Economy

Foreign seeds cause worries over food safety

By Lan Lan (China Daily)
Updated: 2010-07-29 09:30

The company's expansion has raised eyebrows as it is fast approaching the 60 million hectares under Zhengdan 958, the biggest domestic corn seed, said Hu.

China has a total corn sowing area of around 450 million hectares.

Related readings:  China's grain reserves may be contaminated  Despite natural disasters, grain harvest looks good  China cuts forecast for 2010 rice production  Expert predicts slight drop in grain output

Corn prices are expected to continue their uptrend this year also, said experts. The average purchasing price of corn per kilogram has increased from 1.88 yuan (28 cents) in January to 2.12 yuan in July, said Ma Wenfeng, an analyst with Boabc Agriculture Network.

The situation is not that bad when it comes to other staples like wheat and rice where domestic companies still have a sizable lead over foreign players.

The nation's total grain harvest was around 500 million tons last year, with corn accounting for 155 million tons, according to government data.

But analysts said the scenario may not remain the same. Chinese companies will have to make significant technological advances and develop better marketing strategies if they have to stay ahead of the foreign companies, they said.

Lack of research and development (R&D) facilities is a major issue confronting domestic seed companies. "The technology used for domestic corn is 10 to 20 years behind the US companies," said Hu.

China has about 8,700 seed firms, and only 10 of them have independent R&D capabilities, he said.The industry should also increase the entry threshold for seed companies. At present, companies need registration funds of only 1-5 million yuan to enter the market, he said.

"The government should reduce the number of seed companies to around 100 by increasing the threshold for seed companies, while the smaller players can become suppliers for the big companies," Hu said.