Sowing the seeds of domestic success(2)

Regional efforts

Compared with domestic suppliers, the Chinese authorities have built a quality control system for exports that is specifically designed to meet the standards in other countries, which usually have much higher requirements with regard to the use of pesticides and fertilizers.

To date, the General Administration of Quality Supervision, Inspection and Quarantine has certified 144 county-level areas as national-level demonstration areas. A string of measures, including enhanced cooperation between different government departments, strict controls on the use of pesticides, and stringent production standards, have been enforced in these areas to ensure that the products meet standards overseas.

In Anqiu, farmers use formula fertilizers to ensure that the products meet the requirements of the destination countries. Farmers are also required to put Quick Response code labels on products to ensure that each individual packet can be traced to the farmer that supplied it.

Yuan Li, deputy Party chief of Anqiu, said local efforts to produce high-quality goods for export have resulted in an improvement in the overall quality of the region's agricultural products.

"Producing agricultural goods is not like producing items in a factory, where quality control can be managed in-house. Agricultural production involves a large number of farmers, and a whole system, including food standards, regulations, and the coordination of different government departments," he said.

Li, of Northwest A&F University, said the role of demonstration areas in pushing forward standardization of the agricultural sector should not be underestimated.

"Agriculture is highly dependent on natural conditions, and that's why it's easy to encourage the production of a single product across a whole region," he said.

Anqiu Foreign Trade Foods' Liu said the raising of the bar for the standards of agricultural products in her region has helped boost the quality of the company's products. "Without the regional regulations on pesticide use, we would have to build isolation belts between our farmland and other people's," she said, adding that regional management has also made life easier for agricultural processors because they can easily obtain safe products from nearby farms.

Challenges remain

However, many exporters have conceded that several challenges have yet to be addressed if they are to further exploit the domestic market. For example, most of the products sold in destination countries bear the logos and labels of foreign food companies, and not those of the Chinese producers. This has resulted in a lack of domestic awareness of Chinese companies, despite the excellence of their products. "We need to shore up our brands and distribution channels, although that would mean costs would increase," Wang, of Genseida, said.

Li Binglong, a professor at the College of Economics and Management at China Agricultural University in Beijing, said branding and marketing are crucial steps for agricultural exporters looking to break into the domestic market. "That means more brands should be established to help farmers face up to market challenges," he said.

Another restraining factor is the lack of effective refrigeration systems, or "cold chains", whereby perishable goods can be stored for long periods prior to sale, according to officials.

Qiu Haifang, deputy mayor of Anqiu, said the large sums required mean few farmers are willing to invest in cold-chain facilities, despite the obvious benefits, especially in terms of sheltering producers from market risks and extreme fluctuations in prices.

"Refrigeration is a crucial part of the vegetable industry if we want to further expand our retail chains. The authorities can provide the farmers with guidance in that regard, but ultimately it's up to producers to invest and beef up their production capacities. If they don't do that, it could be very hard for them to succeed in the domestic market," she said.