Saturday, May 22, 2010

China - the world's food basket?

There is always a concern that during a recession that cashed up nations can scour the world looking for bargains.

Take for instance - the infamous Crafar Farms saga - sold to the China Jin Hui Mining Corporation.

It is fair to say that China is moving aggressively beyond being the world's factory - now it also wants to be the world's food producer - the  food basket.

China is able to farm on a scale much larger than anyone - in New Zealand for instance -and they have the money. The model is relatively simple - just like the Hong Kong aquisition- basically you buy a business in a country (renowned for a particular product) - learn what you can - and once you are successfully running it - use as a blueprint - and bring it back to the mother land.

I was talking to a fruit grower in the Tasman region - who had one of the two major supermarket chains cancel their order for their fruit at the last moment - as well - now they were getting their fresh fruit from China.

So do ask when you are at the supermarket - where those berries are coming from!

The main stumbling blocks for China - re: food production - is a complete lack of trust for the product (remember melamine!).

However, China succeeded in becoming the world's factory - they also have a good chance at becoming the food basket - think "Chinese Green Grocer" on an unprecedented scale.

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