Once a competitor to U.S. rice farmers, China could soon become a consumer of California rice.
Some hurdles still need to be crossed, according to Tim Johnson, president and chief executive officer of the California Rice Commission (CRC). Nevertheless, an agreement already signed by U.S. Department of Agriculture Secretary Sonny Perdue has opened the door to California rice exports to China.
“This is a significant market opportunity,” Johnson said.
California currently produces nearly two million metric tons of rice annually from about 500,000 planted acres of mostly medium-grain varieties. It also accounts for nearly all of the nation’s sushi rice production and some other specialty rice varieties. This differs from the long grain rice produced primarily in the southern U.S.
Chris Crutchfield, president and chief executive officer of American Commodity Company, a full-service handler and marketer of milled and paddy rice in California's Sacramento Valley rice-growing region, thinks expects exports could start with this year’s crop.
While it’s never been illegal to ship rice to China, Crutchfield says phytosanitary agreements between the two countries were necessary and must still be formalized before California rice exports can take place. These processes take years to develop.
The next step in the process will be a formal inspection of several U.S. facilities by Chinese inspectors. This inspection has not occurred yet though it's expected to take place before the end of the year.
The target audience for California rice will be middle and upper class consumers who Crutchfield says have food safety concerns about home-grown rice, and have the financial ability to buy U.S. exports.
China has long produced rice from short grain to long grain, though their most prevalent production and largest import has been long grain varieties, he says.
“I think it has great potential for the state over the long haul,” Crutchfield says.
The goal will be for the California rice industry to build markets for California varieties, he continued. News of the possible new market has not yet impacted grower rice prices.
Johnson says the entire U.S. rice industry could benefit from this new market.
“This is certainly everybody’s hope,” Johnson said, adding that China already imports about five million metric tons of rice annually, or more than double California’s total production.
Johnson believes China could be more interested in the medium grain Calrose varieties. California’s largest rice consumer is Japan including about 350,000 metric tons imported annually.
“We think exports could be modest at first,” Johnson said. “It’ll take time to understand the full impact of this decision, but we’re excited about it.”