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Revealed Market Advantage Analysis – China

Note: This report includes forecasting data that is based on baseline historical data.

Executive summary

China imported Can$14.3 billion worth of processed food and beverage products from Canada from 2015 to 2019.

The top five products accounted for 59.6% of China's processed food and beverage imports from Canada.

China's top-five processed food and beverages imported from Canada, from 2015 to 2019, were: canola oil (HS: 151411), oilcake and other solid residues (HS: 230641), offal of swine, frozen (HS: 020649), frozen cold-water shrimps and prawns (HS: 030616) and frozen pork (HS: 020329. Trade data was extracted from Global Trade Tracker, including UN Comtrade.

This report identifies alternative global markets of Canadian processed food and beverage products by using the following indicators for Canada's trade diversification efforts:

  1. Largest global importers of canola oil, oilcake and other solid residues, offal of swine, frozen, frozen cold-water shrimps and prawns and frozen pork in 2019.
  2. Top growth markets for those products from 2018 to 2019.
  3. Global markets importing a disproportionately larger share of those products from Canada in 2019.

Revealed market advantage

China's imports from Canada: 2015 to 2019

China imported Can$14.3 billion worth of processed food and beverage products from Canada from 2015 to 2019. The top five products accounted for 59.6% of China's processed food and beverage imports from Canada.

Figure 1: top 5 processed food and beverage products dominate China's imports from Canada: 2015-2019
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  • Canola Oil: 28.2%
  • Oilcake and other solid residues: 141.8%
  • Offal of swine, frozen: 7.1%
  • Frozen cold-water shrimps and prawns: 6.3%
  • Frozen pork: 6.2%
  • Other: 40.4%

Source: Global Trade Tracker, as of August 7, 2020

This analysis looks at China's top-five processed food and beverage products imported from Canada and identifies alternate markets in the world for these products. China's top-five processed food and beverages imported from Canada, from 2015 to 2019, were: canola oil (HS: 151411), oilcake and other solid residues (HS: 230641), offal of swine, frozen (HS: 020649), frozen cold-water shrimps and prawns (HS: 030616) and frozen pork (HS: 020329. Trade data was extracted from Global Trade Tracker, including UN Comtrade.

This report identifies alternative global markets of Canadian processed food and beverage products by using the following indicators for Canada's trade diversification efforts:

  1. Largest global importers of canola oil, oilcake and other solid residues, offal of swine, frozen, frozen cold-water shrimps and prawns and frozen pork in 2019.
  2. Top growth markets for those products from 2018 to 2019.
  3. Global markets importing a disproportionately larger share of those products from Canada in 2019.

To identify markets for Canada to diversify its agri-trade in the world, we applied Farm Credit Canada's (FCC) definition of revealed market advantage. This tool is used to identify preferred markets for Canadian processed food and beverage products in 2019 - that is, markets whose imports of canola oil, oilcake and other solid residues, offal of swine, frozen, frozen cold-water shrimps and prawns and frozen pork were greater than expected, compared to the world's imports of those same products from Canada (FCC,2019).

Revealed market advantage

Canada has a revealed market advantage (RMA) over its competitors in x market if the x market's imports of a Canadian product represent a greater share of their total purchases than is found in world purchases of Canadian products.

An example:

Japan import values of Canadian pork versus its total import values of pork ÷ Global import values of Canadian pork relative to global import values of pork = 21.6% ÷ 7.2% = 3.0

RMA: a score above "1" indicates those markets whose imports of Canadian pork represent a greater share of their total purchases than is found at the world level of purchases of Canadian pork. These are our "preferred" markets.

Source: FCC, 2019

Canola oil

Trade diversification opportunities for Canadian products in 2019: Largest global importers
Largest global importers Can$ (millions) in 2019
China 1,731.0
Netherlands 502.4
Norway 480.1
United States 287.9
Poland 149.1
Belgium 143.0
Korea 142.4
Russia 139.8
Germany 132.6
Chile 114.7
Source: Global Trade Tracker 2020
Trade diversification opportunities for Canadian products in 2019: Top growth markets
Top growth markets Growth rate % 2018-19
Sweden 177.5
Japan 141.5
Latvia 95.9
Russia 54.0
Germany 47.6
Lithuania 30.8
Korea 30.2
Colombia 28.8
China 26.9
Denmark 19.5
Note: Top growth markets include countries with at least 0.5% of total global imports and the largest growth rates between 2018 and 2019
Trade diversification opportunities for Canadian products in 2019: Preferred markets
Preferred markets (2019) Revealed market advantage (RMA)
Hong Kong 2.8
Nicaragua 2.8
United Staes 2.8
Singapore 2.8
Chile 2.7
Korea 2.7
Japan 2.0
Malaysia 1.8
China 1.7
Taiwan 1.3

