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2010
CWB commemorates half-century of trade with China
March 8, 2010
Winnipeg - As Canada and China mark the 40th anniversary of diplomatic relations, the Canadian Wheat Board is celebrating nearly 50 years of trade with the economic giant.
Over that time, China has imported more than 120 million tonnes of western Canadian wheat and barley – enough to make 279 billion loaves of bread and 55 billion bottles of beer.
"As Canada and China mark a major milestone in diplomatic relations, the CWB is proud of its role in helping to forge a relationship between both nations," says Ward Weisensel, CWB chief operating officer, who has just returned from Beijing, where he visited major customers. "We signed our first long-term trade agreement with China in 1961, and today China continues to be a major customer of western Canadian grain."
Wheat trade between the two nations began during a period of famine in China, and the CWB became one of the first foreign businesses to deal with the new People's Republic of China. The wheat trade is widely recognized as a major foundation of Canada-China relations.
Celebrations of the 40th anniversary of diplomatic relations get underway today at a reception in Ottawa, attended by CWB representatives, Chinese and Canadian government officials, and business leaders from other major Canadian companies doing business in China. The CWB will participate in 40th anniversary celebrations throughout the year, and will host a special event for its customers this July at Expo 2010 in Shanghai.
While wheat continues to play a major role in the CWB's relationship with China, exports of malting barley have now become a significant part of the trade. China is the world's largest beer producer, brewing more than 43 billion litres a year. (By comparison, about two billion litres are produced annually in Canada.) China is also the largest importer of western Canadian malting barley, importing an average of 386 000 tonnes per year over the past ten years.
In addition to increased beer consumption, growing affluence in China has created a niche-market for premium wheat flour. The CWB is participating in a unique branding initiative with the Guchuan Food Company, in which dumpling flour made from Canada Western Red Spring wheat is being distributed in bags and gift boxes designed jointly by the CWB and Guchuan.
The CWB has maintained an office in Beijing since 1994, one of only two CWB offices located outside of Canada.
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. As one of Canada's biggest exporters, the Winnipeg-based organization sells grain to over 70 countries and returns all sales revenue, less marketing costs, to farmers.
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For more information, please contact:
John Lyons
CWB media relations manager
Tel: (204) 983-3101
Cell: (204) 223-4281
john_lyons@cwb.ca
The Canadian Wheat Board and China – a relationship spanning 50 years
- The wheat trade between Canada and China began 50 years ago, in the midst of a great famine in China. At the time, China faced trade embargoes from many nations, including the United States, and was finding it difficult to source food for its starving population. The Canadian Wheat Board (CWB) became one of the first foreign traders to deal with the new People's Republic of China.
- In 1961, the CWB signed its first long-term agreement with China, laying the foundation for an enduring relationship. This visionary move occurred almost 10 years before the official recognition of diplomatic ties between Canada and China in 1970. The wheat trade became an "icebreaker" that helped pave the way for diplomatic relations and for trade with China by other Canadian companies.
- To this day, Chinese wheat buyers and government officials acknowledge the important role played by the CWB during the difficult transition years of the 1960s. The wheat trade with China is recognized by both countries as one of the most important foundations of Canada-China relations. This relationship has also had ongoing benefits for the sale of western Canadian wheat and barley to China over the past five decades. For example, in 1971, China purchased all of its required wheat imports from Canada – the only time in Chinese wheat trade history that one country was given 100-per-cent market share.
- Since 1961, more than 120 million tonnes of wheat and barley combined has flowed to China from the fields of Western Canada – enough to produce 279 billion loaves of bread and 55 billion bottles of beer.
- China's current import demand for wheat is highly variable and depends on its own domestic wheat production each year. The CWB supplied 2.3 million tonnes of wheat to China in the 2004-05 crop year, but has averaged 544 000 tonnes annually over the past decade (more than any other wheat exporter). China is the world's largest wheat producer, growing an average of 104 million tonnes annually and can often cover its own consumption. However, a small percentage decline in production can create a huge increase in the need for imported wheat.
- In 1994, the CWB opened an office in Beijing to maintain and enhance its close ties with Chinese buyers, end-users of Canadian grain and Chinese government departments. CWB representatives will host an official celebration of this valued relationship in July 2010, inviting grain customers and partners to a special event being held during the World Exposition in Shanghai.
- As the Chinese standard of living increases, the number of beer drinkers has risen, creating new opportunities for malting barley from Western Canada. Although per-capita consumption is relatively low, China is the world's largest beer producer, brewing more than 43 billion litres a year (compared with 23 billion litres in the U.S. and two billion litres in Canada). The CWB is a large supplier of malting barley for Chinese beer, with sales averaging 386 000 tonnes a year.
- Increasing affluence in China also means growing niche-market demand for premium flour. The CWB is participating in a unique branding initiative with the Guchuan Food Company, supplying bags of high-end, Canadian-milled dumpling flour made from Canada Western Red Spring wheat. The flour is distributed in China in bags and gift boxes jointly designed by the CWB and Guchuan.
- Approximately 50 Chinese grain buyers, processors and industry officials visit the CWB's headquarters in Winnipeg each year to learn more about western Canadian grain. They attend specialized courses and technical programs at the Canadian International Grains Institute (CIGI) in Winnipeg, which is partly funded by the CWB, and tour the farms where wheat and barley are grown. CWB and CIGI representatives also travel to China several times each year for sales support and customer assistance.
