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Projections of Dairy Product Consumption and Trade Opportunities in China

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  • Ma, Hengyun
  • Rae, Allan N.

Abstract

China has been rapidly increasing its consumption and imports of dairy products in recent years. A two-stage demand system was estimated for livestock product consumption in urban China over the 1990s. Total expenditure elasticities for the livestock commodity group and expenditure elasticities for dairy products within the livestock commodity group were calculated. The results suggest that dairy products, even in urban areas, remain luxury goods because of a high expenditure elasticity (1.14). Due to rapidly increasing consumption and the likelihood of inadequate supply growth, China will continue to increase its imports of dairy products to meet its domestic demand. Projections imply that China’s imports of dairy products may range between 13-30 percent of its total domestic consumption by 2006. Due to differences in regional income and population growth rates, increases in dairy products consumption may occur especially in the Coastal, South and North areas, where potential trade opportunities may exist.

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Bibliographic Info

Article provided by University of Melbourne, Melbourne School of Land and Environment in its journal Australasian Agribusiness Review.

Volume (Year): 12 (2004)
Issue (Month): ()
Pages:

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Handle: RePEc:ags:auagre:132084

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Web page: http://www.agrifood.info/review/

Related research

Keywords: China; dairy products; two-stage demand system; livestock; expenditure elasticities; regional income; consumption; Agribusiness; Agricultural and Food Policy; Consumer/Household Economics; Farm Management; Food Consumption/Nutrition/Food Safety; International Development; International Relations/Trade; Livestock Production/Industries; Marketing; Research Methods/ Statistical Methods; ISSN 1442-6951;

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References

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  1. Huang, Jikun & Rozelle, Scott, 1995. "Market development and food demand in rural China," FCND discussion papers 4, International Food Policy Research Institute (IFPRI).
  2. Pollak, Robert A & Wales, Terence J, 1978. "Estimation of Complete Demand Systems from Household Budget Data: The Linear and Quadratic Expenditure Systems," American Economic Review, American Economic Association, vol. 68(3), pages 348-59, June.
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  4. Fan, Shenggen & Cramer, Gail & Wailes, Eric, 1994. "Food demand in rural China: evidence from rural household survey," Agricultural Economics, Blackwell, vol. 11(1), pages 61-69, September.
  5. Chern, Wen S. & Wang, Guijing, 1994. "The Engel function and complete food demand system for Chinese urban households," China Economic Review, Elsevier, vol. 5(1), pages 35-57.
  6. Allan N. Rae, 1997. "Changing food consumption patterns in East Asia: Implications of the trend towards livestock products," Agribusiness, John Wiley & Sons, Ltd., vol. 13(1), pages 33-44.
  7. F. J. Atkins & W. A. Kerr & D. B. McGivern, 1989. "A Note on Structural Change in Canadian Beef Demand," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 37(3), pages 513-524, November.
  8. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June.
  9. Stroppiana, Ruth & Riethmuller, Paul & Kobayashi, Kohei, 1998. "Regional Differences in the Japanese Diet: The Case of Drinking Milk," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, vol. 28(1), pages 85-102, March.
  10. Chizuru Shono & Nobuhiro Suzuki & Harry M. Kaiser, 2000. "Will China's diet follow western diets?," Agribusiness, John Wiley & Sons, Ltd., vol. 16(3), pages 271-279.
  11. Gao, X. M. & Wailes, Eric J. & Cramer, Gail L., 1996. "Partial Rationing and Chinese Urban Household Food Demand Analysis," Journal of Comparative Economics, Elsevier, vol. 22(1), pages 43-62, February.
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Citations

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Cited by:
  1. Dong, Fengxia, 2006. "The outlook for Asian dairy markets: The role of demographics, income, and prices," Food Policy, Elsevier, vol. 31(3), pages 260-271, June.
  2. Bai, Junfei & Wahl, Thomas I. & McCluskey, Jill J., 2008. "Fluid milk consumption in urban Qingdao, China," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 52(2), June.
  3. Dong, Fengxia, 2005. "Outlook for Asian Dairy Markets: The Role of Demographics, Income, and Prices," Staff General Research Papers 12379, Iowa State University, Department of Economics.

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