Opportunities for trade diversification of canola oil in the world

In 2019, there were 10 preferred markets where Canadian canola oil had the strongest advantage: Hong Kong, Nicaragua, the United States (U.S) and Singapore reporting RMA's of 2.8 respectively, with Chile, Korea, Japan, Malaysia, China and Taiwan reporting, 2.7, 2.7, 2.0, 1.8, 1.7 and 1.3 respectively. Most notably, our exports have a comparative advantage not only in China but Korea as well, as both were also the world's two largest global importers and top growth markets of canola oil in 2019. The U.S and Chile were also two of the largest global importers while Japan was also one of the top growth markets for canola oil. Other high potential markets for export growth include Russia and Germany as they were not only two of the largest global importers of canola oil but also two of the top growth markets for canola oil in 2019.

Oilcake and other solid residues

Trade diversification opportunities for Canadian products in 2019: Largest global importers
Largest global importers Can$ (millions) in 2019
United States 1,182.20
China 646.0
Netherlands 211.8
Germany 169.8
France 127.7
Spain 112.0
Finland 89.7
Denmark 78.7
United Kingdom 76.8
Norway 71.2
Source: Global Trade Tracker 2020
Trade diversification opportunities for Canadian products in 2019: Top growth markets
Top growth markets Growth rate % 2018-19
Sweden 38.7
Russia 33.1
France 30.3
Switzerland 22.2
United Kingdom 21.9
Belgium 19.9
China 18.7
Spain 18.1
Israel 3.7
Germany 3.0
Note: Top growth markets include countries with at least 0.5% of total global imports and the largest growth rates between 2018 and 2019.
Trade diversification opportunities for Canadian products in 2019: Preferred markets
Preferred markets (2019) Revealed market advantage (RMA)
United States 1.8
Korea 1.8
China 1.7
Mexico 1.0

Opportunities for trade diversification of oilcake and other solid residues in the world

In 2019, there were 4 preferred markets where Canadian oilcake and other solid residues had the strongest advantage: the US, Korea, China, and Mexico, with the U.S and Korea reporting a RMA of 1.8 and China and Mexico reporting a RMA of 1.7 and 1.0 respectively. Most notably, our exports have a comparative advantage in China as one of the largest global importers and top growth market for oilcake and other solid residues in 2019. The U.S was also one of the largest global importers of oilcake and other solid residues in 2019. Other high potential markets for export growth include France, the United Kingdom, Spain and Germany as they were not only four of the largest global importers but also four of the world's top growth markets for oilcake and other solid residues in 2019.

Offal of swine, frozen

Trade diversification opportunities for Canadian products in 2019: Largest global importers
Largest global importers Can$ (millions) in 2019
China 2,473.20
Hong Kong 719.7
Philippines 293.1
Mexico 121.4
Vietnam 103.9
Japan 78.1
Korea 53.3
United States 43.1
Côte d'Ivoire 42.5
Taiwan 39.0
Source: Global Trade Tracker 2020
Trade diversification opportunities for Canadian products in 2019: Top growth markets
Top growth markets Growth rate % 2018-19
Vietnam 94.9
China 26.0
Italy 17.3
United States 12.2
Denmark 3.3
Côte d'Ivoire 3.0
Note:Top growth markets include countries with at least 0.5% of total global imports and the largest growth rates between 2018 and 2019.
Trade diversification opportunities for Canadian products in 2019: Preferred markets
Preferred markets (2019) Revealed market advantage (RMA)
Jamaica 11.6
United States 9.8
Barbados 7.0
Taiwan 4.4
Panama 4.2
Mexico 2.8
Japan 2.0
Antigua and Barbuda 1.5
Malaysia 1.5
China 1.0

Opportunities for trade diversification of offal of swine, frozen in the world

In 2019, there were 10 preferred markets where Canadian offal of swine, frozen, had the strongest advantage: Jamaica, the U.S, Barbados, Taiwan, Panama, Mexico, Japan, Antigua and Barbuda, Malaysia and China with a RMA of 11.6, 9.8, 7.0, 4.4, 4.2, 2.8, 2.0, 1.5, 1.5, and 1.0 respectively. Most notably, our exports have a comparative advantage not only in China but the U.S as well, as both were also two of the largest global importers and top growth markets for offal of swine, frozen in 2019. Japan, Taiwan and Mexico were also three of the largest global importers of offal of swine, frozen. Other high potential markets for export growth include Vietnam and Côte d'Ivoire as they were not only two of the largest global importers of offal of swine, frozen but also two of the top growth markets for offal of swine, frozen in 2019.

