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Chinese organic food boom

Wang Xinqiu is prepared to pay ten times more for organic vegetables than for regular produce in Beijing. It buys her peace of mind.

“Organic food seems safer,” said Wang, a Chinese medicine practitioner, after selecting organic cabbage and ginger at a Carrefour SA supermarket as her daughter, 8-year-old Maria, tagged along. “A big reason I buy organic is I’m concerned that my child could eat something contaminated.”

People in China are developing a taste for organically grown food. More than 60% of the country’s 562 million city dwellers are willing to pay more for produce certified safe or organic, according to research commissioned by the Chinese Ministry of Commerce.

Wal-Mart Stores Inc. and Carrefour are among those taking advantage of the trend. Sales of organic vegetables at one Wal-Mart store in Beijing soared 88 percent in the 12 months through November, the company said. Chinese people in 2005 bought or exported US$13.3 billion of food certified as green, a local standard that limits pesticide and chemical use, Chinese government figures show.

“Chinese consumers really are serious about safe and organic foods, and they’re willing to pay for them,” said Elizabeth Harrington, chief executive officer of E. Harrington Global, a Chicago firm that contributed to the Commerce Ministry research. “Part of it is the negative publicity that has come out in recent years about everything from fake foods to contaminated baby foods to pesticides in apples.”

The Health Ministry declared 144 instances of food poisoning involving 4,922 people in October through December, a 42 percent increase in those affected from a year earlier.

As wages and food production rise, “the issue has shifted from total supply to the quality of supply,” said Huang Jikun, director of the Center for Agricultural Policy at the Chinese Academy of Sciences in Beijing. “People are concerned. There’s more information available and we know what we are eating.”

Song Guangxiong, a professor at North China Electricity University in Beijing, said he learned about the dangers of pesticides from a friend who runs an organic farm near the city. He now buys only organic vegetables.

“There’s going to be a bill for the choices we make,” said Song, 33. “It’s pretty expensive, but I think it’s worth the money.”

Cost will deter many Chinese, said Wang, 42, the traditional-medicine doctor. She can afford organic foods on her US$387 monthly wage, she said.

The US giant discount supermarket chain Wal-Mart started selling organic products in all of its Chinese stores – which now total 71 – in May 2005. Organic grain sales rose 33% in the 12 months through November and egg sales climbed 50%, said Jonathan Dong, a spokesman in Beijing.

“Organic food is becoming increasingly popular,” Dong said. “We see good growth potential in the long term.”

China’s national standard for organic products took effect in April 2005, 15 years after the creation of the green standard.

Yang Fu, 26, moved to Beijing from Sichuan province in 2004 to work for an equipment-leasing company. With more pay and access to organic produce, he has opted for the safest diet.

“I don’t have to worry when I buy organic food,” he said.

Story by Dune Lawrence in Beijing for Bloomberg News

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