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Thursday October 26, 2017
Cross-province power trade to growTHE government plans to connect the power grids of the southwestern provinces of Yunnan and Guizhou and increase the power transmission capacity of Sichuan and Shaanxi provinces, China’s top economic planner said Tuesday.
The move comes as the world’s top energy consumer strives to reform its energy infrastructure and to reduce power transmission barriers between provinces in order
to boost energy consumption.The National Development
and Reform Commission (NDRC) said in a statement that it aims to transmit at least 20 gigawatts from Sichuan and 13 GW from Yunnan to nearby provinces by the end of 2020, drawing on hydropower proj-ects in the two provinces.
Prices for 500-kilovolt power transmission are expected to be cut in Yunnan Province, the statement said, to increase the
competitiveness of hydropower over coal.
The economic planner also said it will promote cross-regional hydropower trade by cutting coal-fi red power generation in energy-intensive regions.
China generated 1.05 trillion kilowatt hours of hydropower in 2016, accounting for 17.8 percent of its total power mix and 69.4 percent of electric-ity generated from renewable energy.
However, the southwestern parts of China have found it diffi cult to connect to the grids, with around 57.4 billion kWh of hydropower was not used in Yunnan and Sichuan provinces last year.
“Authorities in Yunnan and Sichuan provinces should upgrade their power structure ... and aim to not exacerbate the hydropower curtailment problem by 2020,” the NDRC said. (SD-Agencies)
THE world’s largest pork com-pany, WH Group Ltd., said Tuesday its U.S. subsidiary, Smithfi eld Foods, will for the fi rst time sell its U.S.-produced pork online in China, via online retailer JD.com Inc.
The move follows other international food companies that are looking to boost sales in the world’s top pork con-sumer through its vast e-com-merce market, with a growing middle class developing a taste for branded and imported meat products.
The fresh food division of JD.com, JD Fresh, will be the online sales platform for Smith-fi eld’s pork products in China, according to an agreement signed by Smithfi eld, Henan Shuanghui Investment and Development Co., which is also owned by WH Group, and JD.com.
Smithfi eld said in a statement Tuesday that Shuanghui, Asia’s largest animal protein company, would be its domestic agent for the venture.
WH Group bought Smithfi eld in 2013 in a US$4.7 billion deal
aimed at tapping the massive supplies of U.S. meat for export to China.
JD Fresh is the largest direct sales fresh food platform in China, as well as the biggest online pork retail market in the country. In the fi rst half of 2017, gross merchandise volume (GMV) from direct sales of meats on JD Fresh increased more than 780 percent year on year, according to Tuesday’s statement.
JD.com’s meat sales have rocketed in recent years, reach-
ing the hundreds of millions of yuan in 2016, with imported meat accounting for more than a third of its total sale of meat, a spokesman for the company said previously.
The products sold on JD Fresh will include bone-in cuts and variety meats, with a focus on small packaged frozen products, which are some of the types in highest demand in China, the statement said.
The parties will also cooperate on areas such as data and cold chain logistics. (SD-Agencies)
Smithfield Foods goes online to sell US pork in China
RUSSIA held on to its position as China’s top crude oil supplier ahead of Angola and Saudi Arabia for the seventh straight month in September, with shipments hit-ting a record as refi ners rushed to buy lower-sulfur oil to meet cleaner fuels standards.
Imports from Russia last month were almost 6.35 million tons, or 1.545 million barrels per day (bpd), up 60.5 percent from the same month last year, accord-ing to a detailed breakdown of commodity trade data released by the General Administration of Customs.
For the fi rst three quarters of the year, crude volumes from Russia gained 18 percent year on year to nearly 45 million tons, or 1.2 million bpd, also holding fi rm its top ranking.
The lower cost of Russian crude and China’s shift to cleaner diesel was the key driver behind the record Russian oil purchases.
“Many teapot refi neries are not equipped with hydrotreat-ing units to cut down sulfur. That means they need to import crude with lower sulfur content to meet the cleaner diesel quality,” said Harry Liu of consultancy IHS Markit.
The widening spread between Brent-linked crudes and Middle Eastern benchmark Dubai also made Russia’s ESPO grade, priced off Dubai, relatively attrac-tive, Liu added.
Meanwhile, Angola, China’s second-largest source of crude, supplied 11.7 percent more oil than a year earlier at 4.677 million tons, or 1.14 million bpd. Angola also maintained second place for the January-September supplies ahead of Saudi.
Supplies from Saudi Arabia were up 9.6 percent last month year on year at 4.276 million tons, or about 1.04 million bpd.
Shipments for the January-September period dipped 0.6 percent year on year at 38.52 mil-lion tons, or 1.03 million bpd.
Russian supplies could climb further next year as privately-run conglomerate CEFC China Energy agreed earlier this month to buy 220,000 to 260,000 bpd of oil from Rosneft, as part of a US$9.1 billion investment in the world’s largest listed oil company.
Shipments from Iran were up 59 percent last month from a year earlier to 3.22 million tons, or 784,060 bpd.
U.S. supplies last month were 120,580 bpd, up 260 percent from a year earlier, and for the January-September period totaled 4.755 million tons, after the country started exports to China last year.
China’s total crude oil imports in September climbed to the second highest on record at around 9 million bpd, buoyed by purchases from CNOOC and as independent refi neries returned from maintenances. (SD-Agencies)
Russia retains spot as China’s top oil supplier
JD.COM Inc. is keen to partner with the Saudi Government, a senior executive said, as China’s second-biggest e-commerce fi rm plans to enter the Middle East.
“We want to have a part-nership with the Saudi Gov-ernment,” Winston Cheng, president of the fi rm’s inter-national business, said in an interview on the sidelines of an investment conference. “Saudi’s Vision 2030 is an incredible opportunity.”
Vision 2030 is Saudi Arabia’s economic reform plan aimed at boosting private sector growth and developing non-oil indus-tries.
JD.com’s comments came as Saudi Arabia’s main sovereign wealth fund, the Public Invest-ment Fund, organized a major business conference in Riyadh with technology singled out as a core area of investment.
In a sign of growing tech interest in the region, U.S. e-commerce fi rm Amazon.com bought Middle Eastern online retailer Souq.com earlier this year in a deal described by Goldman Sachs as the biggest technology merger and acquisi-tion deal in the Arab world.
Chinese e-commerce peer Alibaba Group Holding Ltd.’s cloud-computing subsidiary Aliyun has also established a joint venture with Dubai’s state-owned Meraas Group.
“This (region) is the next new frontier,” said JD.com’s Cheng. “We’ll see how this conference turns out in terms of a partner-ship (with the Saudi Govern-ment) but we’re looking to move very fast.” (SD-Agencies)
JD.com targets Mid-East entry Shoppers buy
candies and biscuits at a supermarket in Chengdu, Sichuan Prov-ince, in this fi le photo. Growth in sales of con-sumer goods ranging from biscuits and candies to toothpaste and shampoo has slowed in China to a fi ve-year low, a survey showed. SD-Agencies
GROWTH in sales of consumer goods ranging from biscuits and candies to toothpaste and shampoo has slowed in China to a fi ve-year low, a survey showed, in a major challenge for global fi rms seeking to attract buyers in the world’s second-largest economy.
Demand for fast-moving con-sumer goods has waned in China, with sales growing 2 percent in the fi rst half of 2017, less than year-ago levels, a report from consultancies Kantar World-panel and Bain & Co. shows.
That is the weakest half-year growth since 2012, according to the report based on a survey of 40,000 households. While sales rose 3.6 percent in the third quar-ter of the year, it is still a far cry from a near 20 percent growth just over half a decade ago.
The data gives a gauge of how China’s consumers are spend-ing their money — key as global
investors and brands such as Nestle, Pampers owner Procter & Gamble or Coca-Cola look to tap the spending power of the country’s potential shoppers.
“The type of consumption people enjoy now is very differ-ent — travel, lifestyle, entertain-ment are all growing strongly,” said Bruno Lannes, Shanghai-based partner at Bain.
“(This is) where people are spending, and it’s taking money away from fast-moving con-sumer goods.”
A boom in cheap food delivery — luring huge investment into fi rms like Meituan-Dianping — has also hit grocery sales as people cook less often at home, Lannes added.
But not all products did badly.
While chocolate, chewing gum and candy saw double-digit drops in sales volume in the fi rst six months of the year, health-
focused products like yogurt and bottled water and some personal care products fared far better.
The Kantar-Bain report offers detailed insights into consumer spending patterns beyond broader offi cial retail sales. The latter also includes data from segments like cars and oil prod-ucts and showed a rise of 10.3 percent for September.
Sales of South Korean skin care and makeup products in China fell 4.8 percent in the fi rst half of the year.
For 2017, sales of fast-moving consumer goods in China is expected to be “slightly” better than last year’s 2.9 percent rise, which was the slowest in a decade, Kantar’s China division general manager Jason Yu said.
“We did see some recovery in the third quarter of the year,” said Yu. “Really important now is how the fourth quarter per-forms.” (SD-Agencies)
Survey shows changing consumption habits