Frozen cold-water shrimps and prawns

Trade diversification opportunities for Canadian products in 2019: Largest global importers
Largest global importers Can$ (millions) in 2019
China 402.3
Denmark 272.7
Japan 201.0
Sweden 79.2
Morocco 70.5
Iceland 69.8
Norway 63.2
Albania 38.0
Russia 32.9
Belgium 29.0
Source: Global Trade Tracker 2020
Trade diversification opportunities for Canadian products in 2019: Top growth markets
Top growth markets Growth rate % 2018-19
Morocco 95.9
Qatar 35.5
Ukraine 31.6
Albania 20.3
Guatemala 13.4
Germany 13.3
Denmark 13.3
Thailand 9.3
China 3.0
Netherlands 1.0
Note: Top growth markets include countries with at least 0.5% of total global imports and the largest growth rates between 2018 and 2019.
Trade diversification opportunities for Canadian products in 2019: Preferred markets
Preferred markets (2019) Revealed market advantage (RMA)
Serbia 3.0
Ukraine 2.7
Indonesia 2.3
Korea 2.0
China 1.9
Albania 1.7
Bulgaria 1.7
Vietnam 1.6
Japan 1.6
Morocco 1.6

Opportunities for trade diversification of frozen cold-water shrimps and prawns in the world

In 2019, they were 10 preferred markets where Canadian frozen cold-water shrimps and prawns, had the strongest advantage: Serbia, Ukraine, Indonesia, Korea, China, Albania, Bulgaria, Vietnam, Japan and Morocco with RMA's of 3.0, 2.7, 2.3, 2.0, 1.9, 1.7, 1.7, 1.6, 1.6 and 1.6 respectively. Most notably, our exports have a comparative advantage in Morocco, Albania and China, which were also three of the largest global importers and top growth markets for frozen cold-water shrimps and prawns in 2019. Japan was also one of the largest global importer of frozen cold-water shrimps and prawns while Ukraine was also one of the top growth markets for frozen cold-water shrimps and prawns. Other high potential markets for export growth include Denmark as not only one of the largest global importer but also one of the top growth markets for frozen cold-water shrimps and prawns in 2019.

Frozen pork

Trade diversification opportunities for Canadian products in 2019: Largest global importers
Largest global importers Can$ (millions) in 2019
China 4,798.90
Japan 3,522.60
Korea 1,976.30
Australia 782.3
United States 668.1
Hong Kong 594.4
United Kingdom 359.3
Romania 333.9
Chile 309.3
Mexico 297.1
Source: Global Trade Tracker 2020
Trade diversification opportunities for Canadian products in 2019: Top growth markets
Top growth markets Growth rate % 2018-19
China 145.2
Russia 61.4
Chile 42.3
Australia 31.7
Croatia 29.6
Spain 29.2
Bulgaria 20.8
Romania 19.2
Uruguay 18.6
Czech Republic 16.9
Note: Top growth markets include countries with at least 0.5% of total global imports and the largest growth rates between 2018 and 2019.
Trade diversification opportunities for Canadian products in 2019: Preferred markets
Preferred markets (2019) Revealed market advantage (RMA)
Jamaica 15.8
Mauritius 8.3
Barbados 6.7
Philippines 6.2
Taiwan 5.6
Puerto Rico 5.0
United States 2.9
Mexico 2.8
North Macedonia 2.8
New Zealand 2.7

Opportunities for trade diversification of frozen pork in the world

In 2019, they were 10 preferred markets where Canadian frozen pork, had the strongest advantage: Jamaica, Mauritius, Barbados, Philippines, Taiwan, Puerto Rico, the U.S, Mexico, North Macedonia and New Zealand with a RMA of 15.8, 8.3, 6.7, 6.2, 5.6, 5.0, 2.9, 2.8, 2.8 and 2.7 respectively. Most notably, our exports have a comparative advantage in Mexico and the U.S, which were also two of the largest global importers of frozen pork in 2019. Other high potential markets for export growth include China, Chile, Australia and Romania as they were not only four of the largest global importers but also four of top growth markets for frozen pork in 2019.

For more information

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For additional information on Food & Hotel China, 2020, please contact:

Ben Berry, Deputy Director
Trade Show Strategy and Delivery
Agriculture and agri-food Canada
ben.berry@canada.ca

More on Canada's agriculture and agri-food sectors:

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Resources

Revealed Market Advantage Analysis – China
Global Analysis Report

Prepared by: Laurie Bernardi, International Market Research Analyst

© Her Majesty the Queen in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2021).

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