USA Rice Explores E-Commerce Potential in Chinese Market

Sep 19, 2017
U.S. rice could be just a click away
 JD.com & Alibaba Logos
WASHINGTON, DC -- While the U.S. rice industry anxiously awaits entry into the Chinese market, USA Rice is reaching out to various importers and sellers of rice in the e-commerce business there.  E-commerce is a huge platform in China; last year, there were USD$744 billion in ecommerce sales, a 40 percent increase from the prior year.  Alibaba controls about 60 percent of that market – the next largest company is JD.com with a 25 percent share.

Yesterday, USA Rice met with representatives from both Alibaba and JD.com at the Alibaba office here to discuss U.S. rice production and our interest in supplying rice to China in the very near future.  

Asked about the prospect of new U.S. products being permitted to enter the Chinese market, Mr. Jinghua Bao, the Logistics Planning and Development Director of JD.com, outlined the logistics of selling rice.  “Since rice has a heavy weight but lower price point, it must be subsidized by other products,” said Mr. Bao.  “If the logistics work out and the price is right, this could work out.”  

“U.S. rice must differentiate itself from other origins…it must be unique,” said Mr. Ming Chen, the Logistics Director for Alibaba’s HeMa Fresh Gourmet Supermarket Chain.  “If it is, then price is not an issue.”

While China is U.S. agriculture’s largest export market, U.S. rice has not yet been permitted to enter the ports.  Two months ago, a phytosanitary protocol was signed between the two countries signaling the potential entrance of U.S. rice to the market.  The next step is an inspection of U.S. rice export facilities by Chinese phytosanitary authorities that is expected to happen by the end of this year.  

USA Rice is exhibiting at FHC China in Shanghai in November; several attendees at yesterday’s meeting said they look forward to seeing USA Rice and our members there.