         18,070        0             6,646         44,422

  12091000   Sugar Beet       0             58            536           0             873           1,044

  12092990   Other Forage     1,249,460     2,524,267     2,337,536     1,885,926     2,770,193     2,891,030

  120999     Fruit,Melon and  783,685       662,806       1,147,914     3,975,169     4,808,440     6,028,404
             Other                                                                                  

  120991     Vegetable        3,940,825     5,678,370     4,602,073     19,396,415    24,908,355    28,769,017

  Source:                                                                                           
  China                                                                                             
  Customs                                                                                           
  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------

## Table 6 China\'s Exports to the U.S. in Volume and Value

  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------
                              **Volume                                  **Value                     
                              (KG)**                                    (US\$)**                    

  HS Code    **Planting       **MY02/03**   **MY04/04**   **MY04/05**   **MY02/03**   **MY04/04**   **MY04/05**
             Seeds/MY**                                                                             

             **Total**        459,342       649,863       766,517       6,676,999     8,958,984     10,026,632

  10019010   Wheat            0             0             0             0             0             0

  10020010   Rye              0             0             0             0             0             0

  10030010   Barley           0             0             0             0             0             0

  10040010   Oats             0             0             0             0             0             0

  100510     Corn             0             0             0             0             0             0

  10061010   Rice             0             0             0             0             0             0

  10061011   Rice Long Grain  0             0             0             0             0             0

  10061019   Rice Other       0             0             0             0             0             0

  10070010   Sorghum          0             0             0             0             0             0

  10089010   Other Cereals    0             0             1,936         0             0             7,373

  12010010   Soybeans         0             0             119,010       0             0             52,364

  12021010   Peanuts          0             0             0             0             0             0

  12051010   Rape/Colza, low  0             0             0             0             0             0
             erucic acid                                                                            

  12059010   Rape/Colza,nes   0             0             0             0             0             0

  12060010   Sunflower        0             0             0             0             0             0

  12072010   Cotton           187,609       209,774       14,846        469,023       517,756       37,105

  12092910   Other Sugar Beet 0             0             0             0             0             0

  120921     Alfalfa          0             0             20,175        0             0             19,973

  120922     Clover           0             0             0             0             0             0

  120923     Fescue           0             820           20,000        0             1215          30,400

  120925     Rye Grass        0             0             0             0             0             0

  120930     Herbaceous       7,334         38,099        214,711       75,165        141,974       298,616

  120930     Timothy          0             0             0             0             0             0

  12091000   Sugar Beet       0             0             0             0             0             0

  12092990   Other Forage     2,844         154,949       20,475        42,020        123,112       27,192

  120999     Fruit,Melon and  30,501        34,779        35,945        342,956       537426        826,440
             Other                                                                                  

  120991     Vegetable Seeds  231,054       211,442       319,419       5,747,835     7,637,501     8,727,169

  Source:                                                                                           
  China                                                                                             
  Customs                                                                                           
  ---------- ---------------- ------------- ------------- ------------- ------------- ------------- -------------

## Table 7 China's Main Seed Exports & Major Destinations

  -------------------- ----------------- --------------- -----------------
  **Rice Other Exports                                   
  Volume (in KG) and                                     
  Major Destinations**                                   

  Country              **MY 02/03**      **MY03/04**     **MY04/05**

  Vietnam              10,074,260        9,875,240       1,430,080

  Bangladesh           5,600             23,422          586,740

  Ecuador              13,650            27,300          54,600

  Pakistan             0                 1,000           20,050

  Spain                0                 0               14,000

  **Total**            10,098,121        9,928,154       2,107,649

                                                         

  **Rice, Long Grain                                     
  Exports Volume (in                                     
  KG) and Major                                          
  Destinations**                                         

  Country              **MY 02/03**      **MY03/04**     **MY04/05**

  Vietnam              3,024,580         2,402,390       10,149,905

  Bangladesh           100,166           199,560         546,440

  Pakistan             63,000            20,000          120,000

  Guinea               35,000            44,600          41,200

  Indonesia            60                2,205           8,248

  **Total**            3,226,256         2,668,755       10,867,943

                                                         

  **Vegetable Seed                                       
  Exports in Volume                                      
  (in KG) and Major                                      
  Destinations**                                         

  Country              **MY 02/03**      **MY03/04**     **MY04/05**

  Korea, South         1,771,643         2,055,361       1,267,537

  Netherlands          592,152           932,229         877,847

  France               77,371            177,852         386,791

  **United States**    231,054           211,442         319,419

  Japan                359,095           274,815         311,622

  Italy                12,056            72,162          309,584

  Taiwan               201,825           199,249         232,857

  **Total**            3,940,825         5,678,370       4,602,073

                                                         

  **Fruit, Melon &                                       
  Other Exports in                                       
  Volume (in KG) and                                     
  Major Destinations**                                   

  Country              **MY 02/03**      **MY03/04**     **MY04/05**

  Korea, South         236,451           243,296         583,300

  Japan                332,908           188,863         340,418

  Taiwan               10,317            10,902          49,536

  Korea, North         2,000             52,360          37,250

  **United States**    30,501            34,779          35,945

  India                20,870            37,615          22,902

  Netherlands          19,928            23,813          19,626

  Pakistan             5,210             7,889           10,734

  **Total**            783,685           662,806         1,147,914
  -------------------- ----------------- --------------- -----------------

Source: China Customs

[^1]: ^1^ A program that pays farmers to plant trees or grasses instead
    of row crops.

[^2]: This is allowed under China's WTO accession agreement